How Canada hopes to one-up the White House on NAFTA

Wooing America

Sixty-four cities, 44 states and 300 contacts. Inside Canada’s six-month mission to one-up the White House in the next NAFTA negotiations, one handshake at a time.

When it’s 28 degrees in Savannah, Ga., and a visitor has just packed away a healthy helping of fried chicken, black-eyed peas and okra gumbo at Mrs. Wilkes Dining Room, the thing to do is to take the 15-minute stroll down Whitaker to East Broughton, where a scoop of Leopold’s ice cream awaits. A perfect evening’s end for a typical tourist wandering around southeastern Georgia.

Lawrence MacAulay, though, was no ordinary tourist when he spent a couple of days in Savannah in June. Canada’s agriculture minister was on the job; he’d gone down to see U.S. Secretary of Agriculture Sonny Perdue, a son of Georgia and once its two-term governor. Also on hand was their Mexican counterpart, Pepe Calzada. Perdue had invited MacAulay and Calzada, along with their wives, for a couple of days of southern hospitality.

The folksy MacAulay had only met Perdue a few weeks earlier in Toronto on the sidelines of a conference meant to promote trade between Canadian provinces and southeastern states. Perdue described that meeting as “friendly but frank.”

In Savannah, the three men looked like old friends, complete with backslapping and uproarious laughter captured on camera. Perdue described the trilateral as a “fantastic visit.” The next day he was off on Air Force One, accompanying the president to Iowa. MacAulay headed back to Canada.

MacAulay’s friendly trip to Georgia was far from a one-off event. Senior Canadian officials have made dozens of similar trips to the U.S. recently. In fact, Justin Trudeau’s Liberals and an energetic corps of diplomats have likely seen more of America over the past six months than most Americans will ever see of their own country.

U.S. Secretary of Agriculture Sonny Perdue, Canadian Agriculture Minister Lawrence MacAulay and Mexican Secretary of Agriculture José Calzada visit Bland Farms in Glennville, Georgia for trilateral meetings as well as other joint events June 20, 2017. (Preston Keres/USDA)

R-L: Perdue, MacAulay and Calzada in Georgia. Preston Keres/
USDA

The aim of this so-called charm offensive has been to build up a network of free-trade-friendly officials south of the border that Ottawa hopes will be strong enough to counter anti-Canadian rhetoric now swirling in the U.S. around the North American Free Trade Agreement. U.S. President Donald Trump, for one, has sent mixed signals. In a January phone call with Mexican President Enrique Peña Nieto, Trump reportedly said trade with Canada was “much more balanced and much more fair” than with Mexico. Trump has also occasionally expressed dismay: “The fact is, NAFTA—whether it’s Mexico or Canada—is a disaster for our country,” he said in April. “We can’t let Canada, or anybody else, take advantage and do what they did to our workers and to our farmers.”

Ottawa’s list of American allies now runs into the hundreds. The massive effort, spearheaded by Foreign Affairs Minister Chrystia Freeland and Ambassador to the U.S. David MacNaughton, has enlisted premiers and parliamentarians, mayors and ministers, and Liberals and Conservatives alike, united by one basic goal: talk to any American official, at any level of government, who’s willing to stand up for NAFTA as negotiations begin in August.

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The plan was rolled out without much fanfare at first, but it is not a secret. The Prime Minister made that clear at a midsummer gathering of U.S. governors, timed just a few days before the U.S. released its NAFTA renegotiation objectives.

As he spoke to the National Governors Association in Providence, R.I., Trudeau had the ear of exactly the sort of power brokers Canada needs as NAFTA’s future hangs in the balance: governors with influence. As he politely mocked pundits’ inclination to dig into and dissect his government’s frequent visits to the U.S., Trudeau made his government’s intentions clear: “Journalists are leafing through Sun Tzu’s The Art of War and making oblique references to chess. It has the effect of making the obvious seem complex or at least fancy,” he quipped. “But our strategy—our plan—is actually extremely straightforward.”

That “straightforward” plan stitched together more than 300 individual contacts in at least 64 cities, with American politicians and businesses from 44 states. A Maclean’s analysis of government agendas and social media accounts—which does not include meetings that weren't made public, and isn't a complete or official accounting—suggests the Canadians have met Democrats, Republicans and business leaders in hundreds of meetings. They’ve targeted key conferences with influencers at the federal and state levels, including that July gathering of governors, a similar northern Montana summit for western governors and a Great Lakes economic forum in Detroit.

If Canada comes out ahead in NAFTA 2.0, it will have been won one handshake at a time.


Lauren Cattermole

Public Safety Minister Ralph Goodale spent the third Saturday and Sunday in June in his Saskatchewan riding, at Regina’s Pride parade and then its jazz festival. On June 20, the following Tuesday, he tabled long-awaited national-security legislation meant to fix the worst parts of a controversial anti-terrorism law brought in by the previous Conservative government. In between, Goodale flew to Minnesota, where he met with Gov. Mark Dayton in Saint Paul—and gifted him a painting by Sioux artist Maxine Noel—and sat down for a luncheon Q & A with the Canadian American Business Council (CABC) in Minneapolis.

Lauren Cattermole

Ottawa’s strategy at these events is to endear the Canadians to whoever is in the room, establish some sort of rapport, then win the crowd over with compelling data. “It’s not adversarial, it’s not mercenary, it is a conversation among friends,” says Goodale, who squeezed an interview with Maclean’s into his trip to the Minneapolis airport at the end of the day.

CABC CEO Maryscott Greenwood, a popular and well-connected American lawyer and lobbyist who lives in D.C. but once worked at the U.S. embassy in Ottawa, took the stage with Goodale for a chummy hour in front of local business and political leaders. Goodale’s comments strayed beyond NAFTA into the realms of border security, refugee resettlement and climate change. He seemed to be introducing his government, and himself, to Minneapolis.

After the talk, Goodale did what ministers typically do on these trips: he spent much of the afternoon making Canada’s case in the media, both on network TV back home and in front of local media. He mentioned the $11.5 billion in trade between Canada and Minnesota and the 174,000 jobs in the state that depend on cross-border trade. That Midwestern whirlwind, only hours before a long day in Ottawa with little room for error, underscored the importance of scoring face time in front of a U.S. audience that recently elected an “America first” president.

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Cross-border trade critics in the U.S. fume about NAFTA’s impact on working people. And whatever the agreement’s broad benefits, opponents bemoan years of jobs outsourced to cheaper Mexican operations, stagnant wages for workers and growing trade deficits, particularly with Mexico.

The point of the Liberal strategy is to make friends in advance of what could be tough trade negotiations, says Greenwood, who spoke to Maclean’s after the luncheon at the University of Minnesota’s business school. But she admitted an even starker reality facing the Canadians: “It’s really hard, in this day and age, to get attention.” That’s where her organization, which is independent and non-partisan, decided to chip in.

Goodale might not have found himself in the upper Midwest if not for Greenwood’s initiative. The CABC assembled a spate of spring events—independent of Ottawa’s official effort but certainly complementary—that pushed the importance of the Canada-U.S. relationship on key business communities.

The CABC, which represents massive multinationals including Facebook, ExxonMobil and Lockheed Martin, hosted a pair of high-profile chats between former presidents and prime ministers: first, Stephen Harper and George W. Bush met in Dallas in early June; a few days later, Joe Clark and Jimmy Carter took the stage in Atlanta. Then it was on to Minnesota, where Greenwood took pride in attracting the likes of Goodale. “Minneapolis wasn’t on the [government’s] list until we put it on the list,” she says. “They haven’t had a Cabinet minister here for more than 10 years.”

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The CABC’s interest in a strong NAFTA comes as no surprise. The continent’s biggest companies, most of which are members of the lobby group, operate north of the 49th parallel, south of the Rio Grande and everywhere in between. “Nobody’s thinking we’ll revert to a world where it’s Fortress America, pull up the drawbridge. Business doesn’t operate like that,” says Greenwood. “Business wants to benefit from globalization and efficiencies in supply chains, and also wants to know what the rules of the road are.”

And that continental integration goes beyond trade, she says. When Goodale riffed on border security and the environment, he was making a case for his own government’s priorities—but he was also hinting at the interconnectedness of Canadians, Americans and Mexicans. “If all you do is think about economics, you can walk down a path that’s not as productive,” says Greenwood. “You have to understand the fuller picture,” including files like mutual defence and shared international waters.

Taking the message outside of Washington, D.C., is intentional too. Says Greenwood: “Nothing like the election of a president who says he’s going to tear up the NAFTA to focus your attention on making sure that regular people outside the Beltway understand that that would be a bad idea.”

Justin Trudeau
Prime Minister
Number of meetings: At least 24
Number of states visited: At least 4
Highlight: Snapped photos with seven governors at the National Governors Association meeting on July 14

Canada’s plan isn’t to ignore D.C. altogether—envoys have made dozens of trips inside the Beltway—but it’s keenly attuned to the importance of the heartland, and a rustier sort of belt.

A few weeks before Goodale took the stage with the voice of big business, one of his Cabinet colleagues spent a day in northwestern Ohio. Bardish Chagger is better known in Ottawa as the quarterback of the government’s parliamentary agenda, but she’s also the minister of small business and tourism—and she wore that hat on a trip to Toledo, Ohio, about an hour’s drive from the Ambassador Bridge to Canada.

It’s a typical Midwestern city in flux, fighting a slowly shrinking population just as its trade-hungry port has emerged as one of the fastest-growing on the Great Lakes, buoyed by convenient access to a convergence of highways, railways and waterways.

The city does a lot of business with Canada. The local port, for example, handled 8.4 million tons of shipped goods in 2015, and more than half of that traffic was inbound from or outbound to Canada. Chagger’s visit took her to the local chamber of commerce, where she heard from companies that deal with the consequences of whatever trade agreements are hammered out between Ottawa and Washington.

Brad Wall
Saskatchewan premier
Number of meetings: At least 4
Number of states visited: At least 2
Highlight: Spoke in front of both house of the Iowa State legislature on March 15

“If there’s going to be a hiccup, once it trickles all the way down to the small businesses, something that may have seemed wonderful at a high level might actually be pretty onerous,” says Colleen Kardasz, the director of the Toledo chamber of commerce’s export assistance network.

Kardasz spends her days helping companies understand the technical side of trade—mostly, she says, sorting through paperwork and bureaucracy. She urges new exporters who hope to compete in Canada to consider every angle before shipping something across the border. “What are you packing your product in? What’s it going on and how’s it getting there?” she says. Details matter. Exporters have to know which boxes can be shipped, and what load limits lie ahead on Canadian roads. “If you pick the wrong stuff, it could get stuck at the border,” says Kardasz.

Northwestern Ohio is full of eager exporters who rely on NAFTA, she says. And pulling the plug on the trade deal, if it comes to that, “could be catastrophic to some companies. The reduction and removal of trade barriers can make or break a small company. I’m not working with companies with enormous profit margins.”

Susan Harper
Consul General, Miami
Number of meetings: At least 31
Number of states visited: At least 2
Highlight: Met a large chunk of Florida's congressional delegation on a three-day trip to D.C.

Kardasz says they’d much rather tinker, always with an eye to minimizing headaches at the border. “It sounds silly, but it comes down to, for most companies, the documents,” she says. “Do you have to fill out 10 forms or can we get this down to five? Can we get it down to three? What about one?”

There’s a reason that people like Kardasz, and the chambers of commerce where they work, are never far away when Canada’s charm offensive comes to town. They know the local scene, precisely who’s frustrated with red tape and what they think should be done about it. “If you look at [high-level] trade data, you’re always going to be a year or two behind,” says Kardasz. “If you go to a chamber of commerce, they’re going to have their finger on the pulse of that community, because that’s their job.”

But chambers are also valuable for their influence. Khawar Nasim, Canada’s consul general in Minneapolis, is one of 12 Canadian regional envoys who’s racked up lots of travel points this year as he travels around the five states in his territory. On Jan. 12, one of the coldest days of the year, Nasim found himself in Bismarck, N.D., where he joined the new Republican governor onstage and spread his economic gospel to the local chamber. A thousand people were in the room.

That evening marked Gov. Doug Burgum’s first major public event after his election several weeks earlier. “It is a key event on everyone’s calendar. It’s a table-setting event,” says Nasim. “The chambers of commerce down here have incredible reach and grasp in their territory.”

Later this year, Nasim will deliver a keynote speech in Duluth, Minn., where he expects another 1,500 people. And he’s bullish on the reception he’ll receive. “I’m not a widget salesman with 15 clients. I have millions of people in the five-state area,” he says. “We’re not the beggars at the door. They’re wanting to hear from us.”

Karina Gould throwing out first pitch at a Buffalo Bisons game. (karinagould/Twitter)

After a day of meeting local leaders, Democratic Institutions Minister Karina Gould throws out the first pitch at a Buffalo Bisons game on May 18. karinagould/ Twitter

Nasim’s colleagues at consulates across America are on a similar mission. Susan Harper in Miami, James Villeneuve in Los Angeles, Stéphane Lessard in Denver, Sara Wilshaw in Dallas and former New Brunswick premier David Alward in Boston, among others, have combined to pop up in more than 100 meetings, panels and round tables with regional chambers, members of Congress and state assemblies. Their hope is that local chambers lean on lawmakers who depend on their support, and those state interests influence more powerful lawmakers on Capitol Hill.

It’s not always a slam dunk. That network of American influencers isn’t universally pro-NAFTA. When she was in Toledo, Chagger met Rep. Marcy Kaptur, the longest-serving woman in the U.S. House of Representatives—and a staunch critic of continental trade. Kaptur, a left-wing Democrat, opposes the free-trade agreement and wants a new NAFTA to narrow U.S. trade deficits and create better-paying jobs for workers even if big corporations take a hit.

“We’ve worked very hard to create a framework for a continental compact for development in the Americas,” says Kaptur, who wants more strictly enforced labour and environmental standards codified in any agreement. Her beef isn’t with the foreign nation on the other side of Lake Erie, however. “We love Canada,” she says. “I think Canada and the U.S. should set the gold standard” on continental co-operation. It’s Mexico’s place in the agreement that worries her. Like the Republicans on the other side of the aisle, Kaptur has watched jobs in her district disappear into a Mexican economy with cheaper labour and plenty of room to grow. Convincing Kaptur to support a renegotiated agreement will likely be a hard sell.

Prime Minister Trudeau and President Trump hold a joint press conference at the White House. February 13, 2017. (Adam Scotti/PMO)

Trudeau and Trump hold a press conference at the White House. Adam Scotti/PMO


Robert Lighthizer, the U.S. trade representative, released the American side’s objectives for NAFTA renegotiation on July 17. That 18-page set of priorities offered a first look at where the U.S. hopes to steer trade with Canada and Mexico after nearly 25 years under the old agreement. Its introduction closed with some hope: “If we succeed in achieving these objectives . . . we look forward to a seamless transition to the new NAFTA.”

The document admits that “some Americans have benefited from new market access provided by the agreement.” But the trade deal, reads the preamble, also “created new problems for many American workers.” The U.S. wants to “ensure truly fair trade” that represents “a much better agreement for Americans.” Negotiators will set their sights on “the elimination of unfair subsidies,” particularly in the agricultural sector.

It could be a long road ahead for the Canadians, who are under no obligation to respond publicly and will hold their own objectives close to their chest until negotiations officially get under way on Aug. 16. Trudeau has insisted on a “fair dispute resolution system” and vowed to support Canada’s supply-managed sectors. The feds have also set the stage for negotiations by appointing a senior trade official as deputy ambassador, filling key consulates with trade experts and establishing an advisory council that includes former Tory MPs James Moore and Rona Ambrose, long-time NDP strategist Brian Topp and First Nations leader Perry Bellegarde.

The reliably fractious negotiations to come on agriculture will pit powerful lobby groups on both sides of the border against each other—tussles over Canada’s supply-managed dairy sector are typically the most newsworthy.

That’s where trips like MacAulay’s time in Savannah could start to pay off. The Canadian side hopes that whatever that summit lacked in substance is made up in goodwill between high-level colleagues.

The Deep South jaunt “wasn’t a meeting to start trade negotiations,” says MacAulay, who joked that Perdue showed the minister’s wife how to bait a hook. “It was a quite friendly atmosphere. He didn’t lay any issue on the table. I did not. Neither did Calzada. The trade officials will deal with these issues,” says MacAulay. (The minister spoke to Maclean’s from a July conference in Portland, Ore., yet another forum where a crop of free-trading Canadians—including Edmonton Mayor Don Iveson—pumped up Canada-U.S. co-operation.)

“If you don’t know who to call, or if you don’t think anybody you really want to speak to will take your call, then you’re like two ships passing in the night, and misinformation or disinformation or aggravation will continue,” says Goodale. “Once you’ve got that ability to communicate, you’re not going to be fooled or conned or sloughed off, because you know who you’re dealing with and there’s a level of trust that develops. You search for ways in which everybody can win. And you really have an incentive, because you know the other person and kind of like the other person. They’re not an enemy.”

Six months of relationship-building has knitted together a network that should get out ahead of decision-makers in Washington who ultimately negotiate the deals. “We’ve got lots of advocates who are well-informed and are prepared to put their shoulder to the wheel,” says Goodale. “You try as much as possible before a complaint about an issue or an industry goes all the way to the top, to correct the misconceptions before they fester to that degree.”

The top is, of course, the man who lives in the White House. He is not being ignored: Brian Mulroney, who was prime minister when NAFTA was signed and happens to be a friend of Trump and Commerce Secretary Wilbur Ross, has advised the Trudeau Cabinet on the trade file. During a cancer benefit at the president’s Mar-a-Lago estate last February, Mulroney charmed the room with a rendition of When Irish Eyes Are Smiling, a tune he famously belted out with former president Ronald Reagan. Trump reportedly responded with a standing ovation.

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PHOTO-OPS ACROSS AMERICA


But even Trump’s influence, whichever way he goes, has its limits. “At some point, you have to turn toward the professionals who are part of his team. The president of the United States can’t single-handedly manage every single aspect of every single portfolio every single day,” says Greenwood. “He’ll parachute in at his own discretion, as we’ve seen. Sometimes that’s helpful, sometimes it’s challenging, but on the trade front, it’s really about Lighthizer and Ross and the team.”

It could get messy. As serious negotiators go about their work, the White House will also work to satisfy its own competing needs. “You have the Bannon faction of the White House that promised to rip up NAFTA,” says Greenwood. “The president needs to be seen to be making progress on things. He needs to not upset the apple cart completely in the business community. And he needs to let his team do their job. That’s the state of play.”

The Trump administration is keenly aware of Canada’s overt attempt to win over key influencers. At the summer governors’ meeting, Vice-President Mike Pence spoke immediately before Trudeau. The former Indiana governor was at ease in front of a bunch of familiar faces, many of whom had tweeted photos with the popular Canadian visitor. He thanked Trudeau for all the “early outreach” and struck an eminently conciliatory note. “Every trade relationship can improve, and as the Prime Minister knows, we’re looking forward to bringing NAFTA into the future in a way that will equally benefit both our countries,” he said.

Those remarks registered a small victory for Canada in the sort of room where Canadians have made themselves comfortable this year. But Pence has a boss. And only when Trump’s signature is on a new trade deal will the exhausted envoys from the north know if all those handshakes paid off.


Reporter: Nick Taylor-Vaisey
Editor: Colin Campbell
Designer: Lauren Cattermole
Director of photography: Liz Sullivan
Assistant editors, digital: Terra Ciolfe, Murad Hemmadi
Parliament icon: Fabien Jouin/Noun Project
Suitcase icon: Andrey/Noun Project
Canadian provinces icon: Bence Bezeredy/Noun Project
Published: August 9, 2017