Never having been much of a supporter in the first place, I can’t say I mind this week’s demolition of NAFTA, aka the US/Canada softwood lumber “compromise.” But if I were a “sober realist” about free trade, I might be composing a mea culpa of my own to those hippie NAFTA skeptics right about now:

The federal government defended its softwood deal with the United States Friday, dismissing suggestions the pact favours American interests and arguing that it took action where past efforts had failed.

…On Thursday, Mr. Harper announced the Conservative government had brokered a truce in the long-running softwood lumber dispute.

…A key element of the agreement will see about $4-billion (U.S.) in U.S. collected duties returned to Canadian firms. However, about a $1-billion in U.S. collected duties remains south of the border despite Ottawa’s victory in legal battles under the North American free-trade agreement that would have refunded all levies.

That aspect of the agreement drew fire in the House of Commons on Friday, with opposition critics accusing the government of bowing to the United States.

“With yesterday’s deal, Canada lost both ways,” Liberal House Leader Ralph Goodale said.

“It was a political deal, a deal at any price, and the Americans got a signing bonus of up to $1.5-billion, swiped directly from Canadians.

“Why did this government give in on bended knee to Uncle Sam?”

….
The complex agreement also allows Canada to ship as much lumber as it wants to the United States. But if the price falls below $355 per thousand board feet, the different regions of Canada can make a choice.

They can pay a sliding export tax that rises as high as 15 per cent as lumber prices fall, or pay a smaller charge and face a regional quota. Canada would collect the export tax.

Now I’m no hippie, but from where I sit, the US keeping 20% of 5 billion unjustly levied tariff dollars does not sound like a victory for free trade, especially against a backdrop of consistent legal rebuffs to the US position by the NAFTA court. A hippie might even quote Bobby Dylan: Steal a little and they throw you in jail/Steal a lot and they make you king.

The real coffin marker, however, is the quid pro quo. Capping Canada’s market share at 34 percent (unmentioned in the Globe article, but alluded to here) while guaranteeing US timber interests their own slice of the action in a down market, is less reminiscent of Adam Smith and David Ricardo than it is of Tony Soprano and Johnny Sack, carving up the waste management business. From the market’s reaction to the deal, too, it looks like Fat Tony took Johnny to the cleaners.

Canadians should look on the bright side, however. With the US’s actual stance towards free trade now abundantly clear, Canucks should feel perfectly fine disregarding NAFTA requirements in other areas, like the requirement that Americans get Canada’s oil on the same terms as their own citizens. Gas prices in the US are starting to approach those that Canadians have been paying for years, I hear. Be a shame if their largest source of imported oil decided that it should go to its own people first, instead of a bunch of gas-guzzling whiners with no interest in open bilateral trade. Nowad’msayin’?

Capice?