FROLITICKS

Just up the St. Lawrence River in Quebec, Canada, there is the lovely region of Charlevoix. Amid hills, lakes and rivers there exists parks and hiking trails, picturesque little villages and tons of nature.  From the shores, you can often see whales playing in the St. Lawrence River. This June 8^th and 9^th, the region will host the next G7 summit.  If you’re not already aware, the G7 consists of the U.S., Canada, Japan, Germany, the United Kingdom, France, and Italy. What’s particularly interesting this time, President Donald Trump, the so-called master negotiator, will be there after having just placed tariffs on steel and aluminum imported from Canada, Mexico and Europe. Oh to be a fly on the wall at that meeting!

One has to remember that one of the goals of the G7 over the last four decades was to help coordinate trade and economic policies among these and other industrialized countries. The G7 has always been seen as a close-knit group having common interests.  This may all change at this summit.  None of the participants is happy with President Trump’s protectionist policies.  Indeed, some observers have described the new grouping as the “G6 plus one”, the U.S. being the one. The past goals of enhancing cooperation may be in real jeopardy, particularly when you have the American President publishing rambling tweets about the U.S. getting screwed by “stupid trade.” It’s obvious that Trump’s playing to his political core base back home, much to the chagrin of other Republicans and State governors who support “free trade” and have economically benefited from such support.

Moreover, the G7 has been somewhat effective because it had established a level of trust among its members. Now, Trump is straining those very bonds.  In addition, the President’s administration has not really gone after the real culprit in this story, China.  Instead, the President appears to be more concerned about his family’s financial interests in China and China’s role in the upcoming talks with North Korea. Although some will argue that the G7 as a body has done little to tackle certain economic and international trade issues, the fact is that at least it was there, along with the group of 20, to discuss emerging issues and perhaps avert damaging protectionist policies.

Let’s face it, I support free trade as benefiting all of us in one way or another. Indeed, I highlighted my views back in March in my blog entitled Does Trump Not Understand Fundamental Principles Behind Multi-lateral Trade?.  As for Canada, it has always had a close political and economic relationship with it’s southern neighbour.  Placing tariffs on certain products traded to the U.S. can only hurt that relationship.  Canadians are a proud people and take such actions as an affront to their country and its values, as appropriately expressed by Prime Minister Justin Trudeau.  Such actions by this American administration will do nothing but harm the current negotiations around the North American Free Trade Agreement (NAFTA).  Unfortunately, both American and Canadian workers and consumers will suffer from the most recent U.S.-imposed tariffs.  Charlevoix’s quiet ambience will most certainly be invaded by loud and angry voices.