Bush’s Northern Exposure

Going to Canada, where he is widely disliked, was a smart move for President Bush. Canada is one of the United States’ most important trading partners, and Bush’s speech in Halifax, where thousands of anxious Americans found refuge after their planes were diverted from U.S. airports on the morning of Sept. 11, 2001, was a first step toward repairing a badly frayed relationship. Now the president should back up his warm words with action on the two major trade issues that have spoiled a formerly close partnership.

Last year, reacting to the discovery of a single cow in Alberta infected with mad cow disease, the U.S. closed its borders to Canadian beef, live animals and other products. The move was disproportionate to the threat, and Canadians had good reason to resent it. The country slaughtered about 3 million cattle in 2003 and has instituted appropriate safeguards. U.S. agriculture officials have drafted an order to resume the trade, but it has yet to be approved. Canada is requesting a quick resolution, and there’s no reason not to grant it.

Softwood lumber is another sore point. Canada exported $4.6 billion worth of softwood lumber to the U.S. in 2003. Its forestry sector employs more than 290,000 people, and about 300 communities are dependent on forests. The U.S. imposed stiff tariffs on the lumber in 2002, arguing that it was unfairly subsidized and threatened the U.S. timber industry. But the U.S. continues to fight a battle that has already been lost. A panel created under the North American Free Trade Agreement to resolve such disputes has already ruled in Canada’s favor. Further, the World Trade Organization has ruled that the controversial Byrd Amendment, which allows American lumber and other industries to pocket duties imposed on imports ostensibly “dumped” in this market at below cost, is illegal.

While in Canada, Bush vowed he would pursue negotiation instead of litigation on these trade disputes. If he really wants to mend fences, he should make such negotiations a high priority.