From Alberta's oilsands to tariffs, how Biden's presidency could change Canada
TORONTO -- No more trade wars. A multi-billion dollar Alberta pipeline on the chopping block. A jolt of interest — and major investments — in cutting-edge green technology.
Canadians can expect some major changes under incoming U.S. President Joe Biden, who campaigned on a platform that diverged drastically from Donald Trump’s policies in both substance and tone.
Biden enters the White House with plenty of big promises looming, including vaccinations for 100 million Americans in his first 100 days in office and a $1.7-trillion “Clean Energy Revolution” plan that experts say could jolt the economy and lend confidence to green industries.
CTV News has also learned that Biden plans to use an executive order on his first day to scrap the US$8 billion Keystone XL pipeline, which could have major repercussions for Alberta. Construction began in Alberta last summer and the project was set to be completed by 2023. The cross-border pipeline promised 2,000 construction jobs for Albertans and, at its peak, would’ve delivered 830,000 barrels of oil per day from Hardisty, Alta. to Steele City, Neb.
Days after Biden won the election, Foreign Affairs Minister Francois-Philippe Champagne called the win “good news” for Canada, citing new opportunities.
“I'm really hopeful, as I think all Canadians are feeling today… think about climate change, think about the COVID response, think about the economic recovery plan,” Champagne told CTV’s Question Period.
CTVNews.ca chatted with experts and political advisors about how the next four years with Biden in the White House could affect Canada. Here’s what they said.
Back in 1993 when he was a U.S. senator, Biden voted in favour of the initial NAFTA, and gradually supported the idea that it needed updating. Also, as vice president he backed the Trans-Pacific Partnership, which Canada is party to.
When he’s been asked in the past whether he was a free trader, he’s stated that he is “a fair trader.”
Biden’s campaign platform contained an entire section on his planned approach to trade, which centred around ensuring “the future is made in all of America.”
The policy plank pledges to focus on boosting American talent and innovation and maintaining manufacturing jobs in that country, giving small- and medium-sized domestic companies the hand they need in competing internationally.
Vehicles cross at the U.S. Customs booth at the Ambassador Bridge that connects Windsor to Detroit, Mich., on March 18, 2020. (Photo by JEFF KOWALSKY/AFP via Getty Images)
Biden’s trade plans also include:
- Bringing back critical supply chains, so the U.S. isn’t dependent on other nations in a crisis;
- tightening domestic content rules; and,
- working with allies “to modernize international trade rules and associated domestic regulations regarding government procurement to make sure that the U.S. and allies can use their own taxpayer dollars to spur investment in their own countries.”
Earnscliffe Strategy Group's Sarah Goldfeder, who previously worked as a special assistant to two former U.S. ambassadors to Canada, said Biden would more likely lean into the Canadian approach: make trade deals do more than facilitate the movement of goods.
“You see trade policy being asked to do things that aren't necessarily trade, like ensure that there's a fair playing field for workers, ensure there's environmental regulation that protects the planet, and ensure that there's some sort of level playing field and clear rules for the retention of ideas and intellectual property. And so those things aren’t really trade,” said Goldfeder.
“A Biden administration would focus more on the things that are kind of outside trade policy that we ask trade to do,” she said, adding that he’d likely look for a more nuanced trade conversation with a less punitive approach.
Goldfeder also stated that, should there be any outstanding Trump tariffs, Biden would likely scrap them. Trump opted last September to eliminate a 10-per-cent tariff against Canadian aluminum, but tariffs on Canadian softwood — while slashed by more than half in November — are still in place.
Adam Taylor, president of Export Action Global and a former senior advisor to then-federal trade minister Ed Fast, suggested Biden could try to re-enter the Trans Pacific Partnership, though he too will likely maintain a degree of protectionism.
“Increasingly the anti-trade rhetoric that exists in the United States is going to increasingly become almost a bipartisan issue… everybody's going to be preoccupied with appeasing an American worker,” Taylor said.
Joe Biden departs after speaking about climate change and the wildfires on the West Coast a the Delaware Museum of Natural History on September 14, 2020 in Wilmington, Delaware. (Photo by Drew Angerer/Getty Images)
Last July, Biden released a $1.7-trillion “Clean Energy Revolution” plan that promised to invest heavily in green technology and aggressively pursue making the U.S. power sector emissions-free by 2035.
Biden says his plan goes beyond Obama’s environmental platform, and would ensure the U.S. reaches net-zero emissions no later than 2050. On airline emissions, which make up about two per cent of global emissions, Biden vows to “pursue measures to incentivize the creation of new, sustainable fuels for aircraft, as well as other changes to aircraft technology and standards, and air traffic management.”
He has also vowed to recommit the U.S. to the Paris Climate Agreement, and to encourage other countries to ramp up their own emissions-cutting goals.
On Keystone XL, Biden vowed early on that he would scrap the pipeline, calling it “tarsands we don’t need.” Alberta has already invested billions into the project.
Alberta Premier Jason Kenney has already come out strongly against Biden’s reported intention to kill Keystone XL, saying the Biden administration “owes Canada the respect to at least sit down with us and talk” about the pipeline’s future.
“Surely, the relationship between Canada and the United States is worth at least having that discussion,” Kenney told CTV’s Power Play on Monday.
It is a sentiment echoed by Director of the Wilson’s Centre Canada Institute in Washington, D.C., Christopher Sands.
“I wouldn’t give up on this pipeline,” Sands said on CTV’s Your Morning Thursday, noting that only the extension is being revoked. “I’m just disappointed that, rather than diplomacy, we went straight to cancellation.”
Sands said that Biden’s decision may be a sign that “environmentalists” have a lot of sway with the new administration.
Waiting until the Friday call scheduled with Prime Minister Justin Trudeau would have been the “courteous” thing to do, he explained.
“I think it shows that Joe Biden – even though there was a lot of celebration yesterday – he is the leader of a party that is divided… he moved very quickly to placate some of his base. I think it’s a sign that the Democrats are in trouble.”
“Joe Biden has had a long career, he knows the courtesies that are expected,” Sands said. “The fact that he did this is a sign that he is not very confident that he can do what he wants, he has to do what his base is telling him.”
Prime Minister Justin Trudeau said Tuesday that Keystone XL continues to be an important project for his government and that Canada will present its arguments in favour of Keystone XL to the incoming administration.
"Our government is making sure that Canada's views are heard and considered by the incoming administration at the highest level," Trudeau said.
Whereas Trump boasted of creating more opportunities for the oil-and-gas sector, Biden says he would “take action against fossil fuel companies and other polluters who put profit over people and knowingly harm our environment and poison our communities’ air, land, and water, or conceal information regarding potential environmental and health risks."
Biden pitched his environmental plan as part of a coronavirus recovery mission, saying that investments in green infrastructure will create much-needed jobs and help kick-start the slumping U.S. economy.
The Democrats’ climate plan was part of a broader campaign to woo younger and left-leaning voters. It was drafted following recommendations from a joint task force involving Vermont Sen. Bernie Sanders, who focused much of his failed campaign for the Democratic presidential nomination on climate.
Since the U.S. left the Paris Climate Agreement, Canada has taken on more of a leadership role on the international stage to encourage other countries to cut emissions. When the U.S. rejoins the global pact under Biden, Canada would likely have less of a voice in these discussions, says Ryan Katz-Rosene, an associate professor at the University of Ottawa who researches environmental policy.
Biden’s promise to invest in green industries could also spur competition for similar investments north of the border. In particular, green hydrogen -- a clean but costly alternative to fossil fuels -- could see some healthy market competition, says Katz-Rosene.
“If the U.S. is pouring trillions of dollars into green tech, that changes the situation,” he said.
"All of a sudden, Canadian producers of green hydrogen … they start saying, ‘Now we need to ramp things up.’”
This cross-border ripple effect could also affect Canadian policy, since the U.S. and Canada are linked by CUSMA and other international agreements with environmental clauses.
Biden’s climate policies could present both opportunities and problems for Canada, Sands said.
“Remember Quebec is building an energy corridor that goes through Maine that has great local support, but we’re also looking at Enbridge Line Five, which connects the upper and lower peninsulas of Michigan, there is a section there that has been blocked – which should be bringing oil from western Canada to Ontario,” Sands said.
“There is a desire to meet climate targets, and if we’re moving away from fracking…then we’re going to have to find energy from somewhere, and Canada brings a lot to the table in that regard,” he said.
Climate Action Tracker, which monitors whether or not countries are on track to hit the Paris Agreement’s 1.5 degrees Celsius goal, lists just one country — Morocco — as doing enough to hit the mark. Canada’s level of action is considered “insufficient,” while the U.S. is considered “critically insufficient,” a ranking behind China, India and Brazil.
A section of an ice field is seen from NASA's Operation IceBridge research aircraft on March 29, 2017 above Ellesmere Island, Canada. (Photo by Mario Tama/Getty Images)
Trump made his views on NATO clear from the earliest days of his political career, suggesting that his support for NATO would be contingent on many of its member countries increasing their defence budgets.
While Trump represented an existential threat to NATO, there could be a very different outcome with Biden, says Steven Lamy, a professor of international relations at the University of Southern California.
"It's not going to be the leadership of the hardcore realist presidencies; it's going to be more a leadership in the Obama style," Lamy told CTVNews.ca via telephone in July.
That "Obama style" could harken back to a speech the then-president gave in Ottawa in 2016, in which he told Parliament that "NATO needs more Canada." Biden, who was Obama's vice-president, made similar comments when he visited Ottawa a few months later, asking Prime Minister Justin Trudeau to take the reins of globalism following Trump's election.
Stephen Saideman, director of the Canadian Defence and Security Network and co-host of the podcast Battle Rhythm, said he has heard concerns a Biden administration might continue to pressure Canada and other below-two-per-cent NATO countries into increasing their defence system – after all, Trump didn't invent the complaint; Obama occasionally brought it up, too.
However, while that prodding might continue with Biden in the White House, it "won't be quite as visible, because it'll sound too Trumpian," Saideman said.
NATO is not the only aspect of American foreign policy that Biden would look to revert to the Obama era. His platform in this area was light on new ideas, and heavy on words such as "restore," "renew" and "reinvigorate."
"What you're going to expect to see from a Biden presidency is they'll make the best possible effort to return to pre-Trump normalcy across the board," Saideman said.
"Just as Trump went through pretty much everything and said, 'If this is an Obama thing, I'm going to get rid of it,' I think the Biden people are going to go through the list of, 'OK, here's what Trump did and here's how best to undo them.'"
Lamy sees one more part of American foreign policy as worthy of Canadian concern: the Arctic.
In Biden's case, as the former second-in-command to the first U.S. president to visit the Alaskan Arctic, that means highlighting and addressing the effects climate change is having on the region.
The Trump administration, on the other hand, focused on the Arctic through the lenses of economics and national security, calling Canada's claim to the Northwest Passage "illegitimate". More recently, it re-established a U.S. consulate in Greenland -- after first attempting to purchase it.
"The only interest that we have now is to keep China out," Lamy said.
OIL AND GAS
Opponents of the Keystone XL and Dakota Access pipelines hold a rally as they protest U.S. President Donald Trump's executive orders advancing their construction, at Lafayette Park next to the White House in Washington, DC, on January 24, 2017. (SAUL LOEB/AFP via Getty Images)
Biden's marquee environmental plan includes adding solar and wind farms across the U.S., building more charging terminals for electric cars, and expanding the use of clean energy in industries such as transit and construction to cut fossil fuel emissions.
The heart of Biden’s plan is a fundamental shift toward renewable energy with the aim of becoming a global leader in green technology and innovation. However, he didn’t go so far as to ban fracking, which accounts for millions of barrels of oil per day, and can lead to groundwater degradation.
In his speech at the Democratic National Convention, Biden drew a direct line between fighting climate change and creating new American jobs.
“We can, and we will, deal with climate change. It's not only a crisis, it's an enormous opportunity — an opportunity for America to lead the world in clean energy and create millions of new good-paying jobs in the process,” he said.
Part of that plan includes killing the Keystone XL pipeline. Biden has repeatedly made it clear he does not want to see the project completed, saying it doesn’t make sense economically or environmentally.
Werner Antweiler, a business professor at the University of British Columbia and an expert in international trade, said Keystone XL has always been up against more than Biden, as global trends shift away from big-budget oil projects.
“These projects that looked promising at the time they were proposed may no longer meet the test of being cost-effective,” Antweiler told CTVNews.ca in a phone interview.
A lot has changed since Keystone XL was first proposed in 2012, and the pandemic has meant less demand for oil from major industrial consumers, such as airlines. Last year, BP's new chief executive Bernard Looney speculated that demand for oil may never return to pre-pandemic levels.
Antweiler said the Trump administration handled the pipeline “as incompetently as can be expected of a hyper-partisan administration.”
“Everyone who has been analyzing this has come to the same conclusion: in an attempt to clear the way for natural resource projects, the Trump administration has been playing fast and loose with environmental rules,” he said.
“The result is quite simple. In the attempt to fast-track these projects, they’ve actually induced delays because it opens up court challenges.”
Concordia University economics professor Moshe Lander said that, when it comes to Alberta’s oil sector, the province simply can’t rely on the U.S. as a customer for much longer because the U.S. is quickly moving toward becoming energy self-sufficient. He described Keystone XL pipeline as “a poisoned chalice” that he believes will suffer a slow death.
“I think that Canada’s medium- to long-term relationship with oil and gas with the U.S. is doomed, and I think Alberta knows it,” Lander said.
“Biden can try to reconnect all he wants, but he’s not looking to reconnect on energy. So I don’t see in the next five to 10 years where anyone in U.S. leadership says we really need to deepen our ties to Canada in terms on energy security.”
With the Keystone XL pipeline all but doomed, Lander said he expects he expects that the bubbling separatist sentiment in Alberta, stoked by the so-called Wexit movement, will grow stronger.
“If the U.S. door starts closing (on oil), then I think you’re going to hear the screams from Alberta get even louder to the federal government … to the point that it challenges the unity of the nation,” Lander said.
Huawei Technologies Co. Chief Financial Officer, Meng Wanzhou, leaves the British Columbia Superior Court on September 23, 2019 in Vancouver. (Photo by Karen Ducey/Getty Images)
While Biden’s 2020 platform didn’t say what his presidency would mean for China, the former VP has stated the “world is facing inescapable challenges” and names “a rising China” as one of them.
Biden’s view is that the next president “must repair our relationships with our allies and stand up to strongmen and thugs on the global stage to rally the world to meet these challenges.” He doesn’t state which category he’d put China in, but during the Democratic primary debates he often emphasized China’s authoritarianism.
He’s also questioned Trump’s mixed messaging on China’s handling of COVID-19, from praising their early response to the coronavirus, to blaming them for the crisis. In an online attack ad called “Unprepared,” Biden spelled out how he would have approached the global pandemic differently.
Trump levelled similar attacks on Biden, suggesting he’s standing up for, rather than up to, China.
Former Canadian ambassador to China Guy Saint-Jacques said that, under Biden, there will be changes.
“Because while there is now consensus in Washington, on both sides of the aisle among Democrats and Republicans that… it's time to be tougher,” said Saint-Jacques. “And I'm convinced that the Democrats would want to reinstitute some of the dialogues that they have had.”
Saint-Jacques said Biden’s past travel to China in his role as vice president would be an asset, and he’d likely look to resume that dialogue and lower the temperature of the rhetoric between China and the United States.
“Overall it would be less confrontational,” he said, adding that with Biden there could be an opportunity for a new approach to the two Michaels.
Saint-Jacques suggested that Biden may be more open to negotiating an agreement for a settlement instead of pursuing the charges against Meng, which could then lead to her being returned to China and ideally Kovrig and Spavor returned to Canada.
“I think Biden will bring back that multilateralism, he'll bring back the bigger focus on things like rights, which again, Canada can be very supportive of,” said Margaret McCuaig-Johnston, a science, society and policy senior fellow at the University of Ottawa, adding that the Democrat’s approach to China is more nuanced and similar to the one Canada has taken over the years.
Citing the shifting Canadian views on China -- from a global force to a bully -- Saint-Jacques said Canada should rethink how it engages on a range of issues, from the pandemic to climate change.
“I think for all those reasons, we have to see China as it is, and therefore, we have to change our strategy,” he said.
That said, doing so will likely be easier with Biden in the White House, the experts said.
“We need a more measured approach, but one that recognizes that China has changed. We need to adjust our China policy, and it would be better to do that with the U.S. as a partner, as opposed to the U.S. being seen as an unreliable partner, because it can go off on tangents in any direction at all on a moment's notice,” said McCuaig-Johnston.
IMMIGRATION AND THE CANADA-U.S. BORDER
Canada is generally believed to have benefited in some ways from Trump's hard line on immigration. This is especially true in the technology industry, where Canada has become a more attractive destination to skilled workers from overseas. This was also evident in the response to last year’s announcement of American visa restrictions, which included the CEO of language app Duolingo threatening to move jobs to Canada, and one Canadian tech organization putting up billboards in San Francisco advertising opportunities north of the border.
Biden’s presidency could be seen as harmful to Canada in the same way, as he appears to have a more open stance on immigration. His platform noted the tech sector and other industries "rely on immigration," and praised the contributions immigrants make to the American economy.
Biden also vowed to reform the visa system in several ways, including by expanding the number of high-skilled visas granted and eliminating existing country-by-country limits on employment visas.
Beyond this, Biden promised to remove daily limits on the number of asylum applicants accepted by the U.S., increase humanitarian aid for asylum-seekers whose claims are pending, and halt all funding for the Mexican border wall – all of which could make the U.S. more attractive to prospective immigrants at the expense of Canada.
During the campaign, the former vice-president said his immigration proposals are one way he will "take urgent action to undo Trump's damage." A common theme of his campaign material was that his presidency would focus on reverting policies enacted in the last four years. That’s one reason why Laurie Trautman, director of the Border Policy Research Institute at Western Washington University, sees opportunities to draw on history from the last time Biden was in the White House to predict how he would handle Canadian border issues.
"We can really draw on the relationship between Obama and Trudeau – and Harper too, for that matter – [to project how Biden might view Canada]," she said.
That could include filling vacant positions at government agencies geared toward cross-border co-operation that have been largely ignored since 2016, Trautman said.
Edited by CTVNews.ca producer Michael Stittle, with files from Christy Somos.