Softwood lumber sellout?

[Wilber]

It is the smaller lumber producers who don't have the deep pockets to continue this fight who need the deal most, not the big guys.

Need the deal?

It is the smaller lumber producers who get put out of business by trade restrictions.

It killed off Doman Industries, the largest remaining family run forest company in BC a couple of years ago

Hunh?

Are you advocating for free trade in lumber or for trade restrictions in the lumber market?

I have no sympathy for US home buyers. It was their government who instigated this. Let them fight their own battles.

Canadians lose too.

For starters the smaller producers need their hunk of that 4B to satisfy their creditors, this fight has maxed them out. They don't have the money to continue it indefinitely. You say smaller producers will be put out of business by restrictions. You are talking theory, I am talking reality. Even if you are right, it is better to be bought out by someone bigger than go bankrupt.

I am in favour of free trade but don't believe we are going to get it when it comes to lumber.

How do Canadians lose more than they are already losing?

[August1991]

In terms of the lumber talks, Canada was waiting for last week's WTO decision and if there was still no agreement in place was prepared to consider the countervailing duty.

It is the last weapon in an arsenal of weapons to use. But it is one that has worked on the U.S. on steel and the Byrd amendment.

Yes, it would hurt Canada but it was targetted at U.S. industries that would a lot more.

Dobbin, you seem to imply that the Canadian strategy was to force the US government to accept free trade in lumber? Firstly, why would the Canadian government want to force the US government to do something in America's own interest? Secondly, Canadian lumber producers don't want free trade.

The only people to gain by free trade would be US homebuyers and as Wilber notes above, who cares about them. Free trade would mean a competitive market and lower lumber prices. Canadian and American producers don't want that.

The US government imposed duties to limit the amount of Canadian lumber entering the US market. The US government kept the money raised by the duties.

Emerson's agreement means that Canadian producers voluntarily agree to raise their selling prices to the same level as if there were still a duty. US producers happily go along with this because they simply want to limit the amount of Canadian lumber in the US market. Canadian producers are more than happy to collect the extra profits.

Why did the Canadian lumbermen take their time to accept this agreement? Because they're exceptionally greedy and the agreement means that each one must limit their production in order to maintain the higher price. Each producer wants another producer to limit the production.

This amounts to an export quota or a voluntary export restraint. It is very much in the interest of the exporters to accept a VER because it turns them into a cartel.

It took no threats of countervailing duties against shrimp imports or twisting of arms to get the US government to agree to this arrangement. Emerson had it as soon as he suggested it. The difficult negotiation was among Canadian producers themselves.

[jbg]

I have no sympathy for US home buyers. It was their government who instigated this. Let them fight their own battles.

The problem is that the benefits of free trade are diffuse and small to individual homebuyers. The benefits of protection are huge to the plutocrats who feed on "welfare for the rich". Fighting our own battles (yes, I am a Yank) is harder than you realize.

Thanks for your appreciation of the plight of the average American trying to make ends meet.

[jdobbin]

Dobbin, you seem to imply that the Canadian strategy was to force the US government to accept free trade in lumber? Firstly, why would the Canadian government want to force the US government to do something in America's own interest? Secondly, Canadian lumber producers don't want free trade.

The only people to gain by free trade would be US homebuyers and as Wilber notes above, who cares about them. Free trade would mean a competitive market and lower lumber prices. Canadian and American producers don't want that.

The US government imposed duties to limit the amount of Canadian lumber entering the US market. The US government kept the money raised by the duties.

Emerson's agreement means that Canadian producers voluntarily agree to raise their selling prices to the same level as if there were still a duty. US producers happily go along with this because they simply want to limit the amount of Canadian lumber in the US market. Canadian producers are more than happy to collect the extra profits.

Why did the Canadian lumbermen take their time to accept this agreement? Because they're exceptionally greedy and the agreement means that each one must limit their production in order to maintain the higher price. Each producer wants another producer to limit the production.

This amounts to an export quota or a voluntary export restraint. It is very much in the interest of the exporters to accept a VER because it turns them into a cartel.

It took no threats of countervailing duties against shrimp imports or twisting of arms to get the US government to agree to this arrangement. Emerson had it as soon as he suggested it. The difficult negotiation was among Canadian producers themselves.

That's not quite true that Emerson had an agreement as soon as he asked for it. In interviews, he has said that he could not get the Americans to agree to any terms nor could he get them to drop the tariffs.

I've never said that I thought there would be free trade in lumber. Check everything I wrote. I said that there was no negotiating because the U.S. wished to delay coming to any terms as long as possible. This was what the lumber lobby in the States was after. It wished to impede a deal by whatever means. Emerson has confirmed that this was what blocked making a deal.

The only thing Canada could do was appeal through NAFTA and the WTO. By winning in all those cases, we could impose a countervailing duty. This is what brought the U.S. to the table. They could have continued to stall a deal but Canada could have gone after industries in the U.S. legally with duties.

The Canadian lumber companies were not the main sticking point to getting a deal. The U.S. didn't want a deal initially. Hence, the tariffs and staying away from the negotiating table.

If you don't believe that, just read what Emerson has said all along.

[Wilber]

I have no sympathy for US home buyers. It was their government who instigated this. Let them fight their own battles.

The problem is that the benefits of free trade are diffuse and small to individual homebuyers. The benefits of protection are huge to the plutocrats who feed on "welfare for the rich". Fighting our own battles (yes, I am a Yank) is harder than you realize.

Thanks for your appreciation of the plight of the average American trying to make ends meet.

I have sympathy for anyone who is trying to make ends meet like the people in my province who have been thrown out of work and communities that have been devastated because of lumber tariffs which have been repeatedly called unfair by NAFTA panels, but it is up to Americans to look after their own government's policies, not Canadians.

[geoffrey]

I have no sympathy for US home buyers. It was their government who instigated this. Let them fight their own battles.

Canadians lose too.

Hence the reality of negotiations in the real world. Got to give a little to get a little.

It was the best we are going to get. Canada is in the wrong in alot of ways on this debate.