Brian Mulroney’s pal Ronald Reagan is now considered one of America’s greatest presidents. For Canadians, memories of Mulroney’s two terms as prime minister are every bit as inflated. We don’t idealize the man. We grant him something even grander: we treat his accomplishments in Canada’s relations with the US—and his failures in constitutional reform—as the end of the journey.
Last week, Canadian opinion leaders celebrated the 25th anniversary of his Free Trade Agreement with the US; the FTA that eliminated nearly all Canadian and US tariffs, created a non-binding dispute settlement system, and provided national treatment for each country’s investors. This deal is not simply widely praised and sparsely reviled; it’s treated as a kind of final settlement in Canada-US economic relations.
After two centuries of progress and retrenchment, Canada’s place on this extraordinary continent appears settled: overseas, we’ll burnish our brand and sign trade deals; at home, we’ll tinker.
Like the sunny memories of Reagan’s economic policies by Reaganites, numbers don’t adequately express the FTA’s positive impacts. Kevin Lynch, once Canada’s highest-ranking civil servant and now Vice-Chairman of the Bank of Montreal, believes the real stuff is intangible:
“Free trade helped Canada to grow up, to turn its face out to the world, to embrace its future as a trading nation, to get over its chronic sense of inferiority."
“'It caused a sea change in attitudes,' he believes. The courage needed to take that free-trade ‘leap of faith’ equipped governments to tackle other seemingly insurmountable challenges: Establishing the goods and services tax, eliminating the deficit, reducing corporate taxes.
“Most important, FTA convinced Canadian governments, Canadian businesses and Canadians generally that this country had the knowledge and confidence to compete in any market.”
As it is in the US, bravado in Canada is also a sure sign of paralysis.
The right and the left see how little Canada’s economy has changed for the better. (Both Kevin Lynch and Jim Stanford, an economist with the Canadian Auto Workers union, accept that Canada’s productivity, just 74% of US levels, is actually slipping further behind the "declining" USA.) Nevertheless, neither protectionists nor free traders make much effort to either undo or outdo what Mulroney put in place.
"Trade diversification" has become the center of the action, the drug of choice by incrementalists in Washington and in Ottawa. At the same time, entrenched bureaucracies manage a Canada-US border that inhibits innovation, competition, and enterprise in both countries—as well as Canada’s security globally.
Currency unification, the physical elimination of the border, and, for instance, a common regime to manage the environment are European ideas, too radical for serious consideration in the New World.
Pros in Ottawa accept that Brian Mulroney pushed Canada about as far as Canadians would go. Indeed, on the constitution, he proved to them how dangerous it would be to try to improve on the success of the country’s last great closer, Pierre Trudeau.
This is a debasing form of respect for the good works of a different time.
Having given thanks, now let’s face it: the "coming of age" gift of the Mulroney-Trudeau years has been turned into a political straightjacket—a limiting sense of what’s possible in the very business of what is possible.
In fact, North Americans are stuck a generation behind European efforts to make their continent a more productive, efficient, and competitive economy. Furthermore, Canada’s constitution still includes two undemocratic and colonial institutions—at the very top.
Canadian optimists should stop watching for moves by the Chinese government to turn China into a law-abiding market democracy and waiting for the children of Canada’s last generation of politicians to stir their hearts.