Author Topic: How will USA respond to Canada's terrible NAFTA demands? (split fm CF-188 Replacement)  (Read 14910 times)

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Offline AlexanderM

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Offline jmt18325

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The end to RTW in the US would be a massive equalizer for Canada in terms of labour competitiveness. 

Offline Ostrozac

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The end to RTW in the US would be a massive equalizer for Canada in terms of labour competitiveness.

And very unlikely to happen. A US Federal law banning RTW would be heavily fought by the states that have already enacted such laws. Besides, nobody's going to waste their limited political capital until the US Supreme Court decision on Janus v AFSCME -- a ruling which is expected in 2018, and which is likely to go on the side of RTW. Such a ruling is probably expected by all involved -- the ruling would give the US a chance to say "sorry Canada, we'd love to help you on that NAFTA proposal, but the judges say it's against our constitution, and our hands are tied".

At this point, it's probably more likely that the RTW trend becomes stronger with the new version of NAFTA, and labour unions continue to weaken in all three nations.

Offline Thucydides

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How will USA respond to Canada's terrible NAFTA demands?!

Much like any card shark once they realize your are trying to bluff them with a pair of duces.....
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Offline GAP

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Ending the RTW laws would a massive gift to the unions
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Offline YZT580

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We are expending precious political capital in trying to dictate to another sovereign nation what laws they will apply internally.  Harper was absolutely correct.  NAFTA is not a tool for effecting social change and it is naive and short-sighted of Trudeau to approach it in this manner.

Offline Retired AF Guy

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We are expending precious political capital in trying to dictate to another sovereign nation what laws they will apply internally.  Harper was absolutely correct.  NAFTA is not a tool for effecting social change and it is naive and short-sighted of Trudeau to approach it in this manner.

You are absolutely right and its interesting that when Trudeau and the Liberals first proposed their ideas commentators over at the National Post where wondering if it was Trudeau who was trying to scuttle NAFTA.
Years ago, fairy tales all began with, "Once upon a time." Now we know they all began with, "If I'm elected."

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Offline Altair

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The US congress has to approve the repeal of NAFTA.

I don't see that happening.

So if these NAFTA talks fail,  and it appears that the Mexicans,  Canadians and Americans want that at this point,  then the US congress would need to kill the deal.

On the off chance that happens,  wouldn't the Canada US free trade deal,  suspended when NAFTA was ratified,  then just come back into effect?

I don't really blame Canada here,  this is simply Trump wanting to try to kill the deal that he campaigned against when running for president.

Look at the American demands,  they are as ridiculous and outrageous as the Canadian ones.

The Americans want to do away with 3rd party conflict resolution. They want a a sunset clause in the deal so that every country needs to go through this every 5 years.

The only way to save NAFTA is for the US congress to exercise a bit of common sense.
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Offline PuckChaser

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The US demands aren't outrageous, they're just horribly one-sided and designed to play hardball. They know they won't get them, which is why they're starting at an extreme and working to compromise. What happens in the Trudeau team decides to trade 3rd party resolution for an unenforceable women's rights clause? Or some other garbage social justice line that shouldn't be anywhere near a trade agreement?

Trying to change another country's social policies through a trade agreement is the mostly asinine thing I've ever heard of, and makes a mockery of the negotiation process.

Offline Altair

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The US demands aren't outrageous, they're just horribly one-sided and designed to play hardball. They know they won't get them, which is why they're starting at an extreme and working to compromise. What happens in the Trudeau team decides to trade 3rd party resolution for an unenforceable women's rights clause? Or some other garbage social justice line that shouldn't be anywhere near a trade agreement?

Trying to change another country's social policies through a trade agreement is the mostly asinine thing I've ever heard of, and makes a mockery of the negotiation process.
  Everything I've read about the negotiations seem to show that the Americans are going a little further than playing hardball,  it seems that they are springing unrealistic and one sided demand after another.

From what I gather they aren't serious about getting a deal done anymore than the Mexican delegation or the Canadian one.

As far as I can tell,  Trump wants NAFTA to die,  he campaigned on it,  this "renegotiation " is how he plans to kill it and congress is the only one who can save it.
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Offline PuckChaser

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We have a better chance of getting a deal done if we ditch Mexico. A lot of the sticking points are going to be because of the abysmal wages there, which drive manufacturing south (Ontario's issue is high wages and extreme hydro rates, driving jobs to the US). You'd see a lot of the country of origin stuff disappear if Mexico wasn't part of the equation.

Offline MCG

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On the off chance that happens,  wouldn't the Canada US free trade deal,  suspended when NAFTA was ratified,  then just come back into effect?
I understand that it was legislated into suspension and would have to be legislated out of suspension.  What are the chances that a US that is willing to let NAFTA die would be a US ready to unsuspend our previous agreement?

Offline AlexanderM

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I'm just providing updates on Trade issues as, from a political point of view, they may impact whom we do business with in the future.


http://business.financialpost.com/news/economy/canada-convinced-donald-trump-will-soon-pull-the-plug-on-nafta-sources

LONDON, Ontario — Canada is increasingly convinced that U.S. President Donald Trump will soon announce that the United States intends to pull out of the North American Free Trade Agreement, two government sources said on Wednesday.

The sources said they expected Trump would make his move at about the same time that negotiators from the United States, Canada and Mexico meet in late January for the sixth and penultimate round of talks to modernize the treaty.

The Canadian and Mexican currencies both weakened against the U.S. dollar after the news.

The Canadian dollar fell 0.9 per cent to $1.2574 against the greenback at 3:05 p.m. in Toronto. The peso fell 0.8 per cent to 19.3963 per dollar. The rate on Canada’s two-year government bonds declined 8 basis points to 1.71 per cent. The yield on 10-year debt was down six basis points to 2.14 per cent, with the rate on similar-maturity U.S. Treasuries little changed.

A White House official, speaking on background, said there hasn’t been any change in the president’s position on NAFTA.

Also:

http://business.financialpost.com/news/economy/newsalert-canada-launches-global-trade-complaint-vs-u-s-over-use-of-duties

And just in case anyone missed this.

http://business.financialpost.com/transportation/u-s-upholds-nearly-300-per-cent-tariffs-on-bombardiers-cseries
« Last Edit: January 10, 2018, 16:35:44 by AlexanderM »

Offline Altair

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Canada strike back

This is going to be fun.

'Canada has just detonated a bomb': Trade relations with U.S. plummet after WTO complaint: http://nationalpost.com/news/economy/u-s-lashes-out-over-ottawas-wto-trade-claim-just-after-higher-tariffs-announced-for-canadian-newsprint-producrs/wcm/357fcb44-d9b9-47a7-94d9-80398165cb8b

Quote
Canada launched the opening salvo in a trade war with the United States Wednesday, lodging an international complaint about the superpower’s use of punitive duties.

The move drew a sharp rebuke from Donald Trump’s trade czar and came amid reports that Canadian government officials say there’s an increasing likelihood the president will withdraw from the three-nation North American Free Trade Association.

“Even if Canada succeeded on these groundless claims, other countries would primarily benefit, not Canada. Canada’s complaint is bad for Canada,” said U.S. Trade Representative Robert Lighthizer.

“Canada’s claims are unfounded and could only lower U.S. confidence that Canada is committed to mutually beneficial trade.”

Canada lodged a World Trade Organization complaint accusing the U.S. of regularly breaching international trade laws through various countervailing and anti-dumping duties, citing nearly 200 examples spanning several decades.

In a statement, Foreign Affairs Minister Chrystia Freeland said, “This WTO action is part of our broader litigation to defend the hundreds of thousands of good, middle class forestry jobs across our country.”

Rationale
Canada cited five reasons for the complaint, saying the U.S. levies penalties beyond what’s allowed by the WTO, improperly calculates rates, unfairly declares penalties retroactive, limits evidence from outside parties, and has a tilted voting system in domestic trade panels that, in the case of a 3-3 tie, awards the win to American companies.

The complaint marks Canada’s most exhaustive attempt yet to counter recent import duties imposed by the U.S., particularly on Canadian softwood lumber products.

“It’s (saying), ‘The entire way in which the U.S. — you — are conducting your anti-dumping, countervailing procedures, is wrong,”’ said Chad Bown, a trade expert at Washington’s Peterson Institute. “This is effectively Canada bringing a dispute on behalf of all exporters in the world — the Europeans, Japan, China — because they’re making a systemic challenge.”

Edward Alden of the Council on Foreign Relations called it a precarious moment for NAFTA and the global trading system, both of which are under threats and criticism from Trump: “Canada has just detonated a bomb under both.”

Ottawa’s ramped-up efforts come amid an increasingly fragile trade relationship between the two countries. The Canadian government is preparing for the possibility that Trump will withdraw from NAFTA, senior officials say, though they aren’t entirely convinced that he will.

After reports Wednesday that Canada now considered it inevitable that Trump would try to withdraw the U.S. from the treaty, one Canadian official with knowledge of the NAFTA negotiation offered a more nuanced position in an email to the Post, saying, “it’s not accurate to say we’re convinced,” but that there was “no question we think there’s a chance it could happen.”

The confusion over Canadian expectations comes ahead of the next round of negotiations, scheduled to be held in Montreal Jan. 23-28.

Trump withdrawing from NAFTA “was always a risk, but that risk is clearly more elevated now,” said Brian DePratto, senior economist at Toronto-Dominion Bank.

Trade war is on
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Offline Happy Guy

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Negotiating tactic in countering the US demands and publicizing the Canadian position.

Offline Oldgateboatdriver

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I find it interesting that none, repeat none, of the statements issued by any US authority has included a statement that would read like the following: "The USA has no doubt that its processes to evaluate trade attacks against its markets and for imposing countervailing duties are fair, provide other nations with the appropriate forum to make their representations, that they are in full compliance with all international trade rules and US obligations thereunder and that we will prevail against Canada at the WTO."

I find it interesting that the position expressed is that the claims are groundless, but then turn to threatening that the consequences for Canada will be bad for Canada. In other words, their reflex is still to threaten the country making claim in an international forum instead of neutrally claiming that they are actually in the right and look forward to prevailing. That's because, Trump be damned, the various "civil servants" of the US that have been around for a while in their trade department know damn well that, in general, before unbiased, neutral, third party arbitrators or tribunals, the US tends to lose and be found in breach of trade rules. The real bully out there in international trade is the US, not all the other nations - except perhaps China who is like the USA and, where the US is concerned, pushes back.

That's why the US, in all trade negotiations, always try hard as hell to avoid having to commit to any neutral, external, unbiased legal process to resolve dispute and prefers instead to impose recourse to the US own legal system within the USA - which is heavily loaded against any foreign nation's position.

Offline SeaKingTacco

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Negotiating tactic in countering the US demands and publicizing the Canadian position.

Great. A trade war with our largest trading partner, who happens to be 10 times our size.

What could possibly go wrong...

Offline jmt18325

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It's pretty clear at this point to anyone watching that the US does not and never did have any intention of resigning NAFTA.  It's time to move on from that.  Obviously, the government has come to the same realization.  The tactics now will involve trade complaints, counter tariffs, and stalling.

Offline SeaKingTacco

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It's pretty clear at this point to anyone watching that the US does not and never did have any intention of resigning NAFTA.  It's time to move on from that.  Obviously, the government has come to the same realization.  The tactics now will involve trade complaints, counter tariffs, and stalling.

Boy, a WTO ruling against the US will really show them, won't it?

Aren't you just about the world's largest Trump critic? In what universe do you think he cares about that?

Now, Canada has basically forced Congress and all the Governors of the States to rally around the President. This has disaster written all over it.

It is not like Canada has a lot of new markets to sell into, especially after our PM's rather disasterous showing in Asia this fall where he managed to piss off everyone from Australia through Japan to China.

If this is all part of a Master Liberal Government strategy, I am prepared to admit that I am wrong. But, based on the bumbling history of this government on nearly every file it has touched over the past two years, I am not optimistic.

Offline Remius

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Boy, a WTO ruling against the US will really show them, won't it?


If this is all part of a Master Liberal Government strategy, I am prepared to admit that I am wrong. But, based on the bumbling history of this government on nearly every file it has touched over the past two years, I am not optimistic.

It might or it might not.  Canada's complaint apparently has some 200 examples.  But, what is interesting is that they are listing many examples that the US is doing to China, the EU and other trading partners.   You can bet that this will be watched by those economies.  Almost as if Canada is hitting below the belt by getting those countries involved indirectly (almost representing them) and maybe setting some precedence for them to follow on with their on complaints.

Maybe it is a part of a master strategy.  Canada vs the US might be a losing fight but the World vs the US might not be...
Optio

Offline Pencil Tech

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There was really no reason to renegotiate this agreement. Trump's reasons for wanting to blow it up are all in his fevered brain. Total demagoguery. Talk about cutting off your nose to spite your face.

Offline AlexanderM

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It might or it might not.  Canada's complaint apparently has some 200 examples.  But, what is interesting is that they are listing many examples that the US is doing to China, the EU and other trading partners.   You can bet that this will be watched by those economies.  Almost as if Canada is hitting below the belt by getting those countries involved indirectly (almost representing them) and maybe setting some precedence for them to follow on with their on complaints.

Maybe it is a part of a master strategy.  Canada vs the US might be a losing fight but the World vs the US might not be...
I believe the saying goes, the only way to deal with a bully is to stand up to the bully. If we knuckle under to Trump it will never end, so if the US is going to try and bully everyone, which they are doing, then it requires a collective front which is the best way to go. Trump doesn't care about trade agreements or rulings, and I'm convinced he's willing to move the goal posts as often as he feels the need, so the only way to deal with that is have, as close to everyone as possible say, that's as far as you go.

Offline Altair

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It might or it might not.  Canada's complaint apparently has some 200 examples.  But, what is interesting is that they are listing many examples that the US is doing to China, the EU and other trading partners.   You can bet that this will be watched by those economies.  Almost as if Canada is hitting below the belt by getting those countries involved indirectly (almost representing them) and maybe setting some precedence for them to follow on with their on complaints.

Maybe it is a part of a master strategy.  Canada vs the US might be a losing fight but the World vs the US might not be...
And it might show that it is easier to deal with Canada and NAFTA than it is to fight god knows how many different countries and Canada at the WTO.

If it gets the US to cave on NAFTA it's a master stroke, but I'm convinced that Ottawa knows NAFTA is dead.
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Offline jmt18325

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Boy, a WTO ruling against the US will really show them, won't it?

Aren't you just about the world's largest Trump critic? In what universe do you think he cares about that?

I doubt that (I haven't really said all that much about him), but I'm definitely not his biggest plan.

With CETA, Canada now has wide access to the European market.  That definitely gives us an alternative.  When it comes to the TPP11, it doesn't really matter how the other countries feel, but whether or not we can make a deal. 

Offline AlexanderM

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