Happy #CanadaDay!

Canada’s new trade deal with the US and Mexico – the new NAFTA, ALENA USMCA, T-MEC – entered into force today, replacing the 25-year old NAFTA.

But the trade angles to Canada’s national day go back much, much further: (thread)

(1/n)

In 1846, the UK repealed the Corn Laws, protective tariffs on imported grain. Good for British factory workers struggling to afford bread. Bad for grain exporters in Upper Canada, whose newish preferential access to UK markets was eroded away. https://www.thecanadianencyclopedia.ca/en/article/canada-corn-act

(2/n)

What did Canadian business interests do? They looked south. In 1854, the UK & the US struck the Elgin-Marcy treaty, cutting duties on food & raw materials between the US and the Province of Canada (Ont/Que), New Brunswick, Nova Scotia, PEI & Nfld.
https://en.wikipedia.org/wiki/Canadian%E2%80%93American_Reciprocity_Treaty

(3/n)

In 1866, the US invoked the treaty’s sunset clause and abrogated it. Washington was annoyed about a perceived imbalance of benefits. The Province of Canada’s 1858 tariff on manufactures didn’t help. Neither did the UK’s quiet support for the South during the Civil War.

(4/n)

The colonies of British North America had been seriously talking about coming together in some sort of union for mutual protection & better governance as well as to expand commercial opportunities with each other. But each faced significant domestic opposition.

(5/n)

The loss of access to the US market helped solidify support for creating a unified market north of the US border.

And on July 1,1867, Ontario, Quebec, New Brunswick & Nova Scotia were united as provinces of the Dominion of Canada.

That's why we're celebrating today.

(6/n)

But the story did not end there. The nature of the bilateral economic relationship with the United States has been at the centre of Canadian politics ever since. ‘Free trade’ or ‘reciprocity’ was a core election issue in 1878, 1891, 1911, and 1988.

(7/n)

In 1878, PM John A. Macdonald’s Conservatives defeated the pro-reciprocity Liberals with the National Policy, which sought to develop Canadian manufacturing industry behind high tariff walls, aided by a new coast-to-coast railway.

(8/n)

In 1891, Wilfrid Laurier’s pro-reciprocity Liberals alarmed central Canadian industry by saying north-south trade made more sense than moving things back and forth across the prairies.

Promising continuity, the aging Macdonald won, only to die a few months later.

(9/n)

Laurier won in 1896, after soft-pedaling trade. Four majorities later, in 1911, he negotiated a bilateral deal cutting tariffs on farm & forestry products. It passed in Congress, but Laurier lost the elxn to Tories claiming the deal paved the way for Canada’s annexation.

(10/n)

The less said about the 1920s and early 1930s the better. Tariffs abounded. Canada looked for export opportunities in the British Empire. But in 1935 the FDR administration struck a reciprocal trade deal with Mackenzie King’s Liberal govt. More liberalization followed.

(11/n)

Fast-forward to 1988 (the first election campaign I remember, and it was about trade!): Tory PM Brian Mulroney’s Canada-US FTA stood accused by John Turner's Liberals and Ed Broadbent's NDP of selling out the country. ( https://greatcanadianspeeches.ca/2019/09/18/john-turner-brian-mulroney-debate-free-trade-oct-1988/)

(12/n)

By the 1993 election campaign, the soon-to-be victorious Liberals, under Jean Chretien, were more or less on board with the original North American Free Trade Agreement.

(13/n)