(2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)
-
Upload
k-12-study-canada -
Category
Education
-
view
231 -
download
1
Transcript of (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)
![Page 1: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/1.jpg)
Teaching About the World’s Largest Trade Relationship
(and Why the Relationship is Important)
Study Canada Summer Institute 2015Dr. Steven Globerman
Source:http://sbadrinath.files.wordpress.com/2009/03/different26rqcu3.jpg?w=400&h=226
1
![Page 2: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/2.jpg)
Some Questions of Interest• Why is Canada so important to the U.S.?
• Why are trade and investment so beneficial to both countries?
• What is the nature of bilateral trade and investment?
• What are the “border priorities” of Canada and the U.S.?
2
![Page 3: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/3.jpg)
1. Canada is our largest trading partner ….
3
![Page 4: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/4.jpg)
1. … and we share the world’s largest bilateral trading
relationship. But not many people know this.
4
![Page 5: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/5.jpg)
Even the Wall Street Journal gets it wrong
5
![Page 6: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/6.jpg)
6
![Page 7: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/7.jpg)
But they corrected their mistake
7
![Page 8: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/8.jpg)
8
![Page 9: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/9.jpg)
Canada China Mexico Japan Germany Korea (South) U.K.0%
2%
4%
6%
8%
10%
12%
14%
16%
18% 16.6%
14.9%13.5%
5.1%4.4%
2.9% 2.7%
Country Shares of Total US Goods Trade (2014)
9
![Page 10: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/10.jpg)
China Canada Mexico Japan Germany Korea (South) U.K.0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%19.9%
14.7%
12.5%
5.7% 5.3%
3.0%2.3%
Country Shares of US Goods Imports (2014)
10
![Page 11: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/11.jpg)
Canada Mexico China Japan Germany U.K. Brazil0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20% 19.2%
14.8%
7.6%
4.1%3.0% 3.3% 2.8%
Country Shares of US Goods Exports (2014)
11
![Page 12: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/12.jpg)
2. Canada is the most important export destination
for 70% of the 50 states
12
![Page 13: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/13.jpg)
Source: http://www.canadainternational.gc.ca/washington/
Canada’s Rank for States’ Exports of Goods
13
![Page 14: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/14.jpg)
14
![Page 15: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/15.jpg)
15
![Page 16: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/16.jpg)
16
![Page 17: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/17.jpg)
Source: Kasoff, Drennen, & Storer Chapter 17
![Page 18: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/18.jpg)
18
Time Trend for Canada’s Share of U.S. Trade
% of U.S. Imports % of U.S. Exports1990 18.4 21.6
1996 19.4 21.9
2000 18.7 22.7
2006 16.1 22.1
2010 14.3 19.3
2014 14.7 19.2
Source: Globerman and Storer (2015), “An Assessment of Bilateral Trade Flows and Their Implications for U.S. Border Infrastructure Investment”
![Page 19: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/19.jpg)
19
Top Commodity Imports from Canada (2013)(U.S. $millions)
HTS 2013 Percent of Total Imports from
Canada87 Motor vehicles and parts 55,704 16.8
27 Mineral fuels 109,000 32.9
84 Mechanical machinery 19,752 6.0
48 Paper products 6,790 2.0
85 Electrical machinery 7,881 2.4
98 Special 10,176 3.1
44 Wood and products 7,884 2.4
Source: Globerman and Storer (2015), “An Assessment of Bilateral Trade Flows and Their Implications for U.S. Border Infrastructure Investment”
![Page 20: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/20.jpg)
20
Top Commodity Exports to Canada (2013)(U.S. $millions)
HTS 2013 Percent of Total Exports to Canada
87 Motor vehicles and parts 51,702 17.2
84 Mechanical machinery 45,298 15.1
85 Electrical machinery 26,774 8.9
98 Special 8,890 3.0
90 Instruments 9,373 3.1
39 Plastics 13,047 4.4
27 Mineral fuels 24,658 8.2
73 Iron and steel 7,879 2.6
Source: Globerman and Storer (2015), “An Assessment of Bilateral Trade Flows and Their Implications for U.S. Border Infrastructure Investment”
![Page 21: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/21.jpg)
21
Interesting Observation
• The leading “import industries” are also often leading “export industries”
Cases in PointMotor vehicles and partsMineral fuelsMechanical machinery Electrical machinery
This identifies the phenomenon of intra-industry trade (IIT) – more later
![Page 22: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/22.jpg)
22
Types of IIT
Example of Vertical:Canada exports crude oil to U.S.; U.S. exports refined
petroleum products to Canada
Example of Horizontal: Canada exports compact cars to U.S. U.S. exports SUVs to Canada
![Page 23: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/23.jpg)
23
Where Goods Cross the Border
U.S. Port Share of Total Imports from Canada
1. Detroit, MI 27%
2. Port Huron, MI 19%
3. Buffalo-Niagara Falls, NY 17.5%
4. Champlain-Rouses Point, NY 6.2%
5. Pembina, ND 4.7%
6. International Falls, MN 4.1%
7. Blaine, WA 3.7%
These 7 land ports process 55.5% of all imports from Canada.
![Page 24: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/24.jpg)
24
General Benefits of Trade1. Specialization by Industry
(Countries specialize in what they do most efficiently relative to other countries)
2. Specialization by Product(Companies specialize in a limited number of products to gain economies of scale)
Trade makes countries wealthier through the phenomenon of specialization.
The majority of trade is carried out by multinational corporations. Almost half of this latter trade is intra-firm.
So foreign direct investment is important.
![Page 25: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/25.jpg)
25
Not Everyone Benefits from Increased Trade
• There will be contractions in specific sectors of the economy with losses of employment
• How important is this phenomenon?
![Page 26: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/26.jpg)
3. Canada is the biggest source of U.S.
petroleum imports
26
![Page 27: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/27.jpg)
27
Country Share of U.S. Petroleum Imports (2014)
Country PercentageCanada 36.7
Saudi Arabia 12.6
Mexico 9.1
Venezuela 8.6
Russia 3.6
Source: U.S. Energy Information Administration
![Page 28: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/28.jpg)
28
U.S. Exports of Oil to Canada Are Growing Rapidly
In April 2014, U.S. exported around 263,000 b/d of crude oil to Canada. That was 2.5 times as much as in April 2012.
In the same month, Canada exported around 2.7 million b/d to U.S.
![Page 29: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/29.jpg)
29
Other “Energy Facts”
• Canada is responsible for almost all U.S. imports of natural gas
• Canada accounts for all imports of U.S. electricity
• Canadian exports account for around 13 percent of U.S. coal imports
![Page 30: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/30.jpg)
“Oil / Tar Sands”Source:The Economist 30
![Page 31: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/31.jpg)
Oil Sands
Reserves• Source:• www.ubc.ca
31
![Page 32: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/32.jpg)
Oil Sands: Surface Digging Method
32
![Page 33: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/33.jpg)
• Source: www.guardian.com33
![Page 34: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/34.jpg)
34
The “Take-Aways”
The oil sands project is a major economic asset for Canada
Canadian oil companies have large sunk costs in the project
Environmentalists see the project as a nightmare – perhaps the single most controversial economic activity in North America
![Page 35: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/35.jpg)
Keystone XLPipelineIssue
35
![Page 36: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/36.jpg)
36
![Page 37: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/37.jpg)
Source: www.latimes.com37
![Page 38: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/38.jpg)
http://nationalpostcomment.files.wordpress.com/2011/11/keystone-pipeline.jpg?w=62038
![Page 39: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/39.jpg)
39
![Page 40: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/40.jpg)
Source:TheEconomist
40
![Page 41: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/41.jpg)
41
![Page 42: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/42.jpg)
42
The Fly in the Ointment
• Native groups are opposed to oil pipeline proposals in Canada
• Where they have legal title to their land, they can block construction unless federal government is willing to invoke eminent domain
![Page 43: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/43.jpg)
Lac Megantic Derailment & Explosionhttp://www.ctvnews.ca/polopoly_fs/1.1359962!/httpImage/image.jpg_gen/derivatives/landscape_960/image.jpg
Pipeline Alternatives: Rail
43
![Page 44: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/44.jpg)
The Economist’s Solution• GHG Emissions are an “external cost”
• Internalize the “externality”
• Put a price on carbon emissions
• Use will reflect the full costs
Problem: The externality crosses national boundaries. Countries must cooperate (not likely given Kyoto accord experience)
44
![Page 45: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/45.jpg)
4. Canada has a diversified economic base, but it has
struggled to develop a thriving high technology sector
45
![Page 46: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/46.jpg)
GDP Shares, April 2012
46
![Page 47: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/47.jpg)
The Modern Canadian Economy: Technology 47
![Page 48: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/48.jpg)
Transportation
http://www.airlinereporter.com/wp-content/uploads/2012/05/ascrj700.jpg
48
![Page 49: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/49.jpg)
49
![Page 50: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/50.jpg)
Adaptation: High-end Clothing
50
![Page 51: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/51.jpg)
51
Canada’s Banking Sector as a Paragon
• Canada avoided the sub-prime mortgage-related economic meltdown that hit the U.S. in 2008
• Many credit Canada’s banking regulations as the reason that Canada avoided the financial sector bankruptcies and mortgage default experiences of the U.S.
• Also, Canada did not experience the severe recession from 2008-2009 that the U.S. experienced
• However, Canada’s overall productivity performance continues to lag that of the U.S.• Since 1984, business sector productivity in Canada has
grown at half the U.S. rate
![Page 52: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/52.jpg)
5. Canada-U.S. trade is often about trading
“apples for apples” and “making things together”
52
![Page 53: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/53.jpg)
Making Things Together:Specialization, Scale and“Apples for Apples” Trade
Ford Edge:Oakville, Ontario. Canada cbc.ca
53
![Page 54: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/54.jpg)
North American Specialization
Ford Escape:Kansas City, MO
54
![Page 55: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/55.jpg)
55
![Page 56: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/56.jpg)
SeaTac Airport Shuttle Trains:
• Source: http://www.visitingdc.com/images/seatac-train.jpg 56
![Page 57: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/57.jpg)
SeaTac Airport Shuttle Trains:Made in PA by a Canadian Company
• Source: http://farm4.static.flickr.com/3379/3198460812_79dd9093c2.jpg 57
![Page 58: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/58.jpg)
Foreign Direct Investment
Seatac shuttle trains illustrate important phenomena:
1. There are many Canadian companies
operating affiliates in the U.S. and likewise for
U.S. companies;
2. A significant share of trade between the two
countries is intra-firm trade.
58
![Page 59: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/59.jpg)
6. The Canadian government has done a lot to improve
business conditions in Canada
59
![Page 60: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/60.jpg)
Some Measures Taken by Federal Government
60
• Lowered corporate tax rates• Improved incentives for innovation• Reduced government debt/GDP ratio• Privatized Crown Corporations• Free trade agreements• NAFTA• European Union• Bilateral
![Page 61: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/61.jpg)
61
![Page 62: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/62.jpg)
62
![Page 63: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/63.jpg)
…Canada’s economy has performed well under free trade
63
![Page 64: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/64.jpg)
2
4
6
8
10
12
14
Unemployment Rate (%)
Canada
United States
64
![Page 65: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/65.jpg)
High Ratio of Household Debt to GDP is a Potential Problem for
Canada
65
• Largely related to mortgage borrowing given relatively high housing prices to income in major Canadian cities.
![Page 66: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/66.jpg)
66
![Page 67: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/67.jpg)
High Ratio of Household Debt is Seen as a Big Risk Factor for
Canadian Economy
67
• Bank of Canada is concerned about a housing “bubble”
• Required down-payments on house purchases have been increased
![Page 68: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/68.jpg)
68
![Page 69: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/69.jpg)
Canada Has a More Equal Distribution of Income Than the U.S.
69
• Tax-transfer system is more “progressive”
• Larger share of government funding for services such as health care; education
![Page 70: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/70.jpg)
•Top 1% Share in 2007
• 18.3%
• 13.8%
70
![Page 71: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/71.jpg)
7. Trade isn’t just goods: Trade in services and foreign
investment
71
![Page 72: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/72.jpg)
72
![Page 73: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/73.jpg)
http://www.findfamilyfun.com/birch-bay-washington.htm
73
![Page 74: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/74.jpg)
74
![Page 75: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/75.jpg)
75
![Page 76: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/76.jpg)
• http://www.bloomberg.com/video/91845099/ 76
![Page 77: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/77.jpg)
• The Economist, U.S. Edition, May 23, 200977
![Page 78: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/78.jpg)
Source: http://hockeygonewild.wordpress.com/2010/03/09/
Identify the symbols and logos:
78
![Page 79: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/79.jpg)
http://www.flickr.com/photos/achimh/4368189976/sizes/l/in/photostream/79
![Page 80: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/80.jpg)
8. Canada had a long history of protecting its economy from
U.S. competition
80
![Page 81: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/81.jpg)
The Tariff “Wall”
“Greedy”AmericanWolves
Happy Canadian Farmers AndManufacturers
Sir John A.Macdonald
81
![Page 82: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/82.jpg)
Source: Hart, M. A Trading Nation
![Page 83: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/83.jpg)
Source: Hart, M. A Trading Nation
![Page 84: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/84.jpg)
84
Some Important Elements of Protection Still Exist
• Very high tariffs on dairy and poultry
• Canadian content rules for broadcasters
• Foreign investment restrictions in a number of sectors including banking,
telecommunications and transportation
• North American Content Rules
![Page 85: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/85.jpg)
• http://news.nationalpost.com• /2012/03/31/tempest-in-a-• yogourt-cup-u-s-based-• chobani-seen-as-threat-to-• local-makers/
85
![Page 86: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/86.jpg)
9. Canadians and Americans have different “border
priorities”
86
![Page 87: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/87.jpg)
Canadian Priorities
87
U.S. Priorities• Security (terrorism)• No “undue” border procedures
• Relatively quick inspection of commercial goods
• Relatively lenient visa permitting • Border infrastructure (second crossing for
Detroit-Windsor)
![Page 88: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/88.jpg)
• Canada: A Source of “Vulnerabilities?”
Source: Bellingham Herald
• Source: ABC news • Source: International Border Commission88
![Page 89: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/89.jpg)
89
![Page 90: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/90.jpg)
90
Priorities Away From the Border
Canada• Protection of Canadian culture• “Buy-American” programs• Keystone pipeline• Anti-dumping
U.S.• Intellectual Property Protection• Canada’s Defense Expenditures• Supply management programs
![Page 91: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/91.jpg)
10. Canada-U.S. Trade: What Will the Future Bring?
91
![Page 92: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/92.jpg)
70%
72%
74%
76%
78%
80%
82%
84%
86%
88%USA Share of Canada's Exports
92
![Page 93: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/93.jpg)
93
The Canadian Dilemma • U.S. is a very important market for Canadian
exports
• But Canada has been “losing share” in U.S. market
• Should Canada try to diversify its markets, e.g. emphasize growing its trade with Asia?
• Should Canada “double-down” and make even greater efforts to increase trade with the U.S.?
![Page 94: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/94.jpg)
94
![Page 95: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/95.jpg)
Successes or Failures?
Source: http://www.thestar.com/opinion/editorialopinion/article/1029360--the-cost-of-freer-trade 95
![Page 96: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/96.jpg)
96
Proposals to Expedite Commercial Border Crossings
• Perimeter security• Harmonize health and safety
regulations/reciprocal recognition of each country’s regulations
• Common external tariff• Expand border infrastructure (2nd bridge
connecting Detroit and Windsor)• Expand membership in Nexus
![Page 97: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/97.jpg)
http://www.dol.wa.gov/images/DLsamples-EDLLg.jpg 97
![Page 98: (2015) Teaching about the World’s Largest Trade Relationship (18.9 MB)](https://reader035.fdocuments.net/reader035/viewer/2022062900/58ea00351a28ab88748b55af/html5/thumbnails/98.jpg)
98
Pie-in-the-Sky
• Common currency
•Economic union
•Political union