David Emerson, Softwood Hero?

[geoffrey]

Hmmm, without knowing the amount of tariffs that is a pretty big leap. Doesn't really make sense that the Canadian government would be allowed to give the tariffs back to the companies. What would be the point of having the tariffs in the first point?

I agree if the Canadian govt is allowed to simply give the tariffs collected back to the companies. If the deal prevents the govts from doing that then Canadian industry will lose more than they could possibly hope to gain with higher prices.

Exactly the point Shoop. It isn't a tariff if the money is returned. But ya, the government would be able to do whatever they want with the money... like a nice juicy corporate tax cut, which would help the industry as well. There are ways of doing it.

As well shoop, good luck to your oilers tonight, all of us in Calgary are cheering for you. We'd love the privledge to knock you guys out in the next round.

[shoop]

I think targeting the money to a program to deal with any actual job losses that might occur as a result of the deal would be a good way to go.

Thanks for the kind wishes aobut the mighty Oil! Unfortunately I'm in Calgary so I have to watch the Flames play tonight. Man an Oilers-Flames series would be awesome!!!

Exactly the point Shoop. It isn't a tariff if the money is returned. But ya, the government would be able to do whatever they want with the money... like a nice juicy corporate tax cut, which would help the industry as well. There are ways of doing it.

As well shoop, good luck to your oilers tonight, all of us in Calgary are cheering for you. We'd love the privledge to knock you guys out in the next round.

[August1991]

Hmmm, without knowing the amount of tariffs that is a pretty big leap. Doesn't really make sense that the Canadian government would be allowed to give the tariffs back to the companies. What would be the point of having the tariffs in the first point?

I agree if the Canadian govt is allowed to simply give the tariffs collected back to the companies. If the deal prevents the govts from doing that then Canadian industry will lose more than they could possibly hope to gain with higher prices.

I don't know why you are talking about tariffs because with this agreement, there won't be any special tariffs or duties applied on Canadian lumber at all. Canadian lumber producers will voluntarily agree to restrict their shipments of lumber to the US market. That's all.

At the moment, the provincial governments are negotiating how much each of their respective lumber producers will be able to ship. They are slicing up the proverbial cake. BC and Quebec are apparently happy, but Ontario feels its slice is too small. Since the cake is big and chocolate, they'll all come around to an agreement, particularly under the threat of having no cake at all.

Are you referring to the $5 billion in duties collected over the past few years of which Canada's share is to be $4 billion? I think this will be given to the Canadian lumbermen as a deal sweetener.

Politics does not get more cynical than this.

[Wilber]

I don't know why anyone would be concerned about the US consumer the way so many Canadian communities have been devastated by these tariffs. They could have pressured their government for a better deal. I don't know why anyone would be upset that the money should be returned to the forest companies. They were the ones who ate the tariff in order to stay in business, not our governments. The result is an industry that is more efficient than that in the US. The US loses on that score.

[August1991]

I don't know why anyone would be concerned about the US consumer the way so many Canadian communities have been devastated by these tariffs. They could have pressured their government for a better deal. I don't know why anyone would be upset that the money should be returned to the forest companies. They were the ones who ate the tariff in order to stay in business, not our governments. The result is an industry that is more efficient than that in the US. The US loses on that score.

I guess you have a point Wilbur, but I'm no nationalist and I object to watching two thugs rob a little old lady in broad daylight - particularly when governments are helping the two thugs.

On a related point, James Travers (a guy with good connections into the Liberal Party but no other apparent skill except maybe wordiness) fills in a little detail about why the Liberals didn't pursue this agreement before:

Liberals and non-partisan sources tell a different story. They say the B.C. government and its powerful forestry industry only lost interest in the plan after meetings with Emerson. His objections, along with concerns in Paul Martin's office that a pre-election deal would stop the then-prime minister from using George W. Bush as a campaign punching bag, convinced Liberals to delay formal negotiations at least until after the January election.

But Industry Minister David Emerson called it a "watershed moment'' that will provide a more secure future for the industry while revoking the duties that have been collected since 2002.

"We've accomplished more in 80 days than any Canadian government has accomplished in a decade,'' Emerson told a news conference.

"We will have free trade at long last,'' he said, denying that it's a failure of NAFTA.

"All trade agreements are imperfect in one way or another. But this is a signal that NAFTA can work.''

AP

Emerson is full of it. This is "free trade" in the same sense that Canada's milk market is free trade.

It looks like Emerson called up Harper after the election, told him that he had the makings of a softwood deal on the Canadian side but he had to make Minister for it to happen.

From the same article linked above, this lonely paragraph:

The U.S. National Association of Home Builders, a huge group with 225,000 members who buy 85 per cent of Canadian lumber imports, said it's a bad agreement.

[lost&outofcontrol]

From the same article linked above, this lonely paragraph:

The U.S. National Association of Home Builders, a huge group with 225,000 members who buy 85 per cent of Canadian lumber imports, said it's a bad agreement.

We(Canada/US) like to abide by the rules of Nafta as long as we have the advantage in the deal.

[scribblet]

I don't know why anyone would be concerned about the US consumer the way so many Canadian communities have been devastated by these tariffs. They could have pressured their government for a better deal. I don't know why anyone would be upset that the money should be returned to the forest companies. They were the ones who ate the tariff in order to stay in business, not our governments. The result is an industry that is more efficient than that in the US. The US loses on that score.

This is a pretty good deal, 34% is the same share of the market they have now, 4 B now is better than nothing,and slim to none chance of more later. If this deal is refused, there will be no more negotiations until the next President. Why should we wait that long? The only reason the opposition is going on about it is obvious to me, they don't like the idea of Harper scoring political points - to h..l with the country.

[Wilber]

If the provinces and the companies think this is a good deal then we should go for it. As far as the US consumer and their National Association of Homebuilders is concerned, they are getting screwed by their own government and by their own forest companies, not by Canadians. Let them fight their own battles.

[shoop]

Jeffrey Simspon said it best in the Globe today.

There will be managed trade, not free trade. So the choice before Canada was: the whole loaf of free trade in lumber, or three-quarters or two-thirds of a loaf of managed trade.The former was preferable; the latter was attainable.

Is it a perfect deal for Canadians? No. Is it the best deal attainable? Yes.

The Government saw no political gain in fighting with the Americans, so they acted in the best interest of Canadians. Strange that... It's been about 13 years since we had a government do that.

[politika]

I think this is a major breakthrough in the Trade war that has been fought for nearly a decade. It is also a breakthrough for our relationship with the United Staes of America. I congradulate on Harpers victory.

I dont get why people are whining that its bad the only way it can get bad is if prices drop which should not happan as wood is on demand in the US, so we will never have to worry about tarrifs. Also out of the money we lost the US is only going to keep a 1 billion, big whoop. It was costing is mor elegal wise to fight this than the money we actually lost anyways, we are geting billions back, but we only lost the one so it is no big loss in my oppinion.

Also I would like to know who made the rumor of the 34% cap on soft wood trade? Probably those pesky Liberals trying to stir up trouble well Harper was away during question period.

[geoffrey]

There is a 34% cap on softwood imports into the US from Canada. That's not a rumour.

[Riverwind]

It appears the devil in the details: the deal is not simply quotas+export duties. It appears that companies have some flexibility when it comes to shipping lumber can choose their poison to meet their business needs. Another subtle point will really help value added industries in Canada: under the new agreement the duties are only applied to the value of wood used to create a value added product - not on the finished product. This is a huge win for a lot of companies on the coast of BC.

This deal is sounding better as details come out.

[geoffrey]

It appears the devil in the details: the deal is not simply quotas+export duties. It appears that companies have some flexibility when it comes to shipping lumber can choose their poison to meet their business needs. Another subtle point will really help value added industries in Canada: under the new agreement the duties are only applied to the value of wood used to create a value added product - not on the finished product. This is a huge win for a lot of companies on the coast of BC.

This deal is sounding better as details come out.

I don't think much duty was ever on the finished product to begin with, but hey, every little bit helps.

[Riverwind]

I don't think much duty was ever on the finished product to begin with, but hey, every little bit helps.

Actually it was - at it was killing the producers of high value cedar products on the coast.

[August1991]

Jeffrey Simspon said it best in the Globe today.

There will be managed trade, not free trade. So the choice before Canada was: the whole loaf of free trade in lumber, or three-quarters or two-thirds of a loaf of managed trade.The former was preferable; the latter was attainable.

Is it a perfect deal for Canadians? No. Is it the best deal attainable? Yes.

The Government saw no political gain in fighting with the Americans, so they acted in the best interest of Canadians. Strange that... It's been about 13 years since we had a government do that.

Jeffrey Simpson is wrong.

This agreement is better for Canadian lumber producers than free trade would be. Under this agreement, they're getting a loaf and a half.

This agreement means that the Canadian and US governments are officially sanctioning and enforcing a cartel formed by individual Canadian lumber producers. Canadian lumber producers could never organize their own OPEC (a few would cheat on the others) but with government help and enforcement, it's possible. By creating this government-sanctioned cartel (call it OLEP, Organization of Lumber Exporting Producers), Canadian producers are better off than if they traded in a free market - just like oil producers prefer OPEC to a free market.

The Liberals didn't sign on to this before because the Liberals get no votes from Canadian lumber producers and workers but the Liberals do get votes from urban Canadians offended by US trade disputes in newspapers. Bush signed on to this because US lumber producers don't care as long as Canadian lumber producers don't depress US prices. The Canadian lumber producers signed on because they could never organize such a cartel on their own.

The only institution that could possibly step in now and stand up and protect the little guy against North American lumber producers and American and Canadian politicians is the WTO. But some ill-informed radicals have unfortunately destroyed that institution's credibility. The WTO can do nothing.

If the provinces and the companies think this is a good deal then we should go for it. As far as the US consumer and their National Association of Homebuilders is concerned, they are getting screwed by their own government and by their own forest companies, not by Canadians. Let them fight their own battles.

You are right Wilbur, and I have to agree with you.

Ultimately, this nonsense is the doing of the US Congress and a US President who is incapable of saying no to a lobby. Ours is not to question why. If the US government wants to force US consumers to cut a cheque for Canadian lumber producers, who is Stephen Harper to step in and say no? Let the Canadian lumbermen take the money and run.

Make no mistake. Harper, Emerson and the federal Tories are going to get credit for this. Softwood lumber will disappear from the headlines for the next seven years. Like milk producers, we'll hear nary a complaint.

----

A small point for the cogniscenti. Lumber producers and dairy producers own land, a resource that is difficult to imitate. Governments are gifting them rents that are not easily dissipated.

[Leafless]

august1991

You wrote- " Make no mistake. harper, Emerson and the federal Tories are going to get credit for this."

I don't know what the big deal is selling a national resource from our public forest namely lumber rather than a made in Canada finished product.

All these bells and whistles from selling a natural resource to a foreign country! Man this is what I call genuine hi- tech Canadian manufacturing ingenuity.

Surley we can do better than sell a 2"x4" or a log.

[Wilber]

Ultimately, this nonsense is the doing of the US Congress and a US President who is incapable of saying no to a lobby. Ours is not to question why. If the US government wants to force US consumers to cut a cheque for Canadian lumber producers, who is Stephen Harper to step in and so no? Let the Canadian lumbermen take the money and run.

Make no mistake. Harper, Emerson and the federal Tories are going to get credit for this. Softwood lumber will disappear from the headlines for the next seven years. Like milk producers, we'll hear nary a complaint.

Unlike our PM a US President it only one part of the equation. He does not control the Congress. He does not even control his own party members within the Congress. Hopefully softwood lumber will disappear from the headlines. It has been in the headlines far too long.

I don't know what you have against milk producers. There are many of them in my area and they are some of the hardest working people I know who have millions invested in their operations. Canada has a quota system for milk producers which requires them to have quota to sell to dairies. Quota is sold on the open market and many farmers have millions invested in it. The idea is to provide a stable market instead of a boom bust cycle but the cost of quota is part of a farmers operating cost and has to be reflected in the price. It's kind of like a limo or taxi license. The city may only charge a couple of grand for the license but because there are limited number they may go for tens or hundreds of thousands on the open market. If you are going to tear apart that system you will have to find a way of reimbursing those farmers for the money invested in quota government forces them to buy in order to be part of the system. Otherwise you will end up bankrupting those who played by the rules and rewarding those who didn't. Blame the system if you want but don't blame the producers

[scribblet]

august1991

You wrote- " Make no mistake. harper, Emerson and the federal Tories are going to get credit for this."

I don't know what the big deal is selling a national resource from our public forest namely lumber rather than a made in Canada finished product.

All these bells and whistles from selling a natural resource to a foreign country! Man this is what I call genuine hi- tech Canadian manufacturing ingenuity.

Surley we can do better than sell a 2"x4" or a log.

Wonder how long it will take for the Liberals to start taking credit for this deal...you know - oh, it was in the works, we would have got the deal, we would have finished it had we stayed in office "

[shoop]

It will depend on public reaction. If it stays positive, thent hey will do so very quickly. Sad, sad, sad...

Wonder how long it will take for the Liberals to start taking credit for this deal...you know - oh, it was in the works, we would have got the deal, we would have finished it had we stayed in office "

[betsy]

According to journalist Fife last Tursday, this is the same deal that the Liberals had gotten but decided to sit on it till after the election.

According to Conservative Kenny, the Liberals had settled for $3.5 billion in their negotiation....which now the Conservative had improved with half a billion more!

[quinton]

The whole thing makes me sick how Canadians can be oblivious to the environmental damage occuring in our northern forests.

Apparently all Canadians care about is about is the profits of big forestry corporations as they mechanize further to cut more forest using fewer employees.

Either that or Canadians have no clue about the kind of clearcutting that is going on and how vast beautiful biologically diverse forests are being eradicated and "replanted" with non-native economic trees with little value to native wildlife.

[geoffrey]

The whole thing makes me sick how Canadians can be oblivious to the environmental damage occuring in our northern forests.

Apparently all Canadians care about is about is the profits of big forestry corporations as they mechanize further to cut more forest using fewer employees.

Either that or Canadians have no clue about the kind of clearcutting that is going on and how vast beautiful biologically diverse forests are being eradicated and "replanted" with non-native economic trees with little value to native wildlife.

So instead we don't use any wood for anything right?

Back to the days of living in caves my friend.

[shoop]

Tough to debate with an ideologue. So a deal that helps ensure employment is a bad thing? Whereas continuing to fight the Americans on this would have kept the stability of forestry jobs in limbo. Do explain oh enlightened one...

So instead we don't use any wood for anything right?

Back to the days of living in caves my friend.

[geoffrey]

Hey hey, uh oh.

Found a little problem in this agreement it seems.

VANCOUVER (CP) - B.C. forest industry leaders say a clause in the proposed softwood lumber deal between Canada and the United States could be a deal-breaker, prompting Premier Gordon Campbell to try to quickly quiet their fears.

Industry sources said Friday the package's so-called anti-circumvention clause could give the U.S. government a veto on changes to provincial forestry policies, impinging on Canadian sovereignty.

This is completely unacceptable.

But,

Harper also played down concern unforeseen problems could derail the deal.

"There's always some drafting things to be worked out and finalized and there's a lot of litigation to be unwound," Harper said during a stop in Charlottetown.

"But we don't foresee any difficulties. We're pretty firm on the details."

The anti-circumvention clause commits the agreement signatories to take no actions that would undermine the agreement or offset export restrictions.

But sources said it could require provincial governments to submit policy changes to U.S. officials - for instance revising timber prices in the B.C. Interior, where companies are rushing to harvest stands of beetle-infested trees.

If we need to go to the US to change domestic policies, this isn't an agreement that I'm ok with. Nor any Canadian should be ok with. Let's see if Harper can get this aspect of the agreement dropped in final negotiations.

[shoop]

Anti-circumvention clauses aren't unheard of. It totally makes sense.

It's in place to prevent a province from changing policies that would materially effect the conditions of the industry as it relates to this deal. It also applies to state governments as well.

If we need to go to the US to change domestic policies, this isn't an agreement that I'm ok with. Nor any Canadian should be ok with. Let's see if Harper can get this aspect of the agreement dropped in final negotiations.