The United States to 2020 and the Requirement for Canadian Action

Excerpts from The US to 2020 prepared for the Business Council of British Columbia

America will remain the principal power in the coming decade, with preponderant military capacity. America’s greatest asset is its resiliency and its capacity for hard work, creativity and risk-taking. President Obama has launched an ambitious, radical renovation of the American economy that will encompass health care and education, as well as climate change.

There is a growing diffusion of power – an emerging multipolarity at the state level that is complicated by threats that defy classic relationships. Most important for Canada is the rise of China and India, a European federation preoccupied with internal cohesion and disinclined to interventions requiring force, and a Russia that is reasserting a sphere of ‘privileged influence’, including in the Arctic. Terrorism, pandemics, religious and tribal animosities and cyber threats further confuse the international arena and underline the requirement for reform and restructuring of the international system.

For Canada, the U.S. is principal ally, economic partner and friend.

Like it or not, know it or not, a vigorous Canada requires a robust America. It is critically important for Canadian security, livelihood and prosperity that we understand the changes taking place in America and their interplay with our own interests and the rest of the world. The changes – economic, demographic, regional – will have profound implications for Canadians, particularly as they relate to security and the border, economic integration, and policies for the environment and energy.

The responsibilities of global primacy and a preoccupation with domestic concerns on the part of the U.S. mean that Canada, never top of mind in American calculations, must constantly, consistently and forcefully make its case. Geographic propinquity and integrated economies provide the platform, while the need for joint, complementary action is illustrated by events as diverse as 9-11 (and closing down Canada-US airspace), pandemics (eg. SARS), and the restructuring of GM.

To advance mutual prosperity we require a ‘smarter’ partnership with the U.S. The onus for initiative lies with Canada. American leadership responds best to big ideas that play to their agenda. By framing our own interests around the American preoccupation with national security, economic recovery and, climate change we can advance our own agenda.

To succeed in the complex American arena we need to have a thousand points of intersection and a high profile media strategy. Thus the requirement for bold, pragmatic leadership – beginning with the prime minister and premiers, with a role and responsibility for Business and Labour, first to develop a coherent set of policies, and then a multi-level strategy to advance and follow-through on Canadian interests.

Summary of Observations & Recommendations for Canada

1. Security is the abiding American preoccupation. We must be their ‘safest’’ and ‘most reliable’ partner – progress on all other files begins with security.  The U.S. needs a high level of confidence that we ‘watching their back’ and to be consistently reminded that we are a reliable partner in collective security (eg. Afghanistan).
2. ‘Smart, bold partnerships’ on energy, the environment, labor mobility, regulatory standards and perimeter management will advance Canadian interests. We can’t take our well-being in the North American space for granted. Continued incrementalism means eventual decline.
3. ‘Being there’ is the best way to understand America. We should have a diplomatic presence in every American state by 2010.
4. Canadian universities and think tanks need to develop ‘knowledge centres’ around critical aspects of the U.S. and develop closer relationships in the U.S. And make maximum use of ‘star-spangled Canadians’ to connect2Canada.
5. Advancing Canadian interests requires a permanent campaign with activist, visible outreach – no other trading partner creates as many jobs for Americans as Canada. It requires a commensurate effort to educate Canadians about the importance of the U.S. for their own livelihood
6. The abiding strength of the Canada-US relationship lies in the hidden wiring – the relationships between states and provinces, business and labour and especially the personal connections between premiers and governors, and legislators.
7. Now is the time to begin an aggressive investment promotion campaign to capitalize on the comparative advantage that Canada will enjoy coming out of the economic downturn. And seek to reduce the friction of cross-border arbitrage by creating the conditions for commensurate productivity with the U.S.
8. A ‘Team Canada’ mission to Silicon Valley and other high-tech centres led by the prime minister and premiers and involving university presidents should aim to create joint research and development projects to enhance Canadian-American competitiveness.
9. Governments must resist the temptation to over-regulate. Business and Labour need to recognize that the changed situation requires them to improve their own game and step up for the common good. Political leadership must be vigilant to the bureaucratic instinct to control and over-regulate. Risk management coupled with good intelligence is the better way to ensure the beneficial flow of people and trade.
10. Canadian resources are central to American energy security. Withholding them is a hollow threat and would only threaten our own unity. But efforts to discount ‘dirty oil’ should be fiercely resisted as protectionism wrapped in ‘green’. Achieving an early, joint approach to carbon management will give us the initiative on the road to Copenhagen. Hydro electricity is an important Canadian card. It’s clean, it’s there and it’s what the smart grid needs. There is a particular opportunity and contribution to nuclear non-proliferation if Canada were to assume stewardship of uranium from ‘cradle to grave’. Commence planning to build a pipeline from the oil sands to the West Coast to diversify and open markets with Asia.

Summary of Observations & Recommendations for British Columbia

1. Regional collaboration, particularly strong between western governors and premiers and legislators (ie. PNWER) is practical, advances mutual interests and can have very positive application to the national level (eg. smart drivers license).
2. Premiers and governors are consistently ahead of the curve in their appreciation of the Canada-U.S. relationship. Launching annual meetings between the National Governors’ Association and Council of the Federation would temper protectionist instincts by underlining the ‘best customer’ relationships between states and provinces. 
3. British Columbia’s pioneering experience with a carbon tax should be integrated into the Canada-US ‘Clean Energy Dialogue’ and into the evolving global dialogue.
4. Water will emerge as the most important resource issue in the 21^st century. It offers both an opportunity for business development, especially in clean water technology and sustainability, and a challenge for policy management.
5. Lumber: As with energy, our dependence on the U.S. market requires a rethink of our marketing strategy – we need to aggressively market to Asia
6. Fish: The ongoing effectiveness of the Pacific Salmon Treaty in 1985 and the Pacific Salmon Commission is a reminder that binational institutions with close state and provincial involvement are the most effective mechanisms for managing resource issues.
7. British Columbia needs to remain vigilant in combating crime to prevent Vancouver and its port from being seen as a gateway in illicit trafficking in people and drugs.
8. Vancouver has become a global hub for creative industries – film and television production, electronic games. They are the incubators for ‘creative communities’. Policy initiatives that respect intellectual property and promote infrastructure, transportation and education are smart investments for the future.
9. Talent will increasingly determine economic prosperity and smart immigration policy, using the provincial nominee program, fast-tracks applicants with skills and talent. It is equally important to sustain and enhance the long-term flow of Asian students seeking high school and university education and to put more emphasis into targeting American, especially Latino students, as a bridge into the Americas and America’s growing Latino population.
10. Drawing on the best practices of the 2000 Sydney and 2008 Beijing Olympics, use the 2010 Olympics as a trampoline to market British Columbia and Canada as a ‘clean and green’ destination for tourism, trade and investment.