Saturday, November 19, 2005

Softwood Lumber Redux

Soft Wood, Hard Dispute
Canadian lumber subsidies aren't the real problem; Canada is.
by James Thayer

Someone has written an article about the Canadian vs. American softwood lumber dispute and has included all the messy little details that the other press never seem to include in their trenchant analysis.

It makes Canada look rather European.

Warning you may experience cognitive dissidence reading the article.

"It's called the softwood dispute. Frank McKenna, the Canadian ambassador to the United States, said recently that Canadians "are talking about it in all the cafés all over Canada."

All the cafes? I don't think so. The only people talking about this are the perenially outraged anti-American contingent, who can usually be found in ALL the cafeterias and cafes under the CBC building in Toronto. .

"In the United States timber rights are typically auctioned to the highest bidder. In Canada, 94 percent of the forest is owned by the government, and stumpage fees--the charge to harvest lumber--are set by government decree. American producers allege that the Canadian government sets stumpage fees at an artificially low level--one-third to one-fourth the actual value--to keep Canadian lumber workers and sawmills busy. United States producers claim this is a $4.4 billion (in Canadian dollars) annual subsidy of the industry."

"FROM 1996 to 2001 an agreement between the two countries allowed Canadians to export 14.7 billion board feet to the United States every year--tariff-free. When that agreement expired in March 2001, the United States levied tariffs on incoming Canadian lumber, and then two months later imposed an additional anti-dumping duty, charging that the Canadian lumber was being sold south of the border for less than it cost to produce."

So there is NO actual agreement presently in place. What 'truth' did the buffoon class reporter, who heckled Dr. Rice, think he was representing?

"The Americans insist now that tariffs will be lifted only when Canada opens its lumber markets to competitive bidding and removes its restrictions on log (as opposed to cut lumber) exports.

Does Canada restrict 'log' exports vs. cut lumber to the States to 'create' more jobs? This will have to be looked into later.

"Why does Canada refuse to let the market work in its softwood industry? Herbert Gruel, professor emeritus of economics at Simon Fraser University, and a senior Fellow at the Fraser Institute, puts it bluntly: "[T]he existing system was created to help the development of the province's vast timber resources. The industry got used to the benefits the system provided and removing them would impose substantial hardships. Many sawmill workers would have to accept lower wages or even lose their jobs. Much investment would have to be written off." In other words, artificially-low stumpage fees are a make-work system benefiting Canadian loggers and sawmill operators.

"At American expense. A United States industry group, the Coalition for Fair Lumber Imports, claims these Canadian subsidies have almost ruined the United States softwood industry. "Despite a strong home building market, U.S. lumber prices are touching new lows, bankruptcies and mill shutdowns are high and climbing higher, while Canada's share of the U.S. market approaches 35 percent, a near record high."

"Canadian conservative leader Stephen Harper knows it: he said the softwood standoff is due to the sour relationship between the Liberal party and Washington.

"Indeed, last April Secretary Rice's first scheduled trip to Ottawa was cancelled when Canada decided not to join the U.S. missile defense plan, deciding to accept American protection, but declining to pay for it [I don't believe we were ever asked to pay for anything, just to endorse it and enjoy some industrial benefits]. And then there's Canada's lack of support in the war against Islamist terrorists. And Prime Minister Martin's penchant for bashing the United States in order to divert attention from his Liberal party's scandals. The most recent demagoguery came during Martin's October 24 dinner with Rice where the prime minister blamed America for rising Canadian crime rates. Martin said weapons were being smuggled into his country from the States. (The National Post was quick to point out that no evidence exists that gun smuggling has gotten worse.)

It's a political pissing match; small potatoes to the Americans but something worth "talking about in all the cafés all over Canada." [ALL of them, mind you] If our corrupt gubmint's representative is to be believed.

We're being slapped upside da hade, for Chretien slipping out of the restaurant with Chirac, when the waiter brought the bill. Same old, same old.

Do people REALLY get the government they deserve?

Italics Mine


At 2:48 AM, Blogger xgrader said...

You need to examine in detail both systems. USA's system is seriously flawed in many ways.

You also need to study economics in regards to our softwood trade. There are many serious disadvantages in the USA, mostly of there own making, and will take many decades to sway the balance.

You make ridiculous remarks about previous agreements, that lead me to seriously wonder how much of a clue you really have.

Do some more homework, and write an accurate article.


At 10:54 PM, Blogger Blair said...

I wrote the paragraphs without quotation marks. The only statement(s) I made about the previous agreement(s) was that it expired. If you view this as ridiculous, I'll just have to live with that.

C'mon, you've got to be baiting me with the 'how much of a clue' line. What are you, new?

To recap; I wrote the parts without the quotation marks. The actual article was written by a man named James Thayer. You can read it by clicking on the title.

Thanks for stoppin' by.

Cheers yourself.


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