Canada-United States relationship and bilateral dynamics

Canada-U.S. Relationship

Canada and the United States enjoy the world's longest unprotected border, the world's largest trading relationship and a long history of close and cordial relations. The two nations are presently working together on a number of key issues, including terrorism, trade and issues of border security. The tone of the relationship at any given time is typically set by the political ideologies of the respective nation's leaders. So while the Liberal Chretien government sparred with the Bush administration over a number of key issues, the Conservative Harper government brought the two nations closer together. The twin objectives of this paper are to examine some of the key issues that characterize the present political relationship between Canada and the United States and to analyze the impact that the Obama administration is expected to have in this relationship over the next few years. The political situation in Canada is less certain, with the Harper government narrowly holding onto its minority government.

Political uncertainty on the Canadian side of the border aside, I intend this paper to show that the relationship between Canada and the United States is not only strong, but it will grow stronger over the next few years. This will occur because the administrations of both nations, at least as far as is manifested by the minority Harper government, are close in their views on the most important issues in the bilateral agreement. This congruence will allow the two administrations to work together more closely than even Harper-Bush, and certainly more closely than Chretien-Bush.

Key Issues: Terrorism/Afghanistan

Following the September 11th terrorist attacks, a new relationship was forged between the United States and Canada with respect to terrorism. The notion that terrorist attacks could hit Toronto or Ottawa in the same way that they hit New York and Washington, DC was frightening for the Chretien administration. They quickly joined the Bush administration in the so-called "war on terror," and became part of the NATO coalition that eventually invaded Afghanistan and deposed the Taliban. Both Canada and the United States have remained in Afghanistan ever since.

In that time, the U.S. invasion and occupation of Iraq distracted U.S. military forces, which has proved to be a bone of contention between the two nations. With limited U.S. presence in Afghanistan and the majority of NATO allies unwilling to put their troops into that nation's most troubled regions, the Canadian military has been burdened with a large share of the duty. The resulting casualties have made Afghanistan a major political issue for the Harper government, which has now set a timetable for withdrawal of Canadian combat forces in the region by 2011.

Complicating the issue is the fact that the security situation in Afghanistan has worsened since 2004. Both Canadians and members within the White House agree that the Afghan mission has gone astray, and is presently without a clear sense of direction. The Obama administration has ordered a strategic review of the issue to be completed by early April before action is taken. However, tentative plans call for an increase in U.S. troops to the country.

The issue is of significant political importance to the Obama administration. Obama raised the issue multiple times during his election campaign, pointing out that the war on terror has not been completed, and that the main battleground for the war on terror is Afghanistan, not Iraq. Thus, both nations are heavily involved in Afghanistan, both on the ground and politically at home. The two countries will therefore need to work together closely, along with other relevant nations, including Afghanistan and Pakistan. As Afghanistan is more a political hot button for Canadian politicians, the intensity of this issue in forging the next stage of the Canada-United States relationship will be dependent on whether or not Harper is forced into an election in the near future.

Key Issues: Economic Crisis/Trade

Canada and the United States are already the world's largest trading partners. Free trade and subsequently NAFTA have reinforced this relationship. There have been some high profile disputes in recent years, most notably softwood lumber, but overall these disputes represent a minor portion of trade between the two countries.

The economic crisis looks to impact Canada-U.S. trade relations in a couple of key ways. The first is with respect to protectionism. Canada took offense to a "buy American" clause in Obama's stimulus package, for example. Obama's perceived protectionist leanings have alarmed Canadian politicians and business leaders since the Democratic leadership campaign. Canadians trade with the U.S. fuels the large manufacturing base in Ontario and Quebec, and there is fear that protectionist policies such as the "buy American clause" or the equally contentious country-of-origin-labeling rules in the meat industry will have a negative impact on Canadian businesses.

Another key way in which the economic crisis will affect Canada-U.S. trade relations is that it brings about a convergence of issues for the two nations. Trade between the two nations has become so integrated that not only does the economic crisis spill over, but the plans for solutions also spill over. The handouts to the auto industry, for example, affect a sizeable portion of Ontario's manufacturing base, where tens of thousands of workers make cars for U.S. automakers. Because the nature of trade between the two nations is tighter, so too will be the solutions. Each country has gone its own way thus far in terms of bailout and stimulus packages, but a point will be reached where the two must come together.

The relationship, however, runs into difficulty on account of is asymmetry. American leaders, including Congress, do not generally recognize the size of the trading relationship or its complexity. The relationship has been likened to a double helix, one that cannot be easily unwound. Moreover, Canada is the largest supplier of energy to the United States, and the lack of recognition for that fact threatens the strength of the relationship, especially as rising energy costs make shipping Canadian fossil fuels overseas a more economically viable option.

In all, the trade relationship is of equal importance to both countries. The U.S. accounts for more, in percentage terms, of Canada's trade than Canada counts for the U.S. Yet, the Canadian economy is less volatile than the American economy, as evidenced by the lack of recession north of the border at a time when the U.S. has been in recession for a year. As a result, the economic crisis is a more minor political issue in Canada. The issue for Canadians is maintaining a strong trade regime, from which both countries benefit. For the U.S., the issue at hand is to spur economic growth. Encouraging trade is generally held to be significant contributor to economic growth.

Key Issues: Border Security

Border security is a political hot button issue on both sides of the border, closely tied to both the issue of trade and the issue of terrorism. The United States has taken a wide variety of initiatives in recent years with respect to shoring up security on their borders. Some of these initiatives have threatened to sour the relationship between the U.S. And Canada. With respect to trade, Canada fears that tighter border restrictions will impede the flow of trade between the two countries. U.S. companies that do cross-border business feel the same way. However, in the U.S. trade is not the main concern with respect to border security.

The main concerns for the U.S. with respect to border security are terrorism and illegal immigration. The U.S. is driven by the belief that terrorist attacks can be prevented through stricter border security. Immigration is also a significant issue, especially along the southern border. Prior to September 11th, 2001, the two countries had a much stronger relationship on the issue of border security.

There are many reasons why this issue has seen such a strong divergence of opinion at the political level between Americans and Canadians. Many of the U.S. initiatives are viewed by Canada as placing undue restrictions on the flow of people and goods, with no discernable benefit. Canadians point out that the September 11th hijackers entered the United States legally on visas. At one point, there was a proposal to have Canadians fill out visa paperwork at the border in order to gain entry to the U.S., a move that would have increased border wait times exponentially. The move was viewed with revulsion by business leaders on both sides of the border, and was viewed in Canada as a sign of distrust on the part of the Americans.

In public, both Harper and Obama say the right things. They appear on the same page with respect to improving security while simultaneously keeping the borders open. These twin goals, which not mutually exclusive, are certainly not congruent. Thickening of the borders will inevitably restrict the flow of people and goods. Moreover, the core objectives of the two countries differ with respect to border security. Canada's views are pragmatic, concerned with the flow of goods and services. America's views - certainly those of the nation's hawks - are less rational, concerned with solving problems of their own invention.

Key Issues: Environmental Matters

While the economy, Afghanistan and border security have become the most significant issues in the Canada-U.S. relationship since the presidential election, environmental matters will not take a back seat for long. The environment is an issue of long-standing import between the two nations. There are many areas where the interests of Canada and the United States converge. Acid rain is a long-standing issue, where pollution in the U.S. industrial belt contributes to the destruction of Canadian forests. Alaskan overfishing of BC salmon is another issue of the past.

The main issue today, however, is that of climate change.

The Chretien administration and the Bush administration went their separate ways with respect to climate change, exemplified by Canada's signing of the Kyoto Accord. Through this era, Canada viewed itself as a nation that needed to take a leadership role on the issue of climate change whereas the United States proceeded as though science was irrelevant. The Harper administration brought Canadian environmental philosophy, at least at the highest political level, closer to that of the Bush administration. Indeed, even under Chretien, environmental policy consisted of far more talk than action.

Today, the immediacy of the economic crisis has somewhat superceded climate change. As with border security, the two leaders say the right things with respect to climate change. While it may be too early to evaluate the Obama administration's stand on environmental issues and global warming, Harper has never been especially clear in his articulation of Canada's strategy or objectives with respect to climate change. The nation is a net exporter of fossil fuels, to the extent that the Canadian dollar is now considered by most economists to be a petrocurrency. This reality threatens to color Canada's views on climate change. The United States, as a major user of fossil fuels, has greater incentive to develop an economy for a post-fossil fuel future. In any case, there appears to be little traction for major initiatives with respect to this issue for either country in the near future, despite the fact that the issue is likely to guide the course of the 21st century.

Outlook: The Next Few Years

As with any relationship, that between Canada and the United States will be driven by a handful of key issues. Within the context of these issues, it is reasonable to expect that that nature of the relationship will depend on the degree of congruence between the objectives of the two nations. The more the two nations agree on the desired state to be achieved by a given strategy or tactic, the more the two nations will agree on what that strategy or tactic should be.

Canada and the United States have long had a close, cordial relationship. As a result, this relationship has remained almost exclusively positive. The unique nature of this relationship is such that the only real threat to the positive nature of the relationship is damaging unilateral action. We saw this during the Chretien-Bush years, where political leadership traded barbs and generally disagreed on a wide range of issues of mutual interest. The relationship began to strengthen when the Harper government came to power, in part due to certain congruencies in outlook between the nations' respective administrations.

It is generally considered that the Harper government had more in common with the Bush administration than it does with the Obama administration. This view, however, can be tempered by a solid analysis of the reality. The first important point is that the Harper government is a minority government. They require support from one of the other major parties in order to pass bills, and therefore they are unable to take a stance that is too far to the right. Canadians are generally centrist to center-left in their political orientation. It is beyond the scope of this analysis to speculate on the future of the Harper government, or on the potential impact of a potential Ignatieff administration on Canada-U.S. relations. But it has been demonstrated in the past few years that the more hawkish tendencies of the Conservative party have been muted as a result of their minority status, bringing the Canadian government's views on many key issues closer to those of the center-left Obama administration.

We can see this high level of congruence with regards to the Afghanistan mission. Both Harper and Obama agree that improving conditions in Afghanistan is a priority and a key component of the war on terrorism. This marks a significant improvement in Canada-U.S. relations relative to the Bush administration, which all but ignored Afghanistan in their zeal to invade and occupy Iraq. While the Harper government has set a firm timetable for exiting Afghanistan, this may be subject to change if the political winds change. The current strategy review will go a long way to determining the relationship that Canada and the U.S. will have on the Afghanistan mission. But the two countries are thus far in agreement about the problem and the solutions.