President Obama’s Re-Election—for Obvious and Less Obvious Reasons—May Push the Canada-U.S. Relationship to Center-Stage

By Keith Edmund White 

Will Obama’s second term put the Canada-U.S. relationship on center-stage?  A quick round-up of Canadian headlines shows three major issues dominating the post-election Canada-U.S. relationship: (1) in the short-term, Canadian apprehension over America’s ability to reach a debt deal, (2) Keystone XL, and (3) moving forward on the Beyond the Border Initiative.  But let’s not forget two other wrinkles from America’s election night: Heidi Heitkamp’s Senate win and the failure of a state constitutional roadblock to the Detroit River Crossing Project.  And when you add to this Canada’s critical role in the Trans-Pacific Partnership talks, the Canada-U.S. relationship will be getting its fair due during Obama’s second term.

BC’s The Tyee offers a cautious Canadian reaction to President Obama’s re-election.  The article's two chief points: (1) If Obama does not reach a debt deal with Congressional Republicans, who still hold the U.S. House of Representatives, America could tumble into recession, and drag Canada along for the ride; and (2) hope that Obama will clear full construction of the Keystone XL pipeline.  But The Hill calls Keystone XL an energy election-night ‘loser,’ seeing a Romney White House fast-tracking the project.  My guess: with Keystone XL already under construction, I don’t expect the Obama administration to stall Keystone XL’s northern construction much longer.

But, in any case, Heidi Heitkamp’s Senate victory in North Dakota guarantees one strong, Democratic voice in favor of the pipe-line.

And then, of course, one major pit-fall in Canada-U.S. relations was avoided.  Yesterday Michigan voters shot down a state constitutional amendment that would have delayed—and perhaps killed—plans to build a second, bridge crossing connecting Detroit to Windsor over the Detroit River—a project with obvious economic impact in both Canada and the United States, and strongly supported by Canadian Prime Minster Harper.

But one less reported story bears mentioning.  December 2011’s Beyond the Border Initiative (BTB), a Canada-U.S. project to streamline border regulations and bolster border security, might get a jump start.   Birgit Matthiesen offers this BTB post-election update for the Canadian Manufacturers & Exporters:

Over the last four years, Canada has too often benignly neglected by our neighbour. But the next four years presents an opportunity to build a North American manufacturing base. The US business community has a partner in Canada. One-third of our cross border business is intra-company and another third is comprised of intra-industry shipments. Our best ideas are each other's next new product.

The ball is in our court, as it always is when dealing with an American administration. But we do not have to start at square one.

Two initiatives between President Obama and Prime Minister Harper have already been launched – the Beyond the Border Action Plan and the Regulatory Cooperation Council. The ambition is great, but the progress is slow. Now that the elections are behind us, Ottawa and Washington need to get back to the table on these two efforts.

We have a major opportunity right now. 2013 must be the year that celebrates our cross-border partnership and the strength that our industries bring to each other's communities. Obsolete border management policies and unnecessary regulations must be replaced by a modern framework that will protect us from the economic storms ahead.

But, the big story—and not once mentioned on cable news last night—is that an Obama victory will continue progress, without the interruption of a presidential transition, on the Trans-Pacific Partnership (TPP).  As earlier reported on CUSLI-Nexus, Canada may likely play a critical role in ensuring these talks succeed.  And if this massive trade deal succeeds, it will likely—over the medium and long-term—generate more economic growth--and, at times, painful economic shifting--than any stimulus or jobs bill.  Furthermore, how the TPP goes may well portend how the future effectiveness of the World Trade Organization. 

What’s the importance of listing these seemingly unattached policy items?  First, it seems that two big pressure points in the Canada-U.S. relationship—Keystone XL and the International Detroit River Crossing—have (or soon will be) taken care of.  Next, Canada represents low-hanging economic fruit for the United States.  And—after Obama does heavy lifting on a debt deal and a job bill—the name of the White House economic strategy will be (with one major exception) connecting small dots to generate growth.  One major and needless U.S. economic drain?  Canada-U.S. border regulatory burdens that could be eased through smart, cooperative policies.

Now, naysayers may argue the United States has had trouble keeping focus on Canada.   But, if the TPP talks keep moving ahead, the United States simply won’t have this luxury.  Hence, whether pushed by state-specific issues or international trade diplomacy, the Canada-U.S. relationship may just see its fair share of time on center-stage during Obama's second term.