THE U.S. IN THE CANADIAN FEDERAL ELECTION -- NOT!

C O N F I D E N T I A L SECTION 01 OF 02 OTTAWA 001258

SIPDIS

E.O. 12958: DECL: 09/22/2018
TAGS: PREL PGOV CA
SUBJECT: THE U.S. IN THE CANADIAN FEDERAL ELECTION -- NOT!

REF: OTTAWA 1216

Classified By: PolMinCouns Scott Bellard, reason 1.4 (d)


1. (C) Summary. Despite the overwhelming importance of the
U.S. to Canada for its economy and security, bilateral
relations remain the proverbial 900 pound gorilla that no one
wants to talk about in the 2008 Canadian federal election
campaigns. This likely reflects an almost inherent
inferiority complex of Canadians vis-a-vis their sole
neighbor as well as an underlying assumption that the
fundamentals of the relationship are strong and unchanging
and uncertainty about the outcome of the U.S. Presidential
election. End Summary.


2. (C) The United States is overwhelmingly important to
Canada in ways that are unimaginable to Americans. With over
$500 billion in annual trade, the longest unsecured border in
the world, over 200 million border crossings each year, total
investment in each other's countries of almost $400 billion,
and the unique North American Aerospace Defense (NORAD)
partnership to ensure continental security, excellent
bilateral relations are essential to Canada's well being.
Canadians are, by and large, obsessed with U.S. politics --
especially in the 2008 Presidential race -- and follow them
minutely (with many Canadians even wishing they could vote in
this U.S. election rather than their own, according to a
recent poll). U.S. culture infiltrates Canadian life on
every level. 80 pct of Canadians live within 100 miles of
the border, and Canadians tend to visit the U.S. much more
regularly than their American neighbors come here.


3. (C) Logically, the ability of a candidate, or a party,
or most notably the leader of a party successfully to manage
this essential relationship should be a key factor for voters
to judge in casting their ballots. At least so far in the
2008 Canadian federal election campaign, it is not. There
has been almost a deafening silence so far about foreign
affairs in general, apart from Prime Minister Stephen
Harper's pledge on September 10 that Canadian troops would
indeed leave Afghanistan in 2011 according to the terms of
the March 2008 House of Commons motion, commenting that "you
have to put an end on these things." The Liberals -- and
many media commentators -- seized on this as a major
Conservative "flip flop," with Liberal Party leader Stephane
Dion noting on September 10 that "I have been calling for a
firm end date since February 2007" and that "the
Conservatives can't be trusted on Afghanistan; they can't be
trusted on the climate change crisis; they can't be trusted
on the economy." He has returned in subsequent days to the
Conservative record on the environment and the economy, but
has not pursued the Afghan issue further. All three
opposition party leaders joined in calling for the government
to release a Parliamentary Budget Officer's report on the
full costs of the Afghan mission, which PM Harper agreed to
do, with some apparent hesitation. However, no other foreign
policy issues have yet risen to the surface in the campaigns,
apart from New Democrat Party leader Jack Layton opining on
September 7 that "I believe we can say good-bye to the George
Bush era in our own conduct overseas."


4. (C) The U.S. market meltdown has provided some fodder
for campaign rhetoric, with the Conservatives claiming their
earlier fiscal and monetary actions had insulated Canada from
much of the economic problems seen across the border.
(Comment: there is probably more truth in the fact that the
Canadian financial sector does not have a large presence in
QCanadian financial sector does not have a large presence in
U.S. and other foreign markets, and instead concentrates on
the domestic market. The Canadian financial sector has also
been quite conservative in its lending and investment
choices. End comment.) PM Harper has insisted that the
"core" Canadian economy and institutions were sound, while
promising to work closely with "other international players"
(i.e., not specifically the U.S.) to deal with the current
problems. He warned on September 19 that "voters will have
to decide who is best to govern in this period of economic
uncertainty -- do you want to pay the new Liberal tax? Do
you want the Liberals to bring the GST back to 7%?" The
Liberals have counter-claimed that Canada is now the "worst
performing economy in the G8," while noting earlier Liberal
governments had produced eight consecutive balanced budgets
and created about 300,000 new jobs annually between 1993 and

2005. The NDP's Layton argued on September 16 that these
economic woes are "the clearest possible warning that North
American economies under conservative governments, in both
Canada and the United States, are on the wrong track," but
promised only that an NDP government would institute a
"top-to-bottom" review of Canada's regulatory system -- not
delving into bilateral policy territory.


5. (C) On the environment, Liberal leader Dion, in
defending his "Green Shift" plan on September 11, noted that

OTTAWA 00001258 002 OF 002

"both Barack Obama and John McCain are in favor of putting a
price on carbon. Our biggest trading partner is moving
toward a greener future and we need to do so too." PM Harper
has stuck to the standard Conservative references to the
Liberal plan as a "carbon tax, which will hit every consumer
in every sector" and claimed on September 16 that, under
earlier Liberal governments, "greenhouse gas emissions
increased by more than 30 percent, one of the worst records
of industrialized countries." NDP leader Layton argued
that, on the environment, PM Harper "has no plan" while
"Dion's plan is wrong and won't work," unlike the NDP plan to
reward polluters who "clean up their act and imposing
penalties on those that don't," which he said had also been
"proposed by both U.S. Presidential candidates, Barack Obama
and John McCain."


6. (C) NAFTA? Western Hemisphere Travel Initiative?
Border crossing times? The future of NORAD? Canada's role
in NATO? Protection of Canadian water reserves? Canadian
sovereignty in the Arctic and the Northwest Passage? At
least among the leaders of the major parties, these issues
have not come up so far in the campaigns, although they seize
much public attention in normal times. Even in Ontario and
Quebec, with their long and important borders with the U.S.,
the leadership candidates apparently so far have not ventured
to make promises to woo voters who might be disgruntled with
U.S. policies and practices. However, these may still emerge
as more salient issues at the riding level as individual
candidates press the flesh door to door, and may also then
percolate up to the leadership formal debates on October 1
and 2.


7. (C) Why the U.S. relationship appears off the table, at
least so far, is probably be due to several key factors. An
almost inherent Canadian inferiority complex may disincline
Canadian political leaders from making this election about
the U.S. (unlike in the 1988 free trade campaigns) instead of
sticking to domestic topics of bread-and-butter interest to
voters. The leaders may also recognize that bilateral
relations are simply too important -- and successful -- to
turn into political campaign fodder that could backfire.
They may also be viewing the poll numbers in the U.S. and
recognizing that the results are too close to call. Had the
Canadian campaign taken place after the U.S. election, the
Conservatives might have been tempted to claim they could
work more effectively with a President McCain, or the
Liberals with a President Obama. Even this could be a risky
strategy, as perceptions of being too close to the U.S.
leader are often distasteful to Canadian voters; one
recurrent jibe about PM Harper is that he is a "clone of
George W. Bush." Ultimately, the U.S. is like the proverbial
900 pound gorilla in the midst of the Canadian federal
election: overwhelming but too potentially menacing to
acknowledge.

Visit Canada,s Economy and Environment Forum at
http://www.intelink.gov/communities/state/can ada

WILKINS