BOOK EXCERPT PASSAGES The free trade roller coaster Brian Mulroney In this exclusive excerpt from his book, Memoirs, the former prime minister recounts the tense month of negotiations and stalemated talks with the United States before the dramatic agreement at the 11th hour of the last day — October 3, 1987. Dans ce passage exclusif de ses Mémoires, l’ancien premier ministre décrit les tensions d’un mois complet de négociations et l’impasse dans laquelle se trouvaient les discussions avec les États-Unis avant la conclusion de l’entente survenue in extremis le 3 octobre 1987, une heure avant l’échéance finale. ith the close of the believe goes to the heart of the negoti- series of special committee and Francophonie Summit I ations, it would be prudent to know A full cabinet sessions in early W had to face the alarming soon so that we may take appropriate September had revealed clearly to us fact that the end point for a successful action. (I would note here that the all that the negotiations were at a conclusion to the free trade talks was prime minister will meet all ten standstill, in large part over Canada’s only a month away, with a deadline of Canadian premiers to review these demand for relief from arbitrary October 3, at midnight. US negotiator negotiations on September 14.)” American trade remedy decisions. Peter Murphy still hadn’t revealed any- Howard Baker replied three days Equally, our negotiators had refused to thing worth Canada’s while in regard later, saying that the administration budge on the bottom-line concern of to our key demand: a binding dispute wouldn’t admit the talks could fail. the US team: some easing of Canada’s resolution system. President Reagan “Our negotiators are meeting today investment review decisions. Concerns had already heard about this issue and through the weekend, and we around the cabinet table about the directly from me, so I directed Derek fully expect progress from those ses- prospect of a failed negotiation were Burney to approach his American sions. We ought to be talking instead tempered somewhat by those with lin- counterpart at the White House. about how to construct this historic gering apprehension about the politi- Derek did so, sending a letter to arrangement and thereafter present it cal implications of a positive outcome. Reagan’s chief of staff, Howard Baker, to the Congress, Parliament, and peo- In other words, quite a few members of on September 8. “We do not see a bina- ple of both countries. Derek, these my cabinet would have been pleased tional dispute settlement mechanism talks will succeed or fail on the merits to see the talks fail — Minister of as a concession either side makes for of proposals. But, however, should Agriculture John Wise had strong the other,” Derek wrote. “Rather, we these talks reach a stalemate, I can reservations about any moves away see it as the sine qua non, politically assure you that it will not be due to a from traditional Canadian support and objectively, to make the agree- lack of attention of the president or his mechanisms for parts of our agricultur- ment whole, i.e., to preserve the rules senior advisors.” al sector (especially dairy and poultry), and disciplines against all other politi- The October 3, 1987 deadline for although these concerns were more cal considerations. It is that basic and the president’s use of “fast-track” nego- than matched by those of his it is that important. I want to stress tiating authority — meaning approval American counterpart. Some have sug- that there is no possibility of our con- or rejection but no amendments — gested that “agricultural trade” is the cluding a deal which does not include eventually focused political minds in ultimate oxymoron in trade negotia- a genuine and objective basis for set- both capitals. The run-up to that dead- tions; reluctance to give ground on tling disputes arising from the agree- line during September was the most agriculture policy bedevils multilateral ment’s rules. If it is your judgment that hectic and emotionally charged roller trade negotiations to this day. the administration cannot meet our coaster of any month during my nine Flora MacDonald often exempli- requirements on the issue which I years in office. fied the historical reservations about 112 OPTIONS POLITIQUES OCTOBRE 2007 The free trade roller coaster BOOK EXCERPT free trade within Conservative ranks. experience in trade negotiations, most their products. The Americans also She showed me a cartoon from the notably with the Auto Pact, and demanded preventive action against 1911 campaign to underscore how because I knew he was more than capa- Canadian steel, uranium, cement, sub- long-standing Tory sentiment against ble of standing firm on Canada’s behalf. way cars, fish — in fact, virtually all of free trade had been. “No truck or trade Lester B. Pearson had described a con- our exports south of the border. with the Yankees!” had been Borden’s stant problem facing any Canadian in In one well-known specific case, rallying cry in the 1911 election. Her Simon’s position. “The picture of weak Canada had been hit with restrictions responsibilities as minister of commu- and timid Canadian negotiators being on sales of cedar shakes and shingles nications, which included culture, pushed around and brow-beaten by and, faced with similar action against gave her more immediate concern. American representatives into settle- our even more substantial softwood Our negotiators had addressed this ments that were ‘sell-outs’ is a false and lumber exports, had concluded a issue up front by eliminating culture distorted one. It is often painted, how- “managed trade” truce whereby a 15 percent export sales tax was Fortunately, the adjectives “weak” and “timid” do not apply attached to our sales to the to Simon Reisman, as anyone who has encountered him will United States for a five-year period. This had the advan- attest. My instructions to him and the negotiating team had tage of at least keeping the been explicit from the beginning. We needed an agreement extra revenue in Canadian, that would provide conditions that were significantly better not US Treasury, hands. for Canada in the American market than the status quo. Other sectors of our export economy faced similar pres- Equally, no deal was better than a bad deal. sures, either directly or indirectly. Even when from the negotiations and yet, to the ever, by Canadians who think that a Canadian products were not specifical- Americans, what Canada saw as mani- sure way to get applause and support at ly targeted by American trade remedy festations of culture — magazine, film home is to exploit our anxieties and measures, they risked, as in the case of and publishing policy, postal rates, exaggerate our suspicions over US steel, being side-swiped by actions and so on — the United States saw as power and policies.” aimed at others. business. That ambiguity, and the fact Fortunately, the adjectives “weak” That is why the defensive aim of that the US had GATT rights that pre- and “timid” do not apply to Simon securing existing access to the US mar- vailed in any event, served a useful Reisman, as anyone who has encoun- ket became as vital an objective for our purpose. We knew that even a com- tered him will attest. My instructions negotiators as the benefits to be plete exemption would not assuage to him and the negotiating team had derived from more liberalized, tariff- the cultural lobby. Ironically, even been explicit from the beginning. We free access. It was ironic that Ontario, many Canadian artists who performed needed an agreement that would pro- the province with the most at risk on south of the border insisted on being vide conditions that were significantly the former objective and the most to exempted from travel provisions that better for Canada in the American gain from the latter, was represented would have eased their entry to per- market than the status quo. Equally, by a premier, David Peterson, who form in the US market. no deal was better than a bad deal. was, at best, ambivalent over the nego- Around the cabinet table Mike tiations. Nationalist, anti-American Wilson, John Crosbie, and Don n 1986 a severe protectionist chill sentiments provided a more basic Mazankowski were steadfast support- I had swept through Congress like a inclination to oppose this major policy ers of the negotiating process. By con- bitter November wind, threatening our initiative of my government, and trast, even though she was the access to our most important markets. those sentiments flourished, particu- minister of international trade, Pat A high percentage of our exports to the larly in Toronto, under the persistent Carney wavered from time to time, United States were subject to quotas, drumbeat of the Toronto Star and the depending on her mood of the “voluntary” restraints, and other CBC, implying that if we successfully moment. In his memoirs, No Holds restrictions. As I had told the signed the deal, it would make Canada Barred, Crosbie refers to “Carney’s dif- Commons, the Ottinger Bill, passed in the fifty-first state. The coverage from ficult personality,” and her discomfort three successive years by the House of the Globe and Mail was balanced, and with Simon Reisman’s prominent pub- Representatives, sought to destroy the the editorial view supportive of our lic role seemed, on occasion, to under- Auto Pact, which lay at the heart of initiative. mine her judgment. Ontario’s economic power. There was a I had chosen Simon as our chief crisis a month for Canadian exporters s the negotiations progressed, I negotiator because of his extensive as trade barriers were erected against A arranged several briefing sessions POLICY OPTIONS 113 OCTOBER 2007 Brian Mulroney PASSAGES with first ministers.