This article was originally published on The Conversation, an independent and nonprofit source of news, analysis and commentary from academic experts. Disclosure information is available on the original site.
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Author: Blayne Haggart, Associate Professor of Political Science, Brock University
After threatening Canada and Mexico with illegal tariffs, and Canada with annexation, United States President Donald Trump has agreed to hold off on imposing tariffs on Canada for at least 30 days. This decision came after Prime Minister Justin Trudeau spoke with Trump and committed to strengthening border security.
While this temporary reprieve provides some breathing room, the long-run question of how Canada should handle Trump and the American descent into authoritarianism remains.
Early responses seem to have coalesced around two policies: for Canada to trade less with the U.S. and more with other countries and to strengthen the internal Canadian economy.
Reducing Canada鈥檚 dependence on the U.S. economy is necessary in our current moment, as I鈥檝e previously argued. But it will impose significant costs on Canadians and require a fundamental readjustment in how we think about our economy and society.
The Third Option, revived
This current crisis isn鈥檛 taking place in a historical vacuum. More than 50 years ago, similar concerns about Canada鈥檚 dependence on the U.S. led to a policy discussion centred on what became known as the 鈥淭hird Option.鈥�
In 1972, then-Secretary of State for External Affairs Mitchell Sharp wrote a paper called 鈥淐anada-US Relations: Options for the Future.鈥� At the time, international politics were in a moment of transition, and the U.S. was recalibrating its understanding of its national interest.
Sharp proposed reconsidering the Canada-U.S. relationship. He observed that while Canadians recognized the benefits of ties with the U.S., they were increasingly wary of the direction of the relationship and in support of measures to 鈥渁ssure greater Canadian independence.鈥�
Echoing today鈥檚 concerns, Sharp argued that the central question for Canada was whether its interdependence with the U.S. would 鈥渋mpose an unmanageable strain on the concept of a separate Canadian identity, if not on the elements of Canadian independence.鈥�
The options that Sharp proposed are the same ones on offer today:
1. The First Option: Maintain Canada鈥檚 current relationship with the U.S. with minimal policy adjustments
2. The Second Option: Move toward closer integration with the U.S.
3. The Third Option: Pursue a long-term strategy to strengthen the Canadian economy and reduce vulnerability
From three options to one
Sharp鈥檚 analysis is clear on the costs and benefits of free trade. In terms of benefits, economic prosperity would be easier to attain. In fact, this proved decisive in 1988, when Canada embraced the Second Option 鈥� closer integration through the 1988 Canada-U.S. Free Trade Agreement.
But, as Sharp warned presciently, a free-trade agreement would be a 鈥渨ell-nigh irreversible option for Canada鈥� because it would tie the country so closely to the U.S., raising the cost of disentanglement.
Meanwhile, the U.S. would always be free to redefine the relationship for any reason. This is what happened in 2001 when the U.S. prioritized security over prosperity in response to the 9/11 attacks. It鈥檚 what鈥檚 happening now.
As in 2001, deeper integration remains a tempting response to the U.S. But the risks from integration are even greater now, given that Trump is dismantling U.S. democracy at home and trying to bully its neighbours in unprecedented ways.
Already, Canada is struggling to recruit American allies to fight against the tariffs because U.S. businesses and politicians are afraid to stand up to Trump. Choosing to more deeply integrate would only worsen Canada鈥檚 position, making it a part of the U.S. economy while losing even more political influence.
And that鈥檚 without addressing the morality of collaborating with a country that is currently setting up a concentration camp for migrants in Guantanamo Bay.
Autocratic governments, as Trump鈥檚 administration is demonstrating with his ultimatums against Canada and Mexico, are bullies who will always push the advantage. Taking their demands at face value is a surefire way to surrender Canadian autonomy one piece at a time. So, the First Option 鈥� maintaining the status quo 鈥� is also off the table.
Which leaves the Third Option.
The mortal peril facing Canada
The Third Option has become more appealing across the political spectrum mainly because the U.S. is forcing Canada鈥檚 hand. The uncertainty Trump has injected into the relationship, even in the presence of a trade agreement, has made it more costly for businesses to engage in cross-border trade.
If Trump鈥檚 tariff threat remains, and his attack on the rule of law continues, the U.S. market will become even more unattractive, not least because of the toxic uncertainty Trump has injected into the relationship.
But his actions also underscore the new, extreme danger Canada now faces.
As Sharp recognized in 1972, shared social values were the bedrock of successful Canada-U.S. relations. He understood that, for the Third Option to work, the relationship needed to be 鈥渉armonious.鈥� Even as he considered ways to reduce Canada鈥檚 dependence, he never doubted Canada and the U.S. were 鈥渂roadly compatible societies.鈥�
That shared foundation 鈥� 鈥渂ased on a broad array of shared interests, perceptions and goals鈥� 鈥� made it possible for Canada to chart its own path while maintaining a productive relationship with the U.S.
Today, that assumption no longer holds. The U.S., under Trump, is acting as an expansionist imperial power with little regard for international law.
This is the needle Canadian politicians have to thread. By geography alone, Canada must continue to have a relationship with the U.S. But the absence of shared values makes it incredibly difficult to have any kind of healthy, productive relationship.
The cost of democracy
As Sharp recognized, there is a cost to following the Third Option. It will require a 鈥渄eliberate, comprehensive and long-term strategy鈥� on a scale not seen since the 1960s 鈥� meaning higher taxes, more government intervention and a level of global engagement Canada hasn鈥檛 undertaken in quite a while.
This must all be done in a landscape where Canada and the U.S. no longer share values 鈥� a shift even ardent Canadian nationalists recognized was necessary for Canadian independence 鈥� while pursuing policies that do not antagonize the U.S.
For the Third Option to be viable today, Canadians must embrace an independent Canadian identity based on respect for democracy, pluralism, the rule of law and human rights. It likely requires consensus that U.S. authoritarianism is wholly unacceptable to Canada.
Canada is being pushed toward the Third Option as the least worst approach. But, as was true in Sharp鈥檚 time, the Third Option come at a cost. Independence and democracy don鈥檛 come for free.
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Blayne Haggart does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
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This article is republished from The Conversation under a Creative Commons license. Disclosure information is available on the original site. Read the original article:
https://theconversation.com/trumps-trade-war-is-forcing-canada-to-revive-a-decades-old-plan-to-reduce-u-s-dependence-248433
Blayne Haggart, Associate Professor of Political Science, Brock University, The Conversation
