Saturday, June 30, 2018

The Best Analysis yet of Trump’s America

The article by Frank Buckley, Brian Lee Crowley and Sean Speer in today’s Globe & Mail is by far the best analysis of the driving forces behind the new American  government that I have read.

The article (headed Canada must recognize that the game is changing) is a clear, insightful, penetrating and very accurate assessment of the changed world view all the countries now face in the Trump administration.

If you want to influence Canada’s reaction to Trump, cut out the article and send it (or a hyperlink to it), to your own MP and local journalists. The more people who read it the better for all of us. You can find the article here.  

Why is this analysis so remarkable?

Because most commentators and politicians (including the Trudeau Liberal government) are missing the boat.

Tectonic shift represented by Trump:

The essence is that there is a massive shift taking place in the view of Americans of the place that America occupies in the world, with some of that shift taking the form of the election of Trump.

The authors:
  • dissect Trump’s views in the context of this tectonic shift, 
  • agree that many of his positions reflect that shift, 
  • point out that Trump has been very consistent in his own views, 
  • highlight the nature of the change (from a more subdued nanny state posture to a more transactional one), 
  • and recommend a fresh approach in dealings by other states with the new America.

Major facts of the new American approach:

A few quotes from their article will illustrate:

The truth is he’s been consistent about the need to revisit the basic framework for U.S. global engagement for some time. It started with his campaign launch when he talked about the United States’ asymmetrical trade and military relationships with various countries. As he put it then: “We have all the cards, but we don’t know how to use them. We don’t even know we have the cards because our leaders don’t understand the game.”

And about symmetry:

He’s fed up with asymmetry on inputs combined with symmetry in influence. One can certainly argue that he’s wrong or that his administration is mishandling these issues. But the questions he’s asking aren’t at all unreasonable.

And Americans’ views of the trade-offs:

Is the United States getting value for this spending? Are these institutions still the best means of advancing American interests?

Mr. Trump’s “America First” model, which has majority public support, says no. It thus proposes to replace the notion of “American leadership” of a largely consensual alliance with a rawer exercise of national interest. 

This doesn’t necessarily mean isolationism. But it unambiguously involves a narrower conception of American interests and the United States’ role in the world.

What this means for the future:

We’ll likely see more ad hoc arrangements in U.S. foreign policy rather than permanent international institutions or structures. We’ll also likely see more utilitarian or realist engagements with different countries on an issue-by-issue basis.

The ineffectiveness of tariff retaliations:

The truth is the Trump administration just doesn’t care.
It also isn’t going to be moved by “retaliatory” measures.

Change needed in Canada’s approach to the new America:

The authors propose several changes.

One critical one concerns China:

Instead, a new transactional arrangement must be focused on mutual exchange. The Canadian government must advance areas of mutual interest to work in partnership with the administration. 

Targeting China’s unfair trading practices and national security risks is one example of a policy on which Washington would welcome Canadian help. 

Co-operating on regulatory harmonization to reduce binational transaction costs is another.

Hurry to the newstand and get your hands on this article. Read it several times, until its arguments are lodged firmly in your mind. Send copies or links to all you think might be concerned about what’s happening.

And measure any proposals offered by politicians or pundits against the hard facts in this article.

You will be surprised by how vacuous most suggestions are.

Oh, and welcome to the new  age of America First.

Sunday, March 04, 2018

Trudeau’s Government is screwing up the Trump Steel Tariff issue

And why is this happening? 

Because the Canadian government has not done its homework. 

It has been obvious for more than 18 months that a Trump presidency would pose special problems for the small Canadian economy, but you would never have guessed this from the activities and statements of the Trudeau government.

Trump won because he had views on the direction of the USA that millions of Americans agreed with, and voted for. 

A major view that Trump and his supporters hold is that the American worker has been sold out by the political and economic elites over a period of several decades, and one means this was done was through the free trade agreements, and globalization efforts.

Trump’s policy of reversing the deindustrialization of the US is going to be implemented by his tariff policies, amongst others.

This has been obvious from early on.

Now Trump has announced tariffs on steel and aluminium, aimed at increasing the production of those products in the USA, and using the massive excess capacity in steel and aluminium plants in the USA to produce more.

The Canadian government has failed to seriously analyze the Trump policies, as announced time and again during his campaign, and in the year he has been in office.

And this shows in their response to the tariffs, which might include Canadian exports to the USA (we are a major exporter of steel to the USA).

If our government had done its work properly, it would have analyzed the needs that Trump’s policies were trying to meet, and tried to revise Canadian policies to achieve a win-win solution that meets those needs and our needs.

For example: trying to change the Trump policy of America First and American production increases in its homeland, is a good attempt, but unlikely to change Trump or his millions of supporters.

But trying to meet his concerns that a powerful American needs a thriving steel industry, is a different approach. 

Trump’s spokespersons have clearly spelled out their concerns over the past year, and a major one is the security issue.

Just what has Canada offered the USA to resolve its concern about America being able to produce enough steel to meet its defence needs should the USA find itself in a protracted war?

So far I have heard no intelligent Canadian response to this.

Time to do some hard work in Ottawa. 

Start with a detailed, in-depth analysis of the expressed concerns of the Trump administration over the past year or so, and  then seek solutions that meet those needs, as well as our needs to export steel and aluminium.

Trudeau’s government might be surprised by how many win-win solutions they can come up with if they brainstorm the issues (not the perceptions, or the kneejerk free-trade-driven ideological reactions we have seen to date).

Canada needs a government that does the heavy lifting required to protect and expand our economic growth.

So start with this tariff problem, and solve it in a more meaningful way than the government has announced so far.

And then move on to breaking down trade barriers within Canada.

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