Free Trade and Protection: The U.S.- Canada Case

By Islam, Sadequl | Monthly Review, November 1987 | Go to article overview

Free Trade and Protection: The U.S.- Canada Case


Islam, Sadequl, Monthly Review


FREE TRADE AND PROTECTION: THE U.S.-CANADA CASE

Few issues arouse so many mixed feelings of fervor and trepidation in Canada as the question of free trade between Canada and the United States. The fervor stems from the much touted argument of neoclassical economists, embraced by the current Conservative government of Canada, that a free-trade arrangement will produce substantial gains to Canada in real income and employment through unfettered access to the world's richest market. The trepidation comes from concern that free trade may undermine one of the central objectives that led to the establishment of Canada as a nation: to create and preserve a social and political culture different from that of the United States. Concern over cultural domination is nowhere more real than in Canada, given the facts that the United States accounts for about three quarters of Canadian trade, 90 percent of Canadians live within 200 miles of the U.S. border, and two thirds of Canadians speak the lingua franca of the United States, itself the greatest purveyor of market-oriented culture.

History since about the mid-nineteenth century bears eloquent witness to Canada's love-hate relationship with its neighbor to the south. The debate over free trade dates back to 1854 when Canada, after losing preferential treatment as a British colony following the abolition of the Corn Laws in 1846 in Britain, signed a reciprocity treaty with the United States. However, the treaty, entailing free trade in primary products, was short lived, being abrodated on American request in 1866.

A new era began in 1879 when a Conservative government under the leadership of John A. Macdonald adopted protectionist measures to promote and sustain an indigenous manufacturing sector. The struggle over trade policy, however, continued, and by the turn of the century a free-trade arrangement with the United States was concluded under the auspices of the Liberal Party. This in turn gave rise to an alliance between the capitalists of central Canada and the Conservatives which helped bring down both the free-trade deal and the Liberal government in 1911.

Washington's passage in 1930 of the notoriously protectionist Smoot-Hawley bill led to tariff wars between the United States and its trading partners. A truce, involving tariff reductions, was agreed to by the United States and Canada in 1935; and later, after the Second World War, another free-trade deal between the two countries was nearing completion during 1947-48. However, Canadian Prime Minister McKenzie King, after much pondering, shelved the agreement for fear of being labeled the first prime minister to sell out Canada's national interests.

Canadian policies since the 1960s reflect the growing contradictions of trying to live distinct from but in harmony with its giant neighbor. Through the Auto Pact of 1965, Canada and the United States moved to a sectoral free-trade deal in automobiles--a deal facilitated by the fact that in both countries this sector is dominated by the three big U.S. multinational auto companies. The forces of economic nationalism, however, did not take a back seat. Growing concern over foreign, especially American, ownership in Canada, led to the establishment in 1971 of the Canada Development Corporation to promote Canadian ownership; the Foreign Investment Review Agency in 1974 to control foreign investment; the national energy program in 1981 to promote Canadianization of the energy sector; and a host of policies, to be discussed later, to foster domestic "cultural industries.'

Since the Conservatives came to power in 1984, the pendulum has been swinging back to the other side. Many of the nationalistic policies have fallen into disfavor: most of the restrictions on foreign investment have been removed, and the national energy program has been abandoned. Above all, Conservative Prime Minister Mulroney has rekindled the debate over trade policy by embarking on negotations toward a comprehensive free-trade deal with the United States. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Free Trade and Protection: The U.S.- Canada Case
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.