September 13, 2013

Finest Hour 104, Autumn 1999

Page 27

BY PAUL H. ROBINSON, JR.

Adding Britain Is a Logical Extension or the North American Free Trade Agreement

IN April 1941, Winston Churchill broadcast to his nation and the world a report on the war, which was still going badly for Britain. Nevertheless, he offered hope and he noted, “Nothing that can happen in the East is comparable to what is happening in the West.” He closed with the following lines, “…which seem apt and appropriate to our fortunes tonight and I believe they will be so judged wherever the English language is spoken or the flag of freedom flies:”

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And not by eastern windows only,
When daylight comes, comes in the light;
In front the sun climbs slow, how slowly.
But westward, look, the land is bright!

As Britain contemplates Europe’s Economic Monetary Union, this sentiment has implications today. Should Britain join the EMU, there would almost certainly be a negative effect on Britain’s sovereignty as well as elimination of the pound.

Before World War II Churchill said, “We are bound to further every honest and practical step which the nations of Europe may make to reduce the barriers which divide them and to nourish their common interests and their common welfare….But we have our own dreams and our own task. We are with Europe, but not of it. We are linked, but not absorbed.” After the war, while calling for European unity, he never suggested that Britain’s sovereignty should be absorbed into the continent or that its institutions or currency should be subordinated to the interests of the continent.

The purpose of this article is to suggest that the best course for Britain, which is also in the best interests of Canada and the United States, would be to join with North America on a trilateral basis or as a regular or associate member of the North American Free Trade Agreement.

This would not interfere with Great Britain’s existing obligations under the Maastricht Treaty, but would expand her trade horizon greatly. The UK could become the trade linchpin of the Atlantic between Europe and the Western Hemisphere. “A rising tide lifts all boats.” This market could be expanded to include other European countries as well as kindred nations such as Australia and New Zealand.

U.S. Senator Phil Gramm, chairman of the Senate Banking Committee and member of the Finance Committee, has directed the International Trade Commission to prepare a report analyzing the impact on the U.S. economy, including the impact on American consumers, producers, service providers and exporters, of including Great Britain in a free trade area with the United States, Canada and Mexico.

This report must be submitted to the Senate Finance Committee within 180 days. I hope that the British people will agree this additional trade incentive should be pursued, and that they will make their views known to their Members of Parliament and other appropriate political leaders.

Senator Gramm has stated: “I would like to see Great Britain joining NAFTA to expand trade relations between the U.S. and the U.K. Being in the free trade agreement with us would not prevent their being in a currency agreement with Europe. But it would make good sense because we have so much British capital here and we are close in terms of financial development and historic ties. It would be a check on both protectionism within America and Europe….It is up to the British to respond.”

European parliamentary elections show there is only passive interest in that body and suggests that further governmental connection with the European Union—which joining the euro would mean—is not universally acceptable in Britain. Prime Minister Tony Blair has commented: “We have got to listen and reflect on the lessons of the election.”

While United States Ambassador to Canada, I was called the “Godfather of Free Trade” between the two countries, which has now evolved into NAFTA. Adding Britain is the logical extension of that effort. In this endeavour, I have spoken to political and governmental leaders who have expressed a genuine interest. Conrad Black, owner of The National Post and 400 other newspapers in four countries, has also strongly supported this effort in several articles that appeared in his and other publications.

Trade between the United States and Canada is the largest in the world, last year totaling $504 billion. U.S. Direct investment in Canada has increased from approximately $85 billion in 1991 to $130 billion in 1997. Canadian direct investment in the United States has gone from $63 billion to $99 billion in the same period. In 1998, British investment in the United States was $142 billion: Great Britain is America’s largest foreign investor.

These statistics show the already-great interrelationship between our countries. By comparison, the euro has slipped 8% against the pound, and 12% against the U.S. dollar, since its inception at the beginning of 1999. The American-Canadian trade increase shows what can be done under a trade agreement, particularly in light of the fact that two-way trade has more than doubled since 1989. Between 1992 and 1998, two-way trade increased by more than 13.7% per year, or approximately $1.5 billion per day. Britons must awake to this greatly increased additional trade opportunity: history commends it, economics demand it, reason endorses it. 

Paul Robinson was U.S. Ambassador to Canada, 1981-85. He is currently chairman of Robinson International, Chicago and Washington, and chairman of the International Council of Churchill Societies.