Brian Mulroney chides Ottawa on handling of pipeline crisis

Former Prime Minister Brian Mulroney says Ottawa has “abdicated the leadership of the national government” to interest groups when it comes to addressing the crisis in oil pipeline capacity.

Mulroney told a Toronto investment conference his own strategy would be to try to make First Nations, environmental groups and provincial premiers stakeholders in a project to construct pipelines running east, west and south.

“Otherwise we keep in the ground 175 billion barrels of oil that should be benefiting all Canadians across the country,” Mulroney said at the Franklin Templeton 2019 Global Market Outlook event. He is to deliver a eulogy at the state funeral of former U.S. President George H.W. Bush in Washington on Wednesday.

If those groups refused to support him, Mulroney said he would move ahead anyway, letting Canadians decide, as he did over the matter of the U.S.-Canada Free Trade Agreement in 1988, “whether they support me or they support these other characters, because you can only have one Prime Minister at a time.”

“I’d take my lumps with the electorate, but I’ll bet you a dollar to a doughnut if this is properly laid out they’ll vote for this just as powerfully as they voted for free trade,” he said.

Critics of the Canada-U.S. Free Trade Agreement went to “bizarre lengths” in the 1988 federal election to scare Canadians into believing the “sky would fall” under free trade, Mulroney said. Instead, trade volumes have more than tripled in less than 25 years, from $235 billion in 1989 to $881 billion today, he said.

The U.S. has also done “extremely well” out of the deal, he added.

“A country that has an unemployment rate of 3.8 per cent, the lowest of any industrialized country in the world, cannot seriously argue that it has done poorly in its international agreements,” he said.

Mulroney praised the new U.S.-Mexico Canada Agreement for modernizing NAFTA, maintaining the Chapter 19 dispute settlement mechanism and making compromises on rules of origin in the automotive sector “which really cost Mexico but didn’t hurt Canada or the United States.” The new deal increases the amount of parts and raw materials in a vehicle that must come from American or Mexican sources and raises the percentage of production to be done by workers earning at least US$16 an hour.

“We’ll see now whether it passes Congress and our two parliaments,” Mulroney said.

Though Prime Minister Justin Trudeau, Mexican President Enrique Pena Nieto and President Donald Trump signed the USMCA on the sidelines of the G20 Summit in Argentina last week, the pact still requires ratification by the three countries. While it is expected to pass easily in Canada and Mexico, it faces an uphill battle for approval by the new Democrat-controlled U.S. Congress. Among other things, the Democrats have criticized the enforceability of the new deal’s labour and environmental standards.

In response to the pushback, Trump has said he will terminate the original NAFTA, effectively leaving Congress to chose between USMCA or no deal at all.

Also at the G-20 summit, China and the U.S. reached a 90-day trade truce Saturday following a meeting between Trump and Chinese President Xi Jinping. Trump has since said he will revert to imposing more tariffs on China if efforts to reach a trade deal with Beijing are unsuccessful.

“It’s going to be very complicated and it’s going to be very tough,” Mulroney said of the U.S.-China talks.

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