Jack Mintz: EU ‘partnership’ is not the answer to our U.S. problems

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Photo by Ahmet Sel/Anadolu via Getty ImagesIn the past two weeks, my wife and I spent time in Germany and the United Kingdom. Luckily, we didn’t include France on our trip. Friends who were in Paris last week said many tourist sites were closed and violent demonstrations had to be carefully avoided.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountFrance is a symptom of what is wrong with Europe: paralysis and polarization. Its electorate is shifting to the nationalist right and Marxist-leaning left, neither of which has answers for France’s fiscal, social and security issues. Trying to balance the country’s budget by cutting far-too-generous pensions and social handouts might well spark a revolution. Nor is growth an answer: the country’s competitiveness has been hampered by over-regulation, high taxes and an education system that’s underfunded because of costly teacher pensions.This advertisement has not loaded yet, but your article continues below.The EU is an economic not a political union. Its treaty guarantees freedom of movement of goods, services, capital and people among member countries. It has achieved monetary integration via its own currency, the Euro, although not all members have adopted it. In its early days the EU prospered but it has since experienced low economic growth and a standard of living that is falling behind the United States.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againParalysis in decision-making, high taxes, and over 15,000 EU regulations have undermined European productivity, not just France’s. The EU’s share of world GDP (adjusted for purchasing power parity) has declined from 27 per cent in 1980 to 14 per cent today. In contrast, the United States share has remained at roughly 26 per cent though it has fluctuated over the years.In his new book The Return of the Great Powers, Cambridge historian Brendan Simms writes that “Over the past thirty years or so, the Europeans have never missed an opportunity to miss an opportunity… (A)t every stage, Europeans refused to take the fiscal, political and military leap necessary to secure the EU’s future. There are many projects which make sense in theory but fail in practice. The European Union is unusual in that it is attempting something that history has shown will not even work in theory.”This advertisement has not loaded yet, but your article continues below.Historically, European developments have been critical to U.S. interests. When the European Economic Community was created in 1957, Washington was irritated with Europe’s protectionism and inability to shoulder military and security responsibility. On the other hand, it liked having Europe as a bulwark against communism and did not want it to leave the American orbit.Over time, as economic integration helped bring prosperity, Europe used its economic power to support rules-based international orders on human rights, climate policy and data sovereignty — at times in opposition to U.S. policy. This friction eventually led to Donald Trump’s first-term push for the EU to make a greater commitment to its own security and reduce trade barriers targeting American exports.Given this backdrop, why is Canada seeking deeper economic and security ties with an underperforming European Union? This week’s Canada-EU summit in Montreal has already been downgraded from a discussion about “partnership” to one regarding an “alliance for the future” — this due to Germans’ and others’ opposition to special membership for Canada. For now, this suits Canada, which is only looking for new agreements in trade, defence, education and research to help reduce its dependence on the U.S.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.This is not the first time Canada has tried to do that, of course. In 1971, U.S. president Richard Nixon imposed a 10-per cent surcharge on imports to help stabilize the value of the U.S. dollar. Canada responded by pursuing the “Third Option” of a contractual link to the European Economic Community (EEC).But geography, economics and security concerns eventually overwhelmed the push to diversify trade. By 1988, anti-Americanism took a back seat and Canada signed the Canada-U.S. free trade agreement, later expanded to NAFTA to include Mexico. Free trade with the U.S. did not stop attempts at trade diversification, including by means of a comprehensive economic and trade agreement (CETA) with the EU in 2017 (though 10 EU members have not yet ratified it). As for security, Canada remains largely reliant on the U.S., given Europe’s limited military power, as revealed by Russia’s invasion of Crimea and eastern Ukraine.Canada is and will remain critical to U.S. security no matter who is president so any attempts to go beyond improving trade with Europe and reach new political arrangements like “associate membership” will raise concerns in Washington.A deeper relationship with Europe is appropriate, but poking the eye of our southern neighbour is not in our long-run interest. Even after Trump and Carney are long gone politically, the U.S. still won’t want Canada leaving its security orbit. Nor should Canada want to give up access to the largest, most dynamic market in the world. Just as the Third Option eventually gave way to more, not less, integration with the U.S., so will the current impasse as, in a perilous world, our anger with our partner subsides.We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.