America First

Thursday September 17, 2020

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday September 17, 2020

U.S. calls off tariffs on Canadian aluminum — for now

The United States hit the pause button on tariffs on Canadian aluminum today, agreeing to withdraw current penalties — at least until after the presidential election in November.

November 21, 2019

The move came right as Canada was set to impose a wide range of retaliatory measures that would have hit some politically inconvenient targets for President Donald Trump as he seeks re-election.

Ottawa was planning to reveal its targets for retaliation at 3 p.m. ET today. Shortly after noon, however, the U.S. abruptly declared it would drop its recently imposed 10 per cent import tax on Canadian aluminum — and revisit the issue every month.

That doesn’t mean the conflict is over. In making the announcement, the U.S. unilaterally set monthly targets for the volume of aluminum imports it will accept from Canada without a tariff.

Those targets set by the U.S. take effect in September. The U.S. said it will monitor export volumes six weeks after the end of every month — which punts the issue to mid-November, right after the Nov. 3 presidential election.

May 24, 2019

A Washington trade expert who worked in the Obama White House said it appears the Trump administration wanted to postpone a politically risky fight.

According to Canadian officials, the list of retaliatory tariffs Canada was preparing to impose Tuesday would have struck the very Ohio washing-machine plant where Trump announced his levy on cross-border aluminum.

“I think the threat the Canadian government made of retaliation was credible,” said Chad Bown, a trade official in the Obama White House and senior fellow at the Peterson Institute for International Economics.

“[It had] the potential to hurt some of President Trump’s voters.”

The federal government welcomed the U.S. decision — but warned it’s still prepared to impose retaliatory measures if necessary. (CBC) 

 

Thursday November 23, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday November 23, 2017

U.S. NAFTA auto proposal faces criticism from Canada and Mexico 

The United States negotiating team found itself squeezed at home and abroad during NAFTA talks on Monday, with various actors from Canada, Mexico and within the U.S. pressing it to reconsider demands called unworkable and unworthy of serious bargaining.

November 14, 2017

The Canadian and Mexican governments have refused to produce a counterproposal at the current round of talks on auto policy and are instead delivering a presentation on the self-inflicted damage they claim it would wreak upon America.

Their case was bolstered within the U.S. Senate.

A major auto association told a hearing that the current proposal could induce companies to leave this continent and simply pay import tariffs. This was on the same day that 18 U.S. senators sent a letter demanding the administration conduct an economic analysis before making any changes to NAFTA.

August 24, 2017

The U.S. stunned its partners by demanding that car companies quickly transform their supply chains to boost North American content; ensure half of a car’s parts come from the U.S.; use a new, stricter formula for calculating the origins of a car’s components; and do it all within a year.

“No vehicle produced today could meet such an onerous standard,” the Senate hearing was told by the Alliance of Automobile Manufacturers.

“This proposal is unprecedented and would have significant ramifications on our industry and the U.S. economy, as a whole.”

The U.S. negotiating team is urging people to tone down the rhetoric.

August 17, 2017

It apparently views such proposals as a starting point. An American source familiar with the talks pointed to evidence of the U.S. willingness to negotiate in good faith: the very broadly phrased list of American objectives published online last week.

In a few cases, that list includes specific numbers — like the demand that Canada relax its duties on online purchases by $780. In the case of automobiles, though, there are no numbers — just a reference to a desire for U.S. content in cars.

June 29, 2016

The source said this is normal in negotiating. But what’s less normal, the source said, is the public rhetoric by the Canadian side, with talk of red-lines and non-starters that will make it harder to advance negotiations.

The Canadians adopted a deliberate strategy at this round of proposing nothing on the hardest issues.

Instead, they will deliver a presentation and demand details. Along with Mexico, Canada will press the American side for clarity on how the auto proposal would work, with the subtext of that conversation being their belief that the proposal would not, in fact, work at all. (Source: Toronto Star) 

 

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Tuesday November 14, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Tuesday November 14, 2017

Trans-Pacific Trade Partners Are Moving On, Without the U.S.

President Trump shook up the world economic order this year by pulling the United States out of a major international trade pact and raising fundamental questions about its global role.

October 11, 2017

Today, the world is moving on without it.

A group of 11 countries announced on Saturday that they had committed to resurrecting a sweeping multinational trade agreement, the Trans-Pacific Partnership, without the United States. A new deal, which would have to be signed and ratified by each country, would include major United States allies like Japan, Canada and Mexico. Collectively, they account for about a sixth of global trade.

The agreement will “serve as a foundation for building a broader free-trade area” across Asia, Taro Kono, Japan’s foreign minister, said in a statement.

May 24, 2017

Pointedly, the potential members of what is now called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership came to an early agreement on the broad outline of a deal while many of their leaders were meeting with Mr. Trump in Vietnam — itself a potential member of the new trading group.

Some details of a new deal, including when rules would be phased in, still need to be determined, and prospective member states like Canada raised last-minute concerns. But a new deal could be announced as soon as early next year. 

Other countries are slowly but surely making progress on their own sweeping trade deals, without any participation from the United States. China is negotiating a potential deal with 16 Asia-Pacific countries, including Japan, India and South Korea. The European Union and Japan hope to strike separate trade pacts with a group of South American countries, Brazil and Argentina among them.

From tough talk on China (“they took our jobs”) to casting doubt on the decades-old North American Free Trade Agreement (“the worst trade deal ever made”), Mr. Trump has threatened to lob a grenade at an increasingly integrated global economic system. (Continued: New York Times) 

 

Wednesday July 26, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Wednesday July 26, 2017

Rising loonie: The Winners

Buoyed by strong sentiment about the state of the Canadian economy, and getting the benefit of general weakness in the U.S. greenback, the Canadian dollar is now flying in territory it hasn’t seen in two years.

A recent interest rate increase by the Bank of Canada, and the expectation of more to come, has the loonie up about 10 per cent over the past six weeks.  The Canadian dollar rose above 80 cents US on Monday before closing at 79.97 cents US.

January 14, 2016

“The obvious winner would be the average Canadian, just in terms of their travel plans or in terms of what they buy from the U.S.,” said Doug Porter, chief economist at Bank of Montreal.

The recent loftiness of the loonie makes it cheaper for Canadians to travel when they buy vacations priced in U.S. dollars.

For example, a one-week cruise out of Fort Lauderdale, Fla., priced at $878 US would have cost $1,203 Cdn when the loonie was trading at 73 cents US. With the loonie at 80 cents, that same cruise would cost $1,097 Cdn — meaning a consumer would save $106.

Similar to consumers, Canadian businesses that buy goods or services in U.S. dollars would wind up paying less for those items after factoring in the effects of our fluctuating currency.

For example, professional sports teams often pay player contracts in U.S. dollars.  A stronger loonie means the revenue earned in Canadian dollar goes further when it comes to paying players in greenbacks. (Source: CBC News) 

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Tuesday July 17, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Tuesday July 17, 2017

Trump administration poised to reveal goals for NAFTA talks

United States Trade Representative Robert Lighthizer is expected to release today his negotiating objectives ahead of talks to revise the North American Free Trade Agreement next month.

April 20, 2017

The goals for the renegotiation, as well as the Trump administration’s rationale for how these objectives will lead to an agreement beneficial to the U.S., must be published on the USTR website, as required by Congress in accordance with the trade promotion authority granted to the White House for renegotiating a standing agreement like this.

Formal talks to revise NAFTA are expected to start next month. Such objectives must be published 30 days in advance.

The Canadian government is not required to publish its negotiating objectives ahead of the formal talks, expected to start on or shortly after Aug. 17. The location for these talks has not been finalized yet.

While Canada has been consulting formally and informally — an official consultation period expires Tuesday — politicians, officials and negotiators have been talking to affected industries for weeks to prepare Canada’s bargaining positions.

June 2, 2017

They’re expected to continue to do so throughout the process, although Parliament does not require the kind of transparency Congress does.

“The other NAFTA parties — Canada and Mexico … their position has been: the U.S. wanted to re-open this and modernize it. We’re just coming along,” International trade lawyer Dan Ujczo told CBC News last week. “So I think in some ways the U.S. is going to set the agenda.”

“If it comes out really short and sweet with a very narrow set of lists, that’s indicating that they want to get this done as quick as possible,” he said. But if it isn’t a deep dive, Ujczo expects Congress to demand more specifics. (Source: CBC News) 

 

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