Competitiveness key for Alberta success weathering Trump: Hunter

Posted on December 12, 2024 by Ryan Dahlman

By Trevor Busch
Commentator/Courier
editor@tabertimes.com

Threatened tariffs, economic protectionism, mass deportations – living next to the angry elephant south of our 49th parallel is about to get interesting for Canadians when the Trump administration takes office in January 2025.

All bets are now off as federal and provincial government officials try to decipher the myriad implications of every targeted tweet dropped by president-elect Donald Trump and navigate a path that won’t imperil our own economy or send us into a tailspin of recession.

One curious phenomenon has recently seen pundits and political prognosticators unusually guarded in their analysis rather than the paroxysm of prediction we’ve come to expect.

While all of this could be chocked up to the “Trump effect” and the unpredictable uncertainty his administration is sure to inject into world politics, on the flip side in Canada the apoplectic reactions of Canadian policy makers would appear to be playing directly into the hands of Trump’s divide-and-conquer ethos.

Trump’s recent declaration to impose 25 per cent tariffs on goods from Canada and Mexico has sent shockwaves through the corridors of power in Ottawa and Mexico City, and Taber-Warner MLA Grant Hunter thinks the incoming president-elect will make good on at least some of these threats.

“When it comes to products coming from eastern Canada to the States, he’s indicated that, and I think that he’ll probably follow through with that. He’s probably going to want to renegotiate hard the new NAFTA agreement and I think that would probably go better in the U.S., on the U.S. side than on the Canadian side. So there’ll be some effects on that. He might try to do something with softwood lumber, which is something that’s happened in the past where it could hit us, could hurt us. ‘Buy America’ for beef, so we’ll see whether or not that’s something also when it comes to supply management for things like dairy. He might see that as an issue as well. That’s kind of on the more negative side.”

Hunter argues Trump’s protectionism should really extend to the concept of “Fortress North America” rather than divisive cross-border trade policies that could end up damaging both economies if it erupts into a full-blown trade war.

“I think on the positive side, I believe that he is very much in favour of the Keystone XL pipeline being built, which is going to be a real boon to our economy in Alberta. I would like to be able to see that get back up and going. He has talked about – he’s used the words ‘drill, baby, drill.’ I’m sure he recognizes – the Premier is going down to his inauguration – so she’s going to remind him that we are the largest supplier of oil and gas that they get from international sources. So he’s going to recognize more, I think, that ‘fortress North America’ is really what he should be talking about, rather than just ‘fortress America.’ And so I think that there’s some benefit there. We’ve always said that when the United States gets a cold we get pneumonia here in Canada, because so much of our stuff is exported to the United States,” says Hunter.

“I think that if president-elect Trump can jumpstart their economy and decrease inflation – he talks about doing work on red tape reduction, which I’m a big fan of – I think that there could be a strong U.S. economy, which would be helpful to us because we’d be able to export more to them. I am hopeful that this is going to be a benefit to Alberta and I’m excited about the future.”

Trump’s economic rhetoric is often steeped in the language of oil and gas, and Hunter is optimistic about what this could mean for Alberta – provided his made-in-America approach doesn’t purposely exclude Canada’s enormous potential on that front.

“I would be surprised if he did straight across-the-board tariffs on everything, because as I stated earlier, he needs to have our oil. We have heavy oil coming down the pipeline, and they need that for diesel. Diesel is what still moves things in the United States. And so I think that it would be a mistake. I would be very surprised if he did tariffs on oil. There’s the U.S., the Trump effect, and then there’s also the global effect. They’re a bit at odds right now, and so I’m interested to see how that kind of plays out. The world has been careening towards this green energy, New Deal-type transition off oil and gas. I’ve said this from the beginning: if we have the technology to do it.”

In a post-mortem assessment of the recent Democratic Party presidential campaign, Hunter argues Trump did a vastly better job of speaking to ordinary voters about the issues that mattered most.

“I think the reason why they voted for Trump in the first place is because he said, ‘Look, it’s going to be cheaper under my administration, and cheaper to live. People are getting tired of having to spend more.’ I know that’s probably the number one thing that I hear in my office, is the cost of utilities, the cost of food, the cost of everything is going up, and so people are not happy about it, and they want change. And I think that’s where he came in and said, ‘I know how we could fix this, and this is what we’re going to do.’ And he had a better strategy – at least, he presented a better strategy, I think, than Kamala Harris did.”

Further investment and success in southern Alberta’s agri-food sector will hinge on the question of competitiveness, argues Hunter, who is deeply concerned about federal government policy.

“That’s very material to our area. With the United States, with Trump doing the work he’s doing on red tape reduction and the cost of capital, he’s probably going do the same thing he did last time, which is some kind of an accelerated capital write-down, which was very, very successful the last time he was in office. And so if he does that, it’s going to be a little harder for us to land those deals, to bring them up here, because what they’re competing against is the carbon tax, a high inflationary environment, and a federal government that just doesn’t seem to be focused on making us competitive with the United States and other countries, and so that is a difficult thing that we’re going to have to deal with. And I think that unless we have a federal government that’s willing to go tit-for-tat with the Americans in terms of making it so that Alberta in Canada can be the place where people can start businesses and bring in their businesses, we’re going to lose a bunch of that potential business. And that’s one thing that I am quite concerned about. I do have companies that are kicking the tires, and looking at Southern Alberta there in the corridor for setting up agri-food processing. But we have to be competitive. And Alberta, I think, is competitive. I just think federally we’re not.”