LILLEY: Carney's team putting up roadblocks to trade deal with U.S.

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Canada’s leadership can’t help but shoot itself in the foot when it comes to negotiating a new trade deal with the Americans. We continue to cling to a digital services tax that has angered all sides in Washington and Tuesday passed a bill making it illegal to negotiate anything related to supply management.

Why not just flip the bird at the Americans and quit negotiating now?

On Tuesday, the Senate passed Bill C-202, a bill brought forward by the Bloc Quebecois that makes it a law that negotiators at the Department of Foreign Affairs are not allowed to put supply management on the table. That means no negotiations for quotas, prices for quotas or market access to the chicken, egg or dairy sector are allowed as part of any trade deal.

Before we get into why this is such a horrible idea, consider that the sponsor of this bill is Yves-Francois Blanchet, the leader of the Bloc Quebecois. Canada’s trade policy has now been surrendered, handcuffed you might say, by the leader of the party that wants to break up Canada and who claims that Canada is not a real country.

Now, lots of Canadians would hop up and down and say they don’t want American milk in Canada and that they want to keep supply management. The truth is the Americans are not looking to sell us milk for sale in a carton and they don’t want to end supply management.

What the Americans are looking for is greater access to supplying our market with either cheese or industrial milk for cheese production. They thought they had negotiated greater access through the Canada-U.S.-Mexico Agreement, but then Canadian officials blocked them immediately and the Biden administration took us to a trade tribunal claiming we were violating the trade agreement.

They won one round at the tribunal, we won another and the trade dispute continues. Now, we’ve made it law that dairy can’t be discussed in trade negotiations.

We are tying our hands behind our backs in trade talks to make fewer than 10,000 dairy farmers happy, while annoying every other industry.

Kyle Larkin, executive director of the Grain Growers of Canada, blasted MPs and senators for making Bill C-202 the first bill passed by Parliament at a time when everyone says they want to grow Canada’s economy and expand international trade.

“With critical trade negotiations and renegotiations ahead, including with our largest trading partner, the United States, passing Bill C-202 sends the wrong message internationally,” Larkin said. “For grain farmers who rely on access to international markets, the result will be less ambitious trade agreements, fewer export opportunities, and slower economic growth at home.”

It’s not just other farmers who are annoyed with the dairy farmers, others in the industry are upset but don’t think they can speak up publicly against the powerful dairy cartel.

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On the Digital Services Tax, Canadian investors – including pension funds that many of us rely on – could take a big hit if this tax isn’t repealed. At a time when we are jumping up and down about the Americans imposing unfair and unjustified tariffs and costs on our goods and services, we are doing the same with the DST.

This tax targets American tech companies we all use — like Amazon, Google, Facebook, Netflix and Airbnb — and will require them to pay big money to Ottawa. The Americans, on both sides of the aisle, oppose this tax and see it as unfair and an attack on their tech companies.

It will also impact many Canadian small and medium-size businesses, those selling products on Amazon, those advertising on Google or Facebook or people driving for Uber; they will all end up getting hit with the cost of this tax. Not only is the tax levy going to cost these tech companies and the small businesses that rely on them, but it is retroactive to Jan. 1, 2022, and the first payments are due at the end of this month.

The DST is a major trade irritant for the Americans and it is not just an issue for Trump, but like dairy is something that upsets the Democrats as well. On both issues, the Americans believe that we are in violation of our existing trade agreements.

Yet as we ask for special treatment and favours on tariffs, we are offering little in return in the eyes of the Americans.

If this persists, we won’t be getting a trade deal with the Americans or seeing tariffs lifted anytime soon.