Seamanship Quotation

“In political activity, then, men sail a boundless and bottomless sea; there is neither harbour for shelter nor floor for anchorage, neither starting-place nor appointed destination.”
— from Michael Oakeshott's
Political Education” (1951)

Thursday, March 10, 2011

Mexico shouldn’t set the pace for Canada-US economic integration

WikiLeaks has exposed the obvious: Canadian diplomats and politicians would rather talk directly to Washington rather than in concert with Mexico. This has upset the politically correct:
“As an example, easing two-way trade is a concern for Canada and the U.S., and is the subject of bilateral talks on perimeter security. Yes, Canada is entitled to sort out border arrangements with the U.S., but that should not preclude a more ambitious goal of easing continental trade. Canadian officials have warned that Mexico “may raise concerns about not being included in the vision.” They are justified in doing so.”
Globe Editorial: North American diplomacy takes all three amigos
It is a good thing this issue has finally come to the surface. Canada’s effectiveness on this continent requires a much clearer articulation of Canada-US goals as opposed to trilateral goals. Canada cannot, moreover, restore a special relationship with the United States unless it offers Americans something special.
Concentrating only on enhancing trade won’t and shouldn’t do it. With 112 million people, Mexico is emerging as a significant global economy. It already leads Canada in the automotive sector. So, it makes sense to keep improving trade relations with Mexico as well as the US. However, tariff free trade is just one leg of a fully fledged common market. The other two elements are: a currency union and borderless capital and labor markets. That complete open market should be Canada’s bilateral objective with the United States
Let’s put it positively. Canada can say one thing to American workers that Mexico cannot:  American and Canadian worker productivity and incomes can be enhanced in a Canada-US economic union. Neither Canadians nor Americans would have any reason to flood one another’s local economies and thereby drive down prevailing wages.
Canada’s income and employment picture is very close to that of the US. We rank a few thousand dollars behind in GNP per capita ($45,000 versus $47,000 according the International Monetary Fund and World Bank.) However, Canadian labor market stability is enhanced by relatively lower unemployment rates, higher home ownership rates, and more generous unemployment and health benefits.
Mexico, on the other hand, has massive under-employment and a per capita income level of approximately $10,000 US. It is a source—and gateway—for millions of economic refugees from Latin America. Its ability to maintain internal security, let alone regulate its border perimeter, is questioned. In other words, for now, a continental security perimeter to open internal NAFTA borders can’t possibly include Mexico.
There is nothing in the substance and spirit of NAFTA to constrain Canada and the US from undertaking productivity enhancing measures that are not yet feasible with Mexico as well.
It is the absence of an ambitious agenda that emasculates Canada’s efforts to get Washington’s undivided attention. Pursuing a common market to match the Euro union would attract American attention without causing legitimate offence in Mexico.

No comments:

Post a Comment