Trade flows like diarrhea. It’s pretty hard to control, regardless of COOL

There’s a pig diarrhea storm heading towards Western Canada and it’s almost inevitable that its foul gusts will buffet our hog farmers.

Already Porcine Epidemic Diarrhea Virus is sweeping through farms in Iowa and Minnesota and Manitoba’s hog farms aren’t likely to escape it. How could it, with southeastern Manitoba being directly geographically connected not only to the state of Minnesota and being the furthest, terminal extension of the Midwest, but with Manitoba’s hog industry being intimately involved with the Minnesota and Iowa hog industries.

If you head down to the Emerson border crossing you’ll see an endless string of hog-hauling trucks crossing back and forth, as Manitoba weanlings are shipped to Midwest U.S. hog feeders. There used to be a lot more cross-border trade, with more weanlings heading south and with hundreds of thousands of slaughter hogs heading to Sioux Falls, South Dakota, but the imposition of Country of Origin Labelling scotched much of that trade. The COOL rules, as intended, made it such a pain in the butt for packers to deal with Canadian-born pigs that some packers and therefore feeders decided it just wasn’t worth the effort to buy them.

Yet lots of the trade continued, as smart farmers on both sides of the border figured out how to deal with the absurd rules of COOL – no-one’s been able to justify them yet – so that the best weanlings could get to the best feeders and head towards the best packers. If stuff makes economic sense, humans will try to find ways to make it happen, regardless of any but mile-high barriers. COOL, first version, made trade very difficult, but that hasn’t stopped dynamic people from keeping some of it flowing.

So the U.S. government, after getting its knuckles rapped by the World Trade Organization for the flagrantly trade-distorting impacts of COOL 1.0, responded by doubling-down on the distortions by putting forward 2.0 revisions that would make the situation much worse. Yesterday – the WTO deadline for the U.S. to get into compliance – the USDA stuck with its plans to escalate the dispute with the new revisions, so there are a few more months and years of carnage ahead of us.

But I have little doubt that even if trade is strangled a bit more by these new restrictions, it’ll somehow continue, and the geographic and economic reality of mid-continent North America will continue to exert its influence. Just as the border, with its little buildings and flags and signs has little power to block the drift of the porcine diarrhea storm from south to north, unless an actual wall is built, it’s unlikely that even this nastier form of COOL will succeed in blocking our natural north-south trade.

 

explore

Stories from our other publications