Seeking Common Ground: Canada-U.S. Trade Dispute Settlement Policies in the Nineties

By Andrew D. M. Anderson | Go to book overview

that Agreement, including the key mechanism of the binational Dispute Panels in Chapter Nineteen, to control the abusive use of the AD and CVD trade laws, are working. This is of key importance to Canada, since it is still relying on these mechanisms -- in Chapters Nineteen and Twenty of NAFTA -- to control the abuse by any of the members to NAFTA of their administrative or general trade law systems.

The situations described in all four quadrants of Figure 1.1 will continue to enter into play in this book, since the use of subsidies is a normal part of the industrial policies of many governments that see them as a legitimate way to assist their citizens in increasing their well being or maintaining what they view as critical sectors in their economies. At the same time, there is a recognition by many politicians in the industrialized nations of the necessity of maintaining open markets if the world is not to face the same situation that occurred when international markets were closed in the 1930s and which led to a worldwide economic crash. However, national governments' desires for more open markets are often tempered by the enormous pressures caused by the massive restructuring of industry, and more critically, the presence in the developed nations of the growing "redundant" labor pools that need to be accommodated, as the effects of more open international markets encourage these fundamental economic realignments.

It will not be an easy task to convince "nationalistic" politicians to strip away the tools of their nations' sovereignty that permit them to engage in these types of policies, quite often protectionist ones, that reduce the economic effects of these international transitions, even if the policies work only in the short run. An indication of this can be seen in the somewhat less than Herculean effort that was made in the GATT to overcome the rigidities of industrial nations' governments to subsidize their agricultural producers, as well as other industries. 28

Calls for industrial assistance often do not only originate in goverment but also come from the private sector. 29 Firm which have relied extensively on open world markets for their own growth have quite often shown little regard in pushing this principle into their own domestic markets or areas that have proven troublesome to their domestic politicians. 30 It is therefore unlikely that the political problems surrounding the use of protectionist industrial and trade policies will simply disappear before the end of this century, or even well into the next century.


Notes
5.
Other reasons given for the negotiations by Canada included: the desire to save jobs in the short run and to create jobs in the medium to long run; to strengthen the economy in all geographic regions of Canada; to stimulate balanced growth and

-29-

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