Buy American will bite Canada

Canada has become an interesting focal point for America’s new president in his early days at the Whitehouse.

From President Barack Obama’s first international visit being a work day here in Canada to the “Buy American” protectionist measures in his $820 billion stimulus package, Canada is actively on his radar.

One can understand the protectionist measures to a degree, keep your money at home , spend it internally and create jobs here. You do not want to be seen as helping other people’s woes when you have thousands of people without work in your own nation. The flipside, other nations will not buy American in return, and where does that leave you?

The supply and trade chains between Canada  and the U.S. are so intertwined and integrated, such measures from either side would hurt the other. Ultimately, Canada would be hurt the worst if the protectionist measures cover anything that is bought with taxpayer money under the stimulus plan.

The House of Representatives have already passed the stimulus package and awaits the Senate’s approval. There are already measures in it that ban the use of foreign iron and steel to help generate activity in those sector’s of America’s economy.

Canada needs to push that it should not be “Buy American” but “Buy North American”, NAFTA is there for a reason and should not tossed aside. Swaying President Obama to ensure American does not completely close its doors is quite the diplomatic challenge for Prime Minister Stephen Harper and his team.

When former President George Bush tossed the keys to President Obama, he left the new president with many problems under the hood, who knew that clanking sound would be coming from Canada.

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