Is Canada too dependant on the US?

[August1991]

The softwood and wheat tarrifs were set by the central government. The mad cow problem is with the government. All trade deals and rules are set and agreed to by governments. All regulation involving the production and consumption of good are set by central governments.

True, the softwood tariffs and the mad cow ban were set by the US federal government. Considering the numerous products crossing the border, this can hardly be called a blockade. The FTA was designed precisely to limit this kind of government intervention.

"All trade deals and rules are set by and agreed to by governments." That's simply false. Contract law is largely private. It is individuals that agree to a deal, negotiating the terms as they see fit.

"All regulation involving the production and consumption of good are set by central governments." Is the US a socialist country?

----

From abroad, we confuse the United States the country and the US federal government. In fact, the two are not the same thing at all. Is "Canada" our government in Ottawa?

At least you understand that the sole entity capable of "stupid bully tactics" is the US government. This is a succinct argument in favour of limited government in all countries.

So you set up shops in Montreal shopping malls and Calgary shopping malls both to make more money and to protect yourself from adverse conditions in your previously sole market of Toronto.

But will you make more money by opening up shops abroad? If you will, then do it. (I'm not against Canadians buying non-US products, or selling in non-US markets. I'm against the Canadian government forcing us to do it.)

Diversification. But since it is hard for the little guys, the government has to help them to get out to Montreal and Calgary.

Wait, wait. Why should the government assume risks and not the individual shop keeper? Who understands risks better? Diversification is one way to avoid risk. There are many others.

And what is the risk? That the US government will take an action that will harm the American people! The softwood lumber tariff is not good for the United States.

If you don't like this argument, consider this example: Finland and the Soviet Union. Finland prospered by having most of its trade with the Soviets.

IME, many English Canadians have a dislike of Americans and want as little to do with them as possible. This emotion colours all debates. I'm not certain about the source of this emotion.

*********************************

2001 data on world wheat exporters is available here.

2001 data on world wheat importers is available here.

The CWB is a marketing monopoly. To export Candian wheat, you have to go through the CWB. The issue is whether the CWB has any world market power and hence could make world prices higher by reducing quantity sold (like OPEC and Saudi Arabia).

The short answer is no because Canadian wheat doesn't dominate the market. US wheat represents about 28% of the world market and the US is a "price leader". That is, the US price is the world price. But since the US price is determined by market forces within the US, this is not evidence of monopoly power. (The US price is obviously influenced by US government wheat subsidies and this would drive world prices down, not up.)

The CWB is a method to subsidize Canadian farmers:

If the price received from customers during the year is less than the initial payment, the federal government absorbs the loss.

This is from the CWB web site. As a large bureaucracy, any gains are probably lost though. I would not be surprised to learn that farmers are increasingly dissatisfied with the CWB.

[Big Blue Machine]

We have to be depedent on the US sometimes. They are our biggest trading partner. The "Third Option" with Asia doesn't work.

[idealisttotheend]

KK:

Somehow in the litany of links you posted you missed this one.

About CWB directors--PDF

The CWB is run by farmers for farmers, period.

The fact that you posted seven links does not prove that the CWB is as unpopular as you suggest. I read all seven of them and they all represent the same general group of farmers, several even by the same lobby group. What is not being heard is the silent majority and yes I can prove it.

The reality on the ground is this. There is some opposition to the CWB. When the elections are held for the directors some candadates are actually anti-wheat board directors who run for election. One Mr. Chatenay is an example of an anti-CWB director and activist. If a majority of these anti-CWB directors are ever elected then the CWB will be kaput. Currently though the majority of democratically elected directors of the CWB agree with it's existance and that can be taken to represent the majority of voting farmers agree with the CWB and it's existance.

The Canadian opposition to the CWB's existance tends to be either large farming interests (rarely) or more often farmers who live close to the American border and can easily sell their grain across the border sometimes for prices above what they might get from the board. Various right wing groups like the NCC oppose it but for idealogical reasons not practical ones. If the NCC spoke for the majority of farmers than the CWB directors would be anti-wheat board. The CWB is sometimes unpopular because prices are low or farmers feel it should have turned left when it turned right or other legitimate concerns that are simply a matter of execution of mandate not the mandate itself.

You stated: "...the Wheat Board does not really compete. I believe that it is an extension of Canadian Foreign Policy. All at the expense of our farmers."

In the 11 links you have produced so far, not one has a shread of objective evidence that your statement is true. No evidence whatsoever of big bad Ottawa exploiting western farmers nor any reasons why Ottawa would do so. The CWB web states categlorically that the federal government (by legislation) does not have any control over the majority of directors and the directors give the general direction to the organization here.

Ottawa still has five votes out of the fifteen but the majority are democratically equal and Ottawa (on behalf of non-farmer taxpayers) has a legitimate interest in the CWB's success because it covers loses incurred by the CWB by law.

Here is the Act in question -- see 3.06, 3.07, 3.08 and 4(2) regarding it's governance and the fact that it is not even a crown corporation

The CWB is contentious as it debates whether a dual marketing system would work or not. This is a valid discussion. However, the CWB is by no means an example of Ottawa exploiting western farmers, for foriegn policy or another considerations . Such opinions are at best "misinformed."

Bored -- here is a very interesting but long argument against dual marketing even acknowleging that a monopoly is not the ideal solution. --PDF

[idealisttotheend]

August:

The FTA was designed precisely to limit this kind of government intervention.

And it doesn't seem to be working very well out west at least. Manufactured goods are going both ways (to Ontario's benefit) but resources (where Canada has an advantage) are increasingly being hit with tariffs or bans in defience of laws and science respectedly by our neighbours to the south. Lot of people in Welfare offices that never had to be there before in some towns and smaller cities.

Contract law is largely private.  It is individuals that agree to a deal, negotiating the terms as they see fit. 

Governments are the ones that guarentee those contracts and make the rules governing how and for what they can be signed. There is a free market system currently in Russia and one in Canada. The one in Canada works a lot better than the one in Russia because there are functioning government systems to enforce contracts through the courts based on the laws in effect in Canada. (BTW the other crucial difference is said to be the banking system which is also 'guarenteed' in a way by the Canadian government and regulated to some extent by the same government to ensure it's stability and success.)

"All regulation involving the production and consumption of good are set by central governments."  Is the US a socialist country?

I'm thinking of enviromental laws, labour laws, occupational safety laws, taxation laws, anti-trust laws, intellectul property laws and copyrights. I'm also thinking of the lack thereof and races to the bottom and how that is detremental to society.

At least you understand that the sole entity capable of "stupid bully tactics" is the US government.  This is a succinct argument in favour of limited government in all countries.

I did think of same actually. It comes down to your ideal though (shared by many conservatives and more prevelant out west) of capitalism, August. You see the majority of trade occuring between "individuals". This is how capitalism was designed and how it functions best.

Consider though, how much do you buy from individuals? The computer you read this on didn't come from an individual, it came from a company. The car you drive, your toothbrush, fast food,the building you work in, all come from companies. Look around your house and tell me what percentage of the items therein you bought from individuals and what percentage you bought from companies, some of which are larger than most national governments.

People who argue for smaller or limited governments usually (actually almost 100% of the time) find that their arguments work equally well against companies. Whether it's against bureaucracy, a lack of local control or corruption the problems are inherent to the system that runs both systems (you can tie in Russia's communist society too and argue that the problems there are the same one's of large companies or governments in many respects). Modern economies cannot function under the old mom and pop general store system, it would be impossible to produce the complicated goods we do. These good require experts, systems and very large outlays at startup and to maintain, whether we like it or not. Therefore it is a question of control. Will companies or governments make the rules that control the resources? This argument usually comes down to ideologies. I know you feel companies are inherently more democratic than the government but that's another thread.

Specific to something like softwood though you make the argument that this isn't primarily a government problem yourself. The duties on softwood are not in the interests of the American people because they are pushing prices of lumber up (the intention) and therefore housing prices are going up by as much as 10% I read somewhere. It is the lobby group for the private producers of lumber in the US that have pushed for these "bully" tactics. There is no evidence that limiting governments would reign in the real bullies here and if government is to be critisied it should be for not representing the interests of the majority but of the industry.

[idealisttotheend]

And back to the top at hand (I'm starting to post like Argus just not quite as fast).

August said:

Wait, wait. Why should the government assume risks and not the individual shop keeper?

The government (on behalf of all citizens) assumes the risks whether it likes it or not. Failed buisness cost money in social costs (EI, welfare) and decrease the tax base. Being specific again, the government had to bail out the cattle farmers who didn't diversify enough. It assumed no risk at the outset but still had costs. Had it not bailed them out then there would've been other costs associated with masses of broke ranchers. SInce they did bail them out there must have been a calculationn done that the costs were less of doing that then leaving them alone. This calculation might have been more political than economic but that is not the problem it would seem.

The government can not and should not pretend it is not exposed to some risk in all sectors of the economy. It's about us all being neighbours and connected no matter that we like it or not.

IME, many English Canadians have a dislike of Americans and want as little to do with them as possible.

Out west, I would argue that just the opposite is true. The American's are hurting a lot of people out here but no one is talking seriously about energy retaliation or anything at all. The (public at least) political pressure in the West seems to be all anti-Ottawa and pro-US even with the duties and bans and such. Many individuals are smarter than that but it's not what you see on the news.

Economically, ask a rancher if the need to diversify markets or set up some sort of informal marketing board has anything to do with anti-Americanism. It's a matter of survival in the face of risks that you aren't as exposed to in Quebec.

The CWB is a method to subsidize Canadian farmers:

True but compared to the American and European systems it's not a very good way. As far as farmers getting much in the way of subsidies are concerned at least (they'd get more under the American system which I don't think is necessary).

The CWB is actually a cheaper way to compete with the Americans. Farmers are disatisfied across the world but that's due to low prices not necessarily one marketing system or another.

[August1991]

Governments are the ones that guarentee those contracts and make the rules governing how and for what they can be signed.

That's false in practice. Most contract disputes are resolved between the parties privately - and frequently without any court involvement. (Think of something like credit card debt and credit rating agencies.)

the CWB is by no means an example of Ottawa exploiting western farmers, for foriegn policy or another considerations .

In general, I agree. But does the CWB act in the interests of farmers? Why not have a selling cooperative?

And if we have to subsidize wheat farmers, what is the best way of doing it? You seem to say the CWB is a bad way. True?

Consider though, how much do you buy from individuals? The computer you read this on didn't come from an individual, it came from a company. The car you drive, your toothbrush, fast food,the building you work in, all come from companies.

And individuals make up all those companies. Perhaps it is most important to note that all of the relations between those people and me are voluntary.

I have always been uncomfortable with the word "capitalism". I tend to prefer the phrase "market relations".

I'm thinking of enviromental laws, labour laws, occupational safety laws, taxation laws, anti-trust laws, intellectul property laws and copyrights. I'm also thinking of the lack thereof and races to the bottom and how that is detremental to society.

There is no race to the bottom here. Presumably, these laws make people better off. IOW, they are cost justified since they should bring greater benefit than they cost.

In any case, it is not one single state organization in the US that decides these laws. And I'm not certain how they could be used generally to form a cartel excluding Canadians.

And it doesn't seem to be working very well out west at least.

On the contrary, the FTA (and the WTO) are improvements over what we had before. The western world has finally gotten back to where we were in 1912.

Economically, ask a rancher if the need to diversify markets or set up some sort of informal marketing board has anything to do with anti-Americanism. It's a matter of survival in the face of risks that you aren't as exposed to in Quebec.

I agree that the mad cow business was silly. But the question is: would market diversification lessen the risk? I doubt it.

Nevertheless, I understand the point you are making. Something similar occurs in mining towns. If the price of ore goes down, it's a catastrophe.

SInce they did bail them out there must have been a calculationn done that the costs were less of doing that then leaving them alone. This calculation might have been more political than economic but that is not the problem it would seem.

It was very political, I'm sure. But insurance schemes, particularly in Canada, are often State operated. Pension, health and auto are examples. There are numerous types of agricultural insurance schemes too.

With a homogenous group, group insurance is often the most effective insurance scheme. That is the argument for State health insurance. Does it apply to crop insurance?

[ft.niagara]

Often it seems as though Canada is helpless to make big decisions without the US´s approval. Can we even call ourselves independant anymore? It seems like if the USA catches wind of something Canada wants to do that the USA isn´t too fond of, we are expected to immediately back off. The US threatens to withdraw its support and we´re crippled! Have we become the 51st state?

I am an American. I live outside Buffalo. I see the Peace Bridge probably once a week and visit Canada probably every other month. I see Canada as greatly benefiting from its proximity to the US. Your casinos, and bingo parlors are greatly patronized by Americans. Before NY had casinos, you had yours, and forced NY to build one. Your drinking age is lower, and bottomless dancing is legal, drawing our young across the border. I do not know how this is allowed, but drugs are cheaper in your country drawing people across the border, yet profits from these drugs supply the fuel for new drugs. When SARS, which was similar to a bioterror attack, came to Toronto, and WHO banned travel to Toronto, the CDC did not. When you advertise your casinos, how many ads do you see in Toronto? When WWII broke out, and Canada was in it before the US, Canada was angry at the US for not helping. Your defense budget is so small, it is almost nonexistant. Ninty percent of your population live within 100 miles of the border. Some Canadian and American cities are almost one: Vancouver/Vancouver, and Detroit/Winsor.

And with all this, from your television and radio, there is a detectable antiAmerican thread. I do not know why. Maybe it is the French influence over your politics, and your distain for Americans. Yes, probably most Americans probably do not know Toronto is not the capital of Canada, but I for one see this relationship benefiting Canada more than the US. As far as the 51 state, it would probably be more like states 51-60.

[ft.niagara]

If everyone seems to view the US government as a bully, why not just quit NAFTA? From my point of view there has not been a trade agreement the US government has negotiated which is favorable to the US. Just look at the imbalance of the balance of trade month after month and year after year. With regard to the steel tarriffs, a fellow I know here in Buffalo has a scrap yard who was driven out of business because the price of steel dropped because of dumping by SOMEONE.

[caesar]

. Some Canadian and American cities are almost one: Vancouver/Vancouver, and Detroit/Winsor.

------------------------------------------------------------------------

Where did you come up with this idea????Vancouver BC is a large Canadian port city with several suburbs (Burnaby, Richmond, Surrey, etc) Vancouver, Washington is a suburb of Portland. Neither is our sister city. We would have closer ties to Seattle.

[ft.niagara]

If I am wrong there, then substitute Buffalo/Ft Erie.

[KrustyKidd]

Ninty percent of your population live within 100 miles of the border

More I'll bet. It's not the weather either. We are more concentrated per person on our land than the US popuulation. I am one of the few who have actually gone to the Northwest Teritories to vactation. You are right, we depend on the US more than they do us. Mexico is only a few regulations away from being their top trading partner.

[Guest eureka]

Canada had not benefited more from Free Trade than the US. Both have lost ground since Free Trade for whatever reason but Canada has lost more. Both have lost jobs as a consequence of Free Trade but Canada has lost proportionately more.

The Free Trade agreement was a classic example of a weker partner getting shafted, though, under Mulroney, it prepared itself for the shaft by baring the apprppriate part. The Canadian chief negotiator has admitted since that Canada was to give the US what it wanted. And, the American negotiator in a written memorandum said that America had got all it wanted. He also said that the Canadian economy would be integrated into the American within twenty years.

The integration has not happened because Canadians have resisted it. Free Trade between the countries may have increased but, in my opinion, it is only due to displacement from one side to another and the reverse where it was economical to do so.

Neither economy has gained as a result of Free Trade. Indeed, the last two decades of the twentieth century were the slowest in a very long time in growth for both countries.

[Big Blue Machine]

There's no choice. We have to be dependent on the US. The "Third Option" of trade (trading with different middle east and asian countries can't support what the US trades with Canada per year. America is dependat on us too. We need our oil, wood, beef, electricity. Did you know that Toronto imports electricity from New York? It doesn't come from Niagara Falls. Actually, during the Great Summer Blackout of 2003, my town didn't lose power. We were in the thick of the area that lost power, and we didn't.

[caesar]

We do NOT need to be dependant on the USA. They only have money that we need. They need or want our resources. Cash can come from any other country. It need not be Asia or middle eastern countries. However, China is a growing market for trade. There are many other countries in South American and there is Mexico.

We can trade with the USA when it is viable and fair but we do need to look for more diverse trading partners.

When Bush is gone (soon I hope) perhaps normal trading relations can resume with the USA. We should still seek other trading partners and never concentrate our trade relations too concentrated with one other country.

[willy]

When Bush is gone (soon I hope) perhaps normal trading relations can resume with the USA. We should still seek other trading partners and never concentrate our trade relations too concentrated with one other country.

Last year we had the largest trading surplus with the US in the history of our relationship. Yes we had the softwood problem (still do) and the beef problem (still do) but this just shows how much trade we really do with them. Over 80% of all of our trade.

Plain and simple don't shoot the golden goose and listen carefully to Edwards and his protectionist rant.

[caesar]

We need more trading partners. Trade should never depend on one country too strongly. The USA is our closest neighbour and we have many intertwined industries but we really need more diversified trade.

[Cartman]

I think that we should try to expand the number of trading partners and I believe the gov't has tried to do so for decades. The question is how we should do so. Are you suggesting that we establish more free trade agreements (with other nations)? If so, who?

[KrustyKidd]

Of course we should have as many trading parners as possible, remember though, transportation of goods is of paramount importence to pricing. If we have to send a widget halfway across the world for a customer to buy then who absorbs the shipping cost? If it is us then we will of course send it south rather than east. If it is them, then they will quickly look for a cheaper yet relatively same quality item closer to home.

As for who should be our trading parners? What is it you want to trade? I find that private industry is very ingenious at finding trading parners without government sponsored study groups. If they can make a buck for the teachers pension fund and themselves, they will do it.

[Alliance Fanatic]

NDP candidate Walter Kolisnyk goes up main street less than an hour after Peterson, Dewar and their entourage go to a lunch meeting.

Kolisnyk says the Liberals have slashed support for farmers in the past decade and if they are serious about helping farmers they should give them money like in the U.S. and Europe.

"Let's be honest. Farmers are trying to make a living in an economic environment that's not fair. We're not playing on the same level playing field as everyone else. We're selling our products at a lot lower price than the Americans are getting," Kolisnyk said.

I've grown up on a farm, and I can tell you right now that the vast majority of farmers have a huge disdain for the NDP, and their Socialists policies. That is why not a single NDP MP was voted in, in the province of Saskatchewan due to the fact that Jack Layton won't let his MP's vote based on what their constituents want.

But on free trade, it has been a benefit, and a problem. In my small town, their are very few if any, small businesses up and running, Wal Mart, IGA, and a host of other corporations came in. Don't get me wrong I'm all for the free market, but I do think that corporate taxes for large corporations should be alot higher, and American and international companies should be higher taxed.

On other issues Canada is becoming the 51st state due to the fact that Canada is no longer really a nation. A nation is a group of people that share something in common, Canadian's have nothing in common except for a dislike for the United States. Canada is also more ultra left wing, meaning that we'll give safe haven to those who murder, cheat, and lie, in the United States.

Canada should integrate with American Customs, and immigration.

Canada unfortunately has'nt been able to get stable funding for our military due to the left wing presence, so the United States would have to take over military affairs.

[idealisttotheend]

nd I can tell you right now that the vast majority of farmers have a huge disdain for the NDP, and their Socialists policies

Farmers were a major force behind the creation of the CCF/NDP and Saskatchewan was the birthplace of such socialistic polices. If you read up on the history of Alberta you will see that social credit was also largely supported by farmers. Social credit's early polices were pretty much the opposite of free market policies.

Don't get me wrong I'm all for the free market, but I do think that corporate taxes for large corporations should be alot higher, and American and international companies should be higher taxed.

A conservative who realizes large corporations are bad for capitalism. I think that you are the only one on this forum. I agree totally but you will find that the largest defenders of the free market these days are big corporations (especially in your cherished USA) and that big corporations are the necessary result of an unregulated market place. As to the taxes, small buisness already get a lot of breaks and advantages an they still don't have a chance against the WalMarts of the world.

Canadian's have nothing in common except for a dislike for the United States. Canada is also more ultra left wing,

Surely you can see that those two statements directly contridict each other.

Canada should integrate with American Customs, and immigration.

Why? Why not Mexico's? Why not keep our own? Just to appease the US. Are you too afraid of the responsibilities of having your own country? Do you think that we as Canadians are so inferior that we cannot determine our own customs and immigration?

Canada unfortunately has'nt been able to get stable funding for our military due to the left wing presence,

This is a nice sentiment. Tell me, what legitimate national interests (besides the appeasement of the USA) have the military been unable to fulfill in the last 50 years? What threats have we failed to defend ourselves against (please say terrorism)? Whose health care or education ought we have cut short so we could have a larger military?

And yes the USA complains bitterly about our defence spending. Who is the largest arms exporter in the world? What was the last non-USA initiated military action undertaken by the western world? Perhaps it is in their interests that we have a larger military and not necessarily ours?

so the United States would have to take over military affairs.

Canadians joined both world wars before the USA did. We fought hard and well. We fought in Korea. We were well known around the world for our peacekeeping skills which aren't as sexy as the Nimitz class carriers but are at least as important. We went to Rwanada when the US wouldn't because they were too afraid of seeing American's shipped home in body bags. While we could have (and should have) done better, we at least tried and we tried to send more troops but couldn't because the USA wouldn't lend us the airlift to get them there.

The military needs better equipment, a refocused mission and seriously needs to be de-politicised at many levels but we have nothing to be ashamed of in many respects.

[KrustyKidd]

The military needs better equipment, a refocused mission and seriously needs to be de-politicised at many levels but we have nothing to be ashamed of in many respects.

Our military system is great, we, as a supporting country are garbage. There you go, out of thirty million we have sixty thousand good guys and gals. Let the rest of us become great too and give them what the world needs, a Canadian military period so we don't have to make 'has been' posts al the time and have some efect on this panet instead of complaining about how others are doing it wrong.

[Alliance Fanatic]

Farmers were a major force behind the creation of the CCF/NDP and Saskatchewan was the birthplace of such socialistic polices. If you read up on the history of Alberta you will see that social credit was also largely supported by farmers. Social credit's early polices were pretty much the opposite of free market policies.

That is 100% true. However the problem today is that the NDP is to the extreme left on social policy. This can be seen when Jack Layton refused a free vote of gay marriage. You'd be hard pressed to find farmers that support gay marriage, feminism, employment equity, abortion, uncontrolled immigration, and abortion. Tommy Douglas was originally compassionate, however was socially conservative. The same can be said of Social Credit. The New Democrats actually won a large portion of the seats in Alberta, even in rural ridings such as my own, however they were more socially conservative, which is why they were successful.

The Reform Party also sweeped alot of seats in Saskatchewan even with the presence of a NDP government, even in the last election the NDP won provincially, however the conservatives sweeped 13 of the 14 seats.

A conservative who realizes large corporations are bad for capitalism. I think that you are the only one on this forum. I agree totally but you will find that the largest defenders of the free market these days are big corporations (especially in your cherished USA) and that big corporations are the necessary result of an unregulated market place. As to the taxes, small buisness already get a lot of breaks and advantages an they still don't have a chance against the WalMarts of the world.

I believe in free enterprise. However the current situation is not good, right now very few small businesses can even compete when Wal-Mart, and other big name corporations move in. I think that large corporations should be higher taxed, while smaller businesses should go tax free.

I don't believe that conservatism is supposed to be about "greed". I believe that in some instances the government has to provide help to people who truly need it. On the other hand, I believe that a nation must be based on the traditional values that has been around for ever, and cherish them. Of course their's bigotry in every society, but in order to erase it the best cure is for people to discover tolerance themselves rather than the government shoving it down peoples throats.

On gay rights, I believe that it is a sexual behavior, and that is it. If somebody wants to have sex with a person of the same sex then go ahead. Just don't shove it down our throats.

[caesar]

Krusty; there is much more to making a difference on this planet than by wars and invasions of other countries.

Diplomatic solutions and helping our fellow countries through difficult times. Meddling in other countries political systems and showing unfair favoritism in inter country disputes is counter productive. Mediation and other ways to solve problems should be used first. Military intervention should be a last resort and only with the support of a majority of civillized nations.

[KrustyKidd]

Krusty; there is much more to making a difference on this planet than by wars and invasions of other countries.

Diplomatic solutions and helping our fellow countries through difficult times. Meddling in other countries political systems and showing unfair favoritism in inter country disputes is counter productive. Mediation and other ways to solve problems should be used first. Military intervention should be a last resort and only with the support of a majority of civillized nations.

Absolutely. Now that we have that out of the way, let's get to where we lack in a serious way, our military. as there is much more than just mediation and talks that make the dictators of the world listen. Sometimes they only listen because they know you can back yourself up. Of course that probably does not enter into your Eloi mentality but I think that way. Speak softely and carry a big stick, not speak loudly and don't even bother to have one.