Canadian Manufacturing

U.S. lawmakers balk at NAFTA ‘tweaks,’ urge tough stance against Canada

The finance committee wants substantive changes to Canada's policy around dairy, softwood lumber and poultry; some members blasted Trump's "tweaks" as weak



WASHINGTON—In a possible preview of upcoming NAFTA negotiations, U.S. lawmakers are urging a get-tough approach with Canada in several areas, including the supply-management systems that limit imports of poultry and dairy.

Lawmakers who will be involved in the negotiating process made clear at a confirmation hearing for Donald Trump’s trade czar that they envision more substantive changes than the minor “tweaking” the president recently hinted regarding Canada.

Senators from both parties pressed trade nominee Robert Lighthizer on softwood lumber, intellectual-property protection and, with respect to the NAFTA negotiations, for freer trade in dairy and poultry.

What was notable about the event was that it was a rare public exchange between actors with a legal role in trade negotiations: American law says the U.S. trade representative must consult the Senate finance committee before, during, and after trade talks.

One complained that the president should have been tougher when Canada’s prime minister visited Washington. The committee’s top Democrat, who hails from the lumber-producing state of Oregon, wanted stronger language on softwood.

”I thought it was unfortunate that the president missed an opportunity when Prime Minister Trudeau was here, when he said, ‘Gee, all we need with Canada is a tweak,”’ said Sen. Ron Wyden.

”How are you gonna get tough with Canada with respect to softwood lumber?” asked Wyden.

While Mexico is usually the most frequent target of trade complaints in the U.S., another lawmaker said that, when it comes to a key industry in his state, he actually has bigger problems with the northern neighbour.

”Mexico is now maybe our top customer for American poultry—in the whole world. And Canada maybe is among the last. Among the worst,” said Tom Carper, a Democrat from Delaware.

”(In Canada) they slap a tariff—I think it’s something like a 200- to 250-per-cent tariff—on poultry. It takes away a lot of incentive to try (our) Delmarva chicken when you have that kind of a tariff.

”Your thoughts on fixing that kind of imbalance if we have the chance to renegotiate NAFTA?“

Lighthizer appeared to say that supply management would be raised in the negotiations. He offered no firm guarantees or specifics, however.

”I hadn’t realized they have that high a tariff (on poultry). I agree it’s something we should look at,” the trade nominee replied.

”When we sit down with Canada, we should raise that and a variety of other subjects which have been raised by various members of the committee in the course of this process.”

The Republican chair of the committee, Orrin Hatch, got the event started Tuesday and urged the trade nominee to get more aggressive in screening cargo from Canada for counterfeit or pirated products.

Lighthizer replied that there are several trade issues involving Canada after he was asked about softwood.

”I’ve had a variety of issues with respect to Canada that have been raised by senators. . . . Certainly (softwood) is at the top of the list,” said Lighthizer, who is vying to become the United States trade representative.

A Pennsylvania Republican complained about Canadian dairy. Pat Toomey bemoaned Canada’s restrictions that severely limit the amount of cheese and milk that can be imported without tariffs.

However, another committee member, Republican Pat Roberts urged the administration to steer clear of reimposing country-of-origin labels on meat, an issue which almost started a trade war and caused international court fights. Roberts led the battle to dump mandatory labelling in 2015.

U.S. trade deals begin and end with Congress.

At the start of the process, the administration must spend at least 90 days gathering input from members of key committees in the Senate and House of Representatives _ which hasn’t started yet and which could last into summer.

At the end of negotiations, lawmakers vote on the final deal.

On NAFTA, Lighthizer was asked general questions; he offered general answers.

But Lighthizer was adamant that he supports Trump’s more nationalist approach. The former Reagan administration official and steel-industry lawyer has frequently expressed frustration with modern trade deals, and derided the idea of completely open trade.

”I agree with President Trump that we should have an ‘America First’ trade policy.”

Lighthizer used to work on that same Senate committee as a young staffer several decades ago. He was introduced by his former boss, ex-presidential candidate and one-time Senate finance chair Bob Dole.

The 93-year-old Dole credited his former protege’s integrity and toughness.

”If you need someone who’s aggressive and who’s a bulldog, he’s seated on my right. Bob Lighthizer,” Dole said.

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