Negotiating with Uncle Sam

Abstract

Plus ca change, plus c'est la meme choseThe truth is, of course, that we [Canada and the United States] are about as close as we can possibly be. History and geography looked after that. We cannot disentangle ourselves or put up walls. Coping is inevitable.John W Holmes, 19811When John Holmes published Life with Uncle: Canadian American Relationship in the early 1980s, the world and our border with the United States looked very different from the way they do today. Holmes's essays on the Canada-US relationship were based on a series of lectures he delivered at the University of Toronto in 1980-81 as the Claude T. Bissell visiting professor. They were written before Canada had signed a free trade agreement with the United States and Mexico. Although the Canadian and American economies were becoming increasingly intertwined, there was little evidence that postnationalist sentiment would replace the Canadian nationalism that was still clearly in full bloom. As one American scholar wryly observed, Canadians and Americans maintained distinctly national conceptions of community: The eagle may soar, beavers build dams.2In the 1970s, increasing US investment and ownership in Canada was a focus of widespread concern and debate. Many Canadians, including members of the Liberal government of Pierre Elliott Trudeau, feared that continued integration with the US would ultimately lead to a loss of political autonomy and identity. As the federal government adopted a wide variety of new legislative initiatives to protect Canadian interests, our actions generated inevitable friction with the United States. Foreign Investment Review Agency (FIRA), which was established in 1974 to screen foreign investments in Canada, had by the early 1980s become a major irritant in Canada-US relations. In 1976, the federal government passed bill C-58 in response to the recommendations of the 1970 special senate committee on the mass media (the Davey committee), which allowed Canadian advertisers to seek tax exemption for advertising placed in periodicals that were 75 percent Canadian-owned, or on television stations that were at least 80 percent Canadian-owned. This too stoked a small firestorm in our bilateral relations. Then, in 1980, the Trudeau government enacted the national energy program (NEP), which was directed at lowering the cost of energy for Canadian consumers following the 1979 oil crisis while simultaneously promoting greater levels of Canadian ownership over the ou and gas industry through a greater federal presence in the exploitation of Canada's on and gas reserves. Canadianization targets in the NEP were vigorously protested by the United States.The early 1980s also marked the onset of what some have called the second Cold War. Ronald Reagan had just been elected president following what were widely regarded as a disastrous series of foreign policy setbacks - the American hostage crisis in Tehran following the 1979 Iranian revolution and the Soviet invasion of Afghanistan in 1979, which led many western nations (Canada included) to boycott the 1980 Moscow Olympics. Reagan also embarked on one of the biggest buildups of US defence forces in modern history and a major program of weapons modernization and force structure expansion, including a plan to develop and deploy strategic defences to protect North America from a Soviet nuclear attack.The escalation of US-Soviet tensions in the early 1980s was viewed with increasing discomfort by most Canadians, Holmes included. Canada had been an enthusiastic supporter of US-Soviet detente under presidents Richard Nixon and Gerald Ford and their secretary of state, Henry Kissinger. Canadians had welcomed the end of the Vietnam War. (As a member of the UN truce commissions overseeing the implementation of the 1954 Geneva accords, Ottawa had tried, albeit unsuccessfully, to help mediate an end to that conflict.) Trudeau, who enjoyed a close relationship with Alexsander Yakovlev, the Soviet ambassador to Canada at the time, had also been keen to open new avenues of dialogue that would lead to greater liberalization - what later came to be known as glasnost - in the Soviet Union. …