The Politics of Ballyhoo: David Emerson and the Soft on Sovereignty Trade Deal

A CULTURE OF DEFIANCE: History of the Reform-Conservative Party of Canada

When the RCMP boss Giuliano Zaccardelli, interfered in the 2006 election campaign, there was an immediate drop in Liberal support. They had been clearly headed toward victory, but plummeted as a result of his questionable actions.

Recognizing that they were in trouble, Paul Martin fought hard to keep some of his strongest MPs from going down in defeat. And one he threw himself and his party behind, was David Emerson, whose narrow victory in 2004, suggested he could be in trouble.

Liberal campaign workers .. were being pulled out of races across the Lower Mainland - from ridings in Vancouver, the North Shore, the Tri-Cities and elsewhere - and ordered to Vancouver-Kingsway, where cabinet minister David Emerson was desperately fighting to hold his seat. Whatever the fate of the Martin government, whatever the outcome of nearly a dozen close races in B.C., the Liberals were anxious to save Emerson, their west coast star. The efforts of those many Liberal volunteers were rewarded on January 23 as Emerson won re-election. (1)

Which made his defection (2) all the more troubling. All of those volunteers who worked so hard on his behalf must have been devastated.

Just as all of those party workers and volunteers had trekked across the Lower Mainland to Vancouver-Kingsway in January - to work the phones, to knock on doors, to pound signs into the ground, to scrutineer on election day, to drive voters to the polls - surely Emerson would now be happy to return the favour, to toil on their behalf, to make a personal sacrifice for a year or two ... (1)

It was suggested that he broke ranks because he was lured by the perks of a cabinet post, but I don't think so. Emerson had been an executive at the lumber giant Cancor. He could afford the good life, and the extra $ 70,000 in salary would have been a drop in the bucket.

I think there was something else that lured this robber baron. Stephen Harper's views on trade that heavily favoured the corporate sector.

As successive Liberal and Conservative governments have opened the doors too wide, allowing the takeover of our country's resources, there was always at least a pretence of protecting Canadian sovereignty. Maude Barlow in her book Too Close for Comfort, speaks of the 2004 rivalry for the Tar Sands between China and the U.S.

Paul Martin cautioned that the federal government may have to step in, since this could be deemed a threat to national security. And David Emerson agreed. "The government thinks it should be concerned about the overall position of our natural resources and the degree to which we want to lose control of our natural resource base." (3) (Of course Alberta's premier Ralph Klein blew a gasket, seeing it as more interference from Ottawa.)

And yet after betraying those who voted for him, and those who had worked so hard to get him elected, Emerson would do another 180. When he was hammering out the Softwood Lumber Deal, he lashed out at those who criticized it, as being "anti-American".

Softwood Lumber and Conservative Ballyhoo

I was a bit disappointed in Lawrence Martin's view of the Emerson defection and the Softwood lumber issue, in his new book Harperland. I like the book and found that he did a pretty good job of keeping balance. And yet he used Conservative talking points on this issue. Very odd.

With their defeat, the Liberals also left behind the long-running softwood lumber dispute with the United States. Harper assigned the trade portfolio to his newest Tory, David Emerson, who had worked on the file as a Grit, to prove that the Conservatives could get an agreement their opponents could not. The dispute had intensified in 2002, when the U.S., alleging that Canada unfairly subsidized producers, imposed 27 percent duties on the lumber.

Under the terms of the Free Trade Agreement, a joint trade panel was to settle the problem. All the rulings went Canada's way, but Washington, to the consternation of Canadian negotiators, was not prepared to let those verdicts stand and insisted instead on a negotiated settlement. Having run the Canfor Corporation, B.C.'s giant forestry company, Emerson knew the file well. He had come very close to getting a settlement for the Liberals, which may well have helped them do better in B.C. in the 2006 election*. "But the problem," recalled Emerson, "was that there was an element in the agreement that would have required higher tariffs on western B.C. producers than on eastern producers." That, he said, would have caused too much discord. Under the Tories, however, he engineered his way around that obstacle and secured the deal. The new bilateral accord required the U.S. to pay back about $4 billion of the more than $5 billion it had collected on lumber imports. The missing billion prompted some complaints, but the consensus was that a flawed deal was better than none at all. Harper was pleased. His much-derided floor-crosser got the job done. (4)

Unfortunately "his much derided floor-crosser" only got the job done in favour of the U.S., but the deal was devastating for Canadians, because it once again tied our hands in terms of what we can and cannot do for the industry. The U.S. resented the fact that our lumber sector was subsidized, meaning that we could lower our price when the markets demanded it. This new deal put an end to that, and it was tested in 2007, when Quebec and Ontario introduced aid packages to benefit their forest industries. (5) U.S. officials complained and it went to arbitration.

Paul Martin in his book Hell or High Water, describes what really took place.

George Bush had been after him for a settlement, but Martin explained to him that much of the Canadian timber used for our lumber industry is on crown land. Therefore, all Canadians are in partnership with them. The U.S. counterparts, on the other hand, are mostly private concerns. He spoke of this at a meeting.

Afterwards, Bush came up to me and thanked me for my remarks. I took the opportunity to make a point. "Lookit, I am out there making the case for free trade – something that you want – and yet you aren't respecting that principle with your NAFTA partner in the face of judgment after judgment against you on softwood at international tribunals. How can you be credible on free trade of the Americas when you won't respect the deals you've already signed?" It was the first time I felt the message really penetrated. (6)

And they were very close to reaching a deal, though they were adamant that all of the money the Americans had collected in tariffs, the full 5 billion, had to be returned. Then the election writ was dropped.

When the Harper government picked up the thread of our negotiations in the spring, they yielded on this point, settling for an agreement that returned a billion dollars less than what had been improperly collected, and inexplicably allowing half a billion dollars to flow directly Into the pockets of our American competitors. This was blood money the Americans had won through a policy of harassment.

The Harper government said there was no alternative. But there was – even if the negotiations fell through. The American policy on softwood lumber did not even conform to domestic American law, and ultimately we could have taken the matter to court in the United States. We would have won, and won in a way no U.S. administration could ignore. (6)

But can you imagine Stephen Harper saying no to George Bush, or George Bush saying no to his corporate sector?

During the 2008 election campaign, Jack Layton vowed to scrap the deal:

Layton said the agreement -- hammered out in 2007 under the carriage of former International Trade Minister David Emerson -- was a betrayal of Canadian lumber producers. The "softwood lumber sell-out to the U.S. gave up on years of trade rulings in Canada's favour," Layton said in Kenora, Ont., putting the blame squarely on Conservative Leader Stephen Harper. After the deal was arranged, Layton said, "Harper then broke his promise to provide loan guarantees for struggling producers, and to find ways to help support forestry communities." He added: "Instead, he gave a $50-billion tax gift to profitable banks and oil companies that don't need the help." (7)

This brings us to a more recent issue from South of the border, that is becoming an election issue in their upcoming mid-terms. With the housing market in the U.S. drying up, Canadians have had to look elsewhere for trade, and have found a lucrative market in China. But the Americans are protesting because of our increase in output, which is lowering the price and making competition tougher, as they also tap into the Chinese market. (8)

This was something that Paul Martin wanted included in the deal, because at times accelerated production was necessary, when pine-beetle infestations prompted immediate harvesting. We are supposed to be allowed to compensate for that, but now the Americans are suggesting that we are "cheating", and only using it as an excuse to dominate Chinese trade.

More arbitration. (9)

We should not have signed this deal that has meant the loss of jobs and the loss of our ability to protect our citizens. But in true fashion, Harper bullied everyone into doing his bidding.

The Harper government's excuse was that the Canadian companies couldn't hang on any longer. They had to settle quickly. Of course they had to settle, but that was because David Emerson as a Conservative minister accepted a deal he had rejected as a Liberal minister! His new prime minister in essence threatened a very reluctant Canadian industry: "Knuckle under, because you won't get any help from us if you don't." (6)

So What Was behind All the Ballyhoo?

While the Conservative line remained that Emerson did with them, what he wasn't able to do with the Liberals, there is another story here. There always is, isn't there?

In March of 2006, during the summit in Cancun Mexico, when the media was distracted with the shiny zipper on Harper's hunting vest (something that would never have been part of his wardrobe), a trilateral working group was formed, called the North American Competitiveness Council, another deal giving corporations more power over everything from "trade laws, economies, defense, (and with that foreign policy), emergency response, education, transportation, immigration, health and environmental regulations, resources, energy, law enforcement, intelligence gathering ..." (10)

Signatories to this included Michael Chertoff and Condoleezza Rice, who let it be known that the softwood lumber issue "was a sour spot for them". Stockwell Day, Maxime Bernier, Peter Mackay and David Emerson (who also represented the Canadian Council of Chief Executives) endorsed the deal, so the push was on.

Can you imagine if the headlines in our papers read "Stephen Harper enters into agreement with Michael Chertoff and Condoleezza Rice", both part of the Bush administration. So instead Harper took one for the team and the headline was "Harper's big game hunter look a fashion faux pas, expert says." That's how far our media has fallen. That was the news.

The editors must have weighed the stories: Aggressive deal that hands our country over to American and multi-national corporate interests, or our doofus PM in a hunting vest? And Fashion Faux Pas won the day.

According to author Andrew G. Marshall:

The idea is that they want to move this process of integration so far along without public knowledge that by the time the public becomes aware .. it will be far too late for the public to oppose it, as it will have already become a reality. (10)

And I think it may already be a reality with the Buy American/Sell Canada deal that Harper signed during his two and a half month prorogue vacation. The media meant to warn us of that, but Rhona Ambrose just bought a new pair of shoes, and you know, they had to prioritize.

It just makes me so damn mad.

Footnotes:

*Lawrence is wrong. He did better because of the extra efforts of volunteers who were moved from other constituencies to make sure that he did better. A poll held prior to the election showed less than 20 per cent of residents in the riding knew Emerson by name. (See above)

Previous:

The Politics of Contempt: The Nixon-Harper Ticket

The Politics of Hate: Where Will it Lead?

The Politics of Conceit: "Anything You Can Do I Can Do Better"

The Politics of Opportunity: Election Tampering

The Politics of Jabberwocky: As Canada Plummets Down the Rabbit Hole

The Politics of Ballyhoo: David Emerson and the Soft on Sovereignty Trade Deal

Sources:

1. Emerson: The Power and the Tory. His betrayal, his perks and some context for the outrage, By Will McMartin, The Tyee, February 9, 2006

2. Former Liberal David Emerson defects to Tories, By CTV News Staff, February 6, 2006

3. Too Close for Comfort: Canada's Future Within Fortress North America, By Maude Barlow, McClelland & Stewart Ltd., 2005, ISBN: 0-7710-1088-5, Pg. 200

4. Harperland: The Politics of Control, By Lawrence Martin, Viking Press, 2010, ISBN: 978-0-670-06517-2, Pg. 49-50

5. U.S.-Canada Trade Dispute: 1982 to present, Random Lengths, May 5, 2010.

6. Hell or High Water: My Life in and Out of Politics, By Paul Martin, McClelland & Stewart, 2008, ISBN: 978-0-7710-5692-5 5, Pg. 381-383

7. Layton would cancel Tories' softwood lumber deal, CTV News, September 24 2008

8. Chinese lumber demand fueling B.C. industry improvements, By Autumn MacDonald - Quesnel Cariboo Observer, October 12, 2010

9. U.S. trade officials take step toward reopeining softwood lumber dispute, By Derrick Penner, Vancouver Sun, October 8, 2010

10. Tyrants and Traitors: The “Evolution by Stealth” of a North American Union, By: Andrew G. Marshall, August 7, 2007