Mr. Speaker, the ongoing softwood lumber dispute has a long and tangled history. My greatest frustration is the lack of urgency or hands on attention the Prime Minister has shown the dispute.
I am not alone in this thinking. It is the opinion of a majority of forest industry workers, people representing forest communities and political participants. If it is observable to us that the Prime Minister is not fully engaged then it is surely observable to the U.S. administration and the U.S. special interest lumber lobby.
Yesterday in the House of Commons during question period the Prime Minister said we had a softwood lumber agreement that worked for five years. It did not work. It led to a massive loss of investment and jobs. It led to distortions in the market that proved costly and divisive for producers and customers.
We are in trouble when we expect leadership on our largest trade commodity and the person from whom we require leadership makes such uninformed statements.
Last week the U.S. department of commerce announced a preliminary duty of 12.6% on top of an existing countervail duty of 19.3%, which brings it up to 32%. What did we hear from the Prime Minister? Did we witness a sense of urgency or direct action resulting from the announcement? I could ask the question again but I would not get much of an answer because we saw no urgency or direct action from the Prime Minister.
The U.S. administration has in some respects been much more engaged than the Prime Minister although the U.S. department of commerce has not. The administration has appointed a representative, Mr. Marc Racicot from Montana. He is in Ottawa today.
The Prime Minister assures us he is in communication every two or three weeks with the president and that he spent some time with him in China. That is the extent of it. I am embarrassed that the Prime Minister of Canada would stoop to suggest this would count for anything.
I read that the Prime Minister finagled a photo opportunity with the U.S. president while in China. Once again I am embarrassed. This is not how a Prime Minister behaves. He should not seek a photo opportunity with an unwary president to look good at home while achieving nothing. This is serious business. Communities, workers, their families and enterprises are at risk and we get glibness from the Prime Minister.
Let us talk about today. Today I asked the Prime Minister why he is not fully engaged. Once again he made reference to his overlap along with dozens of other leaders with the president of the United States in China. This was before last Wednesday's anti-dumping announcement.
Is anybody home over there? Are we to believe that the Prime Minister is fully engaged on softwood lumber? I am not a lawyer but the evidence is overwhelmingly clear that he is not.
I cannot overemphasize how large and significant a problem this has been, is and will continue to be unless we witness a dramatic reversal. The dispute may be resolved or it may go to long winded litigation. Does the government have a contingency plan? Since it does not have a plan it probably does not have a contingency plan.
I welcome the appointment by the U.S. of a representative on the softwood lumber dispute. I welcome the litigation announced yesterday by Canfor Corporation. Canfor announced its intention to file a $250 million legal suit under chapter 11 of NAFTA, claiming that the U.S. department of commerce has acted in a capricious and biased manner against its interests. This logic would apply to many other Canadian companies operating in the forest industry.
This protection exists under NAFTA but some in the House of Commons argue it does not belong under NAFTA. The sum of these members resides in the New Democratic Party.
This is the only way to get to a neutral body on this dispute. It is a good move on the part of a Canadian company to let the administration know that in the longer term biased behaviour from the U.S. department of commerce on what is clearly an unsubsidized industry is not acceptable.
When we describe the dispute it is important to recognize that we have strong U.S. allies on this file. A consumer lobby has been in effect in the U.S. for the last two years which has been lobbying legislators and congress to make them aware of the negative impact of the dispute on their constituents, the American public, from the standpoint that putting tariffs on Canadian lumber going to the U.S. is costing American consumers.
This is not a Canada-U.S. battle. It is a fight between Canada and the special interest U.S. lumber lobby. It is completely unproductive and unnecessary and it hurts both nations.
In the longer term I am optimistic because the consumer movement in the U.S. represents 95% of lumber consumption. We have seen an expansion beyond lumber consumer groups into the larger consumer group involved in all aspects of the American economy which says the dispute is hurting everyone in the American economy whether or not they are lumber consumers. That is a positive move.
In the longer term we will see U.S. protectionist legislation change. We may even see litigation deriving from some of the larger players in the consumer movement. I hope that occurs.
Canada cannot alienate the U.S. consumer movement. Whatever we do in the settlement of this dispute we must be cognizant of that. Canada must also rule out any arrangement where we would end up going back to a quota arrangement.
The old quota arrangement for Canada's forest industry that has just expired was a negative one. After yesterday's comment by the Prime Minister it concerns me that it was called a good agreement. I suddenly have a new concern that the government might consider another quota arrangement.
The Canadian Alliance has been pursuing free trade in lumber for a long time. The 1996 to 2001 softwood lumber agreement that recently expired created a softwood lumber quota system that cost Canada thousands of jobs. The federal government orchestrated the arrangement in 1996 with selected industry support. When the deal turned sour and its negative implications became clear to virtually everyone, the government washed its hands and said industry had made it do it.
The Canadian Alliance took the issue seriously and set out a clear analysis and policy statement in June 2000. The Minister for International Trade finally came to a free trade position in March 2001, days before the softwood lumber agreement expired. Much of Canadian industry, the official opposition and American Consumers for Affordable Homes worked hard to ensure the softwood lumber agreement would not be renewed or extended when it expired on March 31.
Canada cannot enter into any arrangement that would impair our competitiveness in the future or reinforce the belief in the U.S. that it could impose its will without concern for international trade rules. The Prime Minister has a strong role to play by talking to the Bush administration. The Prime Minister's Office should have no role in pushing a deal on to the minister against Canadian long term interests.
Some American politicians in the U.S. department of commerce are pushing for a crushing victory for the U.S. lumber lobby. This is producer driven politics at its worst.
What must the government do? The Prime Minister and his senior officials must continue to point out to the Bush administration the benefits of free trade in lumber. They must point out that Canadian industry is not subsidized. The Prime Minister must deliver on his promise that the U.S. cannot call for more Canadian energy while restricting Canadian lumber exports. He can do this in terms of any proposed continental energy discussions.
Now is the worst possible time for governments or industry to concede to the U.S. lumber lobby. Canada has a strong case for free trade access before NAFTA and WTO trade tribunals and the U.S. lumber lobby knows it. Fifteen years of harassment have taken a major toll. If we do not get back to free trade now we will see further permanent job losses and loss of investment in the industry.
Where do we go from here? We need a cost effective analysis to compare litigation with negotiation. I think we will find litigation comes out fairly well in the analysis.
For example, the softwood lumber quota arrangement we all lived with for the past five years effectively cost industry in the range of 15% to 20% although there were haves and have nots depending on who had quota or duty free access and who did not. There was no fairness there.
Now more than ever we need leadership and resolve from our Prime Minister and the federal government. The U.S. lumber lobby did not anticipate that Canada would hold out as long as it has. The U.S. lumber lobby has shown itself to be a self-serving special interest group contrary to the interests of both nations.
There is much pessimism today but there is room for optimism as well. We need to hold our alliance together. We need to fix this thing once and for all.