Home The Ambassador Speeches and Statements September 29, 2005

Ambassador Frank McKenna, Canadian Ambassador to the United States

Woodrow Wilson Centre
Vancouver, BC
September 29, 2005
(transript)

PRINCIPAL(S): Gordon Campbell, Premier of British Columbia; Frank McKenna, Canadian Ambassador to the United States

Audio File

I just want to tell you how deeply honoured I am to be here at the Woodrow Wilson Canadian Centre, it’s just a spectacular institution. And it’s contributing to an understanding and a relationship which is vast and deep but particularly the American side of the border, not as well understood as we’d always like it to be. And it’s a matter of record that the prestige of the association is associated with the wonderful people who have joined the Advisory Board, the extraordinary names, people of accomplishment. And all the previous Woodrow Wilson Award winners, again just a list of outstanding, outstanding citizens, outstanding leaders

And I have to say Gordon, I really was enormously flattered to be introduced by you this evening. I’ve been a long, long- time admirer of Gordon Campbell. I knew he was going to be a terrific premier and we’ve been friends for a long, long time. And for me and maybe for Canadians through me and British Columbia, congratulations on turning around the finances of the province. Congratulations on getting the Olympics which are really Canada’s Olympics. We’re also proud they’re going to be held in British Columbia. And congratulations on being the growth leader for Canada during the past year.

I always love coming to this province, because no matter how big it is, and it is big, and no matter how progressive and wealthy it is, and it is all those things, it always seems like a community. Everybody seems to know everybody and it just seems like one closely knit, close knit community. And it’s communities that I’m used to associating with. And it reminds me so much of what we stand for back east.

This evening is also really special to me because of the people that you’re honouring. Bill Sauder is a remarkable man and his reputation is coast-to-coast, literally. It’s a reputation for philanthropy, without looking for credit, a kind of uncompromising giving, and eclectic giving that has benefited his communities and his province enormously.

And Mike Harcourt, Mike is a great friend. Mike and Becky have been friends of Julie and I from the first day we met. Mike and I served together as premiers. We were very close and talked a lot about issues. We shared a lot of ideas and we spent a lot of time together in the field of battle. And we were in the field of battle together in politics. Gord knows this. With all of the people he serves with, you forge a lot of friendships that cross a lot of geographical ties and other ties. We’ve been friends a long, long time. And I know I just I know what a resolute and joyful warrior Mike Harcourt is. And Mike, everybody in this country and certainly in this province; we just applaud you enormously, for the strength of character you’ ve shown in recovering from your horrible, your horrible fall. You’re like the Timex watch, you can take a licking and keep on ticking.

Now I’m deeply mindful that I’m the only thing between you and supper. And so I’m going to try to get right into it. Just before though, I should tell you I’ve been on the road for a long time. I started in New Brunswick. I was in Toronto this morning. I was in Ottawa. Toronto this morning, I gave a speech at noon and I’m here this evening. So I don’t really know a heck of a lot about where I am or (Inaudible) but when I was back in New Brunswick I was searching for wisdom in my little village as I always do with the local fishermen who live next to me. And I find they know more about the world and they know, they just give me more good ideas than I could ever dream of. So I went out just two days ago I was home for a Katrina fund raiser and I leaned over the backyard fence to talk to the local lobster fisherman in his yard.

And I was feeling a little despondent about the way some things were going and I said to him look, I’m working in a place that’s self absorbed, doesn’t know anything about us, doesn’t know anything about me. That’s inward looking, totally indifferent to the fact that I exist or that we exist. He looked at me with total puzzlement. He said are you still working in Toronto, Frank?

Now there is one piece of good news. There is one piece of very good news that’s even reached us as far away as Washington. And as a former player, as somebody who’s in the arena, former participant, and a big fan I can’t tell you how excited I am. Because this week we’re going to see a return of ferocious cross checking, high elbows, bloody noses, unsportsmanlike conduct, endless trash talk. God it’s good to have Parliament back in session.

But Woodrow Wilson was a remarkable president of the United States. And he has a lot of accomplishments to his credit. I’m just going to refer to two. The first one is an item of curiosity, and that was the fact that during his eight years of presidency he never made a single official visit to Canada. That puts him in the majority in the United States of America. And if this new passport deal goes through it will be an even larger majority in America. Small point made I hope.

But he was also a huge supporter of free trade. A big believer in the power of unfettered trade. I also freely confess to being a big supporter of free trade. My first act as premier was to sign the free trade deal between the United States and Canada. And it was only after a lot of hard looking and thinking, a lot of trepidation, but I came to the conclusion that on balance, even with all of the trade offs that have to be made in any kind of a deal that it was a better deal for Canada and that we should sign it. And it has proven to be good for Canada and it’s proven as all good deals are to be good for the United States of America.

Since 1989 the two-way trade between our countries has tripled, imagine that, tripled. The largest trading relationship in the world by a big factor. It supports some 5.2 million jobs in the United States of America and in Canada, something like one out of every six jobs is associated with that free trade arrangement. The metrics are absolutely staggering. Canada exports something like 86% of its export production to the United States of America. Something like 35 to 40% of our GDP. Imagine, those of you who are business people here, Imagine having one customer consuming a third to 30% of your product. The one thing I can tell you with certainty is that if you have all of your eggs in one basket, as we do as a country, you are going to spend a lot of time watching the basket. And that’s our job down in Washington and in the consulates all across the United States.

I also believe that not just free trade between Canada and the United States is a good thing. I believe that more global free trade is a net positive for humanity. Studies have shown that in the case of the United States that the United States citizens, government of the United States, its citizens are $1 trillion richer as a result of the global free trade that’s taking place today. That translates into $10,000 per household additional income into that household.

Now to complete the job of free trade around the world would result in wealth creation in the United States alone of another half a trillion dollars and another $5,000 per household. A powerful reason to seek greater trading around the globe. But I think there’s an even more compelling and powerful reason than that. Three billion people around the world, half of our population, live in poverty. They live on less than $2.00 a day. Half the world’s population. We, as wealthier countries collectively are giving some $50 billion in aid to try to alleviate that poverty. If we were to open our doors instead of just giving money, but to actually provide unfettered access to Americans that would contribute more than $200 billion which is a far cry from the $50 billion that we’re actually giving out in cash.

Global free trade would lift 500 million people out of poverty. And in many respects it’s such an easy thing to do. You wonder why we’ve not been able collectively, all of us are guilty, to find the political strength to do it. Now Canadians I think are instinctively committed to freer trading relationships. (Inaudible) of the world in that we trade so much of our natural products. But Canadians are rightfully worried at the present time about the United States commitment to free trade. There’s no doubt in my mind of the administration’s commitment to freer trade around the world.

But there is also no doubt in my mind that Congress is in a more protectionist mood than we’ve seen in some time. In some respects I don’t think it has anything to do with us. I think it has more to do with a recognition of just what a powerful trading community the United States is facing in Asia, with India and with China.

The problem is that the ambivalence in the Congress is accentuated by the style and the structure of the US government as we know it. The founders of the confederation in the United States of America introduced a series of checks and balances. Without being critical because we have no right to be critical, instead of checks and balances that’s evolved in my view, and the view of a lot of people in Washington into something approaching gridlock. The United States of America is a great country. There is no country in the world that has a more powerful economy and a more powerful leader of world opinion. But my submission to you is that that is in spite of its government or its structure, rather then because of it.

Party discipline is unknown as we know it. A lot of people in Canada dislike the notion of party discipline, but in the case of party discipline or that particular model of governance, if you were to call the premier, the prime minister, a member of a cabinet, if the cause is right, the support will be mobilized and the measure will be introduced. You have a much more organized entrance into the system and a much better chance that something will happen.

In the United States of America it’s not like that at all. We have 100 senators, 435 congressionally-elected people. It’s like having 535 Carolyn Parrishs loose in your country all at the same time. In the 107th Congress of the United States alone, 9,000 bills were introduced; 377 passed. So a lot of talk but at the end of the day not much necessarily to show for it. It’s a feature that some senators have noticed, noticed with a lot of interest, that when they’re not sitting their popularity goes up. Because the public sees and determines this level of gridlock as well.

So because the system alone in Washington is so complex you need navigators to try to find a way through it. And that’s why in Washington some senators have as many as 75 staff members whose role is to try to navigate their way through the system with their colleagues. 35,000 lobbyists, count them up, 35,000 lobbyists are registered in Washington to help people try to navigate their way through the names to find entrance into the system and to navigate through the maze. That’s just lobbyists.

In addition Washington has more lawyers per capita than any other place in the entire world. That’s why they say it’s not safe to walk on the streets of Washington at night. I’m a lawyer right, I can get away with that hopefully.

But my point is the system really is complicated, it’s very, very difficult to try to deal with measures. The President of the United States introduces a budget but has no control over it. The President cannot introduce legislation, and more importantly doesn’t have jurisdiction over trade. Trade is the prerogative of Congress. And that makes for a very difficult situation when you’re trying to deal with trade issues with the United States.

Now the manner in which the Byrd amendment was introduced is an illustration of exactly how the whole system works. It had originally been introduced by a Senator from Ohio, failed to attract enough support, and didn’t go anywhere. To save the proposal Senator Robert Byrd, who’s a master of Senate rules surreptitiously inserted the language of the Byrd amendment into an agricultural appropriations bill. So some $200 billion or more of money going to farmers all over the United States, very politically popular, hid this little add-on to it. And everybody was faced with the situation of voting for the bill, turning down the farmers or voting against the Byrd amendment. And so of course they all voted for the bill.

Clinton was faced with the potential exercise of his veto, in this case he vetoes all of that money going to the farmers. So he didn’t veto it but said, "You Congress people have to get rid of the Byrd amendment." Well, it’s still there. And all attempts to take it out have failed. So just this week a neutral body, the Government Accountability Office has done a study, a report on the Byrd amendment. And the report is absolutely devastating. It indicates that of the billion dollars that’s been distributed, five US companies have collected something like half of that money.

And what the Byrd amendment has done is put a bounty on trade disputes. And where there’s money of that magnitude there are people around trying to create trade dispute. It’s an incentive, it’s an incentive for lawyers, an incentive for lobbyists to try to put trade disputes which will allow them to get access to this Byrd money which is then distributed to the complainants. So if somebody is standing on the street corner of downtown Vancouver watching somebody to see if they jaywalk and if they do, taking them down to the police station and then taking the fine and putting it in their pocket. It’s a bounty. It’s a bonanza for the lawyers. It’s a bonanza for those few companies that have benefited from it. And it is in direct violation of the WTO. And it is very difficult to eliminate.

And that leads us directly to softwood lumber because the Byrd amendment is a very significant part of our problem. $5 billion has been collected and is sitting there in a pot. To solve softwood lumber we have to decide how to split up and divide the $5 billion which has been collected illegally under WTO rules. It really should be coming back to Canadian producers but is being claimed by the coalition in the United States.

So at any rate on the softwood lumber dispute, speaking of which, I won’t go into it in detail because there are a lot of people in this room who know it better than I do. We’re attacking on every front that we can. Everything from adding value to our industry to finding new export markets, to litigating, to negotiating, to retaliating, to doing advocacy. It’s just a full court press on every front. And by the way, speaking of that, this is in some ways typical of the problem we had with BSE. The border got closed. A very tiny interest group is using the court system. The Administration is on our side and trying to find a solution. But that tiny interest group using the court system is closing the border. And the end result of that misadventure, was that Canada reorganized its beef industry, created more processing capacity in Canada, shutting down something like 10,000 jobs in the United States of America and moving them to Canada. How does anybody in the United States win with that kind of situation?

And in the case of the softwood lumber dispute we all know that the real losers are US consumers who are paying over $1, 000 extra per home for softwood lumber that they should be getting much cheaper. So now let’s leave that aside for a minute because the issue has become even bigger than softwood lumber. Because the coalition has been so desperate to try to find relief on this situation and to finally win that they have now taken the final step of blowing up the bridge and of challenging the constitutionality of NAFTA.

So the small coalition of special interests representing only a proportion of the US softwood processing industry is now challenging the constitutional validity of NAFTA. Now what does that mean? First of all the Administration is forced in the United States to take a stand. It's the same stand that we’ve taken, to defend their legislation, defend their treaty, defend NAFTA. So in that sense it’s separated the coalition from the Administration and from some of their partners within the coalition; because what they’re doing is such a draconian measure.

But it has also put in play a lot of elements that make this whole debate far bigger than a debate about softwood lumber. It puts in play a $500 billion relationship, the largest trading relationship in the entire world. And lest you think it’s one-sided, we are the biggest market in the world for 39 of the 50 states in the United States of America. So it’s put in play their market access to Canada. It’s put in play the energy relationship in which Canada is the biggest provider of oil, of crude, of natural gas, of electricity, of uranium, every single energy category, Canada is the biggest provider to the United States of America which is reliant on foreign export for 60% of its oil needs and our competition is Iran, Iraq, Bolivia, Venezuela, Nigeria, countries that are far less secure and stable than Canada. Not us, but the coalition, this narrow group in the United States of America is putting in play US access to this most secure of energy relationships.

And this coalition is putting in play the United States reputation on trade matters throughout the entire world. If NAFTA can’t stand the scrutiny who is going to trust the United States with respect to a treaty or an agreement? So there’s a lot at stake ladies and gentlemen. We have a lot at stake as well, because this represents a huge part of our national wealth, this relationship. And it’s governed not just by a set of rules, but also by some 200 years of shared history, peaceful coexistence on this piece of geography with connections from president to prime minister, premier to governor, secretary to cabinet minister, right down to cousin to cousin, neighbour to neighbour, man to man, and woman to woman throughout North America.

And if we don’t get it right, if Canada and the United States don’t get it right, what hope is there for any other relationship in the entire world? We are the exemplar. We are the model. We are the best example that anybody can find of a civil, harmonious, friendly, respectful, neighbourly relationship going back for hundreds of years without a shot being fired in anger.

So my point to you is this, the stakes have been raised, the government of the United States can’t be absent, big business in the United States can’t be absent, Chamber of Commerce in the United States can’t be absent, citizens of the United States can’t be absent, and we can’t be absent in the debate as well. Canadian industry and governments across Canada have to become involved in this debate.

This ladies and gentlemen is a fight for our quality of life and the quality of life of our neighbours to the south of us. This is a fight that we have to win. We have a saying on the farm, when the horse is dead, dismount. And this horse is dead. Thank you.