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10. A North American Trajectory? 1994-2000
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284 10 A North American Trajectory? 1994–2000 The conclusion of the North American Free Trade Agreement seemed at last to answer definitively the century-old questions that had tormented Canadians about their country’s relationship to the United States. Whether for better, as NAFTA’s Canadian supporters maintained, or for worse, as its critics insisted, the three countries had taken a major step toward the economic integration of North America, and the continental economy was not about to go away. The official relationship between Canada and the United States was “comfortable and unruffled,” concluded two professors who examined it; “the big bilateral issues have been dealt with, and the current big issues are not bilateral ones.” In the last decade of the twentieth century, and in the twenty-first century, the U.S.-Canadian relationship had to be worked out not only in a trilateral North America, which included Mexico, but also in hemispheric and global contexts. Yet the Canadian ambivalence born of North American asymmetry lived on. In October 1993, the Liberal opposition electorally obliterated Brian Mulroney’s hapless successor as prime minister, Kim Campbell, and reduced the Conservative party to two parliamentary seats. Prime Minister Jean Chrétien and his Liberal government quietly adopted Mulroney’s North American agenda but abandoned Mulroney’s effusive enthusiasm for Canada’s southern neighbor. Chrétien and his ministers understood that too much praise from the United States sometimes played badly at home.1 285 A North American Trajectory? North American Economic Integration Chrétien’s comments on the Canadian-U.S. relationship were designed to distance himself from Mulroney, who had presented himself as a close personal friend of Presidents Ronald Reagan and George H. W. Bush. “Business is business and friendship is friendship,” Chrétien announced , “and the two cannot be confused.” There would be no more presidential–prime ministerial vocal duets at summits, the new prime minister made clear; “besides, I am not a good singer,” he joked to reporters . The difference between the rhetorical and the real Chrétien soon became apparent in his approach to NAFTA, however. On the campaign trail he had promised to tear up the agreement if it were not substantially renegotiated, but once Chrétien was elected, NAFTA suddenly looked like a better deal for Canada. Chrétien, observed a journalist, approached NAFTA exactly as Mackenzie King would have: “Abrogation if necessary, but not necessarily abrogation.” A savvy politician himself, President Bill Clinton understood Chrétien’s domestic dilemmas. A year earlier, Clinton himself had faced the questions of how to support NAFTA without alienating the Democratic Party’s trade union voters and how to differentiate his position on NAFTA from that of his Republican opponent, George H. W. Bush. Clinton therefore stood silent beside Chrétien and Mexican president Carlos Salinas for Canadian television cameras when the three men met in Seattle in November 1993. Clinton smiled generously when Chrétien announced that they had agreed on “improvements” to NAFTA with regard to dispute settlement and exports of Canadian energy and water . U.S. trade representative Mickey Kantor bluntly said that no real changes to NAFTA had been made, and some Canadian newspapers dismissed the “improvements” as “a face-saving measure, and a lame one at that.” But minor changes and the Clinton photo-op allowed Chrétien to claim that he stood up to the Americans and enabled him to proclaim NAFTA effective on 1 January 1994.2 Once in force, NAFTA sold itself. Expressed as a percentage of Canada ’s GDP, exports to the United States almost doubled, to 35 percent, between 1990 and 2000. Canada’s Department of Foreign Affairs and [3.227.239.9] Project MUSE (2024-03-28 09:31 GMT) 286 canada and the united states International Trade (DFAIT) reported in 2001 that Canada’s merchandise trade with the United States had increased 80 percent in value in the first five years of NAFTA and had more than doubled with Mexico in the same period. Canadian exports to the United States and Mexico in that period increased 80 and 65 percent, respectively. Both U.S. and Mexican investment in Canada also increased in those years, by 63 percent for the United States and 300 percent (from a much smaller base) for Mexico. NAFTA could not claim all the credit for the increases. The weak Canadian dollar, which fell below seventy cents U.S. in 1997, contributed to the export boom. NAFTA’s dispute resolution mechanism...