Autonomous State: The Struggle for a Canadian Car Industry from OPEC to Free Trade by Dimitry Anastakis (review)

Dimitry Anastakis’s Autonomous State examines the involvement of Canadian policy-makers in the North American auto industry under the 1965 Automotive Products Trade Pact (apta) with the United Sates. The pact created an integrated continental automobile sector, one dominated by the U. S. Big Three (General Motors, Ford, and Chrysler) but with stipulations designed to protect the Canadians’ “fair share” of production (mostly by the Big Three’s Canadian subsidiaries). Anastakis devotes chapters to the Canadian responses to U.S. automobile safety, emissions and fuel economy standards, the Canadian fight to win new capital investment in auto plants, the 1980 Chrysler bailout, the Canadian autoworkers’ departure from the uaw, the arrival of the Japanese automakers, and the ultimate supersession of the pact by free trade with the United States in the late 1980s.

The story Anastakis tells is about the largely successful pursuit of Canadian economic national interest by politicians and policy-makers. The process was never pretty, the solutions not always elegant or brilliant, but the effort usually advanced the Canadian interest. The often annoyed, sometimes outraged American diplomats with whom the Canadians negotiated on these issues were not blind or incompetent. They just didn’t need or want their preferred outcomes as much as the Canadians did. “An activist Canadian state,” Anastakis argues, “utilized creative and aggressive policies to carve out and grow a ‘fair share’ of the North American car industry for Canada” (5). In his judgment these policy-makers acquitted themselves well.

The national interest that these officials served can be reduced to a word: employment. One in six Canadians (as Canadians constantly reminded themselves) had jobs linked to the auto sector, and Canadian politicians and policy-makers repeatedly rallied to that statistic. In theory, a national economy ought to work tolerably well for a majority when that nation is a democracy. Canadian democracy, Anastakis shows, operated on this assumption during this period. And for the auto sector, it delivered. At a time when U.S. auto sector employment declined sharply, new plants were built and employment and wages in the Canadian sector increased. Deindustrialization in the Canadian auto industry did not occur. The Canadian state played a substantial role in this achievement.

apta involved a tension between nationalism and North Americanism, but these were not always either/or choices. Canadians wanted to produce for the huge U.S. domestic market on at least equal terms and to preserve and grow the Canadian share of North American production, but the latter could be obtained only at the expense of U.S. production. Anastakis notes that the Canadians, while representing a smaller share of the industry, enjoyed an asymmetric advantage. The Big Three were foreign firms operating in Canada, so Canadian officials could legitimately employ national interest arguments with them. U.S. policy-makers could not do the same to Canadian automakers in the United States because there were none. Nor did they have the industrial policy charter to encourage the Big Three to keep production in the United States. Thus, Canadian policy-makers (with the help of Canadian autoworkers) often tipped Big Three decision-making in favour of Canadian production.

Anastakis shows how the personalities of individuals mattered in these outcomes. The Canadians involved were smart, agile, and aggressive. They were intuitive team players. “By the early 2000s,” he writes, “Ontario produced more vehicles than any other jurisdiction in North America including Michigan” (17). That’s what winning in a globalizing economy looks like, and in this case the achievement took human agency – collective, concerted human agency, rather than invisible hands.

Anastakis argues that his “book does not describe some sort of golden age of statism or interventionist utopia” (17). Yet he is wistful for this era of successful government involvement in the private sector, even as he explains why it passed. He shows that the Auto Pact...