The Canada-U.S. Free Trade Agreement

Brian Mulroney (centre) November 1988 Federal Election Rally

The Canada-U.S. Free Trade Agreement

by Mark Wegierski

It seemed, in the summer of 1987, that Brian Mulroney’s Progressive Conservative federal government was headed for one of the worst defeats in Canadian political history. In many of the 1986 and 1987 polls, the federal P.C. party stood at about a quarter of committed popular support, behind both the Liberals and the New Democratic Party (NDP), Canada’s social democrats. Indeed, the NDP had temporarily surged into first place.

Despite the early hopes placed in him, and an overwhelming majority won in 1984, Mulroney was constantly beset by crises and scandals and had arguably failed to develop any coherent or consistent policies, apart that is from strengthening the status-quo of the previous federal Liberal governments. It appeared that virtually every region, province, or interest group in Canada had in some way been alienated from, or offended by, Mulroney. Sometimes, it seemed that his only true supporters were his business pals, for whose benefit he appeared to make most of his exertions.

However, Mulroney did have a genuine interest in Free Trade. Throughout most of Canadian history, the Tories had opposed free trade with the United States, while the Liberals had championed it. In the 1980s, however, the roles were reversed. Indeed, John Turner, the Liberal contender in 1988 — who expressed considerable patriotic sentiments, and was often perceived as a “right-wing Liberal” – could be seen as, comparatively-speaking, more “traditionalist-conservative” than Mulroney.

The Canada-U.S. Free Trade Agreement, ironically, gave Mulroney the one, perfect issue, on which to wage the election of 1988. A simple issue, appealing to a combination of people’s fear and greed, it became the centre-piece of his efforts. Mulroney was able to win a strong majority in the federal election of November 21, 1988, but it could be argued that the true time of reckoning came in 1993, when the federal P.C. party was reduced to a total of two seats.

Presumably, Mulroney did not try for a third term because he sensed that a humiliating defeat was in the offing for the P.C. party. Kim Campbell proved to be a lackluster Prime Minister. Canada was also in a period of economic recession. The P.C. coalition fell apart between the pincers of the Reform Party from the West, and the Bloc Quebecois from Quebec. Ontario voted massively for the Liberal Party in 1993.

In 1987, Mulroney had reached the Meech Lake Accord, a deal with the provinces, which was going to finally break Canada’s constitutional stalemate. Quebec had never agreed to accede to the Constitution Act, 1982, which Liberal Prime Minister Trudeau – in the opinion of many Quebecois – had arbitrarily imposed on Canada and Quebec. The most salient aspect of the Constitution Act, 1982 was the Charter of Rights and Freedoms, which Quebec objected to, because it believed it undermined the province’s collective rights, which had been deployed in previous decades to uphold Quebec as a French-speaking and culturally distinctive province.

The central plank of the Meech Lake Accord was the recognition of Quebec as “a distinct society”. In return, Quebec would accede to the Constitution Act, 1982. The debate over the Meech Lake Accord would drag on until 1990, when the opposition of two smaller English-Canadian provinces, and what was perceived as a groundswell of popular resistance to it in most of English-speaking Canada, would be enough to sink the deal. The Meech Lake Accord was opposed both “from the right”, by Preston Manning and “from the left”, by Pierre Elliott Trudeau. The failure of the Meech Lake Accord would lead to another attempt to break through the impasse, the Charlottetown Agreements of 1992. However, when put to a general, countrywide referendum in late 1992, the Charlottetown Agreements floundered.

Near the end of his second term, Mulroney had brought in the Goods & Services Tax (GST), the Canadian equivalent of the VAT (value-added tax). Set at 7%, it was applied to virtually all economic transactions in Canadian society. The Liberal contender in the 1993 election, Jean Chretien, explicitly promised to abolish the GST. However, he never did so, and the revenue from the GST was doubtless a major element in the federal Liberals’ ability to have huge government spending but also to eventually balance the federal budget. The Canadian media never held Chretien accountable for breaking such a major promise to the Canadian electorate. When the Liberal M.P. John Nunziata voted against the Liberal budget on account of that broken promise, he was summarily expelled from the Liberal Party. Forced into a difficult run as an independent candidate, he was nevertheless re-elected in his riding in the 1997 federal election.

During his Prime Ministership, Mulroney was attacked by the media for being “sleazy” and “hard right” – when, in actuality, he was viscerally “small-l liberal”. For example, he allowed immigration to rise to the unprecedented level of about a quarter-million persons a year – where it has basically remained ever since. His “strong leadership” was mainly used to suppress any “small-c conservatism” in the federal P.C. party.

So, it transpires that Mulroney’s main “right-wing” historical accomplishment was the Free Trade deal. Indeed, in September 2000, Mulroney said he considered it his greatest achievement, and he urged the abolition of border posts along the Canada-U.S. border.

Mark Wegierski is a Toronto-based writer and historical researcher

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