AS aggravating and prolonged as the BSE closed-border dispute was with the United States, the issue is a model of international co-operation compared to the softwood lumber dispute.
At least with BSE, the Americans followed international rules that allowed closed borders, as Canada had done while dealing with Japan and Brazil.
In the long-running lumber dispute, the Americans have shown themselves to be nothing less than the trade bullies free trade critics have always alleged.
Every judgment under the North American Free Trade Agreement dispute resolution panel system has gone against the Americans and yet they persist in collecting an illegal tariff on imports from Canada.
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Last week, the Americans lost the last possible appeal under NAFTA and yet insisted that the $5 billion in illegal tariffs already collected will not be returned. Only a “negotiated” settlement will settle it.
It is as if a convicted felon instructs his lawyers to tell the crown that notwithstanding the conviction, he will only stop stealing if the crown negotiates a favourable deal with him.
This is so outrageous that even such free trade stalwarts as deal architects Derek Burney and Pat Carney, long arrogantly dismissive of free trade skeptics, now are saying the Americans are proving themselves to be untrustworthy.
Increasingly, there is talk that agricultural trade should become part of the Canadian arsenal of retaliatory weapons.
For Canadian farmers fighting their own battles with the Americans over wheat, beef, hogs and other commodities, this can only be an uneasy prospect.
Still, the suggestions to use agriculture as a bargaining chip continue to be made.
Burney, chief of staff to then-prime minister Brian Mulroney when free trade was negotiated, said Canada should threaten tariffs against such American exports as Florida orange juice and California wine.
Ottawa trade consultant and former negotiator Peter Clark had his own proposals.
He suggested last week that while outright retaliation is a “mugs game” that Canada could not win in an outright trade war, the threat of retaliation against some sensitive American agricultural exports could be useful.
Retaliation is permissible under international trade rules.
“American farmers understand the dangers of becoming pawns in international trade chess games,” he wrote. “Canada is waiting for more retaliation authority and will certainly get a huge amount of such rights if the U.S.A. persists. So perhaps Ottawa should be sending signals to the U.S. farm community that it will be considering sanctions on: citrus (Florida, California, Arizona); tomatoes (Florida); lettuce (Florida); and apples (New York, Washington, Oregon).
“Retaliation could be tailored to seasonal needs and some of these products can come from elsewhere.”
It would be dangerous, with no guarantee that Canadian farmers would not end up the victims of a tit-for-tat trade war.
But the fact that retaliation is being considered indicates a growing Canadian awareness, even among free trade partisans, of a lesson Canadian farmers learned long ago.
Americans embrace free trade rules when it suits them. When it doesn’t, old-fashioned protectionism is the order of the day.
Heads they win. Tails we lose.
