MPs say they received Congressional assurances against American protectionist measures

As United States President Joe Biden extolled his administration’s Buy American initiatives with increasingly hardline rhetoric, MPs say they received assurances that the protectionist policies won’t harm Canada. In his latest State of the Union address on Feb. 7, Biden promised a tougher Buy American regime, which has been law since 1933. “For too long, past administrations have found ways to get around it,” he declared. “Not anymore.” He said all construction material used in federal projects will be American-made. While the speech was met with concern by some Canadian stakeholder associations, including the Canadian Manufacturers and Exporters who said a “strong response is needed,” the Canadian government played down the threat. While in Washington, D.C., in the days after the speech, Innovation Minister François-Philippe Champagne (Saint-Maurice-Champlain, Que.) told reporters that he wasn’t concerned, according to media reports. Since Biden took office, the Canadian government has had little success in battling against a Buy American focus for U.S. government procurement. As the American president delivered his third State of the Union address to a joint session of Congress, members of the Canada-U.S. Inter-Parliamentary Group were meeting with members of the House of Representatives as part of a Feb. 6-9 congressional visit. Liberal MP John McKay (Scarborough–Guildwood, Ont.), co-chair of the group, said he received assurances from members of Congress about the Buy American proposals. “We did receive some assurances, certainly from the Republicans and even from some of the Democrats, that is more rhetoric and language than anything else,” he said. “It is counterproductive to the overall reshoring, nearshoring, friendshoring idea. That if we are going to build together then we have to build stuff together without putting up unnecessary and counterproductive barriers,” he said. McKay said the pitch the group of Canadian MPs and Senators brought to Capitol Hill was that North America had to start acting as its own trading bloc. Liberal MP John McKay says American lawmakers assured Parliamentarians that the hardline protectionist language was more about rhetoric. The Hill Times photograph by Andrew Meade “The other reality is that anything that Biden does in the next two years, he will have troubles getting it through the Congressional meat grinder. So, there may not be anything that comes ,” he said. “So, I keep an eye on it. And hopefully it doesn’t materialize in anything other than rhetoric.” Liberal MP Anthony Housefather (Mount Royal, Que.), who was also on the congressional trip, said most of the members of Congress the delegation met with were supportive of a Canadian carveout from Buy American provisions. “While there is a real desire to ensure domestic supply chains and to develop self-sufficiency in both parties, the members I met with were almost universally favourable to exempting Canada and making it buy North American,” he said in an email, noting that feedback was “relatively common” among both Democrats and Republicans. “It was exceptionally comforting to hear that from a number of freshman Republicans who are not from border states,” Housefather added. While it is positive to engage with members of Congress, the assurances may not be overly effective given the other levels of government driving the issue, said Maryscott Greenwood, CEO of the Canadian American Business Council. “A bunch of these decisions aren’t made by individual members of the House of Representatives. ... Some of this is done at the regulatory level. Some of this is done by the executive branch,” she said. “You can’t take it to the bank.” Greenwood said in its effort to gain an exemption to Buy American measures, Canada needs to gain leverage. “It’s not just pounding on the table and saying, ‘Dammit, we’re your best friends, we’re your neighbours, you ought to treat us differently.’ It’s having actual relevance,” she said, remarking that there are pathways for Canada to do that, including on issues of international collaboration. The former American diplomat cited a comment by former American ambassador David Wilkins, in which he said that the goodwill Canada had built-up through its contributions to the Afghanistan mission helped lead to an agreement on softwood lumber. “Goodwill, leverage, a mulligan, whatever you want to call it, it doesn’t just exist, you have to create it,” Greenwood said, noting that Canada’s current opportunity to create leverage is through the processing of critical minerals, which was an idea trumpeted by former Canadian ambassador to the U.S. David MacNaughton. Greenwood said there is also an expectation by Canada to have special treatment, but does not offer the same favouritism to the U.S., citing the foreign property tax implemented by Canada that American lawmakers unsuccessfully fought against as an example. “In what world can you demand special treatment and not have it be reciprocal? That’s not how relationships work,” she said. She said it is also important for Canada to recognize that there are sectors it also protects. Its supply-managed dairy sector has often been criticized, no matter which party is in the White House. Liberal MP Anthony Housefather says a majority of members of Congress that he spoke to are in favour of offering Canada an exemption to Buy American provisions. The Hill Times photograph by Andrew Meade Trade consultant Eric Miller, president of the Rideau Potomac Strategy Group, said so far, Canada’s efforts to fight against Buy American has had little impact, adding more creativity is needed in Ottawa’s effort. “We have to find a way to better pitch the idea that Canada and the U.S. are in this together and that they are in this together in a manner that is different than the U.S. is in it with other countries,” said Miller, who is based in Washington, D.C. He suggested that Canada should try to lobby for a Buy American exemption for a limited number of products that Ottawa considers essential. He said Biden has “substantially toughened” Buy American rules, remarking that the president’s speech was just as much about what he has done as it was about what he will do. “The effects of what he’s done are starting to roll out,” he said. “The big actions had been done in June 2021. But these things don’t just play out immediately, they have a long tail to them. So, what we’re seeing right now is that long tail playing itself out.” NDP MP Richard Cannings (South Okanagan–West Kootenay, B.C.), his party’s international trade critic, said American protectionism is always concerning and Canada has to push back. “This rhetoric that we’ve heard before. Biden has certainly doubled down. So that’s concerning. We have to keep pushing back and make sure that we are inside that tent of what they will use,” he said. He said Canada needs to keep the pressure on the White House, as well as to educate members of Congress about how their districts and states could be affected if Canada is locked out. Fellow NDP MP Lindsay Mathyssen (London–Fanshawe, Ont.) has a private member’s bill tabled in the House, Bill C-300, to give preference to Canadian products and services in government procurements. Cannings called the bill a “last-straw” scenario. “That’s something we should do when there’s nothing else we can do,” he said. Biden is set to make his first visit to Ottawa as president in March. The Hill Times file photograph Bloc Québécois MP Simon-Pierre Savard-Tremblay (Saint-Hyacinthe–Bagot, Que.), his party’s international trade critic, said Biden’s rhetoric could be “really dangerous.” “When Trump was president, some analysts thought he invented trade wars, which is truly not the case. It is an American specialty for a long time,” he said. Savard-Tremblay, who took part in the Congressional visit, said Biden’s speech was “not good news” for Quebec, especially in relation to the province’s softwood lumber industry, noting that one option is for Canada to seek a green exemption. “It is really important that the protectionist policies be placed ahead of the priorities of the next Trudeau and Biden meeting," he said. Biden is set to make his first trip as president to Ottawa in March. nmoss@hilltimes.com The Hill Times

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MPs say they received Congressional assurances against American protectionist measures

'We did receive some assurances, certainly from the Republicans and even from some of the Democrats, that is more rhetoric and language than anything else,' says Liberal MP John McKay.

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