Stand your ground
Dave: As you read this.. please note that I have posted all the major dailies on here from Canada; political persuasions from all of the spectrum are urging the Canadian govt to hold firm against what is viewed protectionsit American bullying simply because we're moe successful at lumber.. most feel if this gets taken to an international tribunal Canada will win (again). This time tho.. no managed settlements.. go for free trade.
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National Post
Pierre Pettigrew, Canada's Minister for International Trade, says he won't back down in the
Canada-U.S. softwood lumber dispute. Indeed, Mr. Pettigrew must stand his ground in the face of
both U.S. protectionism and provincial waffling if he is to properly defend the principle and practice
of free trade in North America.
A petition delivered yesterday to Washington by the U.S. Coalition for Fair Lumber Imports, a lumber
lobby group, demanded a 40% countervail duty on Canadian softwood exports, claiming Canadian
lumber is unfairly subsidized. The U.S. government will likely accept the petition and launch an
investigation, particularly given a recent Senate vote in favour of such action. If a countervail duty is
imposed, Mr. Pettigrew says he will use the dispute mechanisms available under NAFTA and the
World Trade Organization to prove that Canada does not subsidize its logging industry.
His chances would be good, for this is an argument Canada has won several times in the past. Still,
the expense and uncertainty of fighting a countervail duty through these means has some in the
Canadian industry, particularly weaker producers in British Columbia, arguing that Ottawa should
voluntarily impose an export tax as a way of assuaging U.S. concerns. But such an action is
tantamount to admitting fault. And it would compromise the future of free trade since it encourages
any U.S. lobby group that feels aggrieved by Canadian competition to bully us into limiting our
exports.
It is also important to note that the U.S. lumber lobby does not speak for the entire United States. As with most protectionist campaigns, the much ballyhooed losses of the few are in fact greatly
outweighed by the gains of many. In the case of lumber, limiting Canadian imports may help a few
U.S. lumber mills, but it also hurts consumers. In fact, according to the CATO institute, a U.S.
think-tank that supports free trade, the restrictions contained in the 1996 Canada-U.S. Softwood
Lumber Agreement, which expired over the weekend, raised the price of each new U.S. home by as
much as US$1,300. (Ed note - IF duties of 40-80% get imposed. .that goes up to 3-4000 US
bucks - ST)
Open borders in lumber are supported by the rules of the WTO and NAFTA, the needs of the U.S.
consumer and the principle of free trade. Mr. Pettigrew should continue to stand firm.
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