HANNAFORD： American advice for Canada's PM - 'Get rid of DEI!'
Episode Stats
Words per Minute
166.73422
Summary
Almost every week since President Trump was sworn in seven months ago, he has announced that as part of his strategy to rebuild America s industrial base, foreign companies and even countries are pledging significant investments in the United States. According to a recent White House statement, these pledges now exceed a massive $8 trillion in just seven months. Since that statement, there s been a $550 billion country-to-country deal announced with Japan, but are these promises leading to real, on-the-ground activity in the U.S.? Is it all a show? Are we about to lose our Canadian automotive manufacturing industry? With me today is Andrew Hale, a senior policy analyst in trade policy at the Heritage Foundation.
Transcript
00:00:00.000
Good evening, Western Standard viewers, and welcome to Hannaford, a weekly politics show.
00:00:21.000
It is Thursday, August 21st. Almost every week since President Trump was sworn in seven months
00:00:27.240
ago, he has announced that as part of his strategy to rebuild America's industrial base, foreign
00:00:33.660
companies and even countries are pledging significant investments in the United States.
00:00:39.780
According to a recent White House statement, these pledges now exceed a massive $8 trillion
00:00:44.740
in just seven months. Since that statement, there's been a $550 billion country-to-country
00:00:52.440
deal announced with Japan. But are these promises leading to real, on-the-ground activity in
00:00:58.860
the U.S.? Is it all a show? Are we about to lose our Canadian automotive manufacturing industry?
00:01:08.520
With me today is Andrew Hale, a senior policy analyst in trade policy in Washington's Heritage
00:01:18.440
Andrew, is this real? When do struggling Americans in the Rust Belt or anywhere actually start
00:01:23.980
getting good jobs out of all this? And is part of the good jobs that they hope to get, jobs
00:01:30.700
that are presently in Canada making motor cars?
00:01:33.860
Well, I think that it takes literally years to build factories. It can take up to 10 years
00:01:41.220
to build a nuclear reactor. So yes, we do want to make more infrastructure here in the United States.
00:01:46.980
We definitely want to expand manufacturing. But I don't necessarily agree with the approach. I think
00:01:52.260
you could do a lot with deregulation here in the United States. To give you an example,
00:01:56.500
in 1990, we had 57 blast furnaces in which to make steel. We're now down to 11 blast furnaces. And
00:02:03.460
that's largely because it's so difficult to build new blast furnaces given the regulations. And even just
00:02:08.500
last year, the Biden-Harris administration imposed new regulations on the emissions of steel production.
00:02:14.820
And steel production and net zero targets don't mix. So we're actually purchasing 40% of our steel
00:02:20.900
from Canada, our refined steel, because in Canada, you have green steel. You're making your steel
00:02:26.100
from nuclear power in Ontario. And of course, the steel and aluminium being made in Quebec
00:02:32.820
with hydroelectric power. So again, if we want to compete with that, we'll have to build new nuclear
00:02:37.780
reactors. But of course, they take about 10 years to build. So I'm afraid it would be better to free
00:02:44.180
up the regulation of a focus on that, as opposed to a focus on the terrorists.
00:02:48.180
Yes. Well, I actually found an article that you co-wrote with Dr. Stern in the New York Post
00:02:56.660
just last year. And I think you made very much that point, talking about the trade in the United States.
00:03:06.420
And we're talking about the US, but obviously, we're a Canadian outlet. I think we suffer from
00:03:11.860
some of the same things in this country. And you made the point that economic gains need to come
00:03:20.180
through merit, not be conferred by government favoritism. Yes.
00:03:23.940
Yes. Do you think that President Trump is actually addressing that? And further on in that same
00:03:34.260
article, you did speak quite positively about tariffs. So when did...
00:03:38.340
Well, I spoke positively about a border adjustment tax, which is a tariff-like tax. I didn't specifically
00:03:44.260
speak positively about tariffs in general. I was specifically talking about a border adjustment tax,
00:03:48.900
which would be like a GST that you have in Canada. Okay. You explained that China routinely
00:03:59.300
violates American patents, and foreign countries often restrict US companies. They restrict Canadian
00:04:07.140
companies as well, and use tariffs and subsidies to funnel investments and jobs out of the United States.
00:04:13.140
Well, I think what Mr. Trump is trying to do is reverse that process.
00:04:20.580
But maybe you think otherwise. Where do you and he part company on this?
00:04:26.900
Well, I was expecting, you know, when President Trump was going to be elected, I was expecting this,
00:04:32.260
which was Ambassador Robert Lighthizer's, no trade is free, Cheney and Gore's taking on China.
00:04:37.780
That's what we were told was going to be the playbook for the Trump administration, number two,
00:04:43.220
second term administration. And Ambassador Lighthizer hasn't returned yet. He didn't,
00:04:47.140
of course, join the first Trump administration at the beginning. There's still time for him to come
00:04:50.660
back. And remember, of course, the USMC negotiations or KUSMA, as you'd say in Canada,
00:04:55.140
were going nowhere. So we were expecting a real emphasis on China. I wasn't expecting a tariff
00:05:01.060
war against all of our friends and allies. And I have to, like I said, I think that's because
00:05:06.660
the driving force is not Ambassador Lighthizer in this term, as he was very much in charge of trade
00:05:11.940
policy in President Trump's first term, we have Peter Navarro. And he basically is someone who
00:05:17.140
doesn't see tariffs as a means to, as a negotiating tool, which clearly they are. But he also sees
00:05:24.820
them as a means to pay off the national debt and raise revenue. And I would like to address that
00:05:29.620
because we have, what, now 37 trillion in national debt in the United States, and you could abolish
00:05:35.140
every government department except the Pentagon and the entitlement programs, and you'd only take off
00:05:40.740
one trillion off the national debt. And tariffs are not going to pay down the national debt.
00:05:48.020
And I would have to address the actual methodology behind this, I think is somewhat flawed. We have
00:05:52.420
to ask ourselves, what was the methodology behind the tariffs against Canada and Mexico, the initial
00:05:57.860
25% they announced earlier this year, as well as the Liberation Day tariffs in April? They did not
00:06:04.100
actually calculate tariff rates and non-tariff barriers as they said they did. Instead, for every
00:06:09.540
country, they just took our trade deficit with that country of only goods and not services,
00:06:14.420
and divided it by the exports to us. And I think it's important to remember that our trade deficit
00:06:19.540
is the flip side of a demand for our assets. So here in the United States, instead of exchanging
00:06:23.700
exported goods for imported goods, we make financial assets. And we all seek foreign investment, but some
00:06:29.220
deride the trade deficits. And to put it in a different way, if you have a capital account surplus,
00:06:34.580
you must have an equal and opposite signed current account deficit. And most of our current account
00:06:38.820
involves trades and goods and services. So in other words, we have an investment surplus,
00:06:43.060
and God help us if we lose that, because that's a sign of a very wealthy country that people want
00:06:47.060
to invest in. Also, proportionally speaking, Americans have more purchasing power, we purchase stuff
00:06:52.420
as a wealthy country with wealthy citizens, purchasing the world.
00:06:55.460
That's okay. Now that's a very degree level analysis, which is what I would expect from the
00:07:01.300
Heritage Foundation. Thank you. But let's bring this back to, first of all, the Canadian auto industry.
00:07:08.660
I mean, the idea, I think, is that if you put tariffs on a Canadian manufacturer, then eventually it will
00:07:17.380
make more sense. It may be a messy process, it may take a little while, but eventually it's going to make
00:07:23.860
sense for the auto industry to establish itself back in Detroit, back at the south of the border.
00:07:30.820
Anyway, Louisville, Kentucky, maybe a lot of them seem to be going there. That's where my car came from.
00:07:37.380
So this, and of course, Canada can sustain an auto industry on its own market of 40 million people.
00:07:47.220
Now, it's messy, but given time, is that actually a viable strategy on Mr. Trump's part? And should we be,
00:07:57.780
frankly, if we're a Canadian auto worker, looking for something else to do?
00:08:02.340
Well, I think when President Trump initially told the auto manufacturers in Detroit they had 30 days in
00:08:07.780
which to rejig their supply chains back in the United States. I think that what wasn't understood at the time
00:08:14.100
was the fact that it takes literally years to build factories, and it takes decades to establish, in some
00:08:19.860
cases, supply chains. And remember that on average, in the auto industry, auto parts crisscross the U.S. Canadian border,
00:08:26.820
on average, five times, sometimes as much as 10 times in the manufacturing process. So we really do need to have
00:08:33.460
no tariffs on intermediate goods to facilitate that process. Already, we've had some bad news in
00:08:40.580
Michigan. They've closed five plants already. Stellantis has closed a plant. And Cleveland Cliffs,
00:08:46.660
the steel manufacturer, has idled one of its blast furnaces. So again, we've had some bad news as a
00:08:53.940
result of this. And this is with most of the tariffs currently being in abeyance. This data came through
00:09:00.740
before we had the full force of the tariffs. So again, I think that as this, we get more and more
00:09:06.660
bad news going forward. If the tariffs are fully implemented and maintained, we will get a recession.
00:09:13.220
And that will, of course, have an effect on the midterm elections next year. And of course, I think
00:09:18.260
a lot of Republican congressmen and senators are being quite quiet now, hoping that the courts will shut
00:09:24.180
down the use of IEPA emergency legislation to implement tariffs. And because they're frightened,
00:09:29.300
they don't want to be primary right now. So again, but I think the markets will be
00:09:33.220
a moderating force because we have had some bad news.
00:09:37.060
So, Canadian auto workers, do they have a career to look forward to or not?
00:09:42.180
I think they do. I think that Canada does need to diversify its trade export markets and not be
00:09:48.020
dependent on a single market like the United States. I would call for that in any situation. I do think
00:09:53.860
Canada is too heavily dependent upon the United States. And remember, Canada does have free trade
00:09:58.820
agreements all around the world. Indeed, I worked on the CETA agreement between Canada and the European
00:10:05.540
Union, so that Canada can take advantage of trade with Europe, Asia, and all around the world,
00:10:12.260
given that certainly the Harper government and others were very activist in promoting free trade
00:10:18.420
and getting comprehensive free trade agreements.
00:10:21.460
They certainly were. I actually worked for Mr. Harper during those years, and that was pretty much
00:10:27.300
all I was writing for a couple of years, is releasing trade agreements. So we were free traders then,
00:10:32.900
we're free traders now, except that we're not dealing with the free trade United States anymore.
00:10:41.220
I have to wonder whether, at a given time, nevertheless, notwithstanding all of the
00:10:47.620
arguments that you've made, the idea of erecting a tariff wall around the United States is actually
00:10:54.580
ultimately going to serve the US well. I wasn't there to listen to the
00:11:02.820
radio broadcast, but we were all taught early on about President Roosevelt, Franklin D. Roosevelt,
00:11:10.500
talking about America as the arsenal of democracy. I don't think that's true anymore. Certainly, that
00:11:20.020
enormous industrial base that enabled the United States to take the war across the Pacific to Japan
00:11:26.500
in 1941, 42, 45. I don't think America could do that today. Do you think it could?
00:11:36.420
Whether it could or whether it wants to, I think if you're looking, for example, I mean,
00:11:40.340
President Trump certainly has had more of a focus on home, as well as not getting entangled in forever
00:11:47.380
wars abroad. Remember, when in his first term, he didn't want to intervene in Syria. To the anxiety of
00:11:54.020
Prime Minister David Cameron, who's very keen to do so, keeping on the Blair doctrine of humanitarian
00:11:58.100
intervention, I think the United States is pivoting its resources more towards Asia. Ukraine is not in
00:12:04.180
America's backyard. And I don't think it's not electorally, you know, favourable to invest in
00:12:11.300
the war in Ukraine, the billions of the Biden administration invested. I think the United States
00:12:15.460
sees more of investing towards Asia, because they see China, the people's world of China as more of a
00:12:20.020
serious threat. So and of course, making other countries pay for their own defence. I mean, Canada,
00:12:26.420
you know, should spend more on its defence, but not just to appease the United States,
00:12:31.300
the United States isn't paying for it. So it can be independently responsible for its own seas,
00:12:36.260
lab and skies, as Stephen Harper recently said. I think that, you know, why should the you know,
00:12:42.820
if you look at just one country in Europe, like, the Kingdom of Denmark, they've have a very,
00:12:47.380
very social, generous social welfare system. And they were able to have that throughout the Cold
00:12:52.100
War to the present day, because they weren't spending money on their own defence, they're
00:12:56.020
relying upon the United States security umbrella. And I think President Trump is right to say,
00:13:01.700
and others say it's time for other countries to step up the plate, because United States does have 37
00:13:06.900
trillion in national debt, which is unsustainable. And we can no longer afford to pay for the entire
00:13:11.700
world security, nor should we. Yes. Well, I must say, Andrew, you're speaking to,
00:13:19.460
speaking to a true believer here, and to a lot of true believers who watch this programme,
00:13:24.180
everybody thinks, everybody except our own government thinks that we should have done more,
00:13:30.420
and should in the future, do very much more in terms of our own defence. Promises have been made to
00:13:37.060
spend enormous amounts of money. It's one thing to promise it, it's another thing to actually do it,
00:13:43.860
to, A, provide the funds, and B, provide the mechanism to buy the equipment. Canada has a very
00:13:50.260
bad record of doing that. But anyway, that's a slightly different project. I'm just trying to focus on
00:13:58.500
whether this actually makes sense for America, given the time, make the adjustments, bring the
00:14:04.660
industrial base back onto the continent, from where it's been. A lot of people will be affected by it.
00:14:12.980
But in the long haul, is this not a good thing to do?
00:14:18.180
Well, I think as if, like I said, I refer to the former, you know, Ambassador of the United States
00:14:23.060
Trade Representative Office, Ambassador Robert Lighthizer in his book and his focus on China,
00:14:27.380
and I would have thought we would be doing this. I actually believe that these duties,
00:14:30.900
these tariffs harm America's global leadership. And it undermines our progress in establishing
00:14:36.180
resilient supply chains in this region, and outside China in particular. I think the trade war
00:14:43.300
also has the potential to push our allies into the arms of China. So for example, if you want to
00:14:49.300
convince the Dutch, the Kingdom of the Netherlands, not to transfer critical chip-making technology to the
00:14:55.060
people of the book of China, don't tariff all their stuff. And I just think that the approach on
00:14:59.860
Liberation Day, by just announcing these tariffs, I've already mentioned, I don't agree with the
00:15:03.940
methodology. But also, I just think with the wrong approach, because we want to trade with these
00:15:09.460
countries, and have our allies be able to influence them away from and decouple and de-risk for the
00:15:14.260
people of the world of China. And I feel that that actually has had a very negative effect. I mean,
00:15:21.540
look, if you look at some very, very hyper-protectious groups like Coalition for Prosperous
00:15:26.740
America would be one of them. And actually, their head of the trade program is actually Canadian.
00:15:30.660
And he said to me, he says, oh, I think Canadians should just buy local, and Americans should just
00:15:34.500
buy local. Look, we're not going to build factories here, for example, to make rope. We wouldn't even
00:15:39.300
employ people to do that. We would just automate that. It's best that we purchase rope from India,
00:15:44.020
or Africa, or somewhere else. We can buy legacy products from other countries. We don't want
00:15:49.060
Americans to all work in those factories. And often cases, we wouldn't even employ Americans to work
00:15:53.140
with factories. We would just automate that. And of course, the unions are opposed to automation.
00:15:57.940
So I just don't think what they're talking about being a sort of totally self-sufficient
00:16:03.860
United States is possible. What we do want to do is near shore and friend shore, away from the
00:16:09.940
People's Republic of China, and trade with our allies and friends like Canada, not tariff them,
00:16:17.140
Okay, fair enough. Point well made. Now, let's turn back to Canada. You've lived in Canada. You
00:16:22.580
have strong Canadian connections. I even went to school here. So you understand the situation very
00:16:28.020
well. You know how we think north of the border. And of course, you're working for the Heritage
00:16:32.260
Foundation. So you're very au fait with how things are done in Washington. Andrew, if you had 10 minutes
00:16:40.020
with Prime Minister Carney, and he were to ask you what you thought Canada should be doing, how we
00:16:47.780
should approach this situation, what would you tell him? I would say give up the net zero scams. I would
00:16:54.420
say give up all of the ESG and DEI programs. I just feel that there's too many navel gazing on what I would
00:17:04.980
call luxury beliefs. And net zero targets, manufacturing don't mix. I call it not zero.
00:17:12.660
And I think that's going to be a huge problem going forward between, and it has been, between
00:17:18.020
the Trump administration and the current liberal government in Ottawa. And it's obviously caused
00:17:23.300
friction between the aspirations of provinces like Alberta and Saskatchewan and the federal government in
00:17:30.820
Ottawa. I just feel that there is an obsession with net zero targets. And really, it's counterproductive.
00:17:37.620
I would say to Prime Minister Carney, look, your windmills, your solar panels are being made in China,
00:17:44.100
and they're building two new coal fire power plants a week. And it's the dirtiest coal in the world.
00:17:49.860
So good luck with that one. That is not helping the environment. So I agree with President Trump when
00:17:55.860
he says, drill, baby, drill, we have false natural resources here in North America. I believe in,
00:18:00.500
you know, we have this, I believe that the United States should be purchasing Canadian
00:18:04.020
energy as we do. And I believe in a great single market here between, under KUSMA, between Canada,
00:18:11.540
the United States and Mexico. And I think that we need to build pipelines as well to export that energy
00:18:17.780
down here in the United States and abroad. Obviously not be totally dependent upon the US market,
00:18:22.420
but also open up markets abroad for Canadian energy. And I know that on the provincial level,
00:18:26.980
there's been a lot of outreach and that's being done. I've spoken to Danielle Smith. She's doing a
00:18:30.580
great job as Scott Moe is doing as well in Saskatchewan. I would just simply, I mean,
00:18:36.100
I think that would be fallen deaf ears to finish because I mean, Mark Carney's wife, who's brilliant,
00:18:40.500
she works for the Eurasia Group, as does Gerald Butts. They're brilliant people. But I think this
00:18:46.420
obsession, which is almost like a new religion with these people on ESG is just really a non-starter
00:18:53.140
for discussions between the United States right now and Canada under the current Trump administration.
00:18:59.860
Okay. Just for the benefit of people who don't keep up with acronyms, I think a lot of people know
00:19:04.100
what ESG is something that's not good, but environmental, social governments, how does that
00:19:09.780
actually interfere with what Canada needs to be doing now to get his house in order?
00:19:18.260
Well, I mean, so with regards to the net zero targets, I mean, net zero targets in manufacturing,
00:19:25.700
as I already said, don't mix. They kill industry. I mean, right now, Canada has very, very high energy
00:19:33.220
to a degree and a much higher, for example, Europe has literally outsourced much of its manufacturing
00:19:39.700
to China. And of course, the energy, the United Kingdom has some of the highest energy in the
00:19:44.420
world now, and it's killing what's left of British industry. I was speaking to an auto manufacturer,
00:19:51.780
parts manufacturer in Northern Ireland, and he showed me his energy bill. And I just was shocked
00:19:57.060
that compared to the energy prices we pay here in the United States. And so basically,
00:20:02.820
if you want to engage in that ESG, and Mark Carney has even written in one of his books,
00:20:07.540
that to achieve these net zero targets and goals, and to fully implement ESG and make it a success,
00:20:14.020
there has to be, we have to become poorer. And we have to, there will be losers. I don't agree with
00:20:18.820
him. I don't, like I said, this is, it's not just, it pollutes and poisons everything. So for example,
00:20:25.940
just last year, in the United States, we were trying to renew the generalized system of preference,
00:20:31.620
which is a trade preference program for developing countries. And we had the Democrats in trying to
00:20:36.660
impose ESG regulations in the renewal of that legislation. Now in India, gender parity requirements
00:20:44.580
perhaps wouldn't work culturally. In Africa, LGBT requirements perhaps wouldn't work culturally either.
00:20:51.380
And the environmental regulations would make this trade preference program so prohibitively expensive
00:20:58.340
for these, these developing countries, people will just trade with China anyway. So again,
00:21:03.220
I just don't think it's feasible. It's, it's, it's, and I quite frankly, I don't actually believe
00:21:08.100
in the climate hysteria either. Well, I think you're, I think you're speaking for a lot of people who
00:21:14.180
watch this program. And those are exactly the prescriptions that we, that, that, that we offer
00:21:21.060
here through the Western Standard. Let's get rid of the climate change nonsense. Let's get rid of the ESG,
00:21:27.220
the DEI, and concentrate on doing a good job of what we do best, which is producing energy and exporting it.
00:21:34.020
Uh, Andrew, this has been a great conversation. I really appreciate you taking the time. The Heritage
00:21:39.060
Foundation, of course, is a, is a really good, good group. Uh, congratulations on, uh, being a member
00:21:45.940
of that. And, uh, I want to thank you again for coming on and, uh, explaining some of these basic
00:21:52.580
things to us. Thank you so much for having me on. It's been a pleasure. It has been a pleasure.