The Bloc Quebecois is making passage of a bill banning any trade concessions for supply-managed commodities a condition for its support of the minority Liberal government.
It’s a terrible idea, including for supply management.
The truth is that whoever wins the U.S. presidential election, the winner will impose more tariffs.
That will have enormous impact on the Canadian economy because the U.S. is our biggest customer.
Supply management is an important bargaining chip, but we lose it if the bill now in the Senate is approved.
World demand for dairy products is increasing and Canada is one of the few countries which has the resources to capitalize on that demand.
But we can’t export because the World Trade Organization has ruled that supply management is a subsidy and it has banned the export of subsidized products.
But there is nothing to prevent Canada from bargaining that involves ending supply management, nor from the federal and provincial governments from subsidizing milk producers via some back door, such as protecting the environment..
Chicken, eggs and turkey should be able to stand agains an unprotected border with the U.S. because we use the same genetics, feed and other inputs and we have more land and water.
We are certainly less vulnerable to hurricanes, such as Helene and Matthew that destroyed a significant portion of the U.S. chicken and egg farms and processing faciiities.
Fortune magazine has a feature article this month saying increasing tariffs will almost certainly happen with Donald Trump hitting harder than Kamala Harris.
It also calculates that Trump’s tariff proposals will increase inflation, reduce gross domestic product and cost the average American household $1,750 a year.
Those unintended consequences don’t register with voters. Nor does the fact that increasing tariffs is exactly the same as increasing taxes, which is political suicide.
What are the chances of the Bloc Quebecois bill passing? Pretty high.
Bang! Shot in our foot!
