About that border deal between Canada and the U.S.

Canada has finally managed to put the focus back on trade for the first time since 9/11

Amid the pageantry of a joint appearance at the White House alongside President Obama, the prime minister on Wednesday touted the new border security agreement in grandiose terms: the “most significant steps forward in Canada-U.S. cooperation since the North American Free Trade Agreement.” The agreement, though, is less a single leap than a series of many incremental gains, say the technocrats who labored in the shadows to put the multifaceted deal together. One Canadian official likened border negotiations to the cliché about football—it’s a “game of inches.” And this agreement covers a lot of inches—including myriad new ways in which the two nations will share data about travelers and cargo, the promise of a single on-line portal for importers and exporters who today have to schlep paper documents to a variety of government agencies, and pilot projects that will allow certain kinds of pre-inspected cargo to cross the border without stopping. It also includes a border wait-time measurement system and an inventory of border fees to help citizens and policy makers understand how well things are working—or not.

There is no doubt that Canadian officials have learned their lesson from years of trilateral “Three Amigos” summitry that resulted in lengthy bureaucratic to-do lists and more controversy than results. This time, they cut out Mexico, instead running a bilateral process focused on a limited number concrete high-impact results that could be implemented in a short period of time. Rather than endlessly negotiating over grand policy changes, they agreed to more modest pilot projects in complicated areas such as land border-preclearance in order to “build confidence” and demonstrate tangible results on the ground.

With this agreement, Canada has finally managed to turn the trajectory of border relations back to trade facilitation for the first time since 9/11. Trade has not displaced security as the top priority – but the action plan brings some balance. And Canada has managed to do something that it has wanted to do for a decade: get the US to sign on to a “risk management” rather than a “zero risk” approach. This means faster, smoother treatment of “trusted” travelers and traders who give more information to the government – and more scrutiny of those who don’t.

The flip side of simplifying the experience of crossing the physical border, however, is complexity of information-gathering and the sharing and analyzing of information by the two governments behind the scenes. From privacy to oversight issues, this is the area that the public in both countries will need to scrutinize as the deal unfolds.

Indeed, several questions loom over the implementation of this agreement:

First, who will oversee implementation of the agreement? In the joint press conference, Obama said Homeland Security secretary Janet Napolitano and his regulation czar, Cass Sunstein, will head up the project. But who will really be in charge on a day-to-day basis? Canadian officials have complained in the past that DHS bureaucrats have sometimes been unhelpful in reaching goals ostensibly set out by the leaders because the agency is focused on security and does not have trade in its mandate. Canada is hoping the White House will appoint an official senior enough to get things done — but not so senior that he or she will be distracted by other responsibilities.

Second, how will it be paid for? The agreement includes the creation of a joint, five-year Canada-US border infrastructure investment plan that would identify top priority border projects. More broadly, there are numerous other items that will require spending on border buildings, special lanes, computer systems, and personnel. One estimate put the cost at $1 billion, but the officials who briefed reporters today declined to put a number on the deal, noting that it would depend on budgetary processes in each country. Given the division of powers in the US, where the Congress controls spending, no president can promise specific investments.

Third, how well will the pilot projects work? The agreement relies to a great degree on pilot projects to “build confidence” between the countries and show results in areas that have been difficult to reach agreement on – such as land border pre-clearance, and mutual recognition of inspections.

Fourth, how will individual citizens’ personal data be handled? The two governments have agreed to complete by May 30, 2012, a joint statement of privacy protection principles that will guide their work under the plan. This should be closely watched. How will biometric information be stored, protected and shared? What protections and what recourse will there be against mistakes and abuses in the use and sharing of information?

And fifth, the public could use some “confidence building” too. As the regulatory cooperation process goes forward, how transparent will it be? Canadians will want to hold the government accountable on its claims that regulatory cooperation does not mean a race to the least regulation.

Details of the border action plan can be found here.



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