While the US midterm elections could change the political landscape in Washington, experts say they are unlikely to have much impact on Canada-US relations – although they could change the discussion on some key issues.
The midterms elect one-third of the entire US Senate and House of Representatives, both of which are currently under Democratic control.
Election forecasters see the Republicans as a strong favorite to win back the House of Representatives and, increasingly, as slight favorites to win back the Senate.
But regardless of which party holds the balance of power in Congress after the votes are counted, any change in power will have little effect on the relationship between Washington and Ottawa.
“Canada is not really partisan,” said Chris Sands, head of the Canada Institute at the Wilson Centre, a Washington-based think tank.
“The desire to have good relations with Canada and to work things out and have a serious conversation from time to time … is pretty consistent and … the makeup of Congress is unlikely to change that.”
Maryscott Greenwood, head of the Canadian-American Business Council, indicated that the US-Mexico-Canada Agreement trade agreement, referred to in Canada as CUSMA, was ratified with a Republican in the White House and a Democrat-controlled House of Representatives.
“No matter what happens, there will be a lot of new faces in Congress and it’s up to Canada … to introduce an American-Canadian relationship to these new members,” Greenwood said.
But Sands and Greenwood both said that Canada-US relations will be the focus of some critical issues going forward – regardless of which party controls Congress.
Inflation and the economy
Like Canada, the US has been grappling with record high inflation over the past year. Polls have cited the cost of living as a top priority for American voters.
Central banks in both countries have raised interest rates in recent months in an attempt to get inflation under control. But those increases are also slowing economic activity, leading many economists to predict a recession sometime in 2023.
Because of the ties between the U.S. and Canadian economies, cooperation on economic issues will be critical in the coming years, Greenwood said.
“How do we ensure that inflation does not go bananas? How do we ensure that people are employed? And that is not an easy task,” she said. “There are ways for Canada [and] the United States to cooperate on the economy that could help soften the blow.”
The United States recently passed the Anti-Inflation Act, which included hundreds of millions of dollars to start a new domestic industry to manufacture components for electric vehicle batteries.
But the industry will need access to some critical minerals, which could attract investment in Canada’s mining sector.
Ottawa committed $3.8 billion in last spring’s budget to develop a critical minerals strategy. Greenwood said progress on that strategy has been slow.
“If Canada can move faster on its critical minerals strategy, that would be one example of how it could collaborate with the United States, to participate in the coming spending bonanza,” a Greenwood said.
Sands also suggested that the US and Canada could collaborate to provide easier access to business permits to boost economic activity on both sides of the border.
“I think there’s a lot of potential for bipartisan support in that area and that would certainly be a net positive for Canada,” he said.
Environment
Another big piece of the Inflation Reduction Act is the $369 billion the US is investing in climate change programs over the next decade – including clean energy incentives that Ottawa sees as a threat to future investment in Canada.
The Canadian government responded with a plan to match some of those incentives i last week’s economic statement.
Sands said that if Republicans gain more influence in Congress, they will likely push for changes to the act.
“I don’t think everything in the bill is going to get thrown out. I think it’s going to be re-branded so that Republicans can take some credit,” he said.
After the act was passed, Prime Minister Justin Trudeau ignored warnings that Canada is falling behind the United States on climate action — in part referring to Canada’s carbon tax.
But Sands said that while a national carbon tax is a “dormant issue” in the United States, he wouldn’t be surprised if it were part of the conversation.
“If the United States is even thinking about moving in that direction, that would be a hot button issue for Canada,” he said.
Pipelines
Another hot button issue between Washington and Ottawa in recent years has been cross-border pipelines.
Biden basically killed the Keystone XL pipeline – which carried 830,000 barrels of crude a day from the oilfields in Alberta to the US – when he revoked presidential approval on his first day in office.
Even if Republicans – who strongly favor the project – take control of the House of Representatives, Greenwood said they are unlikely to be able to revive Keystone.
“As long as the Biden administration is in the White House … you will not have the Keystone XL pipeline back,” she said.
But Sands said a Republican-controlled House could shift the conversation toward reevaluating how pipelines and other infrastructure projects are allowed in the US.
He also mentioned Enbridge’s Line 5 pipeline – which runs through Michigan from the Wisconsin city of Superior to Sarnia, Ont. — as an example of the United States’ complex permit system for such projects.
In 2020, Michigan Governor Gretchen Whitmer revoked the easement that allowed the line to operate since 1953. Enbridge is fighting Michigan in court and the Canadian government has entered into talks with Washington to keep the pipeline operating.
While Sands said Washington will likely want to have the final say on Line 5, state government involvement complicates the situation.
“It’s a sign, more fundamentally, that we’re not doing a good job of moving cross-border infrastructure forward,” he said.
“So, I think it’s time to restart that conversation and to think about how to approve and review infrastructure. That’s something that I think has bipartisan support.”
Travel
One sticking point that is likely to remain regardless of which party leads Congress concerns cross-border travel — specifically, the NEXUS program that facilitates the flow of people across the Canada-US border.
Last week, a bipartisan group of US Congress members sent a letter to their Canadian counterparts on the Canada-US Interparliamentary Group asking for their “assistance in navigating an issue of mutual concern: the NEXUS backlog and continued closure of Canadian service centers .”
NEXUS centers south of the border reopened in April after a pandemic-related hiatus.
Canada, however, has not done the same with its enrollment centers due to concerns about extending legal protections to US Customs and Border Protection (CBP) officers working on Canadian soil – protections those same officers already have at locations pre-clearance in Canada. airports.
The NEXUS issue is a “big irritant,” Greenwood said. “Democrats and Republicans are worried about it.
“NEXUS is really hanging by a thread. Canada should be very worried about the future of that program if it doesn’t come up with a path forward.”
The federal government has not said when – if ever – these offices in Canada will be operational again, but Trudeau said late last month that he is “very keen to get it going.”
