The Truce in the Softwood Lumber Dispute is Only Temporary
It now appears that a majority of provinces and
lumber companies have reluctantly accepted the softwood lumber deal agreed to
by U.S. President George W. Bush and Canadian Prime Minister Stephen Harper
during their meeting in Washington
in June. The agreement still has to be passed by parliament to become law. The
agreement includes a cap of 34 percent of market share on Canadian exports of
softwood lumber to the United
States and the return of 78 percent of the
illegal tariffs imposed on imports of Canadian lumber for the past few years.
The $1 billion of tariffs not being returned by the Americans will be divided
equally between the Bush administration and the U.S. softwood lumber lobby. This
payment to the lumber lobby is widely seen as payment of its legal fees for
Round Four of the softwood lumber trade war between the U.S. and Canada and as a restocking of its
war chest in preparation for Round Five.
The agreement is ostensibly supposed to run for
seven years. However, either side can terminate it after 18 months with a
six-month notice period. It also stipulates that the U.S. cannot re-impose duties for
one year after the deal is ended. In other words, for all intents and purposes
it is a three-year truce in the softwood lumber trade war that has persisted
for much of the past four decades.
In the face of initial broad opposition to the
agreement from the lumber industry, Harper adopted a “take it or leave it
attitude” and stated that he intended to declare it a non-confidence issue to
ensure its passage in the House of Commons. This would mean that the opposition
parties would either have to agree amongst themselves on how to ensure that the
bill passes or risk an early election. The Bloc Quebecois has “reluctantly”
endorsed the deal after consultation with the Quebec lumber monopolies. Meanwhile, the
Liberals and NDP, intent on making the deal an election issue, have labelled it a “sellout” and an unacceptable infringement on
Canadian sovereignty.
For their part, the majority of the lumber
barons in Canada, while upset that at least $500 million will be going to their
competitors to fight them in the future, have decided that they can live with
the deal because of the dire straits that the industry finds itself in at this
time. Rising energy costs and the increased value of the Canadian dollar
relative to the U.S. dollar, coupled with the U.S. tariffs, have resulted in a
decline in the competitiveness of the Canadian softwood lumber industry and a
drop in industry profits. In return, the lumber barons have shifted the burden
onto the backs of their workers, demanding concessions and laying off
thousands.
The cries of “sellout” by the opposition
parties are disingenuous and for the sole purpose of creating the illusion that
they would have done things differently if they were in power. They are
pointing out that every arbitration board and court has ruled in Canada’s favour over the past 15 years and claiming that the Bush
administration would soon have been forced to pay back the entire $5 billion in
illegally imposed duties. However, this ignores the entire record of the Bush
administration which proves that it cares little about legalities. Not only has
the Bush administration ignored all previous legal decisions on the softwood
lumber issue, but continues to defy a U.S. Supreme Court ruling of several months
ago that the detainment of prisoners without trial in Guantanamo was illegal. If it ignores its own
Supreme Court, why would it feel obligated to obey a lower court or arbitration
board ruling?
The fact
is that the problems in Canada’s
softwood lumber industry are a direct consequence of the domination of Canada
by monopoly capital. The motive of production under monopoly capitalism is
neither to create jobs nor to serve the interests of the domestic economy; the
sole motive of production is the generation of maximum capitalist profits. This
motive of production has led to the development of the entire Canadian economy
– not just the softwood lumber industry – as an export-oriented economy.
Furthermore, it has led to a situation where over 80 percent of Canadian
exports flow to one market, the United
States. Given the reality that the U.S. economy is ten times the size of Canada’s,
it is inevitable that the Canadian economy will be dependent on the American
economy and that the Americans are almost guaranteed to come out on top of any
trade dispute.
The Liberals, NDP and others are suggesting
that their particular policies would reverse this situation. CAW president Buzz
Hargrove is currently demanding a “Made in Canada” policy and is suggesting
that the Liberals or NDP could implement such a policy. However, this is all
sheer sophistry. So long as Canada
is dominated by monopoly capital, alternative policies amount to little more
than rearranging the chairs on the deck of the Titanic. The solution to these
problems is the fundamental reorganization of the Canadian economy to serve the
interests of the working class and people rather than to maximize the profits
of the capitalists. Such an economy would have to put an end to the current
reliance on exporting energy and natural resources and would base itself on
self-reliance and trade for mutual benefit. Such an economy is both possible and
necessary, but requires an end to monopoly capitalist domination of Canada’s
economy.