Canada - Law Firms A Former U.S. Ambassador To Canada On U.S.-Canadian Trade Relations

Friday, October 1, 2004 - 01:00
Gordon D. Giffin

Editor: Ambassador Giffin, you have had a very interesting career. Would you provide our readers with a summary?

Giffin: Following law school, I was privileged to spend almost five years working in the U.S. Senate as legislative director and chief counsel to Senator Sam Nunn. It was an extraordinary experience for a young man just out of law school. I then returned to Atlanta and pursued a private practice career for the ensuing sixteen years. I stayed involved with public policy and in the political arena, however, on behalf of Senator Nunn and, ultimately, as head of the Clinton campaign in Georgia in 1991-92, as well as in 1996. In 1997 I was nominated and confirmed as U.S. Ambassador to Canada. I spent four years in Ottawa, following which I returned to private practice.

Editor: Would you tell us how you came to McKenna Long & Aldridge?

Giffin: In 1986 I joined a growing Atlanta firm with the name Long & Aldridge, where I practiced until becoming Ambassador to Canada. McKenna Long & Aldridge is the successor firm. My practice today is in part similar to that of my prior period with the firm: administrative and regulatory law and government contract work. Today there is an increased international emphasis, particularly with respect to Canada. A substantial part of my current practice involves international trade and transactions. I represent both U.S. companies doing business in Canada and Canadian companies doing business here.

Editor: Would you tell us about your service in Ottawa? What were the highlights of that experience? And the challenges?

Giffin: It was an experience of a lifetime. I grew up in Canada, living there for 17 years. The opportunity to return to the country to represent the U.S. was an extraordinary honor for me. On a personal level, it meant a great deal to me since my daughter was able to spend time there as well. Professionally, is was the best job I have ever had because it involved, in addition to representing my own country, being engaged in addressing a number of public policy challenges on issues, important issues, that make a difference in people's lives. Working to improve the lives of people - and that is what advancing the public policy discussion between the two largest trade partners in the world is all about - is both stimulating and rewarding. It also gave me an opportunity to meet a great many people and develop a whole array of new friends, something that simply does not take place beyond a certain age for most people.

Editor: What, essentially, are the responsibilities of a United States Ambassador to Canada?

Giffin: The Ambassador is the CEO of a large enterprise. We have a large embassy in Ottawa and six consulates across the country. The Embassy is fully staffed by personnel from a variety of agencies, including the Treasury Department, Agriculture, Customs, Homeland Security, the Secret Service, the FBI, the Defense Department, and so on. All of these people report to the Ambassador, who has been delegated authority over U.S. government operations in Canada by the President of the United States. The Ambassador is the principal spokesman and negotiator for the U.S. government on issues affecting relations with the Canadian government, and the principal channel of communication by which the Canadian government's concerns are conveyed to our government. While there are plenty of instances of direct communication between, say, the Canadian Minister of Health and his U.S. counterpart, the Secretary of Health and Human Services, as a practical matter most of the communication goes through the Ambassador. In a capitol such as Ottawa, the U.S. Ambassador is a considerable personage.

Editor: NAFTA has had a considerable impact on the economies of both countries and on their trade relations. How has this evolved over the years?

Giffin: The predecessor to NAFTA was the Canada-U.S. Free Trade Agreement negotiated and implemented in 1988. Prior to that agreement there were significant limitations on trade. While trade was extensive, there were tariffs and non-tariff barriers that served to complicate the process and, indeed, discourage it. The 1988 agreement set the stage for NAFTA. In the ten years since then trade between Canada and the U.S. has literally doubled. While people continue to say that free trade, and NAFTA in particular, has resulted in the loss of jobs in the U.S., the truth of the matter is that this undertaking has resulted in a dramatic increase in economic activity on both sides of the border and a resulting net increase in jobs. NAFTA has been a huge success, for both Canada and the U.S.

Editor: During your tenure as Ambassador, the full impact of NAFTA came into play. How did this affect your role as the manager and overseer of the U.S.-Canada trade relationship from the U.S. side?

Giffin: While NAFTA has been a great success, and while it has benefited both countries to a very great degree, it has not accomplished all of the things that need to be done if North America is truly going to be a free trade zone. There is more to be done in the way of integrating commerce - and facilitating the legitimate flow of both people and trade - and separating it from all of the security issues that have come to the fore since September 11. We have a real interest today in focusing on the flow of illegal goods and people across our borders. It is important, however, that our legitimate concerns in this area do not serve to compromise the legal flow of goods and people. Nor that the flow of legal trade be utilized to screen the illegal. These are extremely complicated matters, and we are still in the early stages of working out the best structures to use in refining our concerns. My own thought is that NAFTA is not a means by which to deal with the security issues attending the flow of goods and services and people across our borders, and that the Homeland Security initiatives do not constitute a vehicle by which to handle trade. There is considerable work to be done in getting the right balance in place.

Editor: In an ever-evolving and more technology-driven world, there are issues that were not contemplated when NAFTA was signed. What are the U.S.-Canada trade issues that must be addressed today?

Giffin: The issue of duties imposed on Canadian lumber coming into the U.S. must be addressed. There are debates on Canadian milk products and wheat which need to be brought to closure. Some of these issues can be adjudicated by NAFTA panels. There are others which - because they were not contemplated at the time NAFTA was negotiated and implemented - do not lend themselves to NAFTA resolution. We have, for instance, open sky arrangements which govern the airline traffic between the two countries. Despite the name, there really is not a true open sky regime in place here. An American airline can fly me from Atlanta to Toronto and back, but it cannot pick up passengers in Toronto and fly them to Montreal. The same goes for Canadian carriers flying to the U.S. This and similar issues related to cargo need to be addressed.

Revisiting NAFTA, tinkering with it, may not be the answer. Dealing with common security issues is obviously something that is important to both countries. And taking NAFTA to the next level and addressing the open issues directly is important to both. They are connected, but getting the balance right, as I say, is going to entail dealing with them in new and innovative ways.

Editor: Please give us your thoughts about Canada as an investment destination and place to do business?

Giffin: Canada is a world class investment destination. It is a highly developed First World country governed by the rule of law and possessing one of the most highly educated and motivated work forces in the world. As a result, Canada is a place where investments are not only secure but can flourish. As with the U.S., there are industries in which some limitations exist concerning majority ownership on the part of foreign interests, and there are some differences with respect to the regulatory regime. But, taking everything into consideration, Canada is a great place to invest and to do business.

Editor: What about the employment situation? How do labor costs compare with those in the U.S.?

Giffin: As a general matter, labor costs in Canada are lower than those prevailing in the U.S. primarily because healthcare costs are not paid by the employer. Canada has a publicly financed healthcare system. There are other benefits that are typically part of the American compensation package that are either missing or lower in Canada. That makes Canada very competitive with respect to employment-related costs.

Editor: Are there security concerns that both countries share? Do they work together on them?

Giffin: Yes, we definitely work together on security issues. It is important to remember that Canada is a sovereign country, however, and that, while both countries have much in common culturally, legally and politically, their laws and regulations are different. And the Canadians are not about to alter theirs in order to replicate ours. In light of the fact that we share the same principles and values, we usually get to roughly the same place in the end, albeit by different paths sometimes. The collaboration between the two sides on security issues is exceptional and, I believe, better than that between any other two sovereign countries in the world.

Editor: Please give us your thoughts on the future of the relationship. How do you see this evolving?

Giffin: I see this relationship evolving along the lines that its history has followed for a century and more. Canada and the U.S. have been, and are, the closest of friends. During most of the international conflicts over the past hundred years we have fought side by side. We are supportive of each other in good times and times not so good. We vacation in each other's country. We have families on both sides of the border. We do business together. Indeed, we are each other's largest trading partner. I see the future as a direct evolution of the past. I am hopeful that we will find ways in which to work together more efficiently, but I do not see any material changes in what has been an extraordinarily close relationship.

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