BULLETIN: U.S. probe into Nova Scotia subsidies: Do we measure the ‘success’ of free trade in dollars or in votes?
This week marks the 25th anniversary of the signing of the Canada-U.S. Free Trade Agreement. This week, U.S. Trade Representative Ron Kirk has launched an inquiry under the North American Free Trade Agreement to determine if the Nova Scotia government has offered improper subsidies to a Cape Breton paper mill.
These developments reinforce the notion that perhaps it makes sense to think of free trade as more of a political tool than an economic concept. As such, its ‘success,’ through the lens of policymakers, lies not in its economic effects (these are diffuse, difficult to measure, and even more difficult to distribute) but in its viability as political capital, as a tool of pressure, as a means of placating voters.
It is for this reason that the invocation of free trade discourse—or the stirring of its institutional machinery—is immediately addressed in terms of political motivations, not of economic realities.
This is how Nova Scotia Premier Darrell Dexter responded to the potential NAFTA challenge:
“Naturally enough, people who are running for election will want to be seen to be taking positions to protect their businesses and their people. We understand that. We’re in that business too.”
So, on the 25th anniversary of CUFTA, when we discuss the merits of free trade and debate its future direction, we should remain cognizant of the degree to which policymakers measure the ‘success’ of free trade not in dollars, but in votes. Maybe this is the only way we can assess whether free trade is really doing the work it was meant to do in the first place.