I make no judgements nor comments regarding the following because it seems like bullheadedness from both sides (on the lumber issue I mean). But what's your take on the oil?

Aug. 18, 2005. 08:47 AM

EDITORIAL: Use Cheney visit to push fair trade

To the Americans the Alberta oil sands are a godsend. As the second largest reservoir of oil on the planet, the tar sands could be just what the United States needs to shake off its dependency on Middle East oil and the high degree of uncertainty that accompanies it.

That happy prospect has prompted U.S. Vice-President Dick Cheney to tour the Alberta oil sands next month.

Despite some hostility from environmental and anti-war groups, Albertans "consider the Americans friends and are very happy with the kind of working relationship we have with them," an aide to Alberta Premier Ralph Klein said, confirming Cheney's visit. That's a sentiment most Canadians share.

But that affirmation of Canada-U.S. harmony is an ill fit with what Klein himself said last week after U.S. President George Bush's administration declined to play fair in our $5 billion dispute over softwood lumber. Washington rebuffed a ruling in Canada's favour by a North American Free Trade Agreement dispute settlement panel, which rejected the unfounded U.S. claim that Canadian softwood lumber exports are unfairly subsidized and so are hurting U.S. producers.

Klein demanded that Prime Minister Paul Martin's government "use whatever legal means it possibly can to force, if you will, the Americans to live up to their obligations under NAFTA." And he was speaking on behalf of all the premiers, who were meeting in Banff.

Klein knows full well that Ottawa cannot "force" Washington to do anything it doesn't want to do. The Bush administration's decision to dismiss a ruling by NAFTA's court of last resort, made in response to an "extraordinary challenge" launched by the Americans themselves after another dispute settlement panel ruled in Canada's favour, amounts to a breathtakingly egregious breach of faith.

Short of launching a full-scale trade war, which could hurt Canadians as much as Americans, all Ottawa can do is put diplomatic and moral pressure on Washington, which is what Trade Minister Jim Peterson tried to do Tuesday, announcing that Canada has suspended further negotiations on softwood until the Americans show some good faith. Canada expects the U.S. to lift its duties on Canada's softwood exports and return $5 billion it has unfairly levied thus far.

But Cheney's visit gives Klein, who has a well-deserved reputation for speaking his mind, an opportunity to do a little arm-twisting on the side.

He should tell Cheney that if Americans want Canada to be their gas station on fair trade terms that serve both countries, they ought to be prepared to shop, fairly, at our lumber yard as well. Free trade in oil and gas should go hand-in-hand with fair trade in softwood.

After all, American access to Alberta's vast oil reserves is covered and protected by NAFTA, the same free trade deal that is supposed to guarantee Canada's softwood lumber producers free and fair access to the U.S. market. Does Cheney expect NAFTA to apply to oil and gas but not to wood? If so, it would be instructive to hear him articulate that case.

As the Bush administration ponders a strategically-located Canadian storehouse of energy that can keep America's economy humming through any global storm, Klein should remind Cheney that our lumber industry is not asking for special treatment, only basic fairness.

The Americans freely negotiated NAFTA with us. They agreed to honour its dispute settlement mechanisms. Then they reneged. That is one shaky foundation on which to build stepped-up co-operation on energy.