The New - 20/20 Magazine

with all bad us economic
news reported in the
media, some canadians
may wonder if James allen’s gloomy
take on america’s future seems
more appropriate in 2010 than
it did in 1775.
the global Great Recession has (at
least so far) hit the us far harder than
it has hit canada. the us is still our
most important customer, however,
so this is no time for canadian
self-congratulation.
rather, canadian manufacturers and
exporters need to understand what
effects the Great Recession has had on
our neighbours, so that canada and the
us can continue to work together to
maintain north america’s high standard
of living.
For this issue of 20/20, we contacted
three in-the-know americans to get
their insights into what canadians need
to know about the Great Recession’s
effects on the us. Here’s what
they shared:
effect #1 — many americans now
have a greater appreciation of the
canada-us supply chain’s importance.
one sign of the severity of the Great
Recession in the us came in the form
of protectionist Buy American rhetoric in
washington. this rhetoric was followed
up with protectionist measures being
incorporated into economic stimulus
measures such as the 2009 American
Recovery and Reinvestment Act (arra).
but this stimulus has become bogged
down in red tape, because the Buy
American rules are very confusing, and
what qualifies as truly “american” is not
readily clear.
Dawn Kristof champney is president
of the water and wastewater equipment
manufacturers association (wwema),
a us-based trade association that has
been actively highlighting how Buy
American procurement policies are
hurting the us recovery.
“this Buy American controversy
has already caused problems for us
companies who need to get critical
components for their products from
places such as canada,” she said.
Here’s one example, as explained
by champney: a wwema member
firm relies on unique canadian knowhow
for the production of a special
component for one of its water
filtration systems. arra contains rules
regarding procurement that include
what champney calls a “vague and
subjective definition of a ‘us-produced
manufactured good.’” such rules put
us firms like this wwema member,
which rely on global supply chains and
foreign-made parts, at a disadvantage.
“the fact that wwema members
are export-oriented,” champney said,
“only adds to their concern about
Buy American, since many us trade
partners have threatened retaliatory
measures in response to arra.”
How surprising that a Buy American
policy has had the result of giving many
americans a far more concrete sense of
the economic ties linking canada and
“This Buy American controversy has
already caused problems for US
companies who need to get critical
components for their products from
places such as Canada.”
the us than they had before. and that
can only help efforts by cme, by the
government of canada and by us firms
hurt by Buy American to ensure the us
government respects its commitment
(through naFta, etc.) to maintain
open markets.
effect #2 — the Great Recession
is increasing the us’ appetite for
discussions about how to reduce drags
on north american productivity.
“over many decades, canada and
the us have invested in what is a very
close continental relationship, and
it’s important during this difficult time
CANADIAN MANUfACTUrErS & ExPOrTErS’ MAgAzINE | 21