What – and Who – Canada Should Be Watching in Washington
The very foundations of the Canada-U.S. economic relationship - worth more than $600 billion per year – are shifting. On a daily basis, the Trump administration is remaking trade policy, unraveling regulations in areas like energy and the environment, and rewriting the tax code in ways that are changing the competitive landscape for cross-border businesses and forcing Canadian policymakers to respond. Washington’s new approach to foreign policy is testing traditional security alliances. Meanwhile, November’s midterm elections will reshape the House and Senate with important implications for cross-border interests—including the fate of trade pacts.
Here are the top issues to watch in the White House and U.S. Congress – as well as across government departments, regulatory agencies and state capitals.
- Trade and Agriculture
NAFTA. The key question is whether the countries can reach a détente soon on the trade front and whether Canada, in order to keep the peace, will be required to make significant changes to policies on dairy, procurement, telecommunications, pharmaceuticals and intellectual property. We’ll track the undulating power dynamics among key White House aides: Robert Lighthizer, the U.S. Trade Representative, a seasoned and pragmatic negotiator; Peter Navarro, the President’s Director of Trade and Industrial Policy, a hard-liner who sees trade as a matter of national security; Steve Mnuchin, the Treasury Secretary, and Larry Kudlow, director of the National Economic Council, two long-time Wall Street hands with the business community’s ear. If an agreement comes together on NAFTA 2.0, the action moves to Capitol Hill where the process of getting a deal through Congress could potentially prove lengthy and challenging. Read more about Pro's Agriculture coverage.
- Midterm elections
On Nov. 6, American politics is poised for an overhaul. Dozens of members of Congress are set to be replaced, with many retiring and others facing uncertain re-election prospects. Included in this potential wave are state legislatures, powerful committees and possibly one or both chambers of the U.S. Congress. We will scour the electoral battlefield for implications on Canadian issues, introducing readers to the new players and their positions on cross-border issues. If Democrats take the House, a key question will be whether they allow a trade deal to come to the floor for a vote – or whether they move to deny the President a “win.” And will any Republican lawmakers take up the pro-trade banner carried by departing senators Jeff Flake and Bob Corker? We’ll be watching Rep. Kevin Brady, chairman of the House Ways and Means Committee, and Sen. John Cornyn, the Senate majority whip. Read more from Pro's Midterms HQ.
- Tax policy and competitiveness
The Trudeau government will unveil a new competitiveness plan this fall under pressure to respond to the 2017 U.S. tax code overhaul. We’ll track how U.S. agencies like the IRS are implementing the new law and examine the effect on Canadian businesses, and individuals who must grapple with new tax bills – and compete with an economic behemoth of a neighbor that now has a lower corporate tax rate. Read more about Pro's Tax coverage.
Canada will become the first major industrialized country to legalize marijuana at the federal level on Oct. 17. While several U.S. states also have legalized cannabis to varying degrees, the federal government has not. We’ll track how the U.S. federal government responds to Canada’s move, and what the politics of pot at the federal and state levels means for Canadian and multinational companies, for cross-border trade and travel, and for investors. And we’ll monitor for state-level policies that could impact the future of Canada’s cannabis industry.
- Border Management and Immigration
From skilled worker visas to work permits for agricultural workers, Canada has a stake in the latest immigration gyrations by the Trump administration and the U.S. Congress. We’ll be covering those issues, plus how the administration’s immigration policies affect migration to Canada. Meanwhile, as border management gets more high-tech, we’ll be digging into every innovation, from facial recognition software for truck drivers to progress toward a fully biometric airport experience – and how new U.S. Customs and Border Protection Commissioner Kevin McAleenan is managing it all. And we’ll monitor how the U.S. government plans to staff and manage the Gordie Howe Bridge as this huge new commercial border crossing moves closer to reality. Read more about Pro's immigration coverage.
- Energy & Environment
Cross-border energy and environmental debates have faded from the newspapers since NAFTA supplanted the Keystone pipeline as the top bilateral irritant, but a pair of Canadian pipeline projects continues to face challenges in the U.S. Meanwhile, we’ll track how the Trump administration is relaxing environmental regulations for pipelines and auto emissions, and how Canadian regulators and automakers respond in industries that are highly integrated across the continent. We’ll also track moves on renewable energy such as wind, solar and hydro, at the federal level and in key states. Read more about Pro's Energy & Environment coverage.
- Technology and cybersecurity
After releasing a cybersecurity strategy this spring, the Canadian government launched consultations for a separate data-management policy. It’s part of a broader international conversation about how to defend against digital crimes, election-meddling, and identity theft, and the stakes are especially high as Canada emerges as a player in Artificial Intelligence and other emerging technologies. From resiliency of the integrated electrical grid, to privacy concerns, to the push for “smart cities” and the standing up of U.S. “Cyber Command,” we’ll cover the cross-border implications of the American technology policy scene. Read more about Pro's Technology & Cybersecurity coverage.
While moving aggressively to roll back the American regulatory state, the Trump administration has also agreed to breathe new life into the Regulatory Cooperation Council, a bi-national effort to harmonize regulations on everything from refrigerators to the SPF protections in lipstick. We’ll be following specific developments related to individual products, as well as broader developments and trends in the process.
- Defense and Alliances
The sprawling Canada-U.S. military relationship features countless points of contact, from NATO to NORAD and the emergence of a new private-sector-heavy space age. We’ll follow the debates over military policy – like spending levels, material purchases, radar refurbishment and missile defense – as well as tactical discussions. We’ll also focus on how Canada’s standing in these alliances shifts throughout the Trump administration. Read more about Pro's Defense coverage.
- Government Procurement
A controversial U.S. dollar-for-dollar procurement proposal signaled the first major rift in the NAFTA negotiation and remains a key issue at the negotiating table. But it’s also an irritant at the state and provincial level. When New York required home-made steel for infrastructure projects, Ontario retaliated in kind. We will not only track the national discussion but also systematically monitor for “Buy American” measures across state legislatures.
POLITICO Pro Canada is original reporting on policy trends and political developments that shape the deeply integrated Canada-U.S. relationship. Created for business leaders and policy makers, POLITICO Pro Canada’s exclusive coverage focuses on federal and state policies that affect bilateral economic interest and government relations. Learn more.