There was a time back in the 1930’s when America believed that an isolationist foreign policy would serve its interests. Pearl Harbour changed that sense of being isolated from the world. Obviously, the costs for isolation both economically and geopolitically were significant.
Today, Donald J. Trump seeks to turn back the clock and institute a new isolationist America, similar to what America did ninety-five years ago. The rest of the world’s western democracies are quickly reaching a point where Trump’s ongoing threats and negative attacks are leading them to both accept Trump’s removal of America from its status in a leadership role geopolitically, and to increase their interest and resolve in forming new relationships and trade partnerships outside of America’s sphere of influence and control.
There is a realization that irrespective of the commitments made to improve either their military forces in NATO, or adjust their trade relationships with America, the U.S. will only be satisfied when it dictates to the other nations. However, it is becoming obvious that nothing they, (or we in Canada) do will ever make the so-called, ‘Master of the Deal’ any more reliable, truthful or honest, — and it clearly illustrates that it is in the best interests of each of our nations to stand together, — in the absence of America.
Retaining a partnership where one party is willing to threaten the other continuously in order to manipulate and coerce actions that favour that party, is not a partnership. As such, it behooves the other party to develop alternative relationships as a block that favours trust and develops increased commitment to stand against the intended coercion and never-ending demands.
Canada, is in the same position as Europe, only with respect to trade, a more difficult dynamic exists. Canadian exports to the U.S. amount to 76% of its total exports. And the relationship in terms of investment is almost about equal. However, diversification is evermore necessary and likely as the United States is becoming increasingly protectionist.
Canada is an exporting nation, and its products are in demand globally. The downside is that transportation costs for much of Canada’s exports are high due to the volume and the size and weight of those commodities.
Instead of Canada exporting raw materials or semi-finished materials, it is now evermore apparent that Canada needs to complete the manufacturing cycle and the refinement and exportation of finished products, such that nations on a global basis will be then be buying Canadian made quality products.
Canada has long exported raw materials to the U.S. where they would then be refined or finished and imported back to Canada. Most notably oil and gas. Now that the relationship with America is being eroded by Donald J. Trump such that it is in Canada’s best interests to spend significant dollars on the infrastructure necessary for the production and distribution of finished products to new markets and partners. This includes a return to super-refineries in Canada.
Expanding Canada’s exports of oil, gas, minerals, forestry products and finished goods to Europe and the far east, especially China, Japan and Korea, appears to be what Canada needs to do in the coming years. While this will take time, it will also not be reversed or undone easily once completed, such that future pressure by the United States will meet with less accommodation and less interest in doing so.
Threats, are not taken lightly by Canadians. And the resolve of Canadians to then develop Canada’s resources to the benefit of Canada becomes evermore important and committed. Canadian resources should be kept, and likely will be, for Canadian production and export to nations where trust is integral to the relationship. Where possible and/or necessary, this will mean that Canada should and will nationalize its resources, — just as Norway did with offshore oil and gas in Europe.
When there fails to be both reciprocity and respect, it mandates a change of behaviour and subsequent action.
Canadians deserve to know that their trade partners can be trusted to not ‘steal the deal’ but to act as trustworthy and committed to the ideals and to the benefit of both parties.
Otherwise, it isn’t trade, it’s coercion under threat, and subservience isn’t worth the paper a trade agreement is written on. If ‘America First’ means America working against the interests of its former partners, then for the neighbour, — be it Mexico or Canada, there is the need to ensure the each countries national and sovereign interests.
Canada will seek new relationships as necessary. If America leaves NATO, then Canada will dramatically increase its military spending and developing its military industrial complex. Rather than buy American weapons systems, Canada will likely seek to build its aircraft and submarines with as much domestic content as possible and from trade partners that are committed to military collaboration and relationships where coercion and threat don’t exist.
What will occur over time, if America truly becomes both isolationist and protectionist, will be to create the Finlandization of Canada, — apart from America.
When your neighbour can’t be trusted, you ensure your own sovereignty through domestic military production and dramatically increase its capacity internally. It also mandates a shift in economic activity away from the status quo.
Canada has had a respectful and balanced relationship with the United States that has lasted for more than 150 years.
Donald J. Trump may well change that permanently.
That will be a painful process, but I would suggest that Canada would be up to the task.
Leave a Reply