Is that it? Is that all the Americans are asking for, as their opening negotiating position on the future of the North American free-trade agreement? Canada, you may now exhale.
After all the noise candidate Donald Trump made about trade deals as alleged destroyers of American jobs, with Mexico the chief villain and NAFTA a weapon aimed at American workers, it was expected that the administration of President Trump would go into the NAFTA talks with some very steep demands. Unlike a traditional Republican, he essentially ran against free trade, portraying it as a zero sum game, where you are either a winner or a loser. He promised that he, master deal-maker, would rewrite the rules and turn the rest of the world into losers.
Six months into his presidency, however, and Mr. Trump is making a habit of letting down voters foolish enough to have bought into his campaign rhetoric.
This week, he did it on health care: Having campaigned on repealing Obamacare and replacing it with something cheaper, better and offering more benefits with zero obligations – an impossible promise, in other words – he and his party have now thrown up their hands and accepted the status quo.
He's about to do it on NAFTA. On Monday, U.S. Trade Representative Robert Lighthizer released the administration's aims for the renegotiation of the free trade pact. There's a lot here that Canada can and will object to – but the list of demands doesn't match the fire-breathing rhetoric of a few months ago.
That may be a disappointment to Trump voters. It should be the opposite for Canadians.
To be clear, the reopening of NAFTA is not a good thing. Surgery is never something to be entered into lightly. But until recently, it looked like the goal of the American physician was engineering the patient's demise. That's why Mr. Lighthizer's shopping list comes as a relief: His goal is merely injuring NAFTA, not giving it a toe tag and sending it to the morgue. This is progress.
What does the American chief negotiator say he wants? Some of it Canada can benefit from, such as an opening up of this country's agricultural supply-management system. Some of it is problematic, like a call to effectively make a lot of consumer e-commerce duty- and tax-free; that would appear to give non-Canadian e-retailers an huge advantage over traditional, local retailers who have to collect GST, HST and provincial taxes.
And some of what the Americans want is a non-starter. At the top of the list is a call to get rid of the bi-national dispute settlement mechanism. This issue nearly scuppered the free trade deal a generation ago, and it's not hard to see why Canada demanded that it be part of any agreement.
Think of a trade agreement like a contract between countries. When people sign a contract, an outside and impartial body – a court – may at some point have to decide who is living up to the terms, and who is not. NAFTA's dispute settlement system is far from perfect, but ditching it would mean that in future trade disputes, the U.S. government would get to play complainant, prosecutor and judge, all rolled in one.
Washington, the larger party, likes that idea. Canada, the smaller party, wants and needs a contract enforced by the rule of law.
Mr. Lighthizer says his team will also push for a carve out for "Buy American" programs, which basically means exempting them from the rules of free trade.
The Americans also want to no longer exempt Mexican and Canadian firms when they take what are known as "safeguard" actions to restrict the import of some classes of foreign goods. That's also a carve out from the principle of free trade, and a diminution of NAFTA, since it would mean subjecting Canadian and Mexican firms to the same treatment as those from outside the free-trade zone.
And Washington wants Canada and Mexico to be completely opened to foreign investment in all sectors. Canada has traditionally restricted investment in sectors from telecommunications to banking to culture.
The dispute settlement demand is a non-starter. The rest, Canada can at least work with, and aim to modify, diminish and trade away for other things. In fact, as part of the horse-trading process, the Canadian government needs to come up with a long list of demands of its own.
Of course, there are no guarantees that all will end well. Canada is not a target many American voters are interested in bashing, but Mexico is another story. And there are elections in both Mexico and the U.S. next year, and voters in both countries who want to see politicians taking shots at those on the other side of the border. Things can always go off the rails. But the NAFTA weather forecast, formerly a tornado warning, has for the moment been revised down to mild rain showers, with a chance of sun.