Trump is steeling up his ‘America First’ trade strategy. He’s calling for 25% tariff on steel and 10% duty on aluminum imports to the USA. Canada is the top exporter to the US of both steel and aluminum.
In a tweet, this week, Trump is suggesting he would consider lifting these tariffs for Canada (and Mexico) IF we concede to White House demands for renegotiating the North America Free Trade Agreement (NAFTA).
As Canadians we’ve had the comfort of knowing that without Congress’s blessing the NAFTA agreement can’t be ripped up. That hope may be growing fainter. Tweeted or not, these new tariffs have a unilateral, dare-to-stop-me tone.
When asked about exemptions and exclusions on the steel and aluminum tariffs, Trump had been clear. These new tariffs are going to be across-the-board. The problem with exclusions, as he puts it: “It’s a slippery slope…where do you stop?”
Hard-ball tactics. Re-write NAFTA the way I want it, says Trump, and I’ll give you an exemption on the steel and aluminum tariffs. Otherwise, I’m not heading down that slippery slope.
Ah, the slippery slope argument. It’s an argument that we all get. And we all seem to accept. Where did this argument come from? It seems to have the power to instantly halt critical thinking. In the case of Trump and tariffs, it has the potential to unwittingly destroy economies.
Certainly there are blue collar workers in Pennsylvania, Ohio, Michigan and Illinois who may be thrilled with these new tariffs on steel and aluminum. On the American coasts, there is nervousness. In California, growers worry about agricultural retaliation. In Texas, the oil patch worries about inflationary costs. Braced for the tit for tat.
Beyond American borders, there is even greater unease. The EU is threatening retaliation. There’s talk of targeting imports of iconic US brands: Harley-Davidson motorcycles, Levi Strauss jeans, bourbon whiskey. Trump is countering, threatening a tax on cars imported from Europe.
Thankfully, Canada has thus far resisted the compulsion to scream retaliation. We’re roughly one-tenth of the size of the American economy. We know we’re tied at the hip to American business. We’re leery of slippery slopes too, especially for sacred cows and chickens protected by supply management. But we know we can’t afford a trade war with the elephant next door.
It’s a jittery time. It’s a time to be aware of, but not afraid of, slippery slopes. It’s a time to steel up. To sink steel spikes into the shifting ground and negotiate our stakes.
Slippery slopes, where did they all come from?
In an either/or world, slippery slopes are a useful metaphor.
We already know that we have an in-built disposition to see the world and our choices as contrasts. Either/or choices.
The metaphor of the slippery slope helps us to hold this either/or dichotomy. The options are A or B, no in-between, no variation, no exceptions.
If First Nations or black Americans are victims, they are all victims. No exceptions.
If we oppose prison sentences for drug users, that means all drug users.
If we want to protect American business, there is either a tariff on steel for all imports, or there isn’t.
In Canada, we treat supply management in our dairy and poultry sectors as untouchable. Why? It’s that slippery slope again.
Slippery slopes stop us in our tracks. They block us from being creative. And, for some strange reason, we’ve all bought into the metaphor.
It’s a lot like the domino-theory. If we give an inch, or make an exception, we tip one domino that will strike another and another. And before you know it, our entire economy will collapse!
Maybe we can take a deep breath and negotiate some of these slippery slopes.
One big happy North American family
Everyone claims Trump is an either/or guy. And, maybe he is. I’m not naïve and I’d hate to be overly pessimistic about this. There’s too much at stake.
It may be overly optimistic to suggest that we can cushion both high tariffs on steel and aluminum exported to the US AND maintain the status quo, competitive Canadian economy. One big happy North American family.
Can Canada and the U.S. can get to a place where both American steel producers and Canadian steel producers are recognized as necessary and sustainable businesses?
Where both Canadian and American agriculture is seen as necessary and sustainable?
For the sake of everyone, this may be a valuable, longer-term goal. It will require trade-offs, supply-chain sharing, solid relationships, transparency, trust and mutuality. Sacred cows may be sent to pasture. Complex, sensitive and gritty work.
In the energy sector, there are Canadians who believe that a surge in domestic production of oil and gas in the U.S. has driven the decline in Canadian energy competitiveness. Often, we frame markets in either/or, zero-sum frames.
And, we may do the same with steel. And agriculture. And a variety of other commodities.
I hope we don’t.
Sometimes, people really do change their minds, the stories they believe. I invite Canadians and Americans to think differently about how we share economies. Either Canada wins or America wins isn’t likely to work for either country.
Can we invite prudence? Prudence is an old-fashioned virtue. Sounds a bit like a maiden aunt. It may be out of style but can we reconsider?
In his book, How to Think, Alan Jacobs has some useful ideas on prudence.
Being prudent doesn’t mean you feel uncertain about what’s right. It means being scrupulous about finding the best means to get where you want to go.
Right now, Canada will have to respond to America’s steel tariffs and NAFTA renegotiation. We can’t be paralyzed by indecision. We need the agility to adjust our strategies as facts change.
It’s not easy, of course. Weighing knowledge is an ongoing process. Making decisions is at best incremental, and ultimately binary. We will have to make a choice among available options. (And, by the way, doing nothing is a choice.)
And prudence leads you to seek allies, however imperfect, preferable to making enemies. We’ve been doing that. The chatter across the 49th parallel is louder.
Not the time to gag.
Finally, Alan Jacobs pitches the idea of forbearance. Another old-fashioned virtue. Suppressing our gag reflex when we’re having a close encounter with our “Repugnant Cultural Other.”
It’s easier for Trump if Canadians gag. Honestly the way it’s going, I want to gag right now.
Yet, I’m asking myself (and you) to consider a little skepticism about personal motives, and a little generosity towards the motives of others. Even Repugnant Cultural Others.
Ultimately we are connected physically, culturally and economically – if anything is too big to fail, it’s the relationship between our two countries. Steel band or steel banned, we are married.
Donna Kennedy-Glans, March 6th 2018
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