Divergent Views on Trade in Canada and the U.S.

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By Stephen Gordon, National Post Apr 05, 2016

International trade is usually not much of an issue in U.S. politics, or at least, it’s much less of an issue than it is for Canada. Although U.S. exports and imports are large by world standards, American merchandise trade as a share of its GDP is the smallest of industrialized countries. Since trade wasn’t very important to the domestic economy, U.S. policymakers have historically viewed it as an instrument of foreign policy, offering access to their market in order to advance their goals in other areas.

Unhappily for Canada and for other countries for whom the U.S. is a major trading partner — that is to say, much of the rest of the world — the surprising strength of both Donald Trump and Bernie Sanders, and their anti-trade messages, may change that. Being pro-trade is a difficult stance to take during this election season, mainly because it’s so difficult to point to good economic news in the U.S. that could be plausibly ascribed to the benefits of international trade: wages are stagnant, median household incomes are falling and income inequality is rising.

Sound familiar? This is the same list of economic woes that the Liberals have been rhyming off for a couple of years now, most recently in the budget. But unlike Trump and Sanders, Prime Minister Justin Trudeau does not go on to conclude that trade has been bad for Canada. This is all to the good, but it does raise the question of how the Liberals have managed to make use of the same talking points as Trump and Sanders without also arriving at the same conclusions.

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