Politics Briefing: NAFTA unlikely to be signed by today’s deadline

Good morning,

Today is a major congressional deadline for NAFTA, the trilateral trade deal that binds together Canada, Mexico and the U.S.

For weeks, high-level officials have been saying that a renegotiated agreement was close. But as the deadline comes, the three countries remain at odds on nearly every major issue on the table.

U.S. House Speaker Paul Ryan, a Republican, has said that meetings must end by today to give Congress enough time to pass a revised deal before the end of the year. Negotiators have been pressed for time both by the U.S. deadline, and the impending spectre of mid-term elections this fall, as well as the July 1 Mexican election.

One scenario has emerged under which the countries agree to U.S. demands on auto-content rules while leaving the other controversial parts of the deal untouched. Canada and Mexico have both said they are willing to give the Trump administration the quick deal it wants, but only if there is a compromise or a withdrawal of the most contentious demands.

This is the daily Politics Briefing newsletter, written by Chris Hannay Ottawa, Mayaz Alam in Toronto and James Keller in Vancouver. If you’re reading this on the web or someone forwarded this email newsletter to you, you can sign up for Politics Briefing and all Globe newsletters here. Have any feedback? Let us know what you think.

CANADIAN HEADLINES

The federal government says its promise to protect Kinder Morgan from losses related to B.C.’s opposition to the Trans Mountain pipeline expansion would also apply to any company that took over the project. Finance Minister Bill Morneau isn’t saying how such financial compensation would work or how much it would cost, nor would he speculate whether Ottawa might end up taking a financial stake in the project. The company has set a May 31 deadline to decide whether it will continue pursuing the pipeline expansion.

Mr. Morneau’s announcement came the same day the Alberta legislature passed a bill that will give it the power to punish B.C. by restricting oil exports to the province. “Albertans, British Columbians and all Canadians should understand that if the path forward for the pipeline through B.C. is not settled soon, I am ready and prepared to turn off the taps,” Premier Rachel Notley said.

Ontario Progressive Conservative Leader Doug Ford contravened elections law by appearing at a fundraiser, the Toronto Star reports.

Former Ontario Progressive Conservative leader Patrick Brown is writing a book about his “political assassination.”

Prime Minister Justin Trudeau says Israel’s use of live ammunition against civilians is “inexcusable,” and he called for an independent investigation into the violence in Gaza.

Border officers are expected to be pulled from airports and land crossings in the Greater Toronto Area and sent to Quebec to help process the large number of asylum seekers pouring over the Canada-U.S. border.

And an Ottawa-based charity is planning to create Canada’s first LGBTQ2+ museum, on a spot practically across the street from the national War Museum. It would be one of the few institutions of its kind in the world.

Campbell Clark (The Globe and Mail) on Morneau and Trans Mountain: “This was a negotiating tactic. Finance Minister Bill Morneau went out in public to say Ottawa would cover all the risks that Kinder Morgan had cited as its reasons for pulling back from the expansion of the Trans Mountain pipeline. And, he said, if Kinder Morgan didn’t want to take the deal, some other company will. It was a countertactic, on the very day that shareholders of Kinder Morgan’s Canadian subsidiary are to meet in Calgary, with the TMX pipeline on the menu.”

Chantal Hébert (Toronto Star) on Trudeau and Trans Mountain: “For Trudeau the most positive news on the pipeline front this past month has come in the shape of polls that found public support for the Trans Mountain expansion to be growing. But those same polls suggest that does not automatically translate into support for spending taxpayers’ money on keeping the pipeline project alive.”

David Parkinson (The Globe and Mail) on manufacturing: “Over the past couple of decades, we’ve grown unaccustomed to hearing the words ‘Canada’ and ‘manufacturing boom’ in the same sentence. But over the past few months, Canada has put together a nice little manufacturing boom. Whether the two can remain in the same sentence for a more sustained stretch could depend in no small part on Ottawa – and the government’s success on the NAFTA and tax-competitiveness fronts. Without removing those key uncertainties that are holding back business investment, manufacturers’ runway for booming looks pretty short.” (for subscribers)

Patricia Meredith and James L. Darroch (The Globe and Mail) on banking and regulators: “Instead of wasting time revising the Bank Act to preserve the status quo, our policy makers should focus on legislation to ensure access to infrastructure and data for innovative new entrants and access to financing for the SMEs that represent Canada’s entry into the 21st century information economy.”

Konrad Yakabuski (The Globe and Mail) on the Coalition Avenir Quebec: “The federal Conservatives appear willing to help the CAQ win this fall in the hope that Mr. Legault can return the favour in next year’s federal vote. A fresh CAQ government, provided it does not mess up out of the starting gate, could provide a major boost to the Tories. It would not likely be enough to allow Mr. Scheer to match Mr. Mulroney’s exploits in the province. Quebec’s urban/rural divide has only widened since 1988, and the blue axis can never again be what it once was. But it’s a lot stronger than it was a year ago.” (for subscribers)

Andrew Coyne (National Post) on Conservatives and Quebec: “Certain things recur eternally, in time with the rhythm of the seasons. Flowers bloom in spring. The swallows return to Capistrano. And the federal Conservatives prostitute themselves for the Quebec-nationalist vote.”

Cynthia Khoo (Policy Options) on internet policy: “Just as we do not expect all humans to grow into one specific kind of adult life, it may do more harm than good to impose a pre-existing notion of what a ‘mature’ industry, governance model or societal apparatus looks like on the Internet and Internet-based innovation.“

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INTERNATIONAL HEADLINES

North Korea is threatening to withdraw from the much-hyped summit between Kim Jong-un and U.S. President Donald Trump, sending reverberations that go far beyond the Korean peninsula. The North briefly had a co-operative tone in the wake of the historic meeting between Mr. Kim and South Korean President Moon Jae-in but have replaced it in an effort to seek more leverage from dismantling its nuclear program. North Korea says it will reconsider the talks with the U.S. “if the U.S. is trying to drive us into a corner to force our unilateral nuclear abandonment.” It also accused the U.S. of harbouring an “awfully sinister” urge to bring about the collapse of North Korea and citing the examples of Libya and Iraq, where regime changes occurred after U.S. involvement, in the process. China has come out and said that it wants North Korea to proceed with the summit, which is set to be held in Singapore on June 12. Although the North has long been an isolated country, China has been one of its few allies.

Former U.S. Secretary of State Rex Tillerson warned graduates of the Virginia Military Institute that American democracy is facing a crisis of ethics and integrity, taking a shot at his former boss. “When we as people, a free people, go wobbly on the truth, even on what may seem to be the most trivial of matters, we go wobbly on America,” he said. “If we do not as Americans confront the crisis of ethics and integrity in our society among our leaders in both public and private sector, and regrettably at times in the non-profit sector, then American democracy as we know it is entering its twilight years.”

Michael Cohen, Mr. Trump’s former personal lawyer, received more than US$100,000 from the president for a “third-party” expense, according to a newly released ethics disclosure. The payment by Mr. Trump renews questions about the US$130,000 payment by Mr. Cohen to buy the silence of adult film actress Stormy Daniels. Mr. Trump had previously said that he didn’t know anything about Mr. Cohen’s payment.

Steve Bannon, former White House chief strategist, sought to use personal data collected online to promote a “culture war,” according to Cambridge Analytica whistleblower Christopher Wylie. Mr. Bannon was a former vice president at the political consulting company that allegedly improperly used personal data or 87 million Facebook users. Mr. Wylie’s comments came in comments to the U.S. Senate. The Trump campaign hired Cambridge Analytica during the 2016 election.

The Brexit file continues to give British Prime Minister Theresa May’s government trouble, with the House of Lords demanding environmental safeguards to the bill that needs to be passed in advance of Britain’s exit from the European Union. The upper chamber, which is unelected, gave Ms. May’s government its 15th defeat on the Brexit bill.

And for those of you that are interested, our guide to the royal wedding is now live. You can catch up on what’s happening, who’s paying for it, why it makes some people mad and how it includes the Mulroney family.

David A. Welch (The Globe and Mail) on North Korea: “States ordinarily schedule summits when the outlines of a deal are already in place. In this case, the summit was scheduled first, and the negotiations have only just begun. It seems that North Korea does not like what it is beginning to learn about U.S. demands –and the White House, no doubt, does not like what it is beginning to learn about North Korean expectations. It’s hard to see a mutually acceptable deal.”

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