The following article is excerpted from the 30 June 2003 edition of the “Toronto Star”.

There has always been a small minority of Canadians who would be happy to see this country incorporated into the United States.

But the real threat to Canada's future as an independent geopolitical entity comes from those I would call the Little Canadians, the economists and think-tank commentators who believe we should pursue ever deeper integration into the United States rather than see Canada broadening its ties with the much vaster global economy.

These proposals come in many forms, from harmonization of most regulations and standards and adoption of the U.S. dollar or a common currency, to implementation of a customs union or a North American perimeter with common immigration rules and border-entry requirements.

The latest example of this kind of thinking, which would involve surrendering political independence for some hoped-for economic gain in the form of reduced paperwork costs at the Canada-U.S. border, is a C.D. Howe Institute commentary on a Canada-U.S. customs union, written by Danielle Goldfarb.

Under a customs union, Canada would have the same tariffs and other border barriers to the rest of the world that the United States has. Goldfarb says Canada and the United States
would have to negotiate what these common tariffs and other barriers, such as quotas and trade penalties, would be, but it is hard to believe the United States would make the major concessions.

The United States imposes a 25 per cent tariff on imported trucks; Canada, 6.1 per cent. The United States has tariffs ranging from 24 per cent to 48 per cent on shoes, while Canadian tariffs are in the range of 0 to 20 per cent. The United States has a 35 per cent tariff on tuna; Canada, 6 per cent. U.S. tariffs on porcelain and glassware range from 21 to 38 per cent, while Canadian tariffs range from 0 to 7 per cent. If we had to adopt U.S. tariffs, we would face price
increases on all these products.  Likewise, the United States has highly protectionist policies on cotton, sugar, peanuts and other such products.

In addition, Goldfarb acknowledges, Canada and the United States have different free-trade agreements with other countries and different treatments for the least developed countries, and treat some other countries, such as Cuba, differently. These differences would also have to       be reconciled.

The United States has the habit of using trade policy as an instrument of foreign policy, imposing trade sanctions on countries behaving in ways Washington doesn't like, …
 

A customs union could force Canada to become a party to U.S. protectionism or foreign-policy actions against other countries.

Nor would a customs union be likely to deliver a Canadian exemption from U.S. trade-remedy laws. …

More importantly, once a customs union was established, Canada and the United States would have to pursue a common negotiating position in future trade talks at such groups as the World Trade Organization. This would probably also extend to international regulatory bodies dealing with health and sanitary standards, telecommunications, financial standards, regulatory matters and other such arrangements. It is hard to see how Canadian concerns would prevail in such a situation.

Goldfarb acknowledges Canada would see "some loss of policy independence," but she believes reduced paperwork at the U.S.-Canada border is more important than Canada's loss of
policy capacity.

There's another issue as well. Like most proponents of deeper integration, Goldfarb seems to believe that including Mexico would be too difficult. So, under her proposal, Mexico would become a second-class member of the North American Free Trade Agreement.

What we need is more Big Canada thinking that sees the entire world as an opportunity and wants to be part of that world. That's why such thinking attaches much greater importance to the World Trade Organization and global talks toward freer trade on a worldwide basis.

A Canada connected to this bigger world will have a much better chance of continuing as an independent geopolitical entity in North America, with more choices and greater say over our own future than one that has locked itself into the grip of the United States.