Before we start let me make this point very clear: This editorial is not an argument for or against supply management. It’s a statement on Canada’s negotiating position heading into the upcoming NAFTA talks.
In any trade you try to maximize the return on an asset. In sports, this could be other players, draft picks or, in the case of world football, millions of sterling in cash. In political circles there are tradeoffs all the time. Negotiating a trade deal is no different than a trade deal to move up in the NFL draft. You hold your cards tight, play hard to get, and maximize your return when you move assets that no one thinks you would ever move.
Supply management has been Canada’s untradeable asset for a long time. But if Gretzky can be traded, maybe supply management could be too.
Wait a minute, you’re probably thinking. He’s a Liberal and a Trudeau, and the official opposition is now led by Andrew Scheer, and both are pro-supply management. The biggest domestic threat to supply management seemed to be Maxime Bernier, but after his defeat in the Conservative Party of Canada leadership race, it appears supply management is here to stay.
Or maybe not, if we want the best deal.
One of my major issues with Bernier potentially becoming the Prime Minister was his promise to give up supply management would come with nothing in return from trading partners like the United States or Australia. His supply management cards were out in the open for the world to see. When all your cards are on the table, your opponents have the upper hand in any negotiation. Bernier would have walked into Washington with supply management in his hand and received nothing in return except a free lunch at the Four Seasons.
Going back to the sports trade analogy, which player gets the least value in return? A player everyone knows the GM wants to get rid of.
Based on all public statements, Trudeau and the Liberals (and Harper’s Conservatives before them) won’t be willing to part with the pillars of supply management. So while Trump talks about getting the best deal for America, Trudeau is the best person to get the best deal for Canada because everyone believes he will protect supply management and his Quebec base at any cost.
Even though I do not believe that Canada has lost at the trade negotiation table in the past with supply management tucked away in its pockets, you can imagine the spoils of victory that Donald Trump would claim if he came back to Wisconsin, Minnesota and New York with increased dairy access into Canada. Many believe that Trump has not shown his boasted negotiation skills with Congress, so NAFTA could be his big chance for a visual win to prove his merit at the negotiating table to his base.
Business is all about timing. And when it comes to dealing with supply managment, Trudeau is in a position to get a good return.
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