The Trump message to industry is
quite clear. Cut out the red tape, impose
tariffs on a variety of imported products,
all to make America great again. U.S.
printers can buy into that because if the
plan actually works the result will be more
printing being produced in America. The
Mexican upheaval is really a US.,
Japanese and Korean manufacturer’s
issue more than it is a Mexican one.
Goods assembled or made in Mexico are
for non-Mexican corporations – with a
majority being American. In the 1980
movie The Formula, a film about a secret
synthetic fuel that would render oil obsolete,
there is a scene between two oil
company executives: Arthur Clements:
[proposing that Titan Oil can raise its
gasoline prices] the people will accept the
12 cents now because we can blame it on
the Arabs. Adam Steiffel: Ah, Arthur,
you’re missing the point, we are the Arabs.
The largest U.S. corporations are
global. The movie showcased what we all
sort of know. America Inc. is the puppeteer.
Mexico (the country) is the one taking
all the flack. The first commandment
of free enterprise speaks of making
products cheaper. Countries like Mexico
are essential to maintaining a low-cost
environment. Jobs are disappearing simply
because of technology and both
Canada and America need a low-cost
producer in their own back yard, just as
the rest of the world’s continents have
access to such countries.
The printing industry on both sides of
the 48th parallel can benefit from Trump’s
hacking away at red tape and forcing
more factories to open up in the USA.
Tariffs alone, if implemented by Congress,
could invigorate rustbelt towns all over
the United States. But there will be losers
and Canada will have to work hard to
keep itself out of Trump’s crosshairs.
If Trump has his way in removing the
so-called tax imposed on manufactured
goods made and exported from America,
this could cause severe indigestion for,
among others, Canadian printers. We
faced difficulties like this in the late 1960s
and early 1970s. After all, Canadians
enjoy exemptions on exported items so
the likelihood of the Republicans agreeing
on similar schemes is not a stretch.
Only a fool believes our large oil reserves
serve a single purpose of providing
energy and powering our vehicles. Oil is
so much more important and used in
everything from food to plastics. But
paper is another story all together. Especially
in coated cut sheet, Canada and
America work somewhat differently. This
can be seen by visiting any cross border
print shop. Southeast Asian and Chinese
paper suppliers enjoy a major slice of a
Canadian printer’s buy. Not as much in
America, where they have always been
aggressive in slapping on anti-dumping
and countervailing duties. With current
zero duties on Canadian printed materials
(to the U.S.), Trump could alter any perceived
advantages save for our weaker dollar.
Today, NAFTA covers a North American Economy with a combined output of USD 17 trillion. The NAFTA region is home to 444.1 million people, 33.3 million of whom live in Canada, 304.1 million in the United States, and 106.7 million in Mexico.
In 1994, when NAFTA was enacted,
there were many Canadian naysayers
warning of impending doom to the Canadian
Auto industry. The previous 1965
AUTOPACT agreement had proven to
be a Godsend for Canada and its replacement?
Well who really knew how that
would play out? Quite wonderfully actually.
But now NAFTA is under attack
and if our government cannot negotiate
favourable terms our print industry could
find itself back in the 1960s – shut out of
tariff-free trade with our largest trading
partner. For us in Canada? We can only
hope that we don’t catch a cold.
A bull in a china shop, Trump, while
upending the way things have been, could
either draw Canada closer economically
or create huge difficulties. His reckless
tweets and simplistic sound bites could
not be more different from his predecessor.
Obama’s speeches make Trump’s
sound like he’s in a primary school debate.
This does not change Trump’s forward
trajectory as he stumbles through his first
America’s small business owners will,
however, applaud him if he does make it
easier for them to expand and run their
businesses. The Environmental Protection
Agency (EPA), for one, has made it
extremely hard for web printers. The EPA
imposes harsh rules for exhausting of
airborne effluents and in some states like
California the paperwork alone kills the
majority of a dwindling industry.
Battles have not begun yet between the
Republican majority Congress and the
President. But they will. In two years,
Congress has an election. A massive
problem will unfold soon between the
two for its possible that the GOP will (if
they completely side with Trump) lose
their majority and make Trump a lame
duck. Congress representatives from
States that do a lot of business with Canada
will be hard pressed to support
schemes that restrict trade between the
two countries. Let the knives come out.
For the U.S. printing industry they
hope Trump will not do anything really
stupid to upend the economy. These folks
are willing to hold their nose and pray
that Trump stays on message to effect
legislation that can benefit U.S. manufacturing.
Canada’s printing industry needs
a strong voice in Washington now more
than ever. Do we have it? Time will tell.
The one argument President Trump can
make that will hold water is trade. The
rest of his ideas are another matter but
let’s hope it’s not too late to take the car