Tornado Alley (PROG)

[StephanieVanbryce]

This Is Not A Joke Or '90s Movie: Here's How A Trade War With Canada Could Happen

President Trump’s new tariffs on Canadian lumber will cause anger in Canada, but could
also be a step towards a much broader trade battle. Beware the Canadian dairy lobby!

Paul McLeod
Posted on April 25, 2017, at 9:52 a.m.

WASHINGTON — President Donald Trump Tuesday turned a simmering dispute between the U.S. and Canada into an open confrontation, announcing a 20% tariff on Canadian softwood lumber imports and threatening in a tweet to go after the Canadian dairy industry.

Donald J. Trump @realDonaldTrump

Canada has made business for our dairy farmers in Wisconsin and other border states very difficult. We will not stand for this. Watch!
12:30 PM - 25 Apr 2017

The Trump administration argues the tariffs, which can hit a maximum of 24%, are a response to Canada illegally subsidizing its lumber industry. Canada denies it does any such thing. And while the the tariffs are a new and not entirely shocking development in a trade dispute that dates back to the 1980s, there are signs this could be a step towards a broader trade war between the two nations.

After a friendly meeting in Washington earlier this year with Canadian Prime Minister Justin Trudeau, Trump said he was mostly happy with Canadian trade and just wanted to make some tweaks to the North American Free Trade Agreement (NAFTA).

But now — with plans for a wall with Mexico hitting obstacles — he’s expressing broader ambitions for the Northern border.

On Tuesday Trump tweeted about Canada’s closed dairy market that protects Canadian producers of milk and cheese by strictly limiting foreign imports. Trump wants American farmers to no longer be shut out from the Canadian market. “We will not stand for this. Watch!” he warned.

That move would give American farmers access to a new multi-billion dollar market, and would likely provide cheaper milk for Canadian consumers. But it would also take on the politically powerful Canadian dairy industry, which will fight viciously to hold on to its monopoly.

The dairy industry is a club of about 12,000 dairy farms that wield immense power in Canadian politics. The protectionist system of price controls — known as supply management — is one of the sacred cows of Canadian trade policy.

The Canadian government has recently pledged hundreds of millions of dollars to appease the dairy industry because a negotiated free trade deal with Europe would allow new imports of European cheese. That contentious deal still leaves domestic dairy farmers in control of 96% of the Canadian market.

In other words, if you want to start a trade war with Canada, go after the dairy industry.

The questions now are how Canada reacts and whether the relationship continues to sour. Canada is the largest consumer of US exports, taking in $280 billion per year. Canada also sends $295 billion in goods back to America, more than any country other than China.

Canada has vowed to fight the new softwood lumber tariffs. On Monday Natural Resources Minister Jim Carr called them “unfair and punitive” and dismissed Trump’s subsidizing allegations as “baseless and unfounded.”

Canada exports about $6 billion worth of lumber to the United States every year, or about 30% of America’s softwood lumber market. Carr said that tariffs on Canadian wood will jack up the price of new homes and jeopardize thousands of homebuilding jobs. He also threatened to sue.

“The Government of Canada will vigorously defend the interests of the Canadian softwood lumber industry, including through litigation,” he said in a statement. “We have prevailed in the past and we will do so again.

The heart of the dispute is that most Canadian lumber is harvested from public land at regulated prices. The American industry relies mostly on harvesting from higher-cost private land. Lobby groups like the US Lumber Coalition argue this allows Canadian companies to flood the US market with artificially cheap lumber, which is a breach of NAFTA. But both the World Trade Organization and NAFTA dispute panels have ruled in Canada’s favor.

The door was left open for this new dispute by the inaction of the Obama administration. The last lumber deal between the two countries was reached in 2006 and expired in October of 2015. Not wanting to touch the hot button issue in the final months of his administration, Obama let the deal expire without a replacement.

While the lumber and dairy disputes represent billions of dollars in their own right, they can be isolated battles. If Trump does re-open NAFTA for negotiation, as promised, then the entire trade relationship between the two nations (plus Mexico) is on the table.


Many embedded links here
https://www.buzzfeed.com/paulmcleod/not-a-1990s-movie?utm_term=.df1aO10wQ#.uh4PqopZR


O.K. .. N. Korea Killing millions, while putting our military in a horrible position! Making a New State Enemy, Mexico, and You are even making new enemies of some your own nation states! .. you dumb pig! .. sheeesh! ... I think you need to make it up with Canada! . .They are smarter than you ! and they have Many Resources plus by Gosh! .. .they have those TALL Good Looking Royal Mounted Police .. if you could find a brain somewhere, you would know that it's time to back OFF asshole!

at least with your mouth - shut up! and pass this job to the business men that you hired to do this job for you..please