William D. Marriott is a retired economist who specialized in public policy analysis of the oil and gas industry.He doesn’t really care much about milk. No, this is all about the North.This is absolutely the last time I will write anything about Donald Trump. Instead I will just sit back and cheer as this wrecking ball slays sacred cows both to the Left and to the Right. After Trump, the world, and Canada, thankfully, will never be the same. Trump is a polarizing figure. Either you hate him or you love him. It is best to adhere to the old adage “take him seriously, but not literally”.His greatest strength is the ability to hold a mirror to our own hypocrisies and blinkered vision. This was the case with Canada and the threat of tariffs. But despite all our huffing and puffing the Americans rightly hold us in contempt. [What I find depressingly pathetic is Canadians now posed to fight an election over a foreign leader’s feigned confusion over trade deficits, when 99% of us don’t even know what a trade deficit is.]Ironically, what we really showed with our misguided “Team Canada” response is a country very much divided. BC is suddenly falling all over themselves to develop their natural resources, Alberta wants to double oil production, Saskatchewan wants to continue coal fired electricity and is setting the stage to become a major lithium producer. Even Manitoba is upgrading an existing railway to Churchill in addition to considering an new deep water terminal in Port Nelson.But it is status quo in Ontario and Quebec, who want to sacrifice Alberta to advance ‘national’ objectives. [Sounds like a Liberal NEP- 2.0 to me. If not that then maybe a really good ballot question for the next federal election.]However, there seems to be some progress as everyone(?), even Quebec, maybe(??), now seems to agree with building pipelines to take advantage of our huge oil and gas wealth. Huh??? While other countries fight wars to get access to oil, Canada, at least a week ago, wanted restrictions to slowly shut down the Alberta industry. But this position seems to have mysteriously been reversed. It is hard to know how we are to cut emissions if we build more pipelines to transport Alberta oil. But it may be possible? Why the big walk-back?Perhaps what has changed is the attitude and consciousness on the part of Westerners and in particular, Albertans. Jordan Peterson, born and bred Albertan, wrote an interesting article for the National Post essentially saying Canada should up its game or Alberta will leave. The article got nearly 1,300 comments most of them positive. But Professor Peterson didn’t stop there. He made a Youtube video essentially just reading the article and made a few additional comments. The video has over 1.1 million (not a typo) views. Looks like not just Albertans watch Youtube. But I digress, this article is about Trump and what he wants from Canada. We now have less than thirty days to come up with ‘something’ or the tariffs will be back on. No doubt the “very good phone call” that Justin Trudeau had with Trump laid out exactly what the ‘something’ is. Trump now seems to have now added banking to his make-believe list of issues that need solving in Canada. But some of the basic trade issues are very real and still need to be resolved.Rather than risk your patience, I will forego trying to take a layman’s look at the Trump Doctrine on tariffs. If you are really brave you can look at a couple of summaries. In particular, the latter article by Anil Wasif concludes Canada needs a “coherent trade strategy that addresses the realities of a recalibrated U.S. trade agenda. Canada must move beyond tit-for-tat retaliation and focus on the larger strategy at play.” Luckily he says the US/Canada trade issues are well known and have been well known for decades.These mainly “include disputes over six key issues: the Digital Services Tax, Online News Act, Online Streaming Act, agriculture and dairy tariffs, automotive rules of origin, and critical minerals collaboration.” He also feels “that a renegotiation of the CUSMA could come sooner than 2026.” It almost certainly will, and that was probably one of Trump’s requests of Trudeau.The problem in this regard is Canada, not Mexico, as we have a dysfunctional federal government that is solely focused on avoiding annihilation in the next election. As part of this objective they have decided to exacerbate and inflame the trade issue with Trump as a way of painting themselves as the only ones capable of dealing with him. There are plenty of people willing fall for this gambit as they are the ones who elected the Trudeau Liberals not once, not twice, but three times. It is very unlikely that we will get a fourth Liberal government but in the meantime what do we do with trade with US? It seems that the Quebec program of dairy supply management is officially a sacred cow (sorry for the bad pun) and is not going anywhere. It is sad that Melanie Joly complains about the price of butter apparently clueless as to why it is so high. Perhaps in our negotiation of Canada’s internal trade barriers, provinces will be allowed to opt out of the program but Quebec could still impose a tariff on any dairy imports from other Canadian provinces. At least the absurd prices will just be borne by Quebec consumers.But Trump really doesn’t care that much about dairy, and maybe not even that much about critical minerals as he has killed the EV scam. What he is really interested in is our northern coast line as a global trade route. Canada has done virtually nothing in terms of securing this waterway and Russia and China are both in control of the North. Thomas Fazi in an article addressing Trump’s interest in Greenland says “the Northern Sea Route is the lynchpin of Moscow’s new energy strategy; it has constructed ports, terminals and icebreaker fleets aimed at leveraging the new shipping routes to export oil, LNG and other resources from the Arctic regions to global markets, particularly Asia. It has also expanded its military presence. China, meanwhile, is also heavily present: having designated itself as a “near-Arctic state” in 2018, it has since been investing in the region through its Polar Silk Road initiative, aiming to integrate Arctic shipping into its broader Belt and Road framework.” Are we still worried about Trump annexing Canada even though Russia has already virtually annexed our northern shore?For all the great Canadian national pride we have been expressing recently, we should be ashamed of our failure to secure the North. Rather than whining about Trump we should thank him and undertake some of the massive infrastructure investments that will be required to support extraction and export of our northern natural resources. At the same time enhancing our military, particularly an Arctic capable navy, would surely appease Trump’s requirement for NATO spending. Steve Bannon sums it up brilliantly in three minutes. Trump is inviting us into to something that will define the world for the next hundred years. If Quebec wants high butter prices then let them have them. What Canadians needs is to become a pivotal player in a secure North.William D. Marriott is a retired economist who specialized in public policy analysis of the oil and gas industry.
