There was a colourful caution on the Canadian side in the early days of the tariff war regarding the strategies that might be used to bring U.S. President Donald Trump to his senses.
Various people noted: “We have to avoid punching ourselves in the face.” It was a reference to retaliatory measures that would end up hurting Canada more than the U.S.
Premier David Eby is clearly keeping the advice in mind. The latest B.C. move, announced Thursday, is a lot milder than the rhetoric he has been using for the past several weeks about Trump.
“Premier directs government to cancel American contracts wherever viable” was the headline.
It’s an appealing move to the vast majority of incredulous people who are watching Trump’s berserk economic moves and getting increasingly anti-American.
But “wherever viable” is a huge qualifier. After 40 years of more or less free trade on top of more than a century of mostly co-operative economic arrangements, cutting off that relationship is not as viable as some would like.
Eby expressed his wish to see B.C. disengage from as many deals involving U.S. supplier as possible several weeks ago. On Thursday he issued a more specific directive to ministries, health authorities and core Crown corporations “to decrease B.C.’s dependence on goods and services from U.S. suppliers.
He said British Columbians expect the government to do what most of them are doing — avoiding U.S. products wherever possible.
“That’s why we’ve directed our government to use its purchasing power to exclude American suppliers and support Canadian companies and trusted reliable trading partners instead.”
Eby said the initial directive was to shy away from future deals. The new order includes current contracts, requiring officials to look for every opportunity to “move existing contracts away from U.S. suppliers and cancelling non-essential government travel to the U.S.”
Existing contracts will be voided — “where viable” — and U.S. suppliers will be excluded from the government catalogue and other corporate supply arrangements. Subscriptions to U.S. publications will be cancelled. So will software subscriptions, but only “non-essential” ones.
Participation in U.S. industry and related associations will be paused or not renewed, and U.S. suppliers will be excluded from opportunities created by core government transfers.
There’s a key phrase in the announcement that hints at how complicated this is going to get.
“These directives will be applied, where viable, following an assessment of legal, financial, operational and other reasonable considerations.”
That leaves room for lots of re-thinking if the government realizes the shots it wants to take backfire.
The only reason why the B.C. public sector deals with U.S. suppliers is because it is cheaper or more convenient. So breaking off deals is almost certainly going to be more expensive, or cumbersome.
Eby acknowledged to reporters how difficult the disengagement will be. In the health sphere — referred to here Thursday — Eby said a lot of medical supplies come from the U.S. “Obviously, these are the kind of things we’re not going to be able to substitute.
“We’re not going to incur dramatic additional costs.”
He said smaller service contracts will be the focus of the drive.
If cancellation is not viable, officials will still have to find ways to encourage development of Canadian alternatives. The U.S. deals developed over time under trade laws that minimized restrictions on foreign suppliers.
Eby said: “These are obligations that the president walked away from in order to attempt to destroy our economy and turn us into the 51st state.”
His directive is a bid to express his contempt for Trump over the “derogative and insulting and inexcusable” treatment of Canada.
But it’s going to run headlong into his desperate attempt to get his deficit under control.
He claimed the government is “moving towards balance, identifying cost savings and reducing administrative costs.”
But all indications are the deficit will go up this year, not down. That makes finding ways to hurt the U.S. without costing B.C. more even more difficult.
The bar on taking part in associations has a notable exemption.
B.C. has belonged since 1991 to the Pacific Northwest Economic Region, an association of five U.S. states and three provinces and two territories. It bills itself as “the gold standard of U.S.-Canada relations.” Elected officials meet regularly to maintain trade relationships.
Eby said B.C. will stay on board to “identify people friendly to our cause” and encourage them to press Trump to change course.
Punishing U.S. suppliers while claiming B.C. is moving towards balanced budgets is a tightrope act that is going to lean heavily on that “wherever viable” clause.
