Power And Dollar

Who wants to re-negotiate NAFTA in Canada?


NDP’s Layton wants to negotiate NAFTA.  Conservatives says they want to negotiate too.  Well, that seems like the country can get some consensus since the left most and the right most parties agree. 

Not so fast.  Harper says it would be a mistake for the Americans to renegotiate.  This is a warning.  Harper actually does not want to renegotiate.   No, this is nothing ideological.  He is being very practical.   Harper is Albertan, but he is not reckless to lose his next election.

You would want to initiate negotiation only when you are at strength.  Harper is only saying I dare you to negotiate: discouraging Americans from negotiation.  Oil is at $100 USD / barrel.  Canadian dollar is about at par.  Why aren’t Canadians at strength?

Who needs the other partner more?  The one who needs more of the other is at disadvantage and has less chips on the bargaining table.  Canada continues to have more than 3/4 of its exports going to the States.  This factor alone is a good start. 

Oil? Sure America is dependent on Canada to sell.  Is Canada selling to anyone else though?  And, remember America secured Iraqi reconstruction contracts?  Remember who got the drilling rights?  How much royalty will they have to pay for the Iraqi oil?  Oil price may fluctuate.  But please do not doubt the supply of oil going to the States. 

If Canada truly wants to re-negotiate NAFTA more to their liking, then the first thing to do is to broaden its own customer base: export products to other countries; reduce its own external political risk.   

International negotiations are to secure their national interests.  Negotiators are responsible to their domestic constituency.  Fairness is about the best deal your chips can buy, not about balancing your gain versus their gain.


March 3, 2008 - Posted by | america politics, canada politics, Current Affairs, politics, US politics | , , , , , ,

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