After the 2008 US Presidential Election: Opportunities for Canada?
Thank you, Ambassador (Michael) Kergin for that introduction and for including me on the panel. I also want to thank CIC President Doug Gould for the invitation to be here today.
In the U.S. midterm elections in November 1994, voters in the United States elected a Republican majority in the House of Representatives led by Newt Gingrich, and voters in California approved Proposition 187 which denied public services to illegal immigrants in that state. Proposition 187 was challenged in court and never took full effect, but it placed immigration squarely on the national agenda, where it remains today
One consequence of the charged atmosphere surrounding immigration in the United States after the 1994 election was the tougher language in the 1996 Illegal Immigration Reform and Immigrant Responsibility Act that included a provision, an amendment to section 110 of the Immigration and Naturalization Service statute, which required that a record be kept of every person who exits or enters the United States.
This sparked a strong reaction in Canada, where the Chrétien government and of course many others worried about the impact that Section 110 would have on border traffic. A series of bilateral dialogues on the future of the border followed: the Shared Border Accord, the Border Vision Initiative, the Cross-Border Crime Forum, and the Canada-US Partnership (CUSP) to name only the most significant. These in turn led to the Smart Border Declaration and Action Plan that Ambassador Kergin and then-Deputy Prime Minister John Manley proposed to the Bush White House in the wake of the September 11, 2001 terrorist attacks.
So, elections have consequences and create both problems and opportunities. While no one would have foreseen the tragedy of September 11 coming prior to the November 2000 presidential elections, many people who had been closely following border issues might have been able to identify the issues and opportunities for a better US-Canada border even then.
The same can be said with regard to the border that an Obama or McCain administration will take responsibility for safeguarding in January 2009. Have we learned anything from the intense border policy debates since 2001? And what are the main areas of potential change to watch for in the next administration?
Distinguishing Transitional versus Actual Border Problems
The first lesson I would hope that we can take from our recent experience coping with the border in both countries is that all border problems are not the same. Some problems are transitional: delays and inconvenience caused by the introduction of new infrastructure, personnel, computer systems, inspection devices, and procedures.
I sometimes compare this type of problem with my recent experiences with Pearson Airport here in Toronto. During the construction of new terminals, it was a pain in the neck to fly to Pearson, or to make a connection here. There were long walks, buses, lost luggage, and nightmare lines at U.S. Customs pre-clearance as well as occasional problems at the Canada Customs arrival area.
But when the construction finished, the hassled diminished. In part this was because we were forced to learn how to navigate the airport in new ways, and in part the facilities now made that navigation easier.
The other type of border problem is an actual border problem, one that is not in transition to getting better on its own.
I would argue that in recent years we have spent far too much time fighting over transitional problems, perhaps not recognizing them as such, and wasted energy and political capital that ought to have been devoted to actual problems.
For example, the U.S. passport requirement, which does pose risks and cause hassles for many people, is a transition problem; it will ease when more travelers have passports and make a habit of taking them with them when they cross the border. The Agriculture and Plant Health Inspection Service or APHIS fee tagged onto our plane tickets is an actual problem; it will raise ticket prices and may one day even be raised, but does not sunset and appears to now be permanent.
Recognizing Format Wars
A second lesson I think we should take from the border battles of recent years is that deepening economic integration has not only brought Canada and the United States closer together, it has also given rise to a new kind of challenge for bilateral diplomacy that is unlike anything we had seen, and which calls for a different kind of strategy in response.
During the 20th century, the majority of problems that the United States caused Canada could be grouped into two categories: unintentional and intentional actions.
Often a new rule or tariff imposed by Congress or a U.S. administration hit Canadian trade, but was actually aimed at Japan or Europe. Sometimes a domestic policy change would cause collateral damage to Canadian interests unbeknownst to U.S. policymakers.
These were unintentional actions taken by U.S. policymakers. Canadas strategy in response was to seek an exemption to the new rule. Most of the time, this worked.
In other cases, Canada was among the intended targets of a U.S. policy change. To deal with these kinds of nasty surprises, Canadians pursued a rules-based order with the United States that led us to treaties such as the Canada-US Free Trade Agreement and NAFTA that would limit Canadas vulnerability to U.S. action or at least to offer a chance at redress through dispute resolution mechanisms.
In the 21st century, however, we have started to see a different kind of problem. Policymakers in the United States may act to set rules for the domestic US economy, and due to the level of close integration between our two countries, this domestic measure affects Canada and the U.S. has neither consulted Canada nor will it necessarily reverse course in response to Canadian petitions. I refer to these as format changes, and in the bilateral context they can lead to format wars.
The best example of this in recent years was the decision of the U.S. Congress to change the dates when we begin and end Daylight Savings Time in the United States. No one consulted Canada before doing this, and yet Canadians had to change their clocks along with Americans.
Two other format changes help to illustrate the nature of this problem more seriously: the U.S. decision to change the documentation format required from U.S. citizens returning to the country, and a hotly debated change the acceptable format for oil purchased by the U.S. government to a higher standard of oil with lower carbon content (Section 526 of the Energy Independence and Security Act of 2007).
The border documentation format change will simplify inspections at the border, since in the United States alone more than 6,000 government entities were responsible for producing birth certificates and it was difficult to spot forgeries or to verify information. Reentry by U.S. citizens from most countries required that they present a passport, but a return from a handful of countries in the Western Hemisphere was permitted with birth certificates and a government issued photo i.d., usually a driver license. The U.S. has led an international effort to improve the standard for passports issued by all countries, to make them more secure and harder to forge; the Government of Canada is upgrading the passports it issues on schedule.
With all this, it only makes sense to change the format for border crossing documentation to make it consistent and more reliable. The National Commission on Terrorist Attacks Upon the United States (also known as the 9/11 Commission) recommended a standard format, and Congress agreed with a legislative mandate enacted in 2004, to be implemented by 2008. But Congress also funded a Western Hemisphere Travel Initiative to address problems during the transition to the new standard, and provided for an option for a secure travel document that is not a passport, but just as good; they left it up to regulators in the U.S. government to define the standard for a secure travel document, and to figure out how to issue them.
The format change for U.S. government oil purchases is based on a calculation of life-cycle estimates of the carbon content of energy sources. Life-cycle estimates include the carbon input to produce the energy as well as to use it, and to manage any attendant waste products. Farm equipment and agricultural land use add to the carbon content of ethanol, which is otherwise cleaner to burn than regular gasoline, but oil may not require as much carbon to produce.
Congress left it up to the executive branch, and the regulators of the Environmental Protection Agency (EPA) to define the life-cycle standards for measuring carbon content. Depending on what the EPA decides, the oil from Albertas oil sands could be graded acceptable or unacceptable based on the new standard, affecting billions of dollars in investment.
Yet it can hardly be argued that the U.S. Congress does not have the authority to place conditions on federal purchases for which it appropriates funding. As with setting standards for border crossing documentation, it is the close integration of the U.S. and Canadian economies that exposes Canadians to the consequences of such decisions to a greater extent than ever before.
It is only the complete lack of political integration that leaves Canadians without a voice in these decisions. So, how should Canada cope?
The answer may be a rules-based order that provides for coordination, but allows each of the three sovereign governments to act according to its own constitutional arrangements.
Managing Relationships in Changed Circumstances
An exemption strategy would not be very satisfying in most cases. Although Canadians are only indirectly affected by the passport requirement, the U.S. Congress cannot exempt Canadians, unique among the peoples of the world, from a passport requirement it is prepared to place on its own citizens.
And what about a rules-based order? Well, the rules authorizing Congress to set standards for government procurement of oil are found in Article 1 of the U.S. Constitution, which grants Congress authority over public spending.
Unlike other arrangements for governing economic integration such as the European Union model, the North American countries chose not to create supra-national institutions. Instead, they reserved their national sovereignty to themselves and opted to negotiate on the coordinated exercise of constitutional authority in each country in order to get things done.
In practice since 2005 this has meant coordinating through the Security and Prosperity Partnership of North America, also known as the SPP. The SPP features twenty working groups that bring together officials from all three governments. There are ten SPP working groups to address security issues, and ten for economic issues. Each working group is co-chaired at the assistant deputy minister level (the equivalent to the assistant secretary level in the U.S. system) by a representative from the civil services of Canada, Mexico and the United States.
Dwight Eisenhower once famously said, In the heat of battle, I have often found plans to have been useless; but planning, to be invaluable. The process of planning helps all participants to understand better the capabilities and constraints of the others, and to learn whos who among their counterparts working on an issue. I believe that the contact among regulators and civil service professionals within the SPP working groups is perhaps the greatest benefit to the SPP overall. We are developing a greater appreciation for one anothers limitations and potential, and our officials are getting to know one another, exchanging cell phone numbers and email addresses. When, in the future, we come to a crisis and must figure out how to resolve it together, these relationships will help our officials to work together better.
Overseeing the twenty working groups are cabinet level co-chairs who report directly to the heads of government on progress, and push the working groups to conclude discussions in a timely manner. Canadas cabinet level participants are the ministers of Foreign Affairs, Public Safety, and Industry. They meet annually with their U.S. and Mexican counterparts to review progress and set targets for delivery at annual summits of the Canadian prime minister with the U.S. and Mexican presidents.
At the cabinet and head-of-government levels, working relationships are developed as well, and these are beneficial to resolving problems and also for putting issues of concern onto one anothers agendas.
The SPP is also a source of some of the best available intelligence on the priorities and concerns of other parts of each government. Is Congress considering new legislation that would affect Canada or Mexico? U.S. officials in the relevant departments and agencies will be keenly aware of this, and can advise their counterparts on how likely Congress might be to act; not a sure thing, even when congressional rhetoric is at a fevered pitch.
If Congress does act, as it did on the question of Daylight Savings Time, it generally sets a legislative mandate but directs the executive administration to translate this into rules and regulations that can be enforced.
Here, too, the value of the SPP for Canada and Mexico is difficult to overestimate. With sympathetic and knowledgeable interlocutors among U.S. federal regulators, it can be easier to mitigate the effects of transitional problems and perhaps even to begin negotiations on the elimination of actual problems.
However, the SPP is potentially most useful of all for addressing the format changes mentioned earlier. New formats are often defined most clearly in rulemaking by regulators, whether they are responsible for parts of the economy or for protecting citizens.
McCain or Obama and a Democratic Congress
There is generally more continuity than discontinuity between U.S. administrations. New presidents typically bring a change in emphasis and style, but the substance the problems that the United States faces and the options open for addressing them remains the same. This is not an election principally fought over how to manage U.S.-Canada relations, and apart from concerns over the U.S.-Mexico border, border issues have not been part of the campaign rhetoric thus far.
This is important to keep in mind no matter who wins in November: expectations for change will be high in both the United States and in Canada (after all, both candidates are running on the theme of change) but these will probably overshoot what the next president will be able to do.
One prominent issue in the campaign for which reality will certainly trump rhetoric is the status of NAFTA. Senator Obama has called for raising labor and environmental standards, and threatened to withdraw from NAFTA unless he gets the changes he seeks from the Canadian and Mexican governments. This boast reveals Obamas inexperience with North American relations; it is not necessary to put a gun to the heads of U.S. neighbors to get their attention, nor to get them to talk to you.
More practically, the SPP provides a process through which the changes that Senator Obama wants can be obtained, through negotiations among regulators in all three countries. In 2006, at the urging of Prime Minister Harper, President Bush and then-President Fox the business community formed the North American Competitiveness Council (NACC), with three national sections, each of which solicits input from business leaders and proposes agenda items for the SPP working groups to tackle. NACC sections can ask for updates on the status of talks from their national leaders, and even receive briefings from working group co-chairmen from their respective countries. They are outside the process, but have a front row seat and can make their voices heard by the participants.
An Obama administration might propose that a North American Environmental Council be formed with three national sections made up of environmental advocates and NGOs, and a similar North American Labor and Human Rights Council be formed with three national sections of civil society and labor union representatives.
In fact, President Obama might even call upon the North American Commission on Environmental Cooperation in Montreal and the North American Commission on Labor Cooperation in Washington to convene and support these new Councils these two institutions established by the NAFTA side agreements added by President Clinton have not been engaged in the SPP, and should be.
Of course, a McCain administration could do the same thing. As unexpected as the SPP was for many of us in March 2005, it will be viewed by historians as one of the most important foreign policy legacies of the second term of President George W. Bush (after the famous surge in Iraq, perhaps).
If SPP critics convince the next U.S. president to abandon the SPP, it will almost certainly have to be re-invented as economic and security concerns arising from our close cross-border linkages grow. Certainly the governments of Canada and Mexico would press for some form of ongoing dialogue on the governance of North American integration were the SPP to disappear.
The most compelling reason for retaining the SPP will come not from the new U.S. president, but from the new U.S. Congress. Since the heady days of the Reagan administration, Congress has grown more protectionist. Some associate this with a more protectionist Democratic Party, now in the majority; other blame the rising tide of populism among Republicans, exemplified by Arkansas Governor Mike Huckabee in the GOP presidential primaries.
This will make U.S.-Canada border relations challenging. A strong president with a capable new Homeland Security secretary can act more decisively; congressional leadership by nature is more diffuse. Greater attention to the U.S.-Mexico border under the 110th Congress often led to one-size-fits-all border policies that did not fit the U.S.-Canada border well at all.
This is why I think that the best hope for the border after 2008 will be leadership from the state and provincial governments. Together, state and provincial governments have formed a number of close partnerships and working relationships in the years since NAFTA took effect. Governors and local politicians have a capacity to engage their congressional representatives, and bring their attention to priority concerns. Canadian provincial premiers are typically on a first-name basis with several U.S. governors, especially of neighboring states. To defend the border against bad ideas, and to lobby for good ideas, the state-provincial nexus will be vital to working with the 111th Congress that will emerge from these elections.
Making the Most of Border Opportunities
In closing, let me cite an example of how Canadians and Americans could work together in the future.
In 2006, the state of Washington was faced with a congressional mandate to improve the security of state driver licenses (under the federal REAL ID Act of 2005) and saw the federal government moving to implement the passport requirement by 2008. Leaders in Olympia wondered: what if they could upgrade the driver licenses to meet the standard as a secure travel document for border crossing, as set out in the Western Hemisphere Travel Initiative?
The U.S. Department of Homeland Security was cool to the idea at first, and so Washington State Governor Christine Gregoire rallied the governors of neighboring states and lobbied their congressional representatives. British Columbia Premier Gordon Campbell was an early ally, and worked to build support in Canada, too.
Congress intervened to press DHS to permit a pilot project under which Washington State developed an enhanced driver license or EDL. Local branch offices of the Department of Motor Vehicles would accept citizenship documentation just as some U.S. Post Offices do for passport applicants, and the material would be sent to the State Department. If U.S. citizenship is verified, the State Department authorizes a radio-frequency chip that is embedded in the driver license and conveys a string of numbers to DHS computers at border inspection booths, calling up the citizens photo and fingerprints as biometric identifiers.
For passport holders, the EDL simply links to the passport record. But a traveler with an EDL does not need to carry their passport when crossing the U.S.-Canada border.
DHS approved the pilot project as a success in late 2007, and several other states including New York and Michigan are working to offer EDLs for their residents. Since DHS shared its data and experience with Public Safety Canada via an SPP working group on border facilitation, British Columbia, Ontario and Quebec have all begin developing EDL programs as well.
Note that this is a format change (to enhanced driver licenses) to counter another format change (the passport requirement) that started as a state initiative and employed the channels established between the two federal governments at the working level as part of the SPP.
Elections have consequences and the outcome of the 2008 U.S. elections will be important for the future of U.S.-Canada relations and our shared border. But when we:
- differentiate between transitional and actual border problems mitigating the first and fighting hard on the second and
- recognize that format changes call for new approaches rather than the old exemption/rules-based-order type of responses and
- take advantage of processes that build close working relationships among the regulators, rule-makers and law enforcers in both countries so that we know one another better and can coordinate more effectively without giving up sovereignty and
- make federalism function by bringing state and provincial governments into the equation as laboratories of reform (as U.S. Supreme Court Justice Louis Brandeis once referred to U.S. states) where good ideas can emerge and be road tested
Canadians and Americans have shown the ability to work together creatively under U.S. presidents of both parties and congresses of all stripes.
Thus, the election matters, but the cooperative, can-do spirit of people in both countries will matter even more.
I fully expect that the kind of leadership that brought us to the EDL solution will emerge to help us build on NAFTA a closer U.S-Canada relationship in the years to come.