THE CANADA-UNITED STATES RELATIONSHIP AT LARGE.

Position:Proceedings of the 41st Annual Canada-United States Law Institute Conference on the State of Our Nations; The Canada-United States Relationship: Canada-United States Perspectives on Law, Policy and Politics in Tumultuous Times - Discussion
 
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Moderator: Consul General Douglas George

Speaker: The Honorable James J. Blanchard

Speaker: Ambassador Bruce Heyman

Speaker: Ross Hornby

Speaker: The Honorable James S. Peterson

CONSUL GEN. GEORGE: Thank you. Good morning. (Greeting in French) but we will do the rest in English. If any of the panelists, wish to answer questions in French, that's their choice.

I am Doug George, the Consul General of Canada in Detroit, and I have the distinct privilege of trying to corral this group of distinguished panelists today and keep us on track.

The Canada-U.S. relationship is a shining example of one of the most successful bilateral relationships in the world. We have strong trading links; we are each other's biggest customer; we have a balanced and mutually beneficial trading relationship with about $2 billion dollars a day in goods and services crossing the border. We have strong defense links.

We jointly protect the North American continent through [the North American Aerospace Defense Command ("NORAD")], and we have fought side by side, including in two world wars, Korea, Afghanistan, and most recently in the fight against ISIS. We have strong environmental links here in Cleveland, especially from one of the Great Lakes. It is important to remember we have joint responsibility for protecting the Great Lakes, 20 percent of the world's fresh water, and the list goes on and on and on.

Now, we have gone through some recent elections. In 2015, Canada changed governments and elected Justin Trudeau. Trudeau's Liberals have been governing for over 16 months, and you may have noticed that, last November, the U.S. elected Donald Trump and Mike Pence, and that administration has governed for a little over two months.

Now, Prime Minister Trudeau and President Trump held a very successful meeting in February and set an ambitious agenda through a joint statement. Canadian ministers have been meeting their counterparts as they have been confirmed, and they are developing good relationships and strong bonds. But, if the first few weeks of the Trump Administration are any indication, we are looking at--how do I put this diplomatically--a very active period in our bilateral relationship.

So we have today a roundtable of distinguished panelists to discuss the way ahead. I will introduce them and then ask each of them to start with remarks from three to five minutes. Then we will get down to a [question and answer ("Q-and-A")] session, and I think it will be a very active and enlightening Q-and-A session.

So there is a slight change from the program you have in front of you. Minister Christine St. Pierre was unable to attend due to pressing parliamentary responsibilities, and we are very honored to have Ross Hornby, who is the former Canadian Ambassador to the European Union and is currently Vice President of Government Affairs and Policy of [General Electric ("GE")] Canada. Ross played a very important role in launching the Canada-EU trade agreement.

Next, I will introduce Ambassador Bruce Heyman. He literally needs no introduction. If you were paying attention last night at dinner, he served as ambassador to Canada from April 14th, 2014 to January 20th of this year.

Something else happened that day, and he came to the post after having a distinguished career at Goldman Sachs. He had the honor and privilege of having a front-row seat during the grueling eleven-week Canadian election campaign and the extended two-week transition period from Prime Minister Harper's Conservatives to Trudeau's Liberals.

Next to him is the Honorable James Peterson, former Minister of International Trade for Canada. He served as a member of Parliament and [as] Secretary of State. He represented Canada in the Doha round [of international trade negotiations] where, at that time, the approach to trade was focusing on the expansion of international trade. He is a legal scholar and teacher and is currently with Fasken Martineau. Also, Mr. Peterson serves as one of the co-chairs of CUSLI.

And last but certainly not least is Governor Blanchard or I should say Ambassador Blanchard, two-term governor of Michigan, member of Congress, and in 1993, he was appointed Ambassador [to] Canada. Since we are in a law school, I would bring to your attention he is currently listed as an international Super Lawyer and is with DLA Piper, and he is co-chair.

GOVERNOR-AMBASSADOR BLANCHARD: Must be [that] my mother wrote that. (Laughter.)

CONSUL GEN. GEORGE: Well, I would just do this in order. Ambassador Heyman, would you like to lead off with some short remarks?

AMBASSADOR HEYMAN: Thank you very much, and thanks for the kind reception last night.

So I thought this morning I would chat a little bit about the work that the Trudeau government is doing and has done to get a jumpstart on the Trump government and give you a sense of what I saw firsthand, and then the manifestation of that, and maybe the path ahead.

So what took place immediately after the election is that the Canadian government really reached out to business leaders, community leaders, consul generals, to their entire infrastructure, and asked who knows Donald Trump? Who has a connection and where is that connection? In addition to that, Katie Telford had previously met Ivanka [Trump] at a conference, and so everybody was triangulating whether using [that connection]. And it was not just one party. It was across party lines, which was, I think, fascinating to watch. But coming together, the conservatives, the liberals, and the NDP all agreed that they needed to focus on the U.S. relationship going forward.

There were meetings taking place while I was still ambassador, where members of the Prime Minister's staff were flying into New York, going to Trump Tower, having a series of meetings, and that enabled them to tell the Canadian story before the story was either developed on its own or having somebody else tell the story for them. All of those paid off in that first visit, and so it was a combination of having the women's conference that took place midday, which was something that was created by Katie Telford, who worked with Ivanka on bringing that together. But I think it differentiated all the other meetings that the President was having and made for a very successful day.

I think the path ahead is as good as can be expected, and I will tell you, from the people that I still communicate with in Washington, even on both sides of the aisle, I don't think there is a country that is closer to the West Wing than Canada. I think the depths of those relationships have continued to grow from Dina Powell to Ivanka to Steve Bannon and to others. So hopefully, this will pay dividends as we talk about the path ahead and the relationships that are going to be necessary as we dive into trade, the border, and other complex issues that will take place.

But the other point that needs to be made is, because the State Department--and you are seeing many articles, even this morning--the State Department is not taking the lead in terms of international relations on a global basis. It's very quiet actually, and not a lot of staff have been filled in. This is really emanating then; the international policy is emanating from the West Wing. So as a result of that and Canada's direct relationship, this is, I think, the best position Canada can be in going into what I would call this next phase, however long it lasts, of interactions, and I would also say there are probably more ministerial and cabinet level exchanges and visits that have taken place between Canada and the U.S. than any other country so far. So on a positive note, this is good work by Canada, and I think that you have to have kudos for the Trudeau government in terms of its leadership in making that happen. So with that, I am going to pass it down the line.

MINISTER JAMES PETERSON: The Canadian story that [Ambassador Heyman] referred to, just to remind you, involved two components: one was defensive and the other was offensive. Defensive was Canada, was not the problem in terms of U.S. trade deficits. They were running a $300 billion-dollar deficit with China, a $50 billion-dollar deficit with Mexico, and a $35.4 surplus with Canada when you include services. On the offensive side, the message was that there are 35 states that have Canada as their biggest market, and nine million U.S. jobs depend on a healthy trade relationship.

Having said that, I think that there is a lot of uncertainty out there right now, and the [United States Trade Representative ("USTR")] notice to Congress about holding up and so-called tweaking the NAFTA certainly has a panoply of areas, which I think are fraught with difficulty. One of their points is to expand access to U.S. agricultural products in both countries. This brings up the perennial issue in Canada: supply management. Let me just say this: the U.S. is running about $25 billion U.S. dollars of subsidies to agriculture. The EU is running over $65 billion U.S. dollars in subsidies, and Canada has very low subsidies compared to that. Now, my point has always been that, yes, we would be happy to put supply management of dairy, foul, chicken, and eggs on the table, but we want to see these obscene levels of subsidies to fanners reduced in our trading preference first. We will play but only if they are prepared to be reasonable.

Again, what was brought up here--and cut me off, Doug, if I am going on too long because we got lots of time--in terms of services, they want increased access to our markets. They said that. And they mentioned telecom, and they mentioned financial services. Now, we have controls on our big banks where no one party can actually control them. Telecom is very restricted so they are gunning at that. They are also gunning at express delivery, and I suppose that's the post office and professional services, in general.

New and upgrading this agreement in line with what the U.S. had agreed to on the...

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