Why Vetting Political Candidates Properly Matters

 In the wake of the events at the US Capitol this week, what sprang to mind for me is a conversation I had nearly four years ago in a New York theatre of all places.  We were in New York in late April of 2017 and in the evening at the last minute decided to attend a Broadway musical.  It was a production of Bandstand at the Bernard B. Jacobs Theatre.  We had about four empty seats beside us but just before the production began a well dressed business person with a briefcase and his partner and their teenage children arrived and took up the seats.  We exchanged brief greetings and then the performance began.

When the intermission began, we got up and stretched our legs a bit.  As is the case with being in America, Americans are the most friendly, gregarious and open of people and always love to start up a conversation and this gentlemen beside me was no exception.  He was apparently a lawyer and when he found out I was an economist asked if I knew Arthur Laffer sparking further conversation.  This fellow was apparently on a board in New York with Arthur Laffer - as well as other interesting people it turns out - and he was on several boards and quite active on a number of fronts.  

He then discovered I was from Canada and as this was late April and President Trump had just announced trade tariffs on Canadian steel, in characteristic American fashion he came right out and asked what I thought of President Trump.  I of course responded with a rather vague  circuitous answer somewhat out of the Sir Humphrey Appleby playbook that essentially amounted to "well he is your president and we must respect the people's choice and I'm sure things will work out in the fullness of time..."

He smiled and then basically said that well you know this was not supposed to happen.  It turns out this friendly, pleasant and articulate gentleman was also a member of the Republican party in New York and on the committee that was supposed to be vetting candidates. He essentially revealed that when Donald Trump announced he was running for President the establishment did not really take him seriously and he was never properly vetted as other candidates were.  While this is something that is pretty much common knowledge now, it was a surprise to me at the time.  

Still, the rest is now history.  Mr. Trump was a force of nature - the kind that creates natural disasters of course - and his environmental impact continues.  His presidency has been capped by the wildest lame duck period in American history and there are still almost two weeks to go.  America's role in the world has been much diminished by the Trump presidency and we are all going to pay the price.   Still, despite the damage, one cannot but hope that the resiliency of the United States will ultimately prevail and that this sad chapter will eventually be a sad footnote in American exceptionalism. 

There are two lessons I draw from this story. First, it is very important for all political parties wherever they may be to never take things for granted and always properly vet all their candidates. Second, New York is still the neatest place in the world because you just never know who you are going to meet at the theater or on the streets.  When all of this COVID business is over, it will be nice to go back.

Trump, Brexit and the EU

On his recent state visit to the UK, US President Donald Trump waded into the Brexit issue and Britain’s EU relations with a number of pronouncements that included tweeting that Britain should throw off the “shackles” of EU membership and also offering the promise of a US trade deal once they left.  If Britain follows through and leaves the EU, a trade deal with the United States would be an important consolation prize but one hopes the British have been watching the US and its ongoing relationship with Canada and Mexico to know that even with trade deals, economic relations with the current US administration can be a bit of a roller coaster.

Of course, President Trump is up to more than simply trying to throw the British a lifeline.  Trump and indeed a chunk of like-minded American policy thinkers have never liked the EU and have been waiting for Euro and the EU to fall apart and fail.  Indeed, one perspective in the Harvard Business Review a number of years ago refers to the EU as a failed experimentbecause of its slow recovery from the 2008-09 recession, the undemocratic aspects of the EU Commission and the failure to create a more integrated federation.  Of course, if Europe was successful in creating a more integrated federation, it would likely spark the ire of Donald Trump even more.

Indeed, with his attacks on the relevance of NATO and the EU, it has been noted that Trump has been trying to disrupt the EU.  While the presence of a united Europe which shares common economic and cultural values and supports a liberal international order, with the United States should be seen as a natural ally, the current President of the United States essentially sees a united Europe as a large bloc that would better serve American interests by being shattered into smaller units. These smaller units can then be played off one against the other for short term economic and political advantage whether it is trade deals that benefit the United States or other short-term alliances.  

Needless to say, the Europeans have a right to be miffed not only with the UK which with Brexit has become a disruptive rather than constructive force in Europe but also with President Trump who is openly hostile to the EU.  Of course, Britain’s behaviour is probably rooted in its history as it spent centuries making sure that continental European powers did not come together to form an alliance.  Once they did with the creation of the EU, a cynic would argue that Britain eventually joined to be a disruptive force from within – indeed, De Gaulle thought they should not be admitted.  The best thing that Europe can do if Britain leaves the EU is to work towards sticking together and becoming more united, but this is going to be a tough task.  

Canada's World Role: Time to Grow Up

Canada is experiencing a particularly rough patch in terms of its international relations given the recent acrimonious trade negotiations with the United States over NAFTA, the deterioration in diplomatic and economic relations with China in the wake of the Meng Wanzhou affair and the recent spats with Saudi Arabia and now even the Phillipines.  Despite our efforts to reach out diplomatically to our allies and gain their support for our predicaments, no one is going to come to our aid.  While some of this can be traced to the deterioration of a rules-based world economic and political order and the rise of more populist regimes, the recent setbacks suffered by Canada have another direct contributor – the United States and especially President Trump. 

The United States has signaled to the world that its America First policies extend to its closest North American neighbours – Canada and Mexico – and that there are limits to any “special” relationship with Canada.  The lifting today of the tariffs on steel and aluminum does not change this.  The NAFTA negotiations not only saw tariffs imposed on Canada but a set of particularly personal attacks on the Prime Minister and the negotiating team.  Essentially, the Prime minister was “slapped around” in public by President Trump and the message this conveyed did not go unnoticed in the rest of the world.  The message was that Canada no longer enjoyed any special protection from its close affiliation with the Americans – it was just another American foreign relation.

This may all seem far-fetched to the members of Canada’s governing Laurentian elites whose views are still anchored in the Golden Age of Canadian diplomacy of Lester Pearson but then most of them probably did not attend a rough and tumble northern Ontario elementary school in the 1970s.  Unlike the zero tolerance environments of today’s elementary schools, violence in the playground was quite prevalent several decades ago.   If the biggest kid took a dislike to you during recess and slapped you around, it was a signal to his minions that they could slap you around too.  Taking a stand on principle and shouting out the importance of fairness and values would simply get you another pummeling.  The trick to survival in that environment was to lay low and not attract too much attention while still getting things done.

So, Canada is in a situation not of its own making but one in which it is going to have to work hard to forge the economic relationships we need to support our standard of living.  After all, about one third of our GDP is rooted in exports which means that we cannot just take our balls and go home to play. However, we do have to be more hard-nosed about reciprocity in our economic relationships with countries that are able to use Canadian rule of law to their advantage when it comes to investing in Canada but do not extend the same privileges to our citizens and companies.  Our overall diplomatic efforts to build alliances must continue but in the long run they need to be coupled with something else – we need to get bigger if we want to ensure we are not so readily pushed around on the world playground. 

Canada needs to continue to grow its population to expand its economic mass and needs to do so through migration incentives that place population in centers other than Toronto, Montreal and Vancouver to promote broader development.  Canada also needs to spend more on its own defense if it wants to be taken more seriously.  There are challenges coming to our Arctic sovereignty and unless we are planning to give the region away to Russia, the United States and China, we need to be able to effectively command access and transit through the region.  We cannot depend on the United States or other allies to promote our interests – we need to do it more astutely and assertively ourselves. 
 

Is the Russia-America Global CoDominium About to Begin?

Well, I had so much fun writing this and posting it on Worthwhile Canadian Initiative that I decided it was worth posting here too!


In the wake of the Putin-Trump Helsinki summit, there is much speculation about what was actually said between Putin and Trump behind closed doors and the uncertainty spread throughout the American government about whether agreements had been reached on issues such as Syria and the Ukraine.  The subsequent invitation to Putin to visit the White house in the fall – probably just before the November elections – has resulted in further uncertainty especially after Putin’s statement that he proposed to Trump holding a referendum to resolve the eastern Ukraine issue.  So, what is really going on here?
Quite frankly, we have all have been scratching our heads as the behaviour in some respects is reminiscent of 18^th and 19^th century monarchs gathering to decide the fate of wide swaths of the world in private meetings.  Putin is an autocrat and Trump is a business autocrat who admires political autocrats, so their personal level diplomacy may indeed be a series of moves designed to remake the world and return it to an age when Russian and American led blocs were the only game in town. Both the Russians and the Americans have seen their political influence decline in a multilateral world led by growing Asia-Pacific economies and both countries have been less than comfortable with the rise of China.
One has to wonder if this is an attempt by Trump to forge some type of private alliance with the Russians in an effort to coordinate their interests and deal with their ebbing international influence? The idea sounds like science fiction.  Indeed, the idea of these two countries getting together and establishing a CoDominium actually has substance in an alternate reality – the science fiction world of Larry Niven and Jerry Pournelle.  In their novel The Mote in God’s Eye, which was originally published in 1974, a series of treaties between the Russians and the Americans establishing the CoDominium in the 1990s sets the stage for a global government and the expansion of the human species out into the galaxy.  This of course would place Trump’s musings about setting up a Space Force into quite an entirely different light. Indeed, is Donald Trump drawing inspiration from a mythical civilization disrupting character known as a Crazy Eddie? 
Trump may be trying to engineer some broader type of Russian-American political alliance to counter their waning influence in the world driven by a nostalgia for the 1960s and 1970s.  After all, the rise of the Chinese economy and the growth of Chinese military influence is seen as a potential concern in some circles.  It does not matter how far-fetched the idea may seem given everything else that has been happening lately whenever Donald Trump takes the world stage.  Disrupting the world, wrecking the liberal economic order and creating chaos and then having America and Russia step in to fix things may seem crazy but does it make sense to foreign policy experts?  And, while Trump may be thinking along these lines what is Putin really thinking? I doubt he is a Niven and Pournelle fan.
Of course, one expects that greater formal cooperation between the Americans and the Russians will ultimately require Congress to sign-off especially if actual treaties are eventually negotiated. On the other hand, if it is all kept informal and behind closed doors, who knows what is eventually going to emerge?

Economic News Around Northern Ontario: March 19th Edition

Well, another week has come and gone and there are many economic stories bubbling around northern Ontario and even farther afield with implications for northern Ontario.  For example, this morning's Thunder Bay Chronicle-Journal reported on upcoming talks between the forest sector and the federal government on preparing for the upcoming Canada-US softwood lumber negotiations.  However, little information was provided in the story as to what strategy options are being explored as Canada moves into negotiations with the Trump administration on this file.

Stakes high for forestry sector, Chronicle-Journal March 19th, 2017.

The policies of the Trump administration will soon also be front and center with respect to environmental funding dealing with the Great Lakes.  The budget proposed in the United States has put forth rather large cuts to program spending and one area that will have a direct impact on northern Ontario is what seems to be the complete elimination of $300 million dollars annually for the Great Lakes Restoration Initiative with plans shifting the responsibility onto state and local governments.  See:

Canadian politicians outraged at Trump Great Lakes funding cuts.  The Globe and Mail, March 17th, 2017.

In brighter news, while northern Ontario reports the lowest optimism when it comes to construction activity in the Ontario Construction Secretariat 2017 Construction confidence Indicator, it is nevertheless up from 2016 and part of that optimism is due to a number of post-secondary construction projects in Sudbury and North Bay at Laurentian University and Canadore College.  However, the Trump effect is again rearing its head here as: "Despite the boost in overall confidence, nearly half of the 500 contractors surveyed report they expect the Donald Trump presidency to have a negative or harmful effect on Ontario’s economy and construction industry. This sentiment is most acute in Windsor-Sarnia where 59 per cent of respondents believe Trump’s government will harm Ontario’s economy." See:

Post-secondary projects generate optimism in North Bay, Sudbury-survey. North Bay Nugget, March 16th, 2017.

In business activity and expansion news:

Explor Resources starts drilling program on Timmins-area property. Northern Ontario Business. March 16th, 2017.

Prime Gelato makes the leap to grocery stores and restaurant menus in Thunder Bay. CBC News. March 17th, 2017.

U.S. Coast Guard ready to break ice from Duluth to Thunder Bay. CBC News. March 15th, 2017.

Seminar offered to help local firms export to the U.S. Saultonline. March 14th, 2017.

When it comes to civic issues and municipal government, a couple of items.  The urban renewal legacy of the 1970s haunts us still.  In Thunder Bay, they are revisiting the future of Victoriaville Mall.  In the 1970s, both the north and south downtowns in Thunder Bay (corresponding to the old cities of Port Arthur and Fort William) received urban renewal makeovers that in the long run were less than successful.  The Keskus Mall in downtown Port Arthur was eventually demolished to make way for the Casino but Victoriaville which was built right on the main downtown intersection and permanently affected traffic patterns lingers on and apparently costs the City of Thunder Bay $500,000 annually.  Victoriaville hit tough sledding right off the bat in the recession of the early 1980s as its anchor store -the Chapples family store - went under.  Keskus did not lose its major retail anchor until the late1990s when Eaton's went under. 

Thunder Bay city council considers step towards Victoriaville mall demolition. CBC News. March 15th, 2017.

And in Sudbury, the big municipal fiscal issue is the contentious reorganization of its fire and paramedic services with a big meeting slated for March 21st.  For my take on the issue and links to some of the news stories, see my earlier blog post here.

In Sudbury mining news, see:

Vale to mothball century-old Ontario nickel mine. Mining.com. March 13th, 2017.

It is also Federal budget week with the budget coming down March 22nd and we will have to see what emerges specifically geared towards northern Ontario.  For my contribution to federal budget debate this week, see here. Have a great week.