Americas

Canada

  • Israel
    UN Quiz: Who’s the Prime Minister of Israel?
    Despite the criticism of the UN’s Goldstone Report, including by Goldstone himself, the UN seems determined to do it again. Goldstone investigated "Operation Cast Lead," the war between Israel and Hamas in December 2008 and January 2009, or more precisely he ignored Hamas and investigated Israel. Now the UN Human Rights Council has appointed a commission to investigate the current conflict, and once again Israel alone is to be the target. There will be no investigation of the rocket and mortars fired at Israel by Hamas, nothing about the purpose of the terror tunnels dug by Hamas into Israel, nothing about human shields, nothing even about Hamas’s use of UN facilities as storage sites and launching pads. This kind of investigation requires the right leader, and the UN appears to have found him: a Canadian law professor named William Schabas. No nonsense about objectivity here: Schabas is on record denouncing Israel repeatedly, as UN Watch has documented. But it gets worse: he is also on record as saying that Prime Minister Netanyahu should be "in the dock" for the crimes Israel committed during Operation Cast Lead. Minor problem: Netanyahu was not in government at the time; Ehud Olmert was prime minister then. Such small details do not apparently trouble Schabas: what’s the difference, prosecute one Israeli or another. His own intense hostility to Netanyahu, also documented by UN Watch, may have led to this little mistake--which shows not only hostility to Israel and Netanyahu but a cavalier attitude toward the facts. All in all, he’s exactly what the UN Human Rights Council is looking for. Canada’s foreign minister John Baird had it right when he tweeted "UN Human Rights Council continues to be a sham for advancing human rights; today’s ann’t for members of its Gaza inquiry reveals its agenda."      
    Post by Elliott Abrams August 13, 2014 Pressure Points
  • United States
    Good Neighbors
    President Obama will meet tomorrow with Mexican President Enrique Peña Nieto and Canadian Prime Minister Steven Harper for the North American Leaders’ Summit. The three leaders will take a look back on the last twenty years of regional integration, but even more importantly, they will have an opportunity to set the course for the next two decades. In this piece for Foreign Policy, I explain why working trilaterally for a North American future is more important now than ever before for the United States. On Feb. 19, President Obama heads to Mexico to meet with President Enrique Peña Nieto and Canadian Prime Minister Stephen Harper at the North American Leaders’ Summit. The three leaders will undoubtedly look back at the last twenty years, recognizing the mostly positive changes that the North American Free Trade Agreement (NAFTA) and other cross-border ties have brought to the three nations. But the more important element of the meeting is a question: Will the leaders look forward in a serious way, setting the neighborhood agenda for the next 20 years and grabbing the opportunity to promote a truly North American future? The most fundamental building block of that future is and will continue to be trade. Today, each of these nations is among the others’ largest trading partners, with intra-regional trade reaching more than $1 trillion a year. Some 14 million U.S. jobs depend on its neighbors—5 million more than in pre-NAFTA days. These jobs pay, on average, some 18 percent more than those catering to just U.S. consumers—what economists call the "nontradeable" sectors, according to a Department of Commerce study. This and other international trade have also benefited American households through the wider variety of goods available at lower prices. To be sure, some jobs have left. But studies show that even more have been created, and that these jobs have come precisely from those companies that embrace global production. A study by Harvard Business School and University of Michigan professors, using confidential data collected by the commerce department, estimates that, for every ten jobs that multinationals create abroad, they create on average two new jobs in America. By producing globally—and especially continentally—companies like Ford, Caterpillar, General Electric, and OfficeMax have been able to expand locally. This finding reflects perhaps the biggest commercial shift since the signing of NAFTA: the changing nature of production. Rather than sending each other finished products, the United States, Mexico, and Canada now trade pieces and parts. The back-and-forth among assembly lines, plants, and countries in the making of each car, plane, computer, or flat-screen TV means that for every item imported from Mexico, 40 percent of its value, on average, was actually "made in the USA." (For Canada, it is 25 percent.) That means, of the nearly $277 billion in goods imported from Mexico in 2012, $111 billion was actually made by U.S. workers. In contrast, of the much larger $425 billion imported from China, less than $17 billion was derived from U.S. labor. As dramatic are the changes on the energy front. Here, North America has long been tied together: Canada and Mexico have been top oil suppliers to the United States for many years. The flows are often reciprocated, with Mexico buying U.S. natural gas and the United States and Canada sharing electricity through integrated grids. But the potential of North American energy has transformed in recent years. In the United States, the rise of shale oil and gas has shifted the conversation from one of preoccupations with scarcity to talk of self-sufficiency and even abundance. In Canada, new technologies are unlocking the vast resources of Alberta’s oil sands, and warming temperatures are opening up potential new finds under the Arctic ice. In Mexico, recent constitutional reforms are changing the energy landscape, opening up this sector, after decades of state control, to private investment and expertise. The rising exploration and production accompanying new U.S. energy finds has kicked off an employment boom, with estimates of between one and two million new jobs being created in the next six years. But the surge will also have wider-ranging effects, encouraging further investment in energy-intensive industries like chemicals, fertilizers, cement, glass, and plastics. And, if exploited in an environmentally sustainable way, access to cheap and stable energy in the three nations will undergird the regional supply chains that are already deeply embedded, giving corporations one more reason to choose North America over other locales for their production. Vital to this dynamic future is security. Here, the three nations face threats ranging from organized crime to terrorism, from health and natural disasters to cybersecurity. Since the attacks of Sept. 11, the United States has increasingly come to see its borders as a source of vulnerability and addressed them both unilaterally and bilaterally through policies like "Beyond the Border" with Canada and the "Twenty-First Century Border Initiative" with Mexico, which aimed to improve security by jointly sharing intelligence and creating trusted traveler and other programs to speed up the good and stop the bad crossing each day. These border-centric strategies have improved security, but often at the cost of trade and economic competitiveness. And by working only bilaterally on security threats, the three nations often miss the benefits that could come from a much closer and coordinated regional approach to protecting North America’s peoples. The time is right for re-envisioning North America. Mexico is in the middle of historic changes. Over the last 16 months, the country’s congress has passed as many major reforms across several policy areas, ranging from education to anti-trust, taxes to energy. These changes should make Mexico more open, and the integrated supply chains already in place with its neighbors all the more competitive. Moreover, immigration flows—which fell to net zero with the United States in recent years—have at least the potential to lessen the heated rhetoric that inflames bilateral tensions and to open up space for constructive engagement on economic, energy, and security issues, among others. To the north, meanwhile, Ottawa is open to engaging the United States, and to working to make the most of Canada’s energy boom and resurging potential for manufacturing. It has also expressed an interest in a regional approach to global issues. The costs of not engaging are increasingly high. In a world of regional blocs, deepening U.S. ties with its economic allies—particularly its neighbors—will help maintain national competitiveness. America’s dream of energy self-sufficiency depends too on its neighbors, and, on the security front, given the significant interlacing of companies, workers, families, and communities, outcomes in one place often reverberate regionally. The United States is already a global superpower. But with its neighbors, it could extend its reach even deeper. At this week’s summit, North America’s leaders need to do more than acknowledge their mutual interdependence—they need to set an ambitious agenda to expand it.
    Post by Shannon K. O'Neil February 18, 2014 Latin America’s Moment
  • Canada
    A Conversation with Stephen Harper, Prime Minister of Canada
    Play
    ROBERT RUBIN: All righty. Welcome. I'm Bob Rubin, co-chairman of the council. And we welcome you here today. We are absolutely delighted to have with us our distinguished guest, the prime minister of Canada, Stephen Harper. I will not recite from his resume; as you know, it's council practice to simply welcome our distinguished visitor. But it's worth looking at that resume. It's extremely impressive and this is an extremely accomplished prime minister.Let me just make one personal observation. I had the good fortune to be at breakfast with the prime minister this morning. We discussed -- or the group that was there discussed economic issues, we discussed the Mideast, about which he knows an enormous amount. And he is very, very thoughtful, as you will quickly find out.So we again, Prime Minister, are just delighted to have you with us. Our program will be as follows: I'll spend about, oh, the first half of the program posing a few questions to the prime minister and then we'll open it up to all the participants. And then we will adjourn on time. If you do ask a question, raise you hand. Somebody will come to you with a microphone. State who you are, your affiliation, and be very brief so we can get as many questions in as possible.Let me start you off in this way, Prime Minister -- as I mentioned at breakfast, I happen to have a very small investment account, so it kind of interests me -- (laughter) -- what do -- what do you -- and I think, you know, I do, because I think Canada has a very strong position. But as you look forward over the next five or 10 years, what do you think about when you think about risks, problems, concerns, issues that Canada needs to address?PRIME MINISTER STEPHEN HARPER: Sure. Well, first of all, thank you for the kind introduction and thank you, everybody, for having me today. I'm delighted to be back here. Bob, let me just say this, what I said this morning, you know, we can point to little things, there's always things you want to see better in your economy. But the fundamentals of the Canadian economy are very strong. Our growth is slow, but it has been extremely steady -- the best overall since the end of the recession in the G-7. We continue to create jobs. We have the lowest tax rates at the federal level we've had in 50 years. And our debt and deficit levels are lowest in the G-7 by a long way -- by a long way.RUBIN: Can you tell people what they are? I think --HARPER: Well, at a federal level we're now peaking at about 33 percent. So it's a very, very manageable level.I can point to little things, but all of the risks to Canada are really external. There were never in Canada any of the fundamental problems that led to the recession globally -- the banking problems, the housing market problems, the sovereign debt problems. None of these things were present in Canada in any significant way. And our recession came about entirely due to our external markets, our export markets and the effect of commodity prices. And these things remain our significant risks in the -- in the near and medium term. What I have told Canadians repeatedly in the last few years is those risks are there, they're going to continue to be with us. And our finance minister, Mr. Flaherty, will continue to dialogue with his partners around the world, our central bank will try and deal with those things.What we have to do in Canada is, quite frankly, simply look past those things and ask ourselves what can we do to try and increase the growth potential of our economy over time going forward. And that's why we are working on trade agreements, including completing the one we're in -- negotiating with the EU right now; why we're keeping our taxes down, getting our budget balanced; why we're making investments in long-term economic infrastructure and innovation; why we're focusing -- are trying to focus our training programs increasingly on economic and labor force needs; why we're reorienting our very -- I think very positive immigrations programs even more towards the labor force. We're trying to do all the things we can to deal with the growth potential of the Canadian economy, and as I say, not that there are no risks in Canada, but the real significant risks are all external.RUBIN: May I ask you a question, Prime Minister? My impression -- I think this is right -- is that with all the great strengths of Canada, productivity still has not increased at the rate that it has in some of the competitive countries -- for example, ours. HARPER: Yeah.RUBIN: And what would you think, if that's right -- and I think it's right -- what would you think the reasons would be? And what can be done to address that?HARPER: Yeah, it is -- it is true. I don't think we entirely know why it is true, but you know, we're doing a couple things that are important. In terms of particularly our manufacturing sector, we're doing things to encourage innovation and investment in that sector. We've had accelerated capital cost allowance write-downs for new machinery and equipment. We've eliminated all tariffs, incoming and outgoing, on manufactured goods. And we're putting more money into -- government money into the commercial side, commercialization side, of research and development.These are all things on which we're starting to see some improvements in productivity, particularly in that -- I think that's the really key place where it has to be done. The other thing we're doing more going forward is looking at -- you know, given that we're -- like all big Western economies, we have large government, what can we do to improve productivity and efficiency in government. As we're trying to balance our budget, rather than cutting services left, right and center, we're trying to look at ways we can reduce back office overheads, we can find more efficiency through application of new technology, how we can improve our performance management system for our public servants, to make sure that we're getting the highest levels of results. So those are some of the things we're trying to do on productivity, and I think I see some sign it's starting to have some effect. But it's something we'll have to watch going forward. RUBIN: You obviously are an enormous producer of energy -- gas, oil, coal and so forth. How do the environmental versus the production of energy forces weigh out in Canada? You've got the gateway pipeline --HARPER: Right.RUBIN: -- which I think now has run into some difficulty in British Columbia, if I remember correctly.HARPER: Well, then the Northern Gateway is still -- it's still part of a regulatory review process. I -- as I tell people repeatedly, we in Canada -- you know, we have a market-driven energy system; the government does not fund or invest in particular energy products -- projects, outside of the hydroelectric sector. We have vigorous regulatory systems to look at the economic, environmental and other impacts of environmental -- of energy projects.I'll repeat what I said this morning: to repeat kind of what you said, Bob, that, you know, whether it's coal, hydroelectricity, uranium, natural gas, oil, you name it, Canada is one of the largest producers in the world, and in almost every case with some of the largest reserves in the world. So whatever the energy mix of the future, as I tell people, Canada will be a major provider.Look, environmental challenges are real. They have to be dealt with. You know, in terms of the one that -- probably one I do want to talk about today, the Keystone pipeline in particular --RUBIN: (Chuckles.) Thought you might. HARPER: -- and the oil sands, let me just talk a little bit about the environmental side of that, because I know that's something we're going to be focused on. Oil sands -- first of all, one needs to put this in a global perspective. Less than one-tenth of 1 percent of global emissions are in the oil sands. And so it -- it's, you know, almost nothing globally.Now obviously it's a significant part of the -- of our own pressures in terms of our targets, the targets we share -- we share a Copenhagen target with the United States. We have the same target and obviously constraining emissions there in the oil sands is going to be important. We've had a 25 percent reduction over the past decade or so in emissions intensity out of the oil sands -- 25 percent down. The province of Alberta already has a technology fund, a regulatory approach in the oil sands that is going to lead to even more investments in technology that will continue to reduce our emissions. So look, truth of the matter is heavy oils out of the oil sands -- yes, there still are emissions issues, but no -- no more so than heavy crudes in other parts of the world, including Venezuela. And I don't have to tell you there are probably reasons beyond just emissions why you would want to have your oil from Canada rather than from Venezuela.You know, this project -- well, if I can just take a second, four things. I talked about the environment. You know, on the economic side, 40,000 jobs in this country alone over the life of the project -- I don't think, given the growth and job record in North America, we can afford to turn down -- turn up our nose at that. Energy security -- this project will bring in enough oil to reduce American offshore dependence by 40 percent. This is an enormous benefit to the United States in terms of long-term energy security. And finally, of course, I think when you weigh all these factors, including the environmental factors, it explains why there is such overwhelming public support for this pipeline in the United States and why the -- in the -- particularly in the regions affected, there's such broad bipartisan support.So I think this absolutely needs to go ahead, but you can rest assured that making our emissions targets, including in the oil sands sector, is an important objective of the government of Canada.RUBIN: This may be an unfair question. You don't have to respond to it. But you've obviously been touched with the -- or involved with the -- our government quite a bit on this subject. What would your prognosis be for approval? You can not respond to that, and you can say that -- (laughter) -- you can say it's complicated -- (inaudible) --HARPER: (Inaudible) -- ask Ambassador Jacobson that question. (Laughter.) Look --RUBIN: I don't think he wants to take personal responsibility for this. (Laughter.)HARPER: I think -- you know, as I say, I think all the facts, including the recent -- you know, recent State Department had a pretty thorough analysis of this, including the environmental impact. And the immediate -- the only real immediate environmental issue here is that we want to increase the flow of oil from Canada via pipeline or via rail. If we don't do the pipeline, more and more is going to be coming in via rail, which is far more environmentally challenging in terms of emissions and risks and all kinds of other things than building a proper pipeline. I think all the facts are overwhelmingly on the side of approval of this, but there is a process in the United States. As I'm told by those who know, the process is subject, as in everything in this country, to a massive potential litigation on either side, so the -- I know the administration will do a thorough analysis before arriving at the right decision.RUBIN: Let me go back to my first question. (Laughter.) That was what -- that's what I thought you were going to say. Let me go back to the first question again. It really -- I've spent a fair bit of time on this. It's hard to see internally -- for the external difference -- internally, where Canada could go wrong. Yet every economy has its risks. So if you were to identify the 1 percent risk that would worry you, what would it be?HARPER: Well, as I say, they are -- they are external. That's what keeps me up at night. We've had -- I think there's been some comment on it here. We have had, as you know, growth of household debt in Canada. I think it's -- it -- the assets behind it still speak to the fact that it's well-supported. The financial institutions lending are the most solid in the world. But household debt has risen. We've taken some important steps in Canada to cool that trend through changing some mortgage rules, which is having a noticeable impact. You know, there's always risks you can't predict in this world. There are security risks. There are terrorist attacks. As you know, we just have been working with the Royal Canadian Mounted Police and the Federal Bureau of Investigation working to make arrests on a particular incident we had not long after the Boston bombings. So there's political risks. There's always the risk of -- there's always the risk of people picking the wrong government, but my primary job is to make sure that doesn't happen. (Laughter.)RUBIN: Well, since you raise that, I wasn't going to. But you do have -- (laughter) -- you have to have an election within the next 2 1/2 years sometime.HARPER: Yeah, actually, we have a date set for October 25th.RUBIN: Oh, you do? OK, I didn't realize that. What will the issues in that election likely be?HARPER: (Chuckles.) You know, I -- look, I tell -- in fairness, Bob, I tell people that my focus right now is the economy. And I am not -- you know, I'm trying to -- trying to stay out of campaign mode as long as I can. The -- that's one of the differences between our system and your system. The campaign mode is not perpetual in Canada, although when we had minority governments, it sometimes seemed that way. I believe that in the foreseeable future, to most people, the economy, the future of jobs and opportunities for themselves and for their children -- those will continue to be the major issues. I think they'll be the major issues for some time to come.I think -- look, I think, in the developed world, we're going to have some ongoing challenges, particularly in Europe, and, for that matter, U.S. fiscal situation is likely to remain challenging for a while. But I think we're at a crossroads as I think we all recognize there is a -- there really is a shift, an unprecedented shift of power and wealth away from the Western world.And in many ways, that's a good thing, because we're seeing hundreds of millions of people come out of poverty who never had opportunity before, and it's something we want to see continue. But at the same time, if these trends continue, they will be a real threat to our standards of living. And what we keep telling Canadians, and I think all Western governments need to tell their people, is we can maintain and increase our standard of living and opportunity for our children and grandchildren, but we have to govern ourselves responsibly, we have to live within our means, and we have to not develop a mentality that somehow, the wealth we have today is a right, and it is simply going to be taken as a given. It's going to be earned in a very competitive world. We're prepared as government to make the investments and decisions necessary to grab that future. And I think we have to keep working with our people to make sure they understand those challenges, not just in their communities but obviously business leaders as well.RUBIN: Look, I think that's a very good statement of the challenge that faces all of us. Would you like to comment is another question you might want to be diplomatic about. (Chuckles.) As you look south -- you obviously have a very strong economic relation with our country -- what is -- how does it strike you that we're doing --HARPER: Well --RUBIN: -- in the context of the framework you just set out?HARPER: Look, we've made -- you know, Canadians are very -- you know, very proud of the fact that the country has performed so well over the past seven or eight years. And, you know, for the first time in a very long time, maybe ever, we now have numbers on standard of living that are at or exceed the numbers of the United States as a consequence of some of the trends of the last few years. And Canadians always -- I tell people from around the world, Canadians always compare themselves to the Americans because you're our only real neighbor, and it's the only real comparison that matters to us. And we're proud of that comparison.But we also know that for our country to realize its potential, the United States has to do better. I'm encouraged by growth signs I see in the United States. As I mentioned here earlier today, I have enormous -- first, I'm an enormous admirer of this country. And in spite of the fact I value the differences we have as Canadians, I'm an enormous admirer of this country, and I have enormous faith in the ability of the American people and particularly the American business community to always find opportunity, always seize it and always create a better future. That's been the history of this country. I think it requires a hell of a lot of effort by everybody in Washington to make that not true. (Laughter.) And I just -- I just don't think they can sustain that kind of effort indefinitely, so -- (laughter) --RUBIN: Boy. Well, that's a -- (chuckles) -- that, Prime Minister, is very well said. I hope that -- (inaudible) -- I hope that your bet on their inability to maintain that indefinitely has turned out to be right. (Laughter.)Before we turn to everybody else, let me ask you, I had not realized, actually, until you were coming here just how deeply you've been involved with the Mideast and how constructively, from our point of view, at least. Why don't you tell people a little bit about your involvement, how much you've been involved and what you've done and what your views are, including in -- with respect to your views, if I may, on Israel, Syria and Egypt?HARPER: Sure.Well, look. I think like everybody we're very concerned about what's happening in the Mideast. I was criticized somewhat at home for maybe not as enthusiastically embracing the Arab Spring as some, not because I didn't see positive there, but because I also saw enormous risks. And in some countries like Egypt, I think we're starting to see the implications of maybe unrealistic expectations, both foreign and often on behalf of the populations themselves.We were very supportive of our allies on the Libya mission. In fact, it was a Canadian commander, actually, in charge of that mission, with, obviously, our American, British and French and other allies, a mission I think, notwithstanding the problems we see today, was still worthwhile for all kinds of reasons.Look, the one that's on everybody's mind is Syria. And I will just say this: You know, all joking aside about Washington, I -- you know, we've -- I have a really good relationship with the president. And, you know, obviously, think within the constraints of the American system, he's doing what he can do on all kinds of issues. On Syria, I see a lot of criticism about inaction. I look at Syria over the past couple years, and I would urge the president and everybody else extraordinary caution in jumping into this situation. This is a terrible regime. Canada has some of the toughest sanctions in the world against the Assad regime. We believe, as everybody believes, that he should step down and there should be a transition.But we should not fool ourselves about what is happening in Syria. The overwhelming complexion of the events in Syria is that of a sectarian conflict on both sides, with brutality and extremism on both sides. And to just start talking about, you know, as some do, arming unnamed people whose objectives -- whose identities we don't know and whose objectives we do not understand I think is -- I think is extremely risky. So I think we are best to try and continue to work -- we're making -- doing humanitarian aid, as I know the United States is. Best that we keep doing that nonlethal aid, that we assist the neighboring countries, particularly Jordan, who are threatened by this and that we continue to try and do what we can diplomatically, notwithstanding the obstruction of some at the United Nations, that we continue to do what we can diplomatically to try and see if we can't bring the sides together and lead to a more peaceful transition. I think those are still the best options. Even if they don't appear attainable, none of the other options, to me, are very pleasant.I think it is also important -- and I'll use this opportunity to say it again, as I think many of you know, our government has been very well known for its strong support of the state of Israel. I think there is nothing more short sighted in Western capitals, in our time, than the softening support we have seen for Israel around the globe. This is the one strong, stable, democratic, Western ally that we have in this part of the world, and the worst possible thing we could do in the long term for any of our governments is to be anything less than fully supportive of Israel. As long as I'm prime minister, this government will remain very supportive, you know, and -- of that country in what is a very challenging neighborhood.RUBIN: As soon as you said -- we'll turn to everybody else, but now you lead me to a follow-up question, if I may. One would think that, in some respects, they have a very difficult situation right now. If you were Israel, how would you navigate in this -- in this water?HARPER: (Chuckles.)RUBIN: And you may also -- on that one our may find some equal answer, like saying it's complex. HARPER: Yeah, you know, it's so hard. I speak frequently with Prime Minister Netanyahu, and it's so hard for me to put myself in that kind of environment. As president -- or Prime Minister Netanyahu always says to me, he says, I have the worst neighborhood in the world and you have the best neighborhood in the world, because you know where I am and you know all the turmoil around me. And he says, you have three oceans -- you have oceans on three sides and the United States on the other. There is no possible better arrangement any country could ask for -- (laughter) -- in the entire world, and I think he's absolutely right on that.You know, obviously first and foremost -- first and foremost, Israel has to be preoccupied with its own security, given all the risks -- the immediate risks of -- in the immediate neighborhood and the farther off but very real risks of places like Iran and its nuclear weapons ambitions, which I consider to be the biggest single threat to the globe today. At the same time, obviously we encourage Israel to try and work with its neighbors to establish workable relationships, as it has with a couple. And we encourage Israelis and Palestinians to return to the peace table and try and make some progress there. But we should -- I really think we should back away from a mythology that there is some kind of magic bullet in Palestinian-Israeli talks that would affect the wider region. The wider region is in turmoil for reasons that go way beyond the Palestinian question or, for that matter, the existence of Israel.RUBIN: Prime Minister, thank you. Now we will take questions from anybody who would like to begin the process of asking questions. Yes, ma'am. Just state who you are and what your affiliation is.QUESTIONER: Hello. Peggy Hicks with Human Rights Watch. Prime Minister, your government has looked at the issue of violence and murders against indigenous women, and it has been supportive of a parliamentary -- special parliamentary committee that's been set up but so far hasn't been willing to take up the recommendation of a national commission of inquiry to address that very desperate problem, with hundreds of women missing or dead. This featured prominently in Canada's UPR, Universal Periodic Review, in Geneva, and now some provinces and territories have come out in support of National Commission of Inquiry. Is it time for the government to support it as well?HARPER: Yeah, I remain very skeptical. You know, I, first of all, tend to remain skeptical of commissions of inquiry generally. Not to say they never work or never produce good recommendations, but my experience has been, they almost always run way over time, way over budget and often, the recommendations prove to be of limited utility.This issue has been studied; the government itself -- the federal government itself -- it's been studied in several different venues -- the federal government itself provided funding or multi-years of study within various branches of our government. We do really think it is time to pass to action.We have been funding increasing elements -- a number of elements in the justice system to increase the efficacy of both prevention programs as well as investigate techniques on behalf of the police. You know, we're talking about a large number of cases, many of which bear no resemblance to each other whatsoever. And a lot of it is just a matter of getting -- getting better processes to both prevent and investigate these kinds of disturbances.But I think the other thing, more broadly, that is required -- and something we have been battling in parliament for some years -- is to really enhance the status of women in aboriginal communities. For instance, something we have been trying to pass for some years, when we were a minority, without success, and now advancing -- we're a majority is matrimonial property rights on reserve -- women on Canadian reserves, for various reasons -- historical reasons -- don't enjoy the same kinds of property and other rights that women off reserves enjoy.The Canadian Human Rights Commission was, for all intents and purposes -- its authorities were not applied on reserves until a couple of years ago when this government managed to amend legislation. So I think there are practical things besides, obviously, enhancing the efficacy of police work. There are things we have to do to increase and raise the status of women in aboriginal communities. And this has been a bit of a pitched battle, because there are forces within aboriginal communities and outside who have been resisting those kinds of changes.RUBIN: Yes, sir.QUESTIONER: Ralph Bertrands (ph), New York University. Prime Minister, in recent times, ethnic problems around the world have risen -- ethnic separatism has risen. But in Canada, it seems to have declined. Why is that so, and what are the mechanisms the Canadian government has used in this process, and are there any lessons that the rest of the world can learn from this?RUBIN: That's a good question.HARPER: You know, broadly -- I won't comment at great length on the issue of Quebec separatism. As you know, we have a separatist government in Quebec right now, primarily because it was the principal opposition, and Quebecers wanted to change the government, but in fact, support for their actual option of separation is at historic lows.Look, I think one of the things we're very proud of in Canada is the general approach we've had to diversity. It obviously has origins in the country, because almost from the outset, we've had two national languages. We've had a policy of multiculturalism for some years. The approach we have used in Canada that I think has been very effective -- it's not perfect -- is that we have always taken the view that when people are prepared -- people who have lived millennia in other nations pull up their roots and come to Canada, that this is a very dramatic decision they are taking.And in wanting to do that, we should be very clear that in almost every case, they really want to become Canadians. And so as much as we want and expect them to integrate, we also view that it is our role as the country they're coming to to make that integration process easier and to accept that when immigrants and when people of different cultures come to Canada, they will not only change to suit the country, but the country will, in some -- in some measure, also evolve to reflect them.And so I think, in understanding that this is a two-way street and that we accept diversity as a positive, this is a deeply-rooted, across the political spectrum in Canada. I think it's been something that's served us very well. And I say, notwithstanding problems that arise from time to time, I think it's fair to say that there's probably no country in the world with greater cultural diversity, but also greater cultural harmony than Canada, simultaneously.RUBIN: In that context, Prime Minister, do you have an illegal immigrant problem in Canada of any dimension?HARPER: We have -- we certainly have illegal immigrants in Canada, but nothing like the problem in the United States. Our problems in Canada have tended to be more problems of people coming and making bogus claims in what is a very generous refugee system, as opposed to mass migration from across the border. So we certainly have illegal immigration, but it is -- it would be a fragment of the phenomenon in the United States.QUESTIONER: Mr. Prime Minister, Gordon Giffin, a lawyer from Atlanta, Georgia, proud graduate of Richview Collegiate Institute.HARPER: My high school, same high school. (Laughter.)QUESTIONER: And a former ambassador to Canada. Welcome, sir.I hope I can formulate this question where it is coherent. 1988, Canada-U.S. Free Trade Agreement; 1994, NAFTA. Almost 20 years later, some significant, I'll call them incremental initiatives, largely led by the two gentlemen sitting in front of me here, to improve how we work at the border together. But no big moves to try and make a difference in North America to make us more efficient economically. I'm not talking about in any way political integration or even currency integration, nothing like that.But I even look at the Keystone debate right as evidence of the issue. The only reason we're having this debate is because of an anachronistic provision in our law that relates to a permit to take infrastructure across the 49th parallel. Why we need that in North America, I'm not sure, when all of the jurisdictions along the route get to approve it or not under their own state laws.So my -- really, my question is, is there a chance of a much bigger initiative between our two countries at some point, to break down the anachronistic rules that impede economic efficiencies in North America, some of which have been done in Europe? I'm not talking about creating an EU with a large governance or anything, but the economic efficiencies.Last thing I'll say, when I was in Canada working on things like this, I found the impediment to that to be an insecurity in Canada about dealing with the United States, that we were somehow going to assimilate Canada. I don't see that anymore. I think Canada's much more self-confident in dealing with the United States and the world. So if that's the case, is there a chance at doing a bigger deal going forward?HARPER: Well, Gordon, let me just begin by just repeating -- I know you're familiar with it -- some of the things we are doing, because I think we do have some significant initiative going forward. We have the -- what we call the Beyond the Border Initiative where we are attempting through a series of individual initiatives and investments and closer cooperation between border authorities, to make things more seamless at the border and to push a lot of -- you know, inspections out around the perimeter of North America to try and arrange our affairs so that, as we say things, are -- things are -- you know, may enter twice, but are inspected only once. And we're doing some of those things.We also have a parallel initiative called the Regulatory Cooperation Council, where we've identified 29 areas to create greater consistency and harmonization of regulations and more importantly, in my judgment, especially for our side, is to find ways in those areas where we will prevent regulatory -- unnecessary regulatory difference and duplication going forward, where we try and identify some of those things in advance, try and change some of the processes.And I should mention one very specific project of international cooperation, which is the president just issued a permit for the Detroit River International Crossing, which this is financed largely by Canada, but this will be -- this is a huge piece of infrastructure in what is -- and we often forget the size of this relationship -- what is the largest single trade corridor in the entire world, the Detroit-Windsor trade corridor. So we have some important initiatives going forward. Could they lead to something systemically more integrated? Look, I think on our side, they could. I think on our side, they could. I agree with your assessment. I think the view -- we had a watershed election in 1988 over the free trade agreement with the United States, and the opponents argued that whether economic integration with the United States -- greater economic integration and trade would lead to wealth or not, it would cause Canada to lose its political independence and identity.What we've seen is it has led to vast increases in cross-border trade without any such loss of political independence or identity. In fact, this past year, as you know, we've been celebrating the War of -- the War of 1812, which -- RUBIN: I know. (Chuckles.)HARPER: -- permanently established this -- (laughter) -- this independence and separate identity. So I think that -- there will always be opponents in Canada, but I think that is a real minority view now.I think the resistance to this kind of thing's far more in the United States than in Canada, for reasons that -- and maybe, Bob and others, for reasons you would better fathom than me. Some of it's post-9/11 security concerns, but I've never seen -- the United States in the past decade is -- the sensitivity here about sovereignty and the negative assessments I often read of NAFTA -- completely counterfactual assessments of NAFTA -- I think, are the real barriers. I think the real barrier to making some of these arrangements broader and more systemic in terms of the integration are actually on this side of the border. RUBIN: (Chuckles.)HARPER: So I leave that to you guys to work out.RUBIN: To the best my knowledge, Prime Minister, there's never been a serious study of NAFTA that has shown it not to have been positive, but it lives in the politics of the United States in a very powerful way, because I think it symbolizes a lot of other issues that people are concerned about. That would be my impression, anyway.HARPER: That's -- it -- I don't think there's any evidence that it's been anything but positive. And it's one of these things -- you get this sometime in politics -- you get odd things where nobody would repeal it, yet nobody will admit it works. RUBIN: (Chuckles.)HARPER: And I don't know why that is. In Canada I say the -- there were many people opposed. It was a very close election, 50-50, Canadians' original support, on the Canada-U.S. trade arrangement. Any political party that advocates backing away from this trade relationship or from NAFTA would never a general election in Canada, would never be a serious contender.So that was a watershed, and people understand that this trade is necessary, essential and beneficial.RUBIN: We'll go back again. Right there. Yeah.QUESTIONER: Stephen Blank, Fulbright professor, University of Ottawa. Back to risk. Three factoids: Canada's increasingly a commodity-driven economy now. We see a decline of Canadian manufacturing competitiveness. And the trick -- Canadian dollar trades about 10 to 15 cents higher than we always thought was appropriate. Do these pieces connect with each other? And is this a risk?HARPER: I wouldn't want to say they necessarily connect with each other.We talked earlier today about commodity prices. I'm not sure I agree that we're more commodity-dependent than ever. In fact, I think what distinguishes us from some countries like Australia is we're actually less commodity-dependent.But look, commodities are important. My own view is that commodity prices are likely over any significant period of time to track the general level of global economic activity. Obviously if there's -- if we were to see a recession or vast slowdown in the emerging economy, that would have a real impact on Canada through commodity prices, but it would have a real impact on everybody, whether you were commodity-dependent or not. So I -- you know, as I said earlier, I think -- I think the fact that Canada actually is an advanced economy with a commodity side is actually one of our strengths. The fact that we have both traditional and nontraditional industries distinguishes us from some other developed countries where the kinds of problems you see in manufacturing and elsewhere are much more fatal in the long term.We do need -- as I said earlier, we do need to do more to make our secondary manufacturing sectors more competitive, more effective. We are working with the manufacturing sector through a series of sectoral initiatives as well as general tax policies to make that happen. I think those sectors are very supportive of what we're doing in Canada to make that happen. And on the research side, as you know, we have been making significant changes to try and make sure the vast -- as we -- you know, we are a very big funder of public R&D in Canada -- to make that connect better with private R&D and to have better results on commercialization.So look, those things are all -- we can point at all kinds of things in Canada where things are not ideal or where there are weaknesses. And they're all true. We have strengths and we have weaknesses. I don't think any of these things individually would say that Canada, in isolation, is suddenly going to have a major economic problem. They're all weaknesses we would have that -- on which we would be susceptible, if there were a continued general global economic lowing. So I think our risks primarily (really ?) are external.RUBIN: Over here.QUESTIONER: Thank you, Mr. Prime Minister. Daniel Arbess, Parella Weinberg Partners. I wanted to take the opportunity to ask about universal health care. You know, I was born and grew up in Montreal and had the experience of living with universal health care as an adolescent, and my family did. It provided full access to health care, but it always -- it wasn't always to the highest-quality health care and to the most accessible when you needed it. As you know, the United States is moving in this direction. And getting universal health care right is probably the most important economic imperative. I'm sure Bob Rubin would probably agree with that assessment. Being able to create a universal health care system in this country where costs will be managed but so will the quality and accessibility of service balanced against that is critically important as the demographic advances here. So I wondered whether you could illuminate lessons in the Canadian experience with universal health care that would be applicable to our experience here?HARPER: You know, in all fairness, probably not. (Laughter.) And the reason -- the reason I say that is my experience with the health care system is similar to yours, and that -- as you know, in Canada, the federal government doesn't run the health care system. We provide some significant funding through transfer payments to the provinces, but we actually have very little to do with actually running a health care system. And I don't proclaim any particular expertise in running a health care system.I would agree with your assessment that we have a system of -- a system of universal access. I would actually say that I think, in my own experience, the quality of care is actually quite high. Timeliness is sometimes an issue and becoming more of an issue as we face some of the demographic pressures on that system. And sometimes a system that's publicly dominated innovation is also -- may also be a bit more of a challenge in some areas.But look, as you know, the fact of the matter is, Canadians across the political spectrum, including our party, we are very supportive of the fundamental premise of the Canadian health care system, which is that when somebody is sick and needs medical care, their ability to pay should not be a factor in them being able to access medical care. And that is a principle that Canadians believe in and, I know, one that remains a matter of some debate in the United States.I would also made the following observations -- when I say that I can't give you an easy answer -- I'd make this observation. In spite of the differences between Canadian and American health care and the health care systems in many other Western countries, it seems to me that health care systems around the world, regardless of how they're structured, seem to have a lot of the same problems, the more I actually look at them.And a lot of the reason for the problem is actually a positive thing. It is that with the -- with the great strides we've made in both the professions, professional training, and especially technology and drugs, that there is just more and more and more we can do to improve people's lives and to keep them living longer. But these things all come with price tags and, in some cases, with enormous price tags.And the fact of the matter is it is very difficult for systems to assess, however they assess it, where you're going to put these resources. Resources are never unlimited. And the demands and the ability to treat in many cases are virtually unlimited. And so decisions have to be made, and however those decisions are made, whether they're through queuing or through pricing or whatever they are, are very difficult decisions. And I just think those are challenges.And they're going to be compounded, as we all know, because of the demographics in Western countries, where the population's aging, people will need more health care, and more health care professionals themselves are aging, there will be less and less practitioners. So those are going to be some of the common challenges.In our country, previous federal governments -- well, not running a health care system -- made a point -- our ambassador was a former premier -- they made a point of periodically picking fights with the provinces over health care to demonstrate that somehow we were going to be great defenders of the system. I think that was an entirely negative dynamic. The approach we now take is we try to work with the provinces to assist them in tackling what are very real challenges going forward.RUBIN: Prime Minister, if a province decided they didn't want to have a single-payer system, would they be in a position where they could move away from that?HARPER: They -- technically yes, but they would not be receiving significant transfer payments from the federal government if they did that. And in fairness, there is no political appetite that I'm aware of in any province in any segment of -- significant segment of political opinion to do that.RUBIN: The gentleman over there. Yeah, that's it.QUESTIONER: My name is Andrew Gumlock (sp) from -- (inaudible). You've had some recent bruising battles on economic nationalism. In the fertilizer sector you chose not to allow foreign investors in. In two recent energy deals, you debated it a lot but you ultimately allowed them in, ring-fenced some assets. How do you see this playing out in the short term with the election? But more broadly, and perhaps more importantly, how do you see Canada attracting in the surplus countries into very capital-intensive industries? Frankly, they need capital well in excess of the savings of Canada.HARPER: Yes, that's true. We need -- we need foreign investment and, at the same time, you should be under illusion that we want foreign investment in Canada. And in fact, although we screen all major foreign investments, only twice in our history have we actually rejected foreign investments. I just want to talk briefly about the two issues you raised. The one where we did not allow the investment, this was a case of the potash industry, where currently it's a Canadian/American company, and Canada is a dominate producer. And through a Canadian/American organization, it's headquartered -- or, you know, partly headquartered in Canada. Canada has significant market power in that industry. In one single transaction, what was going to occur was that that significant market power as going to shift out of the country and towards a foreign, private investor. Our judgement was that, because we do screen foreign investments, that that simply was not in the long-term interests of the Canadian economy. I'd say that was fairly unique circumstances.The second case you raise was our decision to allow certain state-owned investments -- one by a Chinese state-owned corporation, another by a Malaysian state-owned corporation -- into the energy sector. And we allowed those after considerable deliberation. And while we allowed those, we were very clear going forward that in areas of the economy -- like, for instance, the oil sands -- where we see now a significant risk that if we did not restrict foreign ownership that we would have in -- essentially have that sector be nationalized by some other state-owned enterprise.Our view is that is not the direction we want for the Canadian economy. We want to have foreign investment. This government -- in fact, it's conservative governments in our country, like mine, who have opened up the economy for foreign investment and have privatized crown corporations. We did not privatize state corporations in order to see other governments nationalize our industry.So while some foreign state-owned investment is desirable, we would not want it at a level at any critical part of the economy where essentially we began to put that sector of the economy under a foreign state management system, rather than having it essentially run by commercial forces. So as they say, it's a matter of level and degree. And we'll deal with that going forward.The risk Canada actually has, given the attractiveness -- we're now rated -- I forget -- was it Forbes who said now Canada's in the best place in the world to make an investment. We get that kind of rating elsewhere. Given the relative smallness of the Canadian economy and the relative size of some potential investors, I do think that if we don't -- if we don't have this concern in mind, we could see our economy morph in a way we don't intend. And as I say, it's not about foreign or domestic. It's about the nature of state-owned enterprises versus genuinely commercial operations. And that's the thing we're keeping an eye on.RUBIN: Yes, sir.QUESTIONER: Jeff Laurenti with The Century Foundation.Mr. Prime Minister, the gradual melting back of the ice cap over the Arctic Ocean, attributed usually to global warming, raises two issues, as you now have long, frozen territorial claims suddenly heating up as well. And I wonder if you might elucidate for us, first, on the mega-issue of global warming, on which Canada has taken a somewhat more nuanced stand -- walking back from Kyoto -- whether -- for Canadians, perhaps the prospect of having a climate more like New Jersey's is so appealing that, you know, it doesn't seem to be urgent. So where do you see the global climate change issue going on the mega level?And then, on the Arctic territorial claims question, what are the major claims and dispute that affect Canada, and do you see that as resolved by the six countries adjacent to the ocean relative to their bargaining power with each other, or under broader principles of international law like the Law of the Sea? What's the interplay between those?HARPER: First of all, on the issue of climate change -- our government's position from the outset is that we need a mandatory international protocol that includes all significant emitters, and that if we do not get that, we will not be able to control global emissions. Part of the reason our government was not supportive of the Kyoto protocol is it controlled one-third of global emissions and a shrinking proportion of global emissions. Even if the Kyoto protocol had -- every country in it had realized their targets, which, of course, most weren't -- they would have had no impact whatsoever on the growth of global emissions.So we need -- we need some of the big emitters outside the developed world -- not just the United States -- China and others -- to be part of a -- of a global system. And I do believe a couple of things going forward if we're going to make that global system effective. It's not just a matter of setting targets. We actually have to have ways of reaching them. You know, many countries have tried simply setting a target as a way of demonstrating that they're going to achieve something. We need a couple of things.I think, first and foremost, we do need technological change. I am convinced that over time, we are not going to effectively tackle emissions unless we develop the technology -- lower emission technology in energy and other sectors. And that is the thing that will allow us to square economic growth with emissions reduction and environmental protection. And I'm convinced that if we cannot square those two things, we're not going to make progress globally.And I don't just say that about developed countries like ours, where people are still saying they need jobs as a consequence of the recession, but certainly, in the developing world, we're not going to simply be able to put caps on economic growth as a way of achieving environmental targets. So that's the framework we're approaching it from, but look, there's a lot of -- there's a lot of work to be done. There is still not -- the reality is, there is still not an acceptance in many countries of the need for mandatory targets at all.On the -- on the issue of territorial claims, you know, with one -- with one small exception, from our standpoint -- with one small exception, there really aren't significant land and territorial claims. There are some disputes, including with your country, on some offshore claims. We have some with the United States on the Beaufort Sea, we obviously have an ongoing dispute about the international status of the Northwest Passage; we have some dispute in the Lincoln Sea area with Denmark.I think these are things that can be resolved bilaterally. We are obviously, at the same time, big supporters of the United Nations Convention on the Law of the Sea and the process that's going on there to deal with the -- you know, the much farther offshore. And we will continue to support those international efforts. But I actually think the immediate territorial disputes, if they are to be resolved at all, can be resolved or managed bilaterally.RUBIN: We have time for half a question more -- (laughter) -- and I'm going to -- I'm going to take the liberty, if I may, of asking the question, because it relates to the question just answered. How do -- can you see any way that the international community is actually going to effectively reach some kind of way of dealing with global climate change before it becomes a crisis that forces action? And in that context, is the G-20 an effective vehicle for dealing with transnational issues?HARPER: Boy, that's a big question.RUBIN: Well, I -- it's a half a question, if you have a half an answer.HARPER: Yeah. Well, look, I think the answer to the first question is yes. I think it's going to be difficult. I think that -- I think that most countries understand not just the question of climate change is serious, but understand that the price of having no effective environmental framework is already causing significant impacts and will cause greater impacts in the future.I think even with marginal progresses in standard of living in places like China and India, there will be overwhelming public demand for environmental improvement in those countries. You know, it's incomprehensible to me, when I look at the growth of China and India and I see the kind of environmental challenges that exist today, how those challenges could be tolerable if they became five or 10 times as bad. So I do think everybody will -- will come to the realization, whether it's on climate change or these broader economic problems of pollution and other such matters, that these things do have to be tackled.I -- I really do think that we'll -- we'll get farther on these things if we take serious approaches. And serious approaches, Bob, means that we admit that not just they are big challenges, but they are also difficult ones. It is not a matter of just getting on a street corner and yelling and that will somehow lead to a solution. These are real challenges that -- where environmental needs intersect and often appear to be at cross-purposes with economic and social development. And unless we realize that, take those things seriously, we're going to keep talking around the real issues. So I think if we admit they're real problems with real, difficult solutions and real, difficult choices that have to be made, that everybody has to contribute to, then I think we'll make progress.And I do think as time wears on and as we've had, you know, failures as we have through Kyoto and failures at some of these international conferences, I do think it will increasingly dawn on actors that we'll just keep failing unless we actually get together and realize this is a -- these are issues that -- that don't have simple, quick answers.That was the first. What was the --RUBIN: Oh, I'm just curious whether you think the G-20 is an effective mechanism for --HARPER: Well, look, I don't know. I -- you know, I don't -- I wish I could tell you yes to that one. The G-20 was extraordinarily effective when President Bush first convened it in late 2008. It was extraordinarily effective at that meeting, at the subsequent ones in London and Pittsburgh, at arriving at a consensus on a series of issues that had to be addressed. And you know, we did a global stimulus. We worked for -- we all worked together on -- we shared, in fact, the panel on working together in more effective financial regulation. There's been another -- a number of other agreements.What my observation would be, that going forward -- when we all faced exactly the same problem, which was a collapse in economic activity, it -- it -- it sure led much more quickly to a consensus on what to do. Now that countries find themselves -- you know, we talk about two three -- two-speed, three-speed developed world, emerging economies on a different trajectory. As the situations and needs of these different countries diverge, getting consensus on these issues is proving to be more and more difficult. I don't know whether it will be -- whether it will be as effective going forward as it needs to be.I do know this, that I think it's the only mechanism at our disposal. I don't think you'd want more than 20 players in the room. Unfortunately, the G-20 tends to mean, in practice, G-20 -- something like G-35. But with 20 to 30 to 35 people in the room, I think you're squeezing the -- the bounds of effectiveness anyway, and -- and there is nothing else that I see as a plausible substitute, other than the major sovereign players getting together and trying to -- to work through some global needs.What -- what we lack -- I would say often the real crucial problem is this. It's -- it's not that -- it's not that -- just that we have divergent paths and -- and different situations. It's that there is still often in these discussions a failure of many people around the table to fully grasp the holistic nature of the approach we need to take.And look, we -- Canada, like everyone else, we defend our national interests and our national perspective. But given that we are part of a global economy, effective -- for lack of a better words, effective global governance through the G-20 -- and that's the closest thing we got -- is only going to work if a lot of people around the table bring a holistic and global perspective to that economy and to -- to what needs to be done globally. And that is still an area where we're deficient, where I don't think there's still enough of a realization that the best we're going to do -- even in some of the largest economies, the best we have is coping mechanisms, unless we actually work together on how we address some of these challenges.RUBIN: Prime Minister, we thank you for being with us and -- (applause) -- you were terrific.(C) 2013 Federal News Service ROBERT RUBIN: All righty. Welcome. I'm Bob Rubin, co-chairman of the council. And we welcome you here today. We are absolutely delighted to have with us our distinguished guest, the prime minister of Canada, Stephen Harper. I will not recite from his resume; as you know, it's council practice to simply welcome our distinguished visitor. But it's worth looking at that resume. It's extremely impressive and this is an extremely accomplished prime minister.Let me just make one personal observation. I had the good fortune to be at breakfast with the prime minister this morning. We discussed -- or the group that was there discussed economic issues, we discussed the Mideast, about which he knows an enormous amount. And he is very, very thoughtful, as you will quickly find out.So we again, Prime Minister, are just delighted to have you with us. Our program will be as follows: I'll spend about, oh, the first half of the program posing a few questions to the prime minister and then we'll open it up to all the participants. And then we will adjourn on time. If you do ask a question, raise you hand. Somebody will come to you with a microphone. State who you are, your affiliation, and be very brief so we can get as many questions in as possible.Let me start you off in this way, Prime Minister -- as I mentioned at breakfast, I happen to have a very small investment account, so it kind of interests me -- (laughter) -- what do -- what do you -- and I think, you know, I do, because I think Canada has a very strong position. But as you look forward over the next five or 10 years, what do you think about when you think about risks, problems, concerns, issues that Canada needs to address?PRIME MINISTER STEPHEN HARPER: Sure. Well, first of all, thank you for the kind introduction and thank you, everybody, for having me today. I'm delighted to be back here. Bob, let me just say this, what I said this morning, you know, we can point to little things, there's always things you want to see better in your economy. But the fundamentals of the Canadian economy are very strong. Our growth is slow, but it has been extremely steady -- the best overall since the end of the recession in the G-7. We continue to create jobs. We have the lowest tax rates at the federal level we've had in 50 years. And our debt and deficit levels are lowest in the G-7 by a long way -- by a long way.RUBIN: Can you tell people what they are? I think --HARPER: Well, at a federal level we're now peaking at about 33 percent. So it's a very, very manageable level.I can point to little things, but all of the risks to Canada are really external. There were never in Canada any of the fundamental problems that led to the recession globally -- the banking problems, the housing market problems, the sovereign debt problems. None of these things were present in Canada in any significant way. And our recession came about entirely due to our external markets, our export markets and the effect of commodity prices. And these things remain our significant risks in the -- in the near and medium term. What I have told Canadians repeatedly in the last few years is those risks are there, they're going to continue to be with us. And our finance minister, Mr. Flaherty, will continue to dialogue with his partners around the world, our central bank will try and deal with those things.What we have to do in Canada is, quite frankly, simply look past those things and ask ourselves what can we do to try and increase the growth potential of our economy over time going forward. And that's why we are working on trade agreements, including completing the one we're in -- negotiating with the EU right now; why we're keeping our taxes down, getting our budget balanced; why we're making investments in long-term economic infrastructure and innovation; why we're focusing -- are trying to focus our training programs increasingly on economic and labor force needs; why we're reorienting our very -- I think very positive immigrations programs even more towards the labor force. We're trying to do all the things we can to deal with the growth potential of the Canadian economy, and as I say, not that there are no risks in Canada, but the real significant risks are all external.RUBIN: May I ask you a question, Prime Minister? My impression -- I think this is right -- is that with all the great strengths of Canada, productivity still has not increased at the rate that it has in some of the competitive countries -- for example, ours. HARPER: Yeah.RUBIN: And what would you think, if that's right -- and I think it's right -- what would you think the reasons would be? And what can be done to address that?HARPER: Yeah, it is -- it is true. I don't think we entirely know why it is true, but you know, we're doing a couple things that are important. In terms of particularly our manufacturing sector, we're doing things to encourage innovation and investment in that sector. We've had accelerated capital cost allowance write-downs for new machinery and equipment. We've eliminated all tariffs, incoming and outgoing, on manufactured goods. And we're putting more money into -- government money into the commercial side, commercialization side, of research and development.These are all things on which we're starting to see some improvements in productivity, particularly in that -- I think that's the really key place where it has to be done. The other thing we're doing more going forward is looking at -- you know, given that we're -- like all big Western economies, we have large government, what can we do to improve productivity and efficiency in government. As we're trying to balance our budget, rather than cutting services left, right and center, we're trying to look at ways we can reduce back office overheads, we can find more efficiency through application of new technology, how we can improve our performance management system for our public servants, to make sure that we're getting the highest levels of results. So those are some of the things we're trying to do on productivity, and I think I see some sign it's starting to have some effect. But it's something we'll have to watch going forward. RUBIN: You obviously are an enormous producer of energy -- gas, oil, coal and so forth. How do the environmental versus the production of energy forces weigh out in Canada? You've got the gateway pipeline --HARPER: Right.RUBIN: -- which I think now has run into some difficulty in British Columbia, if I remember correctly.HARPER: Well, then the Northern Gateway is still -- it's still part of a regulatory review process. I -- as I tell people repeatedly, we in Canada -- you know, we have a market-driven energy system; the government does not fund or invest in particular energy products -- projects, outside of the hydroelectric sector. We have vigorous regulatory systems to look at the economic, environmental and other impacts of environmental -- of energy projects.I'll repeat what I said this morning: to repeat kind of what you said, Bob, that, you know, whether it's coal, hydroelectricity, uranium, natural gas, oil, you name it, Canada is one of the largest producers in the world, and in almost every case with some of the largest reserves in the world. So whatever the energy mix of the future, as I tell people, Canada will be a major provider.Look, environmental challenges are real. They have to be dealt with. You know, in terms of the one that -- probably one I do want to talk about today, the Keystone pipeline in particular --RUBIN: (Chuckles.) Thought you might. HARPER: -- and the oil sands, let me just talk a little bit about the environmental side of that, because I know that's something we're going to be focused on. Oil sands -- first of all, one needs to put this in a global perspective. Less than one-tenth of 1 percent of global emissions are in the oil sands. And so it -- it's, you know, almost nothing globally.Now obviously it's a significant part of the -- of our own pressures in terms of our targets, the targets we share -- we share a Copenhagen target with the United States. We have the same target and obviously constraining emissions there in the oil sands is going to be important. We've had a 25 percent reduction over the past decade or so in emissions intensity out of the oil sands -- 25 percent down. The province of Alberta already has a technology fund, a regulatory approach in the oil sands that is going to lead to even more investments in technology that will continue to reduce our emissions. So look, truth of the matter is heavy oils out of the oil sands -- yes, there still are emissions issues, but no -- no more so than heavy crudes in other parts of the world, including Venezuela. And I don't have to tell you there are probably reasons beyond just emissions why you would want to have your oil from Canada rather than from Venezuela.You know, this project -- well, if I can just take a second, four things. I talked about the environment. You know, on the economic side, 40,000 jobs in this country alone over the life of the project -- I don't think, given the growth and job record in North America, we can afford to turn down -- turn up our nose at that. Energy security -- this project will bring in enough oil to reduce American offshore dependence by 40 percent. This is an enormous benefit to the United States in terms of long-term energy security. And finally, of course, I think when you weigh all these factors, including the environmental factors, it explains why there is such overwhelming public support for this pipeline in the United States and why the -- in the -- particularly in the regions affected, there's such broad bipartisan support.So I think this absolutely needs to go ahead, but you can rest assured that making our emissions targets, including in the oil sands sector, is an important objective of the government of Canada.RUBIN: This may be an unfair question. You don't have to respond to it. But you've obviously been touched with the -- or involved with the -- our government quite a bit on this subject. What would your prognosis be for approval? You can not respond to that, and you can say that -- (laughter) -- you can say it's complicated -- (inaudible) --HARPER: (Inaudible) -- ask Ambassador Jacobson that question. (Laughter.) Look --RUBIN: I don't think he wants to take personal responsibility for this. (Laughter.)HARPER: I think -- you know, as I say, I think all the facts, including the recent -- you know, recent State Department had a pretty thorough analysis of this, including the environmental impact. And the immediate -- the only real immediate environmental issue here is that we want to increase the flow of oil from Canada via pipeline or via rail. If we don't do the pipeline, more and more is going to be coming in via rail, which is far more environmentally challenging in terms of emissions and risks and all kinds of other things than building a proper pipeline. I think all the facts are overwhelmingly on the side of approval of this, but there is a process in the United States. As I'm told by those who know, the process is subject, as in everything in this country, to a massive potential litigation on either side, so the -- I know the administration will do a thorough analysis before arriving at the right decision.RUBIN: Let me go back to my first question. (Laughter.) That was what -- that's what I thought you were going to say. Let me go back to the first question again. It really -- I've spent a fair bit of time on this. It's hard to see internally -- for the external difference -- internally, where Canada could go wrong. Yet every economy has its risks. So if you were to identify the 1 percent risk that would worry you, what would it be?HARPER: Well, as I say, they are -- they are external. That's what keeps me up at night. We've had -- I think there's been some comment on it here. We have had, as you know, growth of household debt in Canada. I think it's -- it -- the assets behind it still speak to the fact that it's well-supported. The financial institutions lending are the most solid in the world. But household debt has risen. We've taken some important steps in Canada to cool that trend through changing some mortgage rules, which is having a noticeable impact. You know, there's always risks you can't predict in this world. There are security risks. There are terrorist attacks. As you know, we just have been working with the Royal Canadian Mounted Police and the Federal Bureau of Investigation working to make arrests on a particular incident we had not long after the Boston bombings. So there's political risks. There's always the risk of -- there's always the risk of people picking the wrong government, but my primary job is to make sure that doesn't happen. (Laughter.)RUBIN: Well, since you raise that, I wasn't going to. But you do have -- (laughter) -- you have to have an election within the next 2 1/2 years sometime.HARPER: Yeah, actually, we have a date set for October 25th.RUBIN: Oh, you do? OK, I didn't realize that. What will the issues in that election likely be?HARPER: (Chuckles.) You know, I -- look, I tell -- in fairness, Bob, I tell people that my focus right now is the economy. And I am not -- you know, I'm trying to -- trying to stay out of campaign mode as long as I can. The -- that's one of the differences between our system and your system. The campaign mode is not perpetual in Canada, although when we had minority governments, it sometimes seemed that way. I believe that in the foreseeable future, to most people, the economy, the future of jobs and opportunities for themselves and for their children -- those will continue to be the major issues. I think they'll be the major issues for some time to come.I think -- look, I think, in the developed world, we're going to have some ongoing challenges, particularly in Europe, and, for that matter, U.S. fiscal situation is likely to remain challenging for a while. But I think we're at a crossroads as I think we all recognize there is a -- there really is a shift, an unprecedented shift of power and wealth away from the Western world.And in many ways, that's a good thing, because we're seeing hundreds of millions of people come out of poverty who never had opportunity before, and it's something we want to see continue. But at the same time, if these trends continue, they will be a real threat to our standards of living. And what we keep telling Canadians, and I think all Western governments need to tell their people, is we can maintain and increase our standard of living and opportunity for our children and grandchildren, but we have to govern ourselves responsibly, we have to live within our means, and we have to not develop a mentality that somehow, the wealth we have today is a right, and it is simply going to be taken as a given. It's going to be earned in a very competitive world. We're prepared as government to make the investments and decisions necessary to grab that future. And I think we have to keep working with our people to make sure they understand those challenges, not just in their communities but obviously business leaders as well.RUBIN: Look, I think that's a very good statement of the challenge that faces all of us. Would you like to comment is another question you might want to be diplomatic about. (Chuckles.) As you look south -- you obviously have a very strong economic relation with our country -- what is -- how does it strike you that we're doing --HARPER: Well --RUBIN: -- in the context of the framework you just set out?HARPER: Look, we've made -- you know, Canadians are very -- you know, very proud of the fact that the country has performed so well over the past seven or eight years. And, you know, for the first time in a very long time, maybe ever, we now have numbers on standard of living that are at or exceed the numbers of the United States as a consequence of some of the trends of the last few years. And Canadians always -- I tell people from around the world, Canadians always compare themselves to the Americans because you're our only real neighbor, and it's the only real comparison that matters to us. And we're proud of that comparison.But we also know that for our country to realize its potential, the United States has to do better. I'm encouraged by growth signs I see in the United States. As I mentioned here earlier today, I have enormous -- first, I'm an enormous admirer of this country. And in spite of the fact I value the differences we have as Canadians, I'm an enormous admirer of this country, and I have enormous faith in the ability of the American people and particularly the American business community to always find opportunity, always seize it and always create a better future. That's been the history of this country. I think it requires a hell of a lot of effort by everybody in Washington to make that not true. (Laughter.) And I just -- I just don't think they can sustain that kind of effort indefinitely, so -- (laughter) --RUBIN: Boy. Well, that's a -- (chuckles) -- that, Prime Minister, is very well said. I hope that -- (inaudible) -- I hope that your bet on their inability to maintain that indefinitely has turned out to be right. (Laughter.)Before we turn to everybody else, let me ask you, I had not realized, actually, until you were coming here just how deeply you've been involved with the Mideast and how constructively, from our point of view, at least. Why don't you tell people a little bit about your involvement, how much you've been involved and what you've done and what your views are, including in -- with respect to your views, if I may, on Israel, Syria and Egypt?HARPER: Sure.Well, look. I think like everybody we're very concerned about what's happening in the Mideast. I was criticized somewhat at home for maybe not as enthusiastically embracing the Arab Spring as some, not because I didn't see positive there, but because I also saw enormous risks. And in some countries like Egypt, I think we're starting to see the implications of maybe unrealistic expectations, both foreign and often on behalf of the populations themselves.We were very supportive of our allies on the Libya mission. In fact, it was a Canadian commander, actually, in charge of that mission, with, obviously, our American, British and French and other allies, a mission I think, notwithstanding the problems we see today, was still worthwhile for all kinds of reasons.Look, the one that's on everybody's mind is Syria. And I will just say this: You know, all joking aside about Washington, I -- you know, we've -- I have a really good relationship with the president. And, you know, obviously, think within the constraints of the American system, he's doing what he can do on all kinds of issues. On Syria, I see a lot of criticism about inaction. I look at Syria over the past couple years, and I would urge the president and everybody else extraordinary caution in jumping into this situation. This is a terrible regime. Canada has some of the toughest sanctions in the world against the Assad regime. We believe, as everybody believes, that he should step down and there should be a transition.But we should not fool ourselves about what is happening in Syria. The overwhelming complexion of the events in Syria is that of a sectarian conflict on both sides, with brutality and extremism on both sides. And to just start talking about, you know, as some do, arming unnamed people whose objectives -- whose identities we don't know and whose objectives we do not understand I think is -- I think is extremely risky. So I think we are best to try and continue to work -- we're making -- doing humanitarian aid, as I know the United States is. Best that we keep doing that nonlethal aid, that we assist the neighboring countries, particularly Jordan, who are threatened by this and that we continue to try and do what we can diplomatically, notwithstanding the obstruction of some at the United Nations, that we continue to do what we can diplomatically to try and see if we can't bring the sides together and lead to a more peaceful transition. I think those are still the best options. Even if they don't appear attainable, none of the other options, to me, are very pleasant.I think it is also important -- and I'll use this opportunity to say it again, as I think many of you know, our government has been very well known for its strong support of the state of Israel. I think there is nothing more short sighted in Western capitals, in our time, than the softening support we have seen for Israel around the globe. This is the one strong, stable, democratic, Western ally that we have in this part of the world, and the worst possible thing we could do in the long term for any of our governments is to be anything less than fully supportive of Israel. As long as I'm prime minister, this government will remain very supportive, you know, and -- of that country in what is a very challenging neighborhood.RUBIN: As soon as you said -- we'll turn to everybody else, but now you lead me to a follow-up question, if I may. One would think that, in some respects, they have a very difficult situation right now. If you were Israel, how would you navigate in this -- in this water?HARPER: (Chuckles.)RUBIN: And you may also -- on that one our may find some equal answer, like saying it's complex. HARPER: Yeah, you know, it's so hard. I speak frequently with Prime Minister Netanyahu, and it's so hard for me to put myself in that kind of environment. As president -- or Prime Minister Netanyahu always says to me, he says, I have the worst neighborhood in the world and you have the best neighborhood in the world, because you know where I am and you know all the turmoil around me. And he says, you have three oceans -- you have oceans on three sides and the United States on the other. There is no possible better arrangement any country could ask for -- (laughter) -- in the entire world, and I think he's absolutely right on that.You know, obviously first and foremost -- first and foremost, Israel has to be preoccupied with its own security, given all the risks -- the immediate risks of -- in the immediate neighborhood and the farther off but very real risks of places like Iran and its nuclear weapons ambitions, which I consider to be the biggest single threat to the globe today. At the same time, obviously we encourage Israel to try and work with its neighbors to establish workable relationships, as it has with a couple. And we encourage Israelis and Palestinians to return to the peace table and try and make some progress there. But we should -- I really think we should back away from a mythology that there is some kind of magic bullet in Palestinian-Israeli talks that would affect the wider region. The wider region is in turmoil for reasons that go way beyond the Palestinian question or, for that matter, the existence of Israel.RUBIN: Prime Minister, thank you. Now we will take questions from anybody who would like to begin the process of asking questions. Yes, ma'am. Just state who you are and what your affiliation is.QUESTIONER: Hello. Peggy Hicks with Human Rights Watch. Prime Minister, your government has looked at the issue of violence and murders against indigenous women, and it has been supportive of a parliamentary -- special parliamentary committee that's been set up but so far hasn't been willing to take up the recommendation of a national commission of inquiry to address that very desperate problem, with hundreds of women missing or dead. This featured prominently in Canada's UPR, Universal Periodic Review, in Geneva, and now some provinces and territories have come out in support of National Commission of Inquiry. Is it time for the government to support it as well?HARPER: Yeah, I remain very skeptical. You know, I, first of all, tend to remain skeptical of commissions of inquiry generally. Not to say they never work or never produce good recommendations, but my experience has been, they almost always run way over time, way over budget and often, the recommendations prove to be of limited utility.This issue has been studied; the government itself -- the federal government itself -- it's been studied in several different venues -- the federal government itself provided funding or multi-years of study within various branches of our government. We do really think it is time to pass to action.We have been funding increasing elements -- a number of elements in the justice system to increase the efficacy of both prevention programs as well as investigate techniques on behalf of the police. You know, we're talking about a large number of cases, many of which bear no resemblance to each other whatsoever. And a lot of it is just a matter of getting -- getting better processes to both prevent and investigate these kinds of disturbances.But I think the other thing, more broadly, that is required -- and something we have been battling in parliament for some years -- is to really enhance the status of women in aboriginal communities. For instance, something we have been trying to pass for some years, when we were a minority, without success, and now advancing -- we're a majority is matrimonial property rights on reserve -- women on Canadian reserves, for various reasons -- historical reasons -- don't enjoy the same kinds of property and other rights that women off reserves enjoy.The Canadian Human Rights Commission was, for all intents and purposes -- its authorities were not applied on reserves until a couple of years ago when this government managed to amend legislation. So I think there are practical things besides, obviously, enhancing the efficacy of police work. There are things we have to do to increase and raise the status of women in aboriginal communities. And this has been a bit of a pitched battle, because there are forces within aboriginal communities and outside who have been resisting those kinds of changes.RUBIN: Yes, sir.QUESTIONER: Ralph Bertrands (ph), New York University. Prime Minister, in recent times, ethnic problems around the world have risen -- ethnic separatism has risen. But in Canada, it seems to have declined. Why is that so, and what are the mechanisms the Canadian government has used in this process, and are there any lessons that the rest of the world can learn from this?RUBIN: That's a good question.HARPER: You know, broadly -- I won't comment at great length on the issue of Quebec separatism. As you know, we have a separatist government in Quebec right now, primarily because it was the principal opposition, and Quebecers wanted to change the government, but in fact, support for their actual option of separation is at historic lows.Look, I think one of the things we're very proud of in Canada is the general approach we've had to diversity. It obviously has origins in the country, because almost from the outset, we've had two national languages. We've had a policy of multiculturalism for some years. The approach we have used in Canada that I think has been very effective -- it's not perfect -- is that we have always taken the view that when people are prepared -- people who have lived millennia in other nations pull up their roots and come to Canada, that this is a very dramatic decision they are taking.And in wanting to do that, we should be very clear that in almost every case, they really want to become Canadians. And so as much as we want and expect them to integrate, we also view that it is our role as the country they're coming to to make that integration process easier and to accept that when immigrants and when people of different cultures come to Canada, they will not only change to suit the country, but the country will, in some -- in some measure, also evolve to reflect them.And so I think, in understanding that this is a two-way street and that we accept diversity as a positive, this is a deeply-rooted, across the political spectrum in Canada. I think it's been something that's served us very well. And I say, notwithstanding problems that arise from time to time, I think it's fair to say that there's probably no country in the world with greater cultural diversity, but also greater cultural harmony than Canada, simultaneously.RUBIN: In that context, Prime Minister, do you have an illegal immigrant problem in Canada of any dimension?HARPER: We have -- we certainly have illegal immigrants in Canada, but nothing like the problem in the United States. Our problems in Canada have tended to be more problems of people coming and making bogus claims in what is a very generous refugee system, as opposed to mass migration from across the border. So we certainly have illegal immigration, but it is -- it would be a fragment of the phenomenon in the United States.QUESTIONER: Mr. Prime Minister, Gordon Giffin, a lawyer from Atlanta, Georgia, proud graduate of Richview Collegiate Institute.HARPER: My high school, same high school. (Laughter.)QUESTIONER: And a former ambassador to Canada. Welcome, sir.I hope I can formulate this question where it is coherent. 1988, Canada-U.S. Free Trade Agreement; 1994, NAFTA. Almost 20 years later, some significant, I'll call them incremental initiatives, largely led by the two gentlemen sitting in front of me here, to improve how we work at the border together. But no big moves to try and make a difference in North America to make us more efficient economically. I'm not talking about in any way political integration or even currency integration, nothing like that.But I even look at the Keystone debate right as evidence of the issue. The only reason we're having this debate is because of an anachronistic provision in our law that relates to a permit to take infrastructure across the 49th parallel. Why we need that in North America, I'm not sure, when all of the jurisdictions along the route get to approve it or not under their own state laws.So my -- really, my question is, is there a chance of a much bigger initiative between our two countries at some point, to break down the anachronistic rules that impede economic efficiencies in North America, some of which have been done in Europe? I'm not talking about creating an EU with a large governance or anything, but the economic efficiencies.Last thing I'll say, when I was in Canada working on things like this, I found the impediment to that to be an insecurity in Canada about dealing with the United States, that we were somehow going to assimilate Canada. I don't see that anymore. I think Canada's much more self-confident in dealing with the United States and the world. So if that's the case, is there a chance at doing a bigger deal going forward?HARPER: Well, Gordon, let me just begin by just repeating -- I know you're familiar with it -- some of the things we are doing, because I think we do have some significant initiative going forward. We have the -- what we call the Beyond the Border Initiative where we are attempting through a series of individual initiatives and investments and closer cooperation between border authorities, to make things more seamless at the border and to push a lot of -- you know, inspections out around the perimeter of North America to try and arrange our affairs so that, as we say things, are -- things are -- you know, may enter twice, but are inspected only once. And we're doing some of those things.We also have a parallel initiative called the Regulatory Cooperation Council, where we've identified 29 areas to create greater consistency and harmonization of regulations and more importantly, in my judgment, especially for our side, is to find ways in those areas where we will prevent regulatory -- unnecessary regulatory difference and duplication going forward, where we try and identify some of those things in advance, try and change some of the processes.And I should mention one very specific project of international cooperation, which is the president just issued a permit for the Detroit River International Crossing, which this is financed largely by Canada, but this will be -- this is a huge piece of infrastructure in what is -- and we often forget the size of this relationship -- what is the largest single trade corridor in the entire world, the Detroit-Windsor trade corridor. So we have some important initiatives going forward. Could they lead to something systemically more integrated? Look, I think on our side, they could. I think on our side, they could. I agree with your assessment. I think the view -- we had a watershed election in 1988 over the free trade agreement with the United States, and the opponents argued that whether economic integration with the United States -- greater economic integration and trade would lead to wealth or not, it would cause Canada to lose its political independence and identity.What we've seen is it has led to vast increases in cross-border trade without any such loss of political independence or identity. In fact, this past year, as you know, we've been celebrating the War of -- the War of 1812, which -- RUBIN: I know. (Chuckles.)HARPER: -- permanently established this -- (laughter) -- this independence and separate identity. So I think that -- there will always be opponents in Canada, but I think that is a real minority view now.I think the resistance to this kind of thing's far more in the United States than in Canada, for reasons that -- and maybe, Bob and others, for reasons you would better fathom than me. Some of it's post-9/11 security concerns, but I've never seen -- the United States in the past decade is -- the sensitivity here about sovereignty and the negative assessments I often read of NAFTA -- completely counterfactual assessments of NAFTA -- I think, are the real barriers. I think the real barrier to making some of these arrangements broader and more systemic in terms of the integration are actually on this side of the border. RUBIN: (Chuckles.)HARPER: So I leave that to you guys to work out.RUBIN: To the best my knowledge, Prime Minister, there's never been a serious study of NAFTA that has shown it not to have been positive, but it lives in the politics of the United States in a very powerful way, because I think it symbolizes a lot of other issues that people are concerned about. That would be my impression, anyway.HARPER: That's -- it -- I don't think there's any evidence that it's been anything but positive. And it's one of these things -- you get this sometime in politics -- you get odd things where nobody would repeal it, yet nobody will admit it works. RUBIN: (Chuckles.)HARPER: And I don't know why that is. In Canada I say the -- there were many people opposed. It was a very close election, 50-50, Canadians' original support, on the Canada-U.S. trade arrangement. Any political party that advocates backing away from this trade relationship or from NAFTA would never a general election in Canada, would never be a serious contender.So that was a watershed, and people understand that this trade is necessary, essential and beneficial.RUBIN: We'll go back again. Right there. Yeah.QUESTIONER: Stephen Blank, Fulbright professor, University of Ottawa. Back to risk. Three factoids: Canada's increasingly a commodity-driven economy now. We see a decline of Canadian manufacturing competitiveness. And the trick -- Canadian dollar trades about 10 to 15 cents higher than we always thought was appropriate. Do these pieces connect with each other? And is this a risk?HARPER: I wouldn't want to say they necessarily connect with each other.We talked earlier today about commodity prices. I'm not sure I agree that we're more commodity-dependent than ever. In fact, I think what distinguishes us from some countries like Australia is we're actually less commodity-dependent.But look, commodities are important. My own view is that commodity prices are likely over any significant period of time to track the general level of global economic activity. Obviously if there's -- if we were to see a recession or vast slowdown in the emerging economy, that would have a real impact on Canada through commodity prices, but it would have a real impact on everybody, whether you were commodity-dependent or not. So I -- you know, as I said earlier, I think -- I think the fact that Canada actually is an advanced economy with a commodity side is actually one of our strengths. The fact that we have both traditional and nontraditional industries distinguishes us from some other developed countries where the kinds of problems you see in manufacturing and elsewhere are much more fatal in the long term.We do need -- as I said earlier, we do need to do more to make our secondary manufacturing sectors more competitive, more effective. We are working with the manufacturing sector through a series of sectoral initiatives as well as general tax policies to make that happen. I think those sectors are very supportive of what we're doing in Canada to make that happen. And on the research side, as you know, we have been making significant changes to try and make sure the vast -- as we -- you know, we are a very big funder of public R&D in Canada -- to make that connect better with private R&D and to have better results on commercialization.So look, those things are all -- we can point at all kinds of things in Canada where things are not ideal or where there are weaknesses. And they're all true. We have strengths and we have weaknesses. I don't think any of these things individually would say that Canada, in isolation, is suddenly going to have a major economic problem. They're all weaknesses we would have that -- on which we would be susceptible, if there were a continued general global economic lowing. So I think our risks primarily (really ?) are external.RUBIN: Over here.QUESTIONER: Thank you, Mr. Prime Minister. Daniel Arbess, Parella Weinberg Partners. I wanted to take the opportunity to ask about universal health care. You know, I was born and grew up in Montreal and had the experience of living with universal health care as an adolescent, and my family did. It provided full access to health care, but it always -- it wasn't always to the highest-quality health care and to the most accessible when you needed it. As you know, the United States is moving in this direction. And getting universal health care right is probably the most important economic imperative. I'm sure Bob Rubin would probably agree with that assessment. Being able to create a universal health care system in this country where costs will be managed but so will the quality and accessibility of service balanced against that is critically important as the demographic advances here. So I wondered whether you could illuminate lessons in the Canadian experience with universal health care that would be applicable to our experience here?HARPER: You know, in all fairness, probably not. (Laughter.) And the reason -- the reason I say that is my experience with the health care system is similar to yours, and that -- as you know, in Canada, the federal government doesn't run the health care system. We provide some significant funding through transfer payments to the provinces, but we actually have very little to do with actually running a health care system. And I don't proclaim any particular expertise in running a health care system.I would agree with your assessment that we have a system of -- a system of universal access. I would actually say that I think, in my own experience, the quality of care is actually quite high. Timeliness is sometimes an issue and becoming more of an issue as we face some of the demographic pressures on that system. And sometimes a system that's publicly dominated innovation is also -- may also be a bit more of a challenge in some areas.But look, as you know, the fact of the matter is, Canadians across the political spectrum, including our party, we are very supportive of the fundamental premise of the Canadian health care system, which is that when somebody is sick and needs medical care, their ability to pay should not be a factor in them being able to access medical care. And that is a principle that Canadians believe in and, I know, one that remains a matter of some debate in the United States.I would also made the following observations -- when I say that I can't give you an easy answer -- I'd make this observation. In spite of the differences between Canadian and American health care and the health care systems in many other Western countries, it seems to me that health care systems around the world, regardless of how they're structured, seem to have a lot of the same problems, the more I actually look at them.And a lot of the reason for the problem is actually a positive thing. It is that with the -- with the great strides we've made in both the professions, professional training, and especially technology and drugs, that there is just more and more and more we can do to improve people's lives and to keep them living longer. But these things all come with price tags and, in some cases, with enormous price tags.And the fact of the matter is it is very difficult for systems to assess, however they assess it, where you're going to put these resources. Resources are never unlimited. And the demands and the ability to treat in many cases are virtually unlimited. And so decisions have to be made, and however those decisions are made, whether they're through queuing or through pricing or whatever they are, are very difficult decisions. And I just think those are challenges.And they're going to be compounded, as we all know, because of the demographics in Western countries, where the population's aging, people will need more health care, and more health care professionals themselves are aging, there will be less and less practitioners. So those are going to be some of the common challenges.In our country, previous federal governments -- well, not running a health care system -- made a point -- our ambassador was a former premier -- they made a point of periodically picking fights with the provinces over health care to demonstrate that somehow we were going to be great defenders of the system. I think that was an entirely negative dynamic. The approach we now take is we try to work with the provinces to assist them in tackling what are very real challenges going forward.RUBIN: Prime Minister, if a province decided they didn't want to have a single-payer system, would they be in a position where they could move away from that?HARPER: They -- technically yes, but they would not be receiving significant transfer payments from the federal government if they did that. And in fairness, there is no political appetite that I'm aware of in any province in any segment of -- significant segment of political opinion to do that.RUBIN: The gentleman over there. Yeah, that's it.QUESTIONER: My name is Andrew Gumlock (sp) from -- (inaudible). You've had some recent bruising battles on economic nationalism. In the fertilizer sector you chose not to allow foreign investors in. In two recent energy deals, you debated it a lot but you ultimately allowed them in, ring-fenced some assets. How do you see this playing out in the short term with the election? But more broadly, and perhaps more importantly, how do you see Canada attracting in the surplus countries into very capital-intensive industries? Frankly, they need capital well in excess of the savings of Canada.HARPER: Yes, that's true. We need -- we need foreign investment and, at the same time, you should be under illusion that we want foreign investment in Canada. And in fact, although we screen all major foreign investments, only twice in our history have we actually rejected foreign investments. I just want to talk briefly about the two issues you raised. The one where we did not allow the investment, this was a case of the potash industry, where currently it's a Canadian/American company, and Canada is a dominate producer. And through a Canadian/American organization, it's headquartered -- or, you know, partly headquartered in Canada. Canada has significant market power in that industry. In one single transaction, what was going to occur was that that significant market power as going to shift out of the country and towards a foreign, private investor. Our judgement was that, because we do screen foreign investments, that that simply was not in the long-term interests of the Canadian economy. I'd say that was fairly unique circumstances.The second case you raise was our decision to allow certain state-owned investments -- one by a Chinese state-owned corporation, another by a Malaysian state-owned corporation -- into the energy sector. And we allowed those after considerable deliberation. And while we allowed those, we were very clear going forward that in areas of the economy -- like, for instance, the oil sands -- where we see now a significant risk that if we did not restrict foreign ownership that we would have in -- essentially have that sector be nationalized by some other state-owned enterprise.Our view is that is not the direction we want for the Canadian economy. We want to have foreign investment. This government -- in fact, it's conservative governments in our country, like mine, who have opened up the economy for foreign investment and have privatized crown corporations. We did not privatize state corporations in order to see other governments nationalize our industry.So while some foreign state-owned investment is desirable, we would not want it at a level at any critical part of the economy where essentially we began to put that sector of the economy under a foreign state management system, rather than having it essentially run by commercial forces. So as they say, it's a matter of level and degree. And we'll deal with that going forward.The risk Canada actually has, given the attractiveness -- we're now rated -- I forget -- was it Forbes who said now Canada's in the best place in the world to make an investment. We get that kind of rating elsewhere. Given the relative smallness of the Canadian economy and the relative size of some potential investors, I do think that if we don't -- if we don't have this concern in mind, we could see our economy morph in a way we don't intend. And as I say, it's not about foreign or domestic. It's about the nature of state-owned enterprises versus genuinely commercial operations. And that's the thing we're keeping an eye on.RUBIN: Yes, sir.QUESTIONER: Jeff Laurenti with The Century Foundation.Mr. Prime Minister, the gradual melting back of the ice cap over the Arctic Ocean, attributed usually to global warming, raises two issues, as you now have long, frozen territorial claims suddenly heating up as well. And I wonder if you might elucidate for us, first, on the mega-issue of global warming, on which Canada has taken a somewhat more nuanced stand -- walking back from Kyoto -- whether -- for Canadians, perhaps the prospect of having a climate more like New Jersey's is so appealing that, you know, it doesn't seem to be urgent. So where do you see the global climate change issue going on the mega level?And then, on the Arctic territorial claims question, what are the major claims and dispute that affect Canada, and do you see that as resolved by the six countries adjacent to the ocean relative to their bargaining power with each other, or under broader principles of international law like the Law of the Sea? What's the interplay between those?HARPER: First of all, on the issue of climate change -- our government's position from the outset is that we need a mandatory international protocol that includes all significant emitters, and that if we do not get that, we will not be able to control global emissions. Part of the reason our government was not supportive of the Kyoto protocol is it controlled one-third of global emissions and a shrinking proportion of global emissions. Even if the Kyoto protocol had -- every country in it had realized their targets, which, of course, most weren't -- they would have had no impact whatsoever on the growth of global emissions.So we need -- we need some of the big emitters outside the developed world -- not just the United States -- China and others -- to be part of a -- of a global system. And I do believe a couple of things going forward if we're going to make that global system effective. It's not just a matter of setting targets. We actually have to have ways of reaching them. You know, many countries have tried simply setting a target as a way of demonstrating that they're going to achieve something. We need a couple of things.I think, first and foremost, we do need technological change. I am convinced that over time, we are not going to effectively tackle emissions unless we develop the technology -- lower emission technology in energy and other sectors. And that is the thing that will allow us to square economic growth with emissions reduction and environmental protection. And I'm convinced that if we cannot square those two things, we're not going to make progress globally.And I don't just say that about developed countries like ours, where people are still saying they need jobs as a consequence of the recession, but certainly, in the developing world, we're not going to simply be able to put caps on economic growth as a way of achieving environmental targets. So that's the framework we're approaching it from, but look, there's a lot of -- there's a lot of work to be done. There is still not -- the reality is, there is still not an acceptance in many countries of the need for mandatory targets at all.On the -- on the issue of territorial claims, you know, with one -- with one small exception, from our standpoint -- with one small exception, there really aren't significant land and territorial claims. There are some disputes, including with your country, on some offshore claims. We have some with the United States on the Beaufort Sea, we obviously have an ongoing dispute about the international status of the Northwest Passage; we have some dispute in the Lincoln Sea area with Denmark.I think these are things that can be resolved bilaterally. We are obviously, at the same time, big supporters of the United Nations Convention on the Law of the Sea and the process that's going on there to deal with the -- you know, the much farther offshore. And we will continue to support those international efforts. But I actually think the immediate territorial disputes, if they are to be resolved at all, can be resolved or managed bilaterally.RUBIN: We have time for half a question more -- (laughter) -- and I'm going to -- I'm going to take the liberty, if I may, of asking the question, because it relates to the question just answered. How do -- can you see any way that the international community is actually going to effectively reach some kind of way of dealing with global climate change before it becomes a crisis that forces action? And in that context, is the G-20 an effective vehicle for dealing with transnational issues?HARPER: Boy, that's a big question.RUBIN: Well, I -- it's a half a question, if you have a half an answer.HARPER: Yeah. Well, look, I think the answer to the first question is yes. I think it's going to be difficult. I think that -- I think that most countries understand not just the question of climate change is serious, but understand that the price of having no effective environmental framework is already causing significant impacts and will cause greater impacts in the future.I think even with marginal progresses in standard of living in places like China and India, there will be overwhelming public demand for environmental improvement in those countries. You know, it's incomprehensible to me, when I look at the growth of China and India and I see the kind of environmental challenges that exist today, how those challenges could be tolerable if they became five or 10 times as bad. So I do think everybody will -- will come to the realization, whether it's on climate change or these broader economic problems of pollution and other such matters, that these things do have to be tackled.I -- I really do think that we'll -- we'll get farther on these things if we take serious approaches. And serious approaches, Bob, means that we admit that not just they are big challenges, but they are also difficult ones. It is not a matter of just getting on a street corner and yelling and that will somehow lead to a solution. These are real challenges that -- where environmental needs intersect and often appear to be at cross-purposes with economic and social development. And unless we realize that, take those things seriously, we're going to keep talking around the real issues. So I think if we admit they're real problems with real, difficult solutions and real, difficult choices that have to be made, that everybody has to contribute to, then I think we'll make progress.And I do think as time wears on and as we've had, you know, failures as we have through Kyoto and failures at some of these international conferences, I do think it will increasingly dawn on actors that we'll just keep failing unless we actually get together and realize this is a -- these are issues that -- that don't have simple, quick answers.That was the first. What was the --RUBIN: Oh, I'm just curious whether you think the G-20 is an effective mechanism for --HARPER: Well, look, I don't know. I -- you know, I don't -- I wish I could tell you yes to that one. The G-20 was extraordinarily effective when President Bush first convened it in late 2008. It was extraordinarily effective at that meeting, at the subsequent ones in London and Pittsburgh, at arriving at a consensus on a series of issues that had to be addressed. And you know, we did a global stimulus. We worked for -- we all worked together on -- we shared, in fact, the panel on working together in more effective financial regulation. There's been another -- a number of other agreements.What my observation would be, that going forward -- when we all faced exactly the same problem, which was a collapse in economic activity, it -- it -- it sure led much more quickly to a consensus on what to do. Now that countries find themselves -- you know, we talk about two three -- two-speed, three-speed developed world, emerging economies on a different trajectory. As the situations and needs of these different countries diverge, getting consensus on these issues is proving to be more and more difficult. I don't know whether it will be -- whether it will be as effective going forward as it needs to be.I do know this, that I think it's the only mechanism at our disposal. I don't think you'd want more than 20 players in the room. Unfortunately, the G-20 tends to mean, in practice, G-20 -- something like G-35. But with 20 to 30 to 35 people in the room, I think you're squeezing the -- the bounds of effectiveness anyway, and -- and there is nothing else that I see as a plausible substitute, other than the major sovereign players getting together and trying to -- to work through some global needs.What -- what we lack -- I would say often the real crucial problem is this. It's -- it's not that -- it's not that -- just that we have divergent paths and -- and different situations. It's that there is still often in these discussions a failure of many people around the table to fully grasp the holistic nature of the approach we need to take.And look, we -- Canada, like everyone else, we defend our national interests and our national perspective. But given that we are part of a global economy, effective -- for lack of a better words, effective global governance through the G-20 -- and that's the closest thing we got -- is only going to work if a lot of people around the table bring a holistic and global perspective to that economy and to -- to what needs to be done globally. And that is still an area where we're deficient, where I don't think there's still enough of a realization that the best we're going to do -- even in some of the largest economies, the best we have is coping mechanisms, unless we actually work together on how we address some of these challenges.RUBIN: Prime Minister, we thank you for being with us and -- (applause) -- you were terrific.(C) 2013 Federal News Service
    Event with Stephen Harper and Robert E. Rubin May 16, 2013
  • Canada
    A Conversation with Stephen Harper
    Play
    Canadian prime minister Stephen Harper discusses trade and the economy, current and future energy issues, and security concerns.
    Event May 16, 2013
  • Defense and Security
    Canada’s Security Agenda
    Canada’s military is managing its role in Afghanistan against new security concerns in the Arctic, and is looking to increase its capacity in an age when other NATO countries are cutting back on spending, says Canadian Rear Admiral David Gardam.
    Interview with David Rear Admiral Gardam and Toni Johnson May 31, 2012
  • Fossil Fuels
    Would the Keystone XL Oil Pipeline Create 250,000 Jobs?
    I’ve written extensively on this blog about some of the ridiculous new arguments being peddled by opponents of the Keystone XL oil pipeline. I hadn’t seen as much in the way of new and implausible assertions from pipeline proponents – until now. Here’s what I found in my email yesterday courtesy of the U.S. Chamber of Commerce: “The project [that environmentalists] oppose is construction of the Keystone XL Pipeline, which would carry crude oil from Canada to refineries primarily along the Gulf Coast and immediately create 20,000 jobs along the pipeline route. Furthermore, economic impact studies show that 250,000 permanent jobs will be created over the long term.” The “economic impact study” in question appears to be a widely cited report by The Perryman Group. (A second widely cited report, by the Canadian Energy Research Institute (CERI), gives a figure of 270,000 jobs but is not directly germane to Keystone XL – it projects impacts from a series of pipelines that might be built between now and 2030.) The Perryman report has been criticized for the claim of 20,000 jobs along the pipeline route. I’ve seen less criticism of the far more impressive 250,000 number (though this is one exception). That’s a shame, since while the number is being invoked prominently, the analysis upon which it’s based is dead wrong. Critiquing the Perryman study is a bit tricky since its methodology is opaque. When I run into this sort of problem, I make sure that I can reproduce the reported results, before I go on to audit them. The Perryman report describes its methodology thusly: “The Keystone XL Project would lead to positive outcomes for US energy markets by providing access to a stable source of incremental petroleum supply, reduced risk and, thus, price. Furthermore, operations of the Keystone XL pipeline will provide a significant ongoing economic stimulus including the creation of hundreds of thousands of jobs due to the stable oil supplies it will make available.In order to model these effects, The Perryman Group initially examined the likely effects of such a shift by calculating the magnitude of the increase in availability (based on an 80% capacity factor for purposes of conservatism) relative to anticipated domestic consumption in the 2010-2012 timeframe. The price effect was then derived using elasticity coefficients for the US market. Because this supplemental supply represents a permanent change in the market, a long-term response parameter was adopted. This measure was obtained from academic research and independently verified for reasonableness.” The Keystone XL pipeline would add 700,000 barrels per day of transborder pipeline capacity. With an 80 percent capacity factor this becomes 560,000 barrels per day. The Perryman report asserts that U.S. consumption is 18.7 million barrels per day (though in one place it says that the number is 20.7). Perryman assumes a baseline oil price of $66.52 per barrel, and the academic research referenced puts U.S. oil demand elasticity at -0.453. Mix this all together and you get a projected price decline of $4.40. Multiply this by 18.7 million barrels per day and, presto, you get an annual impact of $30 billion, pretty much the same number that Perryman uses to ultimately generate 250,000 jobs. There are, however, several things wrong with this calculation. For starters, it assumes that Canadian production will rise by the volume transported by Keystone XL if and only if the pipeline is built; in reality, over time, alternative pipelines are likely to be built, blunting that impact. On a more technical but more fundamental front, U.S. consumption and demand elasticity are the wrong numbers to use in determining the price impact of new supply. The United States is part of a global market, so Perryman should be using global, not U.S., figures. The relevant numbers are about 90 million barrels per day of global demand and a global demand elasticity of somewhere around -0.4. This leads to a projected price impact of about one dollar. But that’s still too high: in response to lower prices created by more Canadian production, both OPEC and non-OPEC (ex-Canada) production should drop. Let’s say that this removes half the impact of new Canadian production on world supply. The price impact of the new Canadian oil supply is now fifty cents a barrel – barely 10 percent of what Perryman projects. Given the Perryman methodology, this should cut the jobs impact by a similar factor, to somewhere around 25,000 rather than the 250,000 originally projected. It’s also worth noting that somewhere between 25 and 50 percent of the material supplied by Keystone will be diluent rather than Canadian oil, which should decrease the impact even further, to somewhere between 12,000 and 19,000 jobs. One might also contend, of course, that the demand elasticity is higher or that the supply elasticity is lower than I assume; more on that in a moment. First, let’s take a look at several other problems with the Perryman analysis. Perryman asserts that savings by U.S. consumers on oil end up getting injected into the U.S. economy. Over the long term, though, that should be partly offset by losses to U.S. oil producers, who must also absorb the lower prices. U.S. liquids production is equal to about half of U.S. consumption; this means that we need to eliminate another 50 percent of Perryman’s projected jobs. We’re now down to somewhere around 7,000 or 8,000 of them. Of course, the money that the United States sends abroad for oil doesn’t vanish – some of it comes back to buy U.S. goods and services. That phenomenon should erode the jobs impact of Keystone even further. The last big problem with the Perryman analysis is its conversion of the oil savings figure into macroeconomic impacts. This one is more difficult to pin down, since the model isn’t available, but the final figures that Perryman reports are mighty suspicious. For starters, he projects that lower oil prices will boost U.S. oil and gas production profits by more than six billion dollars. This makes no sense: lower oil prices should hurt, not help, oil producers. He also reports that total spending in the U.S. economy rises by $100 billion as a result of lower oil prices even though total GDP rises by only $29 billion. The net impact of that would need to be a $71 billion increase in the U.S. current account deficit (whatever you spend money on that you don’t produce is something that you have to import). How lower oil prices can increase the current account deficit is beyond me. It suggests that something in the model is awry. I mentioned earlier that one might challenge my elasticity figures. Let’s say, very pessimistically, that global demand elasticity is -0.2, and that non-Canada supply elasticity is zero. We still get a jobs impact of only 40,000, and that’s setting aside the impact of fixing the broader macroeconomic model. Once again, the 250,000 figure is far too high. Let me be clear: I’m not claiming that Keystone XL will create 7,000 or 8,000 or 40,000 jobs. I find the entire approach of the Perryman study suspicious. What I’m saying is that even if you buy its overall methodology, fixing the basic numbers leads you to much lower jobs estimates. In reality, the actual jobs impacts might be lower or higher than the numbers I’ve shown here. What’s for certain is that the 250,000 figure isn’t supported by the analysis presented. And I ought to reiterate another basic point. I don’t see any reason to block the Keystone XL pipeline, so long as local concerns in Nebraska are fairly addressed, something that shouldn’t pose a high hurdle. The Keystone XL debate is a distraction from things that really matter to the future of U.S. energy and climate policy. So long as the debate is front and center, though, correct facts would be nice.
    Post by Michael Levi October 27, 2011 Energy, Security, and Climate
  • Canada
    Our Common Cause and Shared Responsibility
    Play
    RICHARD THOMAN: Hello, everyone. I think it's -- that the witching hour is upon us. I'm Richard Thoman. I'm your moderator here today. And we're going to hear a short set of remarks from Mr. Lawrence Cannon, who I'll introduce shortly. I will then spend 10 or 15 minutes asking him questions, and we'll end up with the last -- the last half-hour or so open for the room. This is -- obviously, I'd ask you to turn off your cell phones; not just turn them down, turn them off. And I'd also like to remind the membership that this meeting is on the record so -- which is in a way unfortunate, but that's the way it is. Let me introduce our distinguished speaker. Lawrence Cannon is the minister of foreign affairs of Canada. He's had a long career in politics in the province of Quebec, both at the municipal and the provincial levels, and then in 2006 was elected to the federal House of Commons in Ottawa, in 2008 was reelected and very quickly promoted, in October of 2008, to the foreign minister's position. So let me just stop here and introduce Mr. Cannon. Your Excellency. (Applause.) FOREIGN MINISTER LAWRENCE CANNON: Thank you, and good afternoon, ladies and gentlemen. The Council on Foreign Relations has set a remarkable standard of scholarship on critical issues of the day, and I thank you for this gracious invitation. I want to share with you today what I believe constitutes some basic principles that underpin Canada's partnership with the United States. You'll recall in March of 1985, at the Shamrock Summit, President Reagan, at the time, and the Prime Minister Mulroney announced their intention to reduce and eliminate existing barriers to trade and investment flows. That led to our free trade negotiations and later to NAFTA and a tripling of trade between Canada and the United States. Earlier this month in Washington, in a similar -- similarly visionary initiative, President Obama and Prime Minister Harper agreed to take a bold new step to bring our economic competitiveness and our security perimeter to a higher level of joint commitment. For many decades, we shared continental defense -- the continental defense of the air, under NORAD. Alongside NORAD, we will continue to find ways to ensure the security of North America from asymmetrical threats while, at the same time, continues to reap the benefits of an integrated market. Now, it stands to reason, then, that proposals to add new fees for travelers and goods entering the United States, such as recently proposed, would be in our view a step in the wrong direction. Protectionist measures were a threat to our common prosperity when free trade was being negotiated more than 25 years ago; they remain a threat today. Common sense dictates that a top priority for both governments must be job creation and economic growth. To meet President Obama's goal of doubling U.S. exports in five years, there is no better place to focus than on Canada -- your number-one export market, larger than all the 27 EU countries combined. Canada is also the largest and most reliable supplier of all forms of energy to the U.S., electricity, oil and gas and uranium -- a flow that will only increases in the next decade. Today's international headlines are convincing reminders of the importance of energy security. Canada needs a strong and resurgent U.S. economy, and we welcome the signs of more certain recovery already evident this year. A more prosperous America will mean stronger global leadership by America. That too is something Canada would very much welcome. We do have very similar global interests, whether it is responding to new threats to global stability or efforts to bolster global prosperity. While U.S. leadership is indispensable, we both want the world's rising powers, notably China, India and Brazil, to acknowledge and share a greater proportion of the burden of responsibility. As economic power shifts to Asia, I believe Canada and the United States have a genuine stake in establishing new rules of engagement on trade and investment flows using the leverage of our highly integrated economies as a springboard for mutual advantage. Pressures to turn inwards with protectionist move on -- moves on trade and unilateral controls, or manipulation -- I'm sorry -- of currencies pose real threats to global prosperity. We are also both dedicated to the advancement of basic human rights and freedoms, and the freedoms underpinnings our democracies, principles that guide not only our partnership with the U.S. but also our global foreign policy. We are also joined directly with the United States today in the fight against terrorism in Afghanistan. Our military stands shoulder to shoulder with Americans in one of the most lethal regions of that country. We have both made substantial sacrifices of blood and treasure, more so than most, in trying to stabilize this situation. As well, Canada has made major development assistance commitments to Afghanistan and invested to help build a better capability for security and governance. Now, next year, our military commitment will shift exclusively to training -- to a training role because we recognize that ultimately the responsibility for security and progress in Afghanistan rests with the Afghans themselves. We will also continue to work with Pakistan and Afghanistan to help them better manage their border, while also seeking to place the Afghan economy on a stronger footing. Now, Canada, my friends, attaches a major priority to our own hemisphere. We are working with the U.S. to help Mexico strengthen its police and judicial systems and institutions in order to combat transnational organized crime in that country. The real -- the problems, I should say, on the U.S. southern borders are real but fundamentally different from those on your northern border. The Americas have been a foreign policy priority for Canada since 2006. And our Americas strategy is focusing on promoting prosperity, democracy and security, wherever -- or I should say however -- we are increasingly concerned about the challenges of combating organized crime and drug trafficking in that region. Therefore, we believe that it will be important to put a particular focus on the security component of our strategy. (In French.) Fundamentally, common cause should be the rudder and the most obvious principle to guide what we choose to do together right here in North America. To be sure, the risks we face today, whether from terrorism or cyberthreats or from the severe imbalances in a still-fragile global economy, are daunting. But if we ignore our impressive track record of bilateral achievement, those challenges will be even more formidable. Now, in April we commemorate the 20th anniversary of the acid rain accord. What has (sic/had) been a major irritant between Canada and the United States for more than a decade stands now as a model of mutually beneficial commitments to preserve our shared environment. It is imperative that we work together to find a common or parallel approach, one that preserves our environment for future generations and safeguards, at the same time, the efficient operations of energy flows, electricity grids as well as pipeline networks. There is a real risk of economic damage if either country proceeds unilaterally. We must also work together to reject manifestations of what we call "green protectionism" that run counter to trade agreements between both countries. What is needed is a common approach with bilateral commitments driven by our mutual interest in both energy security and climate change. Mutual respect and mutual trust are the hallmarks of a true partnership and a bedrock principle for relations between Canada and the United States. Canada should be sensitive to America's global concerns and be prepared to contribute credibly where we can. America needs to respect Canada's ability to contribute and, as well, to find space of our own on the world stage. So there will be, of course, times when our interests and those of the U.S. diverge. As President Obama stated in Washington earlier this month, and I quote, "I have great confidence," said he, "that Prime Minister Harper is going to be very protective of certain core values of Canada, just as I would be very protective of the core values of the U.S. And those won't always match up perfectly," end of quotation. So we must remember that there is nothing automatic about the management of our historic relationship. Inattention and indifference, no matter how benign, is seldom conducive to constructive engagement. Success must be nurtured systematically through dialogue, stimulated by bold leadership, and celebrated through common achievement. That is the fundamental truth to which Canadians and Americans have borne witness for almost two centuries. Through our mutual devotion to freedom, democracy and justice, it is an example we must bring to a new generation. Thank you. (Applause.) THOMAN: So I will ask you a few questions, and then we'll throw the room open for questions. Let me start off with something that's on a lot of people's minds as you look at the world today. Let's talk about what's happening in the Arab world. To what extent can the United States and its best allies such as Canada really influence that part of the world in what it's going through? And I would just like you to share your observations on what you think is happening and what our shared policy should be as we look at it. CANNON: Well, as I mentioned in my remarks, I think that the most important thing, of course, are the shared values and what we can do together in terms, for instance, of promoting democracy. I, for one, am witness to things that I've done with the secretary of state, particularly, the last year in Krakow in Poland where we participated in an initiative together to promote democracy. I think this is -- and we must not confuse democracy here with elections. Democracy means building the institutions, it means putting in place what needs to be done in terms of running elections. So I think that is an area, that is an area where we can both work, as well as other like-minded countries that are similar to both of ours. THOMAN: Okay. You mentioned the whole issue of border security. I'm a little dangerous because I spent some in Canada, and I remember having a conversation with one of your predecessors after he left office, so he could be very frank. And he was quite critical of the border security policies of the U.S. under the Bush administration. He believed that the first head of Homeland Security was a politician and understood the tradeoffs between perfect security and economic values of trade and jobs. His belief was the second, who was much more security-oriented, didn't understand that trade-off. So would you tell us your sense of where we are? Does this administration understand the trade-offs of the -- the bid and ask between the values of free trade and jobs on one hand and maybe less security, less perfect security -- or perfect security on one hand and much less trade and jobs? CANNON: Well, I think -- I think we all have to acknowledge that the world changed after 9/11 and that, indeed, we needed to be able to make sure that we were able to, as Canadians, acknowledge the importance in terms of protecting the United States homeland. Well, look, let me put it this way. The prime minister when he met President Obama on the 19th of February 2009 stated quite clearly, any threat against the United States is a threat against Canada. So we share that common concern of that threat. But at the same time, we also want to be able to continue down the road to find ways to, yes, acknowledge that concern and build stronger and more secure borders, but at the same time enable that commerce that represents so many jobs both in Canada and in the United States. And so that is why last month the prime minister and the president did come forward with this vision initiative, which is -- deals with perimeter security as well as economic competitiveness. And on a going-forward basis, I think, quite truthfully, that this is our generation's challenge, to be able to continue and to make that grow, much in the same way as back in the late '80s when they were negotiating NAFTA and the free trade agreement. So today's challenges are basically those challenges that will recognize the importance of safe borders and the concerns that one would have in terms of terrorism and narcotrafficking or drug trafficking, but at the same time acknowledging the importance that we both rely on in terms of trade and investment. THOMAN: Very good. I have a number of questions here. Let me -- let me talk to the trade area a little bit. Clearly in this country we have a long-time policy of liberal trade, which worked for our economic growth. We went through NAFTA. And somehow that began to change around a decade ago, and we've now had three trade agreements that have been stuck in Congress for a long time. The Doha round has not worked. And now we're beginning to see countries such as France and Brazil complain about currencies being manipulated by -- pointing fingers at the U.S. and China. Would you talk a little bit about your sense of the environment for free trade, how important it is, where we are, what can change? CANNON: Well, I can speak from Canada's sense. Our previous government, I think, concluded -- I might be mistaken, but I believe two free-trade agreements in a period of 13 years. We've concluded free-trade agreements with a number of countries in Latin America, Panama as well as Colombia. We've been working on a free- trade -- we've concluded a free-trade agreement with Jordan. We are actually working on a comprehensive economic trade agreement with the European Union countries. We are seeking out and quite active in ASEAN. So our government is dedicated to this whole proposition of stronger economic ties are built through trade. What is the back side to that? The back side is protectionism. And we all saw what 1929 had in store for not only here in the United States but as well in Canada: a Great Depression. And so that is what looms behind a lot of people's minds in terms of -- if we don't do that, this might be the consequence. So I think that it is in everybody's interests that we are able to promote trade and trade relations wherever possible. That is our government's policy. And this is what Prime Minister Harper has been seeking since the very beginning of his mandate. THOMAN: Is your observation that the Obama administration has moved on free trade in a positive sense over the last few months, or would you -- how would you qualify that? CANNON: Well, I -- quite honestly, I'll bridge back to the agreement, the vision statement, that -- the declaration, I should say, that the prime minister and the president came to agree upon. Quite clearly, jobs, economic growth are uppermost here in the United States. They are in Canada. I think that both of them are visionaries in terms of saying, well, years ago we were able to commit to free trade agreement. It has given this as a positive result. Today we have to move that to another level. And I think that is what is most important. I look at -- I look at the structure of government, of course, in the United States, which is -- and I explain that to a lot of my counterparts -- which is completely different from the structure of government in Canada, but you know, in Canada, you'll find the provinces that have a role to play in agreements. We saw that, for instance, in the Buy America -- in the Buy America context. We have here in the United States, for instance, an administration, a Congress that is of a different view in some circumstances. So it's not the same kind of political structure, but we all have to compose with that. And I think that when you look at what has taken place over a large number of years between Canada and the United States, as good neighbors we've been able to cross those barriers and obstacles when they were there. THOMAN: Let me now turn to Afghanistan. What are the Canadian lessons learned from Afghanistan? CANNON: I think the overwhelming lesson that we've learned from Afghanistan is a whole-of-government approach. I often use the expression "peace building" in Afghanistan. And when I use that expression in terms of -- as compared to peacekeeping, peace building means that you are able to bring in and bring forward initiatives. We have done that through, for instance, our six objectives, which, yes, dealt with reconstruction, dealt with building schools, helped the Afghan government shore up and help it with its -- I'm sorry, judicial institutions, legal institutions. So there's a myriad of ways that we can come in and we can help. Those experiences, I think, are -- you can find, as a matter of fact, in General Petraeus' document, when he submitted his document and his findings to the president before there was a commitment by the U.S. government in terms of its surge, you'll find large parts of it that are inspired by what Canada's experience has been over the last 10 years in Afghanistan. We are quite pleased with the way that happened and how it occurred. Enormous sacrifice, yes, but I think that it's something that we can all learn our lesson from in helping this country ultimately rebuild itself so that it can assume its responsibilities in terms of its own security and its -- the quality of life of its citizens. THOMAN: And do you have a date for the removal of all Canadian troops? CANNON: Yes. Essentially, our mandate will end at this year -- at least we are closing down our combat mission. We are shifting from a combat mission to one of training -- to a training mission where we will be sending in 950 trainers from our military who will help the Afghan security forces, but particularly, the army, with the techniques that are needed to be able to move forward. We also do have part, I should say, in terms of training. We do have federal officers that will help their police force; correctional officers that will help as well with their prison people. So we have committed to undertake this starting next year. We'll be phased -- a phased approach. We will be ramping down as of the month of July of this year our combat -- combat mission. And we'll be moving into full operations next year. THOMAN: And the Canadian fatalities, as I recall, are the third-largest after ourselves and the Brits. Is that right? CANNON: That's -- that is correct. All the -- on a per capita basis -- THOMAN: Yeah. CANNON: -- that is correct. THOMAN: Right. CANNON: Yes. And that is why we, with the United States, with Britain, have shouldered quite a bit, and I think that -- I think, you know, when -- at the very outset, when we took power, it was extremely important for us to be able to do our share, to make sure that, as an ally, as a member of ISAF, as a member of NATO and one who wants and who respects the United Nations Security Council as well as the United Nations resolutions, it's extremely incumbent that we do our share. And we did do that in that role. And now we will continue in another role in the -- in the years to come. THOMAN: Okay, let me now turn to another thing that you mentioned in your talk, the North American energy security. Could you talk a little about the Canadian view of that, in particular the Keystone XL pipeline project and other such similar projects? CANNON: Well, there's -- as you know, there is an extremely important initiative that is afoot, which indeed will carry some crude to -- from the province of Alberta and down into the United States. It is a debate. I know that the EPA as well as the secretary of state have a role to play in this. We think it's a jumpstart project, extremely important, not only in terms of energy security for the United States -- because, as you know, we are a reliable source of energy. We are a country that offers political stability and, at the same time, we have a free- market approach as well. Once that has been mentioned, we have to as well acknowledge the fact that this will be a job creator in terms of not only the suppliers but those people who will be working on this project. I understand that, for instance, in the state of Illinois, there are well over 60-some-odd suppliers that are ready to and eager to go at building this. So I think that it's a win-win situation for both Canada and the United States in terms of what this project can bring. THOMAN: One final question; then I'll turn it over to the audience. What are the three things that keep you awake at night? CANNON: (Laughs.) I think that -- I think what's important is to be able to -- to be able to go into one's office in the morning and look at the world and say to oneself, is this -- is the planet stable? Is the planet offering things that we generally take for granted in Canada, as well as in the United States -- our liberty, our freedom, human rights, democracy? One goes to bed at night, wakes up in the morning and we certainly hope that we've been able to make progress on those fronts. I get up in the morning last week and I see that Colonel Gadhafi has actually in an outrageous fashion decided to use military might to thwart his population who are demonstrating, what you and I would take as something that is a normal -- normally acquired right and demonstrating against that. These are the things that keep us awake at night. And I think that what we all have to commit to is to be able to make sure that we try to work and make this a better place and a better world. THOMAN: Okay. Let me now throw this open to the membership. I'd like you to join our conversation. Please wait for the microphone. Stand and state your name and affiliation. And limit yourself to one question and keep it as concise as possible so that as many members as possible may ask questions. Yes. QUESTIONER: My name is Stephen Blank. The announcement of a North American security perimeter is certainly a large and very exciting step forward. I think it shows, I bet, very good Canadian spade work leading up to the meeting. It comes at an awkward time, however. The president's plate is very full. So the question is, what comes next? What is your strategy for making this happen? And how do you think the 2008 Congress will respond to this new initiative? Thank you. CANNON: Well, without going into the mechanics of what all this is about, I think that -- let me just state that the declaration per se has a couple of components, one that deals with addressing early threats. So how do we -- how do we look at that? How do we collaborate together on those issues? How do we expand the exchange of information on those threats? And those threats can be as well from a health perspective, pandemics, things of that nature. So I think that's one of the elements that we need to look at. Trade facilitation, economic growth and jobs: I alluded to that before. That's something I think that the Congress of the United States, as well as the parliament of Canada, the government of Canada, is certainly well -- is in a mood to be able to address that much more than we've ever seen in the previous times. I also think that integrated cross-border law enforcement: What can we do to be able to put in place this vision? How do we build on the existing bilateral framework and law enforcement programs that are there? How can we better be efficient at doing that? And then finally I'd say, you know, the whole critical infrastructure that -- that's there and particularly the cyberthreats and cybersecurity, NORAD and NATO. Those are other areas where I think that we can -- we can be quite cooperative. The mechanics -- I know that there is a high-level group that will be put in place, both in the United States as well as in Canada, and they will also be looking at ways -- I mentioned that quite at a glance, but they will be looking at ways to -- how do we go about and look at our regulations and harmonize those regulations? Previously, before taking this position, I was minister of transportation and I was always set back to know that there's about 26 security initiatives that we require in Canada that are not present on a number of vehicles in the United States. They go from where the taillights are to how the bumpers are placed on the vehicles, so that means that GM or Chrysler or Ford would build a vehicle in the United States, and in Canada, while it's a little different, there's a number of security components that have to be added on. So how can we better work on that? How can we better work, for instance, in terms of harmonizing our motor vehicle consumption rules and regulations, fuel regulations? Those are areas where I think that we can -- we can move together. So this committee will be looking at that. So I think that there's a lot -- a great deal on the plate to be able to move forward. I know my answer is long-winded here, but there is -- this initiative is -- as I alluded to before, this is our generation's chance at increasing and bettering what the people who negotiated the free trade agreement did years ago. THOMAN: Jacob (sp). QUESTIONER: Thank you. Jacob Franklin (sp), JP Morgan. My question is intended to help you to sleep at night. (Laughter.) CANNON: (Laughter.) QUESTIONER: And it reflects a deep concern that under the current trajectory there will not be good enough reasons to allow you to sleep well at night. I want to connect it to the first question of Richard. You described the pillars of the U.S.-Canadian cooperation, the importance of U.S. prosperity, the energy security, the importance of common strategy to achieve this. But then, when Richard asked his question, the answer was very much of a medium term: We need to build institutions, we need to promote democracy, et cetera. And yet, his question was based on what he saw last night, and what he saw last night was something that the time frame for dealing with it is so different. They're really talking -- you mentioned already the barbarism, but there is also the issue of this morning the -- in all the channels, there was a competition: Will oil become 90 (dollars), 100 (dollars) to 105 (dollars); as we are sitting here, it's another 5 percent; what is the tipping point by which a double-dip or a recession will reemerge? Are we -- are we just spectators of this arena, or are we participants in it? I think that those who come -- who read the press from the G-20 last weekend have the feeling -- at least I have -- that much more energy -- excuse the pun -- was spent on few percentage changes of the Chinese exchange rate than on the many, many dollars of the change of the price of oil, and that the destiny of the world economy, and therefore the world geopolitics, is so much more depending on it. There is greater urgency, I think. CANNON: I certainly share your view on the urgency. As well, I would add, of course, that Canadian security is uppermost. I -- yesterday when we initiated our evacuation plans, I indicated to the press back home that what was important was to be able to make sure that we bring Canadians out of Libya. You're absolutely right in terms of the effect that this will have on the market, but -- in terms of the oil prices. Surely this is not the first time. I recall in years gone by in the '70s, when I had black hair, that there was this first oil crisis. It seems to me that we've been living "crisises" over the last 30, 40, 50 years in terms of that. What I wanted to mention today was that Canada does offer the United States of America a reliable, neighborly, friendly solution to being able to procure fossil fuels that are needed to be able to generate the economy. The G-20 partners have been looking at a number of economic issues, as you know, issues that are related to modernizing and increasing the framework. The oil prices, they will, of course, fluctuate; they will go up and down. What solution are you offering in terms of -- in terms of going in? Are sanctions something that should be looked at? Maybe so. Those are options that are still on the table and have to be looked at. How do you acquire stability in that market? I don't think that I will be able to give you a prediction today as to the stability of the oil market or the price of a barrel of crude. It's been fluctuating for a number of years. So how do you address this specific issue? I think that we have to look at all of the options. Tomorrow I will be in Italy. I'll be able to sit down with my counterpart, my colleague, and discuss how he views the situation in Libya and what impact that necessarily will have on their economy, because, as you know, Italy is going to be impacted greatly by the reduction in oil, as well as look at with my other counterparts, including Secretary of State Clinton, how do we go about and manage this issue, both from a diplomatic but as well from an economic perspective? And those are things that we have to look at. THOMAN: Yes. QUESTIONER: Carol Brown (sp), free agent. (Laughter.) I have a question -- THOMAN: (Laughs.) I'm envious. QUESTIONER: You mentioned mechanics twice in your remarks. And I have a question about the mechanics and the process of the bilateral U.S.- Canadian relationship. You also mentioned things that happened 20 years ago, like an acid-rain agreement, free-trade agreement, shamrock summit. These all happened at a time when there was a process entailing two meetings a year at the head-of-governments, four a year at the foreign-ministry level. I don't know whether that continues today or not. I don't think it does. But my question really is, are you satisfied with the way the bilateral relationship works on dealing with the very kinds of issues that you've talked about and others have asked about? QUESTIONER: Well, President Obama came to Canada in February of 2009. This was the first time that a long-standing tradition had been reestablished -- that is to say, the first visit by an incumbent -- or at least by a new president generally goes to -- goes to Canada. So President Obama kept that tradition alive. The prime minister reciprocated with a meeting. The prime minister and the president see themselves on a regular basis. I was in Washington a couple of weeks ago, as a matter of fact, where another bilateral meeting was held between the president and the prime minister. And the results of that bilateral meeting are the security perimeter as well as the economic competitiveness initiative. So from a bilateral perspective, both the president and the prime minister are seeing themselves on a regular basis. So that is -- I think that addresses the question that you raised. The other issue in terms of the multilateral approach, you'll recall that previous governments had the prosperity initiative as a -- as a theme. And that brought together the leaders of both Mexico, Canada and the United States to deal with North American common issues. That still continues. But what I think we have been able to do is to step up the bilateral relations as well with the United States, the -- quite -- let me acknowledge that both the president and the prime minister get along extremely well. They're two practical individuals. They're fathers of young families. So they see eye to eye on a number of personal issues, if I can say it that way. But at the same time, I was -- I was able to witness the interaction between the prime minister and the president during the G- 8 Muskoka summit that was held in Ontario last year, as well as the G- 20. And I can say that there is a complicity between the prime minister and the president in terms of their approach and the way they view the world issues and how they see things moving forward. So I would say, all in all, the relationship between the prime minister and the president are excellent. I give it an A, maybe an A- plus. THOMAN: Let me -- Bill, we'll get you next. QUESTIONER: Andrew Gundlach from Arnhold and S. Bleichroeder. You mentioned the XL Keystone pipeline, which goes down to Cushing. And I share your view; it's a great project for both countries. But there's two other big projects -- actually, one other project and one other problem being fixed, which is a project in and of itself. The first is the Kitimat LNG export facility, which I find an interesting project because, in a way, it's a threat to the United States in terms of gas prices having an outlet out of this continent. On the other hand, it's really good for Canada, and especially western Canada, because where gas trades in the Asian markets. So I'm curious how -- TransCanada, for example, who owns the Keystone, thinks it'll never get built. Other people, obviously, think it will get built. I'm curious where you come out. The second is more of a technical question, same issue though, and that's the Enbridge pipeline is two times the size of the Keystone and it's running at 50 percent or 60 percent capacity because the company really hasn't spent enough capital maintaining it over the past 10 years. And I'm wondering whether or not both governments could do more to get them to spend capital on a plan which is better for our energy security and not as good for their shareholders. CANNON: Well, let me just, first, couch that with an issue that this government has taken over the course of the last several years. We've pushed considerably with what we call a "gateway strategy." A gateway strategy is to be able to find more efficient ways to get our products both in and out of the country. And so we've had an Atlantic gateway. We've had one for Quebec and Ontario in terms of that corridor that we use -- the Windsor-Detroit crossing. We've had one for western Canada, particularly our Pacific Gateway initiative. We have invested a large amount of money over the course of the last several years with the private sector to be able to increase our competitiveness, because we are competing with other ports, for instance, out west, whether it be Los Angeles are whether it be in Seattle. We are competing, and so we are trying to -- we're trying to develop that. We certainly believe that getting back to our networks, whether it be a network in terms of oil and gas and the prices are not necessarily familiar. I know that shale gas has modified a lot of the LNG projects, and the regulations in Russia are extremely difficult to overcome. But this having been said, we've been working on a strategy that relies on the global supply chain and basically entails us to find ways to better get our products from Canada to the United states and, of course, elsewhere. So projects like the one that I alluded to before are in the works. They're there. I certainly have raised this at the highest levels. We believe that this is important. We believe that it is good for both the United States as well as Canada. And hopefully, in years to come decisions will be made that will favor these -- more integration in terms of this extremely important resource for our economies. THOMAN: Yes. QUESTIONER: Herbert Levin. Thank you, Mr. Minister, for the recitation of trade problems. I tend to think that's a tax we pay on a huge and very successful economic relationship. But I would like to ask you two questions, even though that violates the rules, but others have gotten away with it. The first one is that the Canadians will go and train police. Well, the U.S. likes that because we don't have a national police force, so we always want other people to train the police. But I would like you to dispel the idea that came into my head, which is: If there's a fight, the Canadians are not coming; if there's no fight, then we'll come and do something good. But I'd like you to tell me I'm wrong on that one. And the second one is: What major policies of the U.S. -- not bilateral stuff -- would you like to see the U.S. change? Do you like our votes in the U.N. on Israel, on Cuba? What about Iran? What about Burma? Do you think we're doing the right thing there? So tell us the things that, when you're alone with your counterpart, you say: I really think you guys are wrong, and you ought to change. CANNON: (Laughs.) QUESTIONER: Or sometimes we get question time in Parliament in Ottawa; we can pick it up. What are you genuinely harassed about American policies in question time? Thank you. CANNON: Well, let me first handle the Afghanistan issue. Canada, when asked to fight, stood, as I mentioned, shoulder-to- shoulder with the other allies. You'll recall that President Karzai, as well as -- both at the London Conference and at the Kabul Conference -- as well as President Obama -- there is a timeline here. There is a -- there is a framework that will lead us inevitably towards the transition. We are actually in a transition. To quote the president of the United States, there is no transition without training. So what the objective here is, at the last NATO meeting that we held in Lisbon, the objective here is to be able to make sure that as we move towards 2015, indeed -- 2014 and 2015 -- indeed, the Afghans themselves will assume complete and total responsibility for their security. To be able to do parts of that is going to require training components. I have had the opportunity of discussing this issue with Secretary of State Clinton a while back -- last summer, as a matter of fact. We also discussed with allies, consulted allies as to how Canada can best serve and help. And in that regard, this training component was extremely important. We do have a national police, but I just want to end on that and say that a number of local police forces do furnish and supply some of their personnel to be able to undertake and carry out these tasks of training. So it's a -- it's sort of a -- I'd say a whole-Canadian initiative, from the federal RCMP to members of police forces across the country. So I think that's the -- that's the important element. Now, not -- I don't want to be rude, but what was the second question again? (Laughter.) THOMAN: It had to -- it had to do with -- QUESTIONER: (Canada won't fight ?). THOMAN: No, no, no, he sort of answered. Your second question -- your second question had to do -- CANNON: Well, no, Canadians have fought. I mean, that's -- we've been -- QUESTIONER: Which U.S. policies do you want changed? CANNON: Oh, okay, yes. Yes. QUESTIONER: (For instance ?) Cuba. What -- CANNON: I'm teasing you here, because you're only allowed one question. (Laughter.) QUESTIONER: At least you can follow up. CANNON: But -- I will. Right, that's correct. That's correct. But, no, I think that on many issues -- for instance, if you -- if you take whether -- you alluded to Burma before. Secretary of State Clinton, as well as myself, were at the ASEAN meeting, where our Burmese counterpart was. We've spoken on numerous occasions. We've made it very clear that we want to see change in that -- in that regime. We want to make sure that human rights are supported. We want to make sure, as well, that -- Aung San Suu Kyi at the time was still under house arrest. We wanted that -- her liberation, her freedom -- before any elections. We wanted the elections to be fair. Obviously, Burma hasn't come up and stood up the way we wanted it, so our position is exactly similar on that. On Israel, we are also calling for the two parties to come back. We have always had a position where we believe in the two-state solution. There are not very many issues -- as a matter of fact, I'm trying to -- trying to -- I'm going through my mind here to find out what issues actually we are -- indeed have different positions on. There are not -- there are not very many issues. I mean, I've got a heck of a lot trouble trying to find one. My deputy minister is here and he -- he's -- MR. : (Off mic.) CANNON: Well, there's two, but yes. MR. : (Laughs.) CANNON: But I mean, this is -- this is a long and outstanding -- since the 1970s. Is it still an issue that differentiates us? I can tell you that from my conversations with my counterpart, I've never had -- this issue has never been raised with me. So we -- I think we are all pushing for a more democratic Cuba, a more -- a Cuba that will, indeed, respect human rights, to free the political prisoners. But here -- again, here's a generation -- I'll be quite honest here -- here's a generation of people that have grown up -- you and I can talk about democracy here, but do they know democracy? They don't know democracy. They have no notion of what democracy might look like. They've been with this government, with Fidel Castro and his brother for the last -- long, long -- number of decades, and they have never known democracy. So here's a -- here's a challenge that we need to put forward in terms of promoting democracy: How do we go about and speak to those young folks that are -- that are looking for and want to seek democracy? It's not just holding elections. I mentioned before: It's to be able to build those institutions. So those are things that we commonly work on, but our position -- you're right -- is different from the United States' position regarding Cuba. But there are far and very few of those distinctions between our policies. THOMAN: Thank you. Yes. QUESTIONER: I'm Ken Roth from Human Rights Watch. I was very happy that in your opening remarks you did talk about the importance of human rights and democracy. And of course, historically Canada, you know, really has played a leadership role in building various institutions and standards, whether it's peacekeeping or the International Criminal Court, the landmine treaties and responsibility to protect doctrine. But I -- I'm probably not telling you anything new that in recent years, the -- you know, the human rights community has been more disappointed with Canada's role. It passed on a leadership role on the Cluster Munitions Convention. It is, you know, the only Western government not to repatriate its citizens from Guantanamo. It was reluctant to investigate allegations that Canadian forces sent detainees to be tortured by Afghan troops. It's been cutting off funding to Canadian NGOs that criticize Israel's troublesome human rights record. And so my question really is, you know, does Canada today aspire to the real leadership role on human rights issues that it traditionally has played, and not on the easy cases of, you know, Burma or Zimbabwe or even Libya today, but on the tough cases where, you know, a difficult position is taken to advance institutions or standards for human rights? CANNON: Well, my first reaction would be to talk to you about those different issues that you've raised. But I don't think that Canada's position on human rights has changed. I think that Canada's position on human rights, as a matter of fact, has strengthened itself over the course of the last several years. You take the case in point in Iran. We have been extremely outspoken. We've just spoken about Cuba. We've been extremely outspoken on Cuba as well in terms of the political prisoners that find themselves behind bars there. We've spoken about that. Ahmadinejad's Iran is outrageous. We -- you'll probably recall from your knowledge the Kazemi case, who's that photojournalist from Montreal who found herself there accused -- wrongly -- of wrongdoings in that country, was literally murdered and with no consequences whatsoever. We've kept a very close eye on Iran, over the course of the last several years, much more so than I don't think any other country has actually -- has actually put out there. China as well: I mean, we've got relations with China, but I can list a number of cases that are raised at every opportunity at the highest level. Both my prime minister as well as myself, when I meet with my counterpart, raise these issues. We push for them. And so, you know, I don't -- I don't at all feel guilty for not pushing human rights. On the contrary, as I mentioned before, we have been pushing human rights around the world, and much more so than I -- than the previous government has done. QUESTIONER: Thank you. Charles Heck. I wonder if you could speak a bit about issues in the seas north of Canada, in the Arctic seas? Am I wrong in thinking that this may be an area where there are some differences between Washington and Ottawa in the legal character of some of these waters? What's under -- what falls within Canadian sovereignty? What other areas or international straits or international in some other way? And are there broader multilateral tasks to be accomplished with other coastal states, like Russian, Denmark, Norway? CANNON: We actually -- both Canada and the United States are partners and members of the Arctic Council, which bring together a number of Arctic countries, Russia and Denmark and Sweden and Norway. And so we do manage a number of issues with the same energy and with the same commitment. There are bilaterally between Canada and the United States, as you know, a couple of issues there but that are well-managed. The Northwest Passage, for instance, is a well-managed issue and that's since, I guess, about 15, 20 years ago when President Reagan as well as Prime Minister Mulroney were able to agree on a memorandum of understanding as to how on a going-forward basis that issue, which is basically an issue that deals with navigation, not Canada's sovereignty, but navigation in that area. The Beaufort Sea is another area where the boundary is disputed. But Secretary of State Clinton as well as myself have tasked our officials to start working on and scoping out what would eventually -- what would a negotiation look like eventually. But we are working cooperatively together the -- in mapping the continental shelf. We want to be able to table a submission to the United Nations convention or at least the commission on the United Nations convention to the law of the seas by 2013. I know that the United States -- and I'll come back to one of the issues (du jour ?) I would hope that the United States would ratify UNCLOS at the first possible occasion. I think that would be extremely helpful. And -- but, you know, I'd say that the issues that are there are well managed. We have put out a foreign policy statement on the north and on the Arctic. What is our number-one priority is Canada's sovereignty in that area. And the United States respects our sovereignty in that area. So I don't see any problem with a potential or a divergent opinion with the U.S. on that. THOMAN: Okay. And I think we're up to 2:00. I just want to remind you that on Monday, February 28th from 12:30 to 2:00 is our next meeting on global solutions for the global economic crisis, with Justin Lin of the World Bank Group; and on Wednesday, March 2nd, with Thomas Hoenig, president and CEO of the Federal Reserve Bank of Kansas City. Mr. Minister, thank you very much. CANNON: Thank you. Thank you very much. THOMAN: Thank you very much. (Applause.) (C) COPYRIGHT 2011, FEDERAL NEWS SERVICE, INC., 1000 VERMONT AVE. NW; 5TH FLOOR; WASHINGTON, DC - 20005, USA. ALL RIGHTS RESERVED. ANY REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION IS EXPRESSLY PROHIBITED. UNAUTHORIZED REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION CONSTITUTES A MISAPPROPRIATION UNDER APPLICABLE UNFAIR COMPETITION LAW, AND FEDERAL NEWS SERVICE, INC. RESERVES THE RIGHT TO PURSUE ALL REMEDIES AVAILABLE TO IT IN RESPECT TO SUCH MISAPPROPRIATION. FEDERAL NEWS SERVICE, INC. IS A PRIVATE FIRM AND IS NOT AFFILIATED WITH THE FEDERAL GOVERNMENT. NO COPYRIGHT IS CLAIMED AS TO ANY PART OF THE ORIGINAL WORK PREPARED BY A UNITED STATES GOVERNMENT OFFICER OR EMPLOYEE AS PART OF THAT PERSON'S OFFICIAL DUTIES. FOR INFORMATION ON SUBSCRIBING TO FNS, PLEASE CALL 202-347-1400 OR E-MAIL [email protected]. THIS IS A RUSH TRANSCRIPT.------------------------- RICHARD THOMAN: Hello, everyone. I think it's -- that the witching hour is upon us. I'm Richard Thoman. I'm your moderator here today. And we're going to hear a short set of remarks from Mr. Lawrence Cannon, who I'll introduce shortly. I will then spend 10 or 15 minutes asking him questions, and we'll end up with the last -- the last half-hour or so open for the room. This is -- obviously, I'd ask you to turn off your cell phones; not just turn them down, turn them off. And I'd also like to remind the membership that this meeting is on the record so -- which is in a way unfortunate, but that's the way it is. Let me introduce our distinguished speaker. Lawrence Cannon is the minister of foreign affairs of Canada. He's had a long career in politics in the province of Quebec, both at the municipal and the provincial levels, and then in 2006 was elected to the federal House of Commons in Ottawa, in 2008 was reelected and very quickly promoted, in October of 2008, to the foreign minister's position. So let me just stop here and introduce Mr. Cannon. Your Excellency. (Applause.) FOREIGN MINISTER LAWRENCE CANNON: Thank you, and good afternoon, ladies and gentlemen. The Council on Foreign Relations has set a remarkable standard of scholarship on critical issues of the day, and I thank you for this gracious invitation. I want to share with you today what I believe constitutes some basic principles that underpin Canada's partnership with the United States. You'll recall in March of 1985, at the Shamrock Summit, President Reagan, at the time, and the Prime Minister Mulroney announced their intention to reduce and eliminate existing barriers to trade and investment flows. That led to our free trade negotiations and later to NAFTA and a tripling of trade between Canada and the United States. Earlier this month in Washington, in a similar -- similarly visionary initiative, President Obama and Prime Minister Harper agreed to take a bold new step to bring our economic competitiveness and our security perimeter to a higher level of joint commitment. For many decades, we shared continental defense -- the continental defense of the air, under NORAD. Alongside NORAD, we will continue to find ways to ensure the security of North America from asymmetrical threats while, at the same time, continues to reap the benefits of an integrated market. Now, it stands to reason, then, that proposals to add new fees for travelers and goods entering the United States, such as recently proposed, would be in our view a step in the wrong direction. Protectionist measures were a threat to our common prosperity when free trade was being negotiated more than 25 years ago; they remain a threat today. Common sense dictates that a top priority for both governments must be job creation and economic growth. To meet President Obama's goal of doubling U.S. exports in five years, there is no better place to focus than on Canada -- your number-one export market, larger than all the 27 EU countries combined. Canada is also the largest and most reliable supplier of all forms of energy to the U.S., electricity, oil and gas and uranium -- a flow that will only increases in the next decade. Today's international headlines are convincing reminders of the importance of energy security. Canada needs a strong and resurgent U.S. economy, and we welcome the signs of more certain recovery already evident this year. A more prosperous America will mean stronger global leadership by America. That too is something Canada would very much welcome. We do have very similar global interests, whether it is responding to new threats to global stability or efforts to bolster global prosperity. While U.S. leadership is indispensable, we both want the world's rising powers, notably China, India and Brazil, to acknowledge and share a greater proportion of the burden of responsibility. As economic power shifts to Asia, I believe Canada and the United States have a genuine stake in establishing new rules of engagement on trade and investment flows using the leverage of our highly integrated economies as a springboard for mutual advantage. Pressures to turn inwards with protectionist move on -- moves on trade and unilateral controls, or manipulation -- I'm sorry -- of currencies pose real threats to global prosperity. We are also both dedicated to the advancement of basic human rights and freedoms, and the freedoms underpinnings our democracies, principles that guide not only our partnership with the U.S. but also our global foreign policy. We are also joined directly with the United States today in the fight against terrorism in Afghanistan. Our military stands shoulder to shoulder with Americans in one of the most lethal regions of that country. We have both made substantial sacrifices of blood and treasure, more so than most, in trying to stabilize this situation. As well, Canada has made major development assistance commitments to Afghanistan and invested to help build a better capability for security and governance. Now, next year, our military commitment will shift exclusively to training -- to a training role because we recognize that ultimately the responsibility for security and progress in Afghanistan rests with the Afghans themselves. We will also continue to work with Pakistan and Afghanistan to help them better manage their border, while also seeking to place the Afghan economy on a stronger footing. Now, Canada, my friends, attaches a major priority to our own hemisphere. We are working with the U.S. to help Mexico strengthen its police and judicial systems and institutions in order to combat transnational organized crime in that country. The real -- the problems, I should say, on the U.S. southern borders are real but fundamentally different from those on your northern border. The Americas have been a foreign policy priority for Canada since 2006. And our Americas strategy is focusing on promoting prosperity, democracy and security, wherever -- or I should say however -- we are increasingly concerned about the challenges of combating organized crime and drug trafficking in that region. Therefore, we believe that it will be important to put a particular focus on the security component of our strategy. (In French.) Fundamentally, common cause should be the rudder and the most obvious principle to guide what we choose to do together right here in North America. To be sure, the risks we face today, whether from terrorism or cyberthreats or from the severe imbalances in a still-fragile global economy, are daunting. But if we ignore our impressive track record of bilateral achievement, those challenges will be even more formidable. Now, in April we commemorate the 20th anniversary of the acid rain accord. What has (sic/had) been a major irritant between Canada and the United States for more than a decade stands now as a model of mutually beneficial commitments to preserve our shared environment. It is imperative that we work together to find a common or parallel approach, one that preserves our environment for future generations and safeguards, at the same time, the efficient operations of energy flows, electricity grids as well as pipeline networks. There is a real risk of economic damage if either country proceeds unilaterally. We must also work together to reject manifestations of what we call "green protectionism" that run counter to trade agreements between both countries. What is needed is a common approach with bilateral commitments driven by our mutual interest in both energy security and climate change. Mutual respect and mutual trust are the hallmarks of a true partnership and a bedrock principle for relations between Canada and the United States. Canada should be sensitive to America's global concerns and be prepared to contribute credibly where we can. America needs to respect Canada's ability to contribute and, as well, to find space of our own on the world stage. So there will be, of course, times when our interests and those of the U.S. diverge. As President Obama stated in Washington earlier this month, and I quote, "I have great confidence," said he, "that Prime Minister Harper is going to be very protective of certain core values of Canada, just as I would be very protective of the core values of the U.S. And those won't always match up perfectly," end of quotation. So we must remember that there is nothing automatic about the management of our historic relationship. Inattention and indifference, no matter how benign, is seldom conducive to constructive engagement. Success must be nurtured systematically through dialogue, stimulated by bold leadership, and celebrated through common achievement. That is the fundamental truth to which Canadians and Americans have borne witness for almost two centuries. Through our mutual devotion to freedom, democracy and justice, it is an example we must bring to a new generation. Thank you. (Applause.) THOMAN: So I will ask you a few questions, and then we'll throw the room open for questions. Let me start off with something that's on a lot of people's minds as you look at the world today. Let's talk about what's happening in the Arab world. To what extent can the United States and its best allies such as Canada really influence that part of the world in what it's going through? And I would just like you to share your observations on what you think is happening and what our shared policy should be as we look at it. CANNON: Well, as I mentioned in my remarks, I think that the most important thing, of course, are the shared values and what we can do together in terms, for instance, of promoting democracy. I, for one, am witness to things that I've done with the secretary of state, particularly, the last year in Krakow in Poland where we participated in an initiative together to promote democracy. I think this is -- and we must not confuse democracy here with elections. Democracy means building the institutions, it means putting in place what needs to be done in terms of running elections. So I think that is an area, that is an area where we can both work, as well as other like-minded countries that are similar to both of ours. THOMAN: Okay. You mentioned the whole issue of border security. I'm a little dangerous because I spent some in Canada, and I remember having a conversation with one of your predecessors after he left office, so he could be very frank. And he was quite critical of the border security policies of the U.S. under the Bush administration. He believed that the first head of Homeland Security was a politician and understood the tradeoffs between perfect security and economic values of trade and jobs. His belief was the second, who was much more security-oriented, didn't understand that trade-off. So would you tell us your sense of where we are? Does this administration understand the trade-offs of the -- the bid and ask between the values of free trade and jobs on one hand and maybe less security, less perfect security -- or perfect security on one hand and much less trade and jobs? CANNON: Well, I think -- I think we all have to acknowledge that the world changed after 9/11 and that, indeed, we needed to be able to make sure that we were able to, as Canadians, acknowledge the importance in terms of protecting the United States homeland. Well, look, let me put it this way. The prime minister when he met President Obama on the 19th of February 2009 stated quite clearly, any threat against the United States is a threat against Canada. So we share that common concern of that threat. But at the same time, we also want to be able to continue down the road to find ways to, yes, acknowledge that concern and build stronger and more secure borders, but at the same time enable that commerce that represents so many jobs both in Canada and in the United States. And so that is why last month the prime minister and the president did come forward with this vision initiative, which is -- deals with perimeter security as well as economic competitiveness. And on a going-forward basis, I think, quite truthfully, that this is our generation's challenge, to be able to continue and to make that grow, much in the same way as back in the late '80s when they were negotiating NAFTA and the free trade agreement. So today's challenges are basically those challenges that will recognize the importance of safe borders and the concerns that one would have in terms of terrorism and narcotrafficking or drug trafficking, but at the same time acknowledging the importance that we both rely on in terms of trade and investment. THOMAN: Very good. I have a number of questions here. Let me -- let me talk to the trade area a little bit. Clearly in this country we have a long-time policy of liberal trade, which worked for our economic growth. We went through NAFTA. And somehow that began to change around a decade ago, and we've now had three trade agreements that have been stuck in Congress for a long time. The Doha round has not worked. And now we're beginning to see countries such as France and Brazil complain about currencies being manipulated by -- pointing fingers at the U.S. and China. Would you talk a little bit about your sense of the environment for free trade, how important it is, where we are, what can change? CANNON: Well, I can speak from Canada's sense. Our previous government, I think, concluded -- I might be mistaken, but I believe two free-trade agreements in a period of 13 years. We've concluded free-trade agreements with a number of countries in Latin America, Panama as well as Colombia. We've been working on a free- trade -- we've concluded a free-trade agreement with Jordan. We are actually working on a comprehensive economic trade agreement with the European Union countries. We are seeking out and quite active in ASEAN. So our government is dedicated to this whole proposition of stronger economic ties are built through trade. What is the back side to that? The back side is protectionism. And we all saw what 1929 had in store for not only here in the United States but as well in Canada: a Great Depression. And so that is what looms behind a lot of people's minds in terms of -- if we don't do that, this might be the consequence. So I think that it is in everybody's interests that we are able to promote trade and trade relations wherever possible. That is our government's policy. And this is what Prime Minister Harper has been seeking since the very beginning of his mandate. THOMAN: Is your observation that the Obama administration has moved on free trade in a positive sense over the last few months, or would you -- how would you qualify that? CANNON: Well, I -- quite honestly, I'll bridge back to the agreement, the vision statement, that -- the declaration, I should say, that the prime minister and the president came to agree upon. Quite clearly, jobs, economic growth are uppermost here in the United States. They are in Canada. I think that both of them are visionaries in terms of saying, well, years ago we were able to commit to free trade agreement. It has given this as a positive result. Today we have to move that to another level. And I think that is what is most important. I look at -- I look at the structure of government, of course, in the United States, which is -- and I explain that to a lot of my counterparts -- which is completely different from the structure of government in Canada, but you know, in Canada, you'll find the provinces that have a role to play in agreements. We saw that, for instance, in the Buy America -- in the Buy America context. We have here in the United States, for instance, an administration, a Congress that is of a different view in some circumstances. So it's not the same kind of political structure, but we all have to compose with that. And I think that when you look at what has taken place over a large number of years between Canada and the United States, as good neighbors we've been able to cross those barriers and obstacles when they were there. THOMAN: Let me now turn to Afghanistan. What are the Canadian lessons learned from Afghanistan? CANNON: I think the overwhelming lesson that we've learned from Afghanistan is a whole-of-government approach. I often use the expression "peace building" in Afghanistan. And when I use that expression in terms of -- as compared to peacekeeping, peace building means that you are able to bring in and bring forward initiatives. We have done that through, for instance, our six objectives, which, yes, dealt with reconstruction, dealt with building schools, helped the Afghan government shore up and help it with its -- I'm sorry, judicial institutions, legal institutions. So there's a myriad of ways that we can come in and we can help. Those experiences, I think, are -- you can find, as a matter of fact, in General Petraeus' document, when he submitted his document and his findings to the president before there was a commitment by the U.S. government in terms of its surge, you'll find large parts of it that are inspired by what Canada's experience has been over the last 10 years in Afghanistan. We are quite pleased with the way that happened and how it occurred. Enormous sacrifice, yes, but I think that it's something that we can all learn our lesson from in helping this country ultimately rebuild itself so that it can assume its responsibilities in terms of its own security and its -- the quality of life of its citizens. THOMAN: And do you have a date for the removal of all Canadian troops? CANNON: Yes. Essentially, our mandate will end at this year -- at least we are closing down our combat mission. We are shifting from a combat mission to one of training -- to a training mission where we will be sending in 950 trainers from our military who will help the Afghan security forces, but particularly, the army, with the techniques that are needed to be able to move forward. We also do have part, I should say, in terms of training. We do have federal officers that will help their police force; correctional officers that will help as well with their prison people. So we have committed to undertake this starting next year. We'll be phased -- a phased approach. We will be ramping down as of the month of July of this year our combat -- combat mission. And we'll be moving into full operations next year. THOMAN: And the Canadian fatalities, as I recall, are the third-largest after ourselves and the Brits. Is that right? CANNON: That's -- that is correct. All the -- on a per capita basis -- THOMAN: Yeah. CANNON: -- that is correct. THOMAN: Right. CANNON: Yes. And that is why we, with the United States, with Britain, have shouldered quite a bit, and I think that -- I think, you know, when -- at the very outset, when we took power, it was extremely important for us to be able to do our share, to make sure that, as an ally, as a member of ISAF, as a member of NATO and one who wants and who respects the United Nations Security Council as well as the United Nations resolutions, it's extremely incumbent that we do our share. And we did do that in that role. And now we will continue in another role in the -- in the years to come. THOMAN: Okay, let me now turn to another thing that you mentioned in your talk, the North American energy security. Could you talk a little about the Canadian view of that, in particular the Keystone XL pipeline project and other such similar projects? CANNON: Well, there's -- as you know, there is an extremely important initiative that is afoot, which indeed will carry some crude to -- from the province of Alberta and down into the United States. It is a debate. I know that the EPA as well as the secretary of state have a role to play in this. We think it's a jumpstart project, extremely important, not only in terms of energy security for the United States -- because, as you know, we are a reliable source of energy. We are a country that offers political stability and, at the same time, we have a free- market approach as well. Once that has been mentioned, we have to as well acknowledge the fact that this will be a job creator in terms of not only the suppliers but those people who will be working on this project. I understand that, for instance, in the state of Illinois, there are well over 60-some-odd suppliers that are ready to and eager to go at building this. So I think that it's a win-win situation for both Canada and the United States in terms of what this project can bring. THOMAN: One final question; then I'll turn it over to the audience. What are the three things that keep you awake at night? CANNON: (Laughs.) I think that -- I think what's important is to be able to -- to be able to go into one's office in the morning and look at the world and say to oneself, is this -- is the planet stable? Is the planet offering things that we generally take for granted in Canada, as well as in the United States -- our liberty, our freedom, human rights, democracy? One goes to bed at night, wakes up in the morning and we certainly hope that we've been able to make progress on those fronts. I get up in the morning last week and I see that Colonel Gadhafi has actually in an outrageous fashion decided to use military might to thwart his population who are demonstrating, what you and I would take as something that is a normal -- normally acquired right and demonstrating against that. These are the things that keep us awake at night. And I think that what we all have to commit to is to be able to make sure that we try to work and make this a better place and a better world. THOMAN: Okay. Let me now throw this open to the membership. I'd like you to join our conversation. Please wait for the microphone. Stand and state your name and affiliation. And limit yourself to one question and keep it as concise as possible so that as many members as possible may ask questions. Yes. QUESTIONER: My name is Stephen Blank. The announcement of a North American security perimeter is certainly a large and very exciting step forward. I think it shows, I bet, very good Canadian spade work leading up to the meeting. It comes at an awkward time, however. The president's plate is very full. So the question is, what comes next? What is your strategy for making this happen? And how do you think the 2008 Congress will respond to this new initiative? Thank you. CANNON: Well, without going into the mechanics of what all this is about, I think that -- let me just state that the declaration per se has a couple of components, one that deals with addressing early threats. So how do we -- how do we look at that? How do we collaborate together on those issues? How do we expand the exchange of information on those threats? And those threats can be as well from a health perspective, pandemics, things of that nature. So I think that's one of the elements that we need to look at. Trade facilitation, economic growth and jobs: I alluded to that before. That's something I think that the Congress of the United States, as well as the parliament of Canada, the government of Canada, is certainly well -- is in a mood to be able to address that much more than we've ever seen in the previous times. I also think that integrated cross-border law enforcement: What can we do to be able to put in place this vision? How do we build on the existing bilateral framework and law enforcement programs that are there? How can we better be efficient at doing that? And then finally I'd say, you know, the whole critical infrastructure that -- that's there and particularly the cyberthreats and cybersecurity, NORAD and NATO. Those are other areas where I think that we can -- we can be quite cooperative. The mechanics -- I know that there is a high-level group that will be put in place, both in the United States as well as in Canada, and they will also be looking at ways -- I mentioned that quite at a glance, but they will be looking at ways to -- how do we go about and look at our regulations and harmonize those regulations? Previously, before taking this position, I was minister of transportation and I was always set back to know that there's about 26 security initiatives that we require in Canada that are not present on a number of vehicles in the United States. They go from where the taillights are to how the bumpers are placed on the vehicles, so that means that GM or Chrysler or Ford would build a vehicle in the United States, and in Canada, while it's a little different, there's a number of security components that have to be added on. So how can we better work on that? How can we better work, for instance, in terms of harmonizing our motor vehicle consumption rules and regulations, fuel regulations? Those are areas where I think that we can -- we can move together. So this committee will be looking at that. So I think that there's a lot -- a great deal on the plate to be able to move forward. I know my answer is long-winded here, but there is -- this initiative is -- as I alluded to before, this is our generation's chance at increasing and bettering what the people who negotiated the free trade agreement did years ago. THOMAN: Jacob (sp). QUESTIONER: Thank you. Jacob Franklin (sp), JP Morgan. My question is intended to help you to sleep at night. (Laughter.) CANNON: (Laughter.) QUESTIONER: And it reflects a deep concern that under the current trajectory there will not be good enough reasons to allow you to sleep well at night. I want to connect it to the first question of Richard. You described the pillars of the U.S.-Canadian cooperation, the importance of U.S. prosperity, the energy security, the importance of common strategy to achieve this. But then, when Richard asked his question, the answer was very much of a medium term: We need to build institutions, we need to promote democracy, et cetera. And yet, his question was based on what he saw last night, and what he saw last night was something that the time frame for dealing with it is so different. They're really talking -- you mentioned already the barbarism, but there is also the issue of this morning the -- in all the channels, there was a competition: Will oil become 90 (dollars), 100 (dollars) to 105 (dollars); as we are sitting here, it's another 5 percent; what is the tipping point by which a double-dip or a recession will reemerge? Are we -- are we just spectators of this arena, or are we participants in it? I think that those who come -- who read the press from the G-20 last weekend have the feeling -- at least I have -- that much more energy -- excuse the pun -- was spent on few percentage changes of the Chinese exchange rate than on the many, many dollars of the change of the price of oil, and that the destiny of the world economy, and therefore the world geopolitics, is so much more depending on it. There is greater urgency, I think. CANNON: I certainly share your view on the urgency. As well, I would add, of course, that Canadian security is uppermost. I -- yesterday when we initiated our evacuation plans, I indicated to the press back home that what was important was to be able to make sure that we bring Canadians out of Libya. You're absolutely right in terms of the effect that this will have on the market, but -- in terms of the oil prices. Surely this is not the first time. I recall in years gone by in the '70s, when I had black hair, that there was this first oil crisis. It seems to me that we've been living "crisises" over the last 30, 40, 50 years in terms of that. What I wanted to mention today was that Canada does offer the United States of America a reliable, neighborly, friendly solution to being able to procure fossil fuels that are needed to be able to generate the economy. The G-20 partners have been looking at a number of economic issues, as you know, issues that are related to modernizing and increasing the framework. The oil prices, they will, of course, fluctuate; they will go up and down. What solution are you offering in terms of -- in terms of going in? Are sanctions something that should be looked at? Maybe so. Those are options that are still on the table and have to be looked at. How do you acquire stability in that market? I don't think that I will be able to give you a prediction today as to the stability of the oil market or the price of a barrel of crude. It's been fluctuating for a number of years. So how do you address this specific issue? I think that we have to look at all of the options. Tomorrow I will be in Italy. I'll be able to sit down with my counterpart, my colleague, and discuss how he views the situation in Libya and what impact that necessarily will have on their economy, because, as you know, Italy is going to be impacted greatly by the reduction in oil, as well as look at with my other counterparts, including Secretary of State Clinton, how do we go about and manage this issue, both from a diplomatic but as well from an economic perspective? And those are things that we have to look at. THOMAN: Yes. QUESTIONER: Carol Brown (sp), free agent. (Laughter.) I have a question -- THOMAN: (Laughs.) I'm envious. QUESTIONER: You mentioned mechanics twice in your remarks. And I have a question about the mechanics and the process of the bilateral U.S.- Canadian relationship. You also mentioned things that happened 20 years ago, like an acid-rain agreement, free-trade agreement, shamrock summit. These all happened at a time when there was a process entailing two meetings a year at the head-of-governments, four a year at the foreign-ministry level. I don't know whether that continues today or not. I don't think it does. But my question really is, are you satisfied with the way the bilateral relationship works on dealing with the very kinds of issues that you've talked about and others have asked about? QUESTIONER: Well, President Obama came to Canada in February of 2009. This was the first time that a long-standing tradition had been reestablished -- that is to say, the first visit by an incumbent -- or at least by a new president generally goes to -- goes to Canada. So President Obama kept that tradition alive. The prime minister reciprocated with a meeting. The prime minister and the president see themselves on a regular basis. I was in Washington a couple of weeks ago, as a matter of fact, where another bilateral meeting was held between the president and the prime minister. And the results of that bilateral meeting are the security perimeter as well as the economic competitiveness initiative. So from a bilateral perspective, both the president and the prime minister are seeing themselves on a regular basis. So that is -- I think that addresses the question that you raised. The other issue in terms of the multilateral approach, you'll recall that previous governments had the prosperity initiative as a -- as a theme. And that brought together the leaders of both Mexico, Canada and the United States to deal with North American common issues. That still continues. But what I think we have been able to do is to step up the bilateral relations as well with the United States, the -- quite -- let me acknowledge that both the president and the prime minister get along extremely well. They're two practical individuals. They're fathers of young families. So they see eye to eye on a number of personal issues, if I can say it that way. But at the same time, I was -- I was able to witness the interaction between the prime minister and the president during the G- 8 Muskoka summit that was held in Ontario last year, as well as the G- 20. And I can say that there is a complicity between the prime minister and the president in terms of their approach and the way they view the world issues and how they see things moving forward. So I would say, all in all, the relationship between the prime minister and the president are excellent. I give it an A, maybe an A- plus. THOMAN: Let me -- Bill, we'll get you next. QUESTIONER: Andrew Gundlach from Arnhold and S. Bleichroeder. You mentioned the XL Keystone pipeline, which goes down to Cushing. And I share your view; it's a great project for both countries. But there's two other big projects -- actually, one other project and one other problem being fixed, which is a project in and of itself. The first is the Kitimat LNG export facility, which I find an interesting project because, in a way, it's a threat to the United States in terms of gas prices having an outlet out of this continent. On the other hand, it's really good for Canada, and especially western Canada, because where gas trades in the Asian markets. So I'm curious how -- TransCanada, for example, who owns the Keystone, thinks it'll never get built. Other people, obviously, think it will get built. I'm curious where you come out. The second is more of a technical question, same issue though, and that's the Enbridge pipeline is two times the size of the Keystone and it's running at 50 percent or 60 percent capacity because the company really hasn't spent enough capital maintaining it over the past 10 years. And I'm wondering whether or not both governments could do more to get them to spend capital on a plan which is better for our energy security and not as good for their shareholders. CANNON: Well, let me just, first, couch that with an issue that this government has taken over the course of the last several years. We've pushed considerably with what we call a "gateway strategy." A gateway strategy is to be able to find more efficient ways to get our products both in and out of the country. And so we've had an Atlantic gateway. We've had one for Quebec and Ontario in terms of that corridor that we use -- the Windsor-Detroit crossing. We've had one for western Canada, particularly our Pacific Gateway initiative. We have invested a large amount of money over the course of the last several years with the private sector to be able to increase our competitiveness, because we are competing with other ports, for instance, out west, whether it be Los Angeles are whether it be in Seattle. We are competing, and so we are trying to -- we're trying to develop that. We certainly believe that getting back to our networks, whether it be a network in terms of oil and gas and the prices are not necessarily familiar. I know that shale gas has modified a lot of the LNG projects, and the regulations in Russia are extremely difficult to overcome. But this having been said, we've been working on a strategy that relies on the global supply chain and basically entails us to find ways to better get our products from Canada to the United states and, of course, elsewhere. So projects like the one that I alluded to before are in the works. They're there. I certainly have raised this at the highest levels. We believe that this is important. We believe that it is good for both the United States as well as Canada. And hopefully, in years to come decisions will be made that will favor these -- more integration in terms of this extremely important resource for our economies. THOMAN: Yes. QUESTIONER: Herbert Levin. Thank you, Mr. Minister, for the recitation of trade problems. I tend to think that's a tax we pay on a huge and very successful economic relationship. But I would like to ask you two questions, even though that violates the rules, but others have gotten away with it. The first one is that the Canadians will go and train police. Well, the U.S. likes that because we don't have a national police force, so we always want other people to train the police. But I would like you to dispel the idea that came into my head, which is: If there's a fight, the Canadians are not coming; if there's no fight, then we'll come and do something good. But I'd like you to tell me I'm wrong on that one. And the second one is: What major policies of the U.S. -- not bilateral stuff -- would you like to see the U.S. change? Do you like our votes in the U.N. on Israel, on Cuba? What about Iran? What about Burma? Do you think we're doing the right thing there? So tell us the things that, when you're alone with your counterpart, you say: I really think you guys are wrong, and you ought to change. CANNON: (Laughs.) QUESTIONER: Or sometimes we get question time in Parliament in Ottawa; we can pick it up. What are you genuinely harassed about American policies in question time? Thank you. CANNON: Well, let me first handle the Afghanistan issue. Canada, when asked to fight, stood, as I mentioned, shoulder-to- shoulder with the other allies. You'll recall that President Karzai, as well as -- both at the London Conference and at the Kabul Conference -- as well as President Obama -- there is a timeline here. There is a -- there is a framework that will lead us inevitably towards the transition. We are actually in a transition. To quote the president of the United States, there is no transition without training. So what the objective here is, at the last NATO meeting that we held in Lisbon, the objective here is to be able to make sure that as we move towards 2015, indeed -- 2014 and 2015 -- indeed, the Afghans themselves will assume complete and total responsibility for their security. To be able to do parts of that is going to require training components. I have had the opportunity of discussing this issue with Secretary of State Clinton a while back -- last summer, as a matter of fact. We also discussed with allies, consulted allies as to how Canada can best serve and help. And in that regard, this training component was extremely important. We do have a national police, but I just want to end on that and say that a number of local police forces do furnish and supply some of their personnel to be able to undertake and carry out these tasks of training. So it's a -- it's sort of a -- I'd say a whole-Canadian initiative, from the federal RCMP to members of police forces across the country. So I think that's the -- that's the important element. Now, not -- I don't want to be rude, but what was the second question again? (Laughter.) THOMAN: It had to -- it had to do with -- QUESTIONER: (Canada won't fight ?). THOMAN: No, no, no, he sort of answered. Your second question -- your second question had to do -- CANNON: Well, no, Canadians have fought. I mean, that's -- we've been -- QUESTIONER: Which U.S. policies do you want changed? CANNON: Oh, okay, yes. Yes. QUESTIONER: (For instance ?) Cuba. What -- CANNON: I'm teasing you here, because you're only allowed one question. (Laughter.) QUESTIONER: At least you can follow up. CANNON: But -- I will. Right, that's correct. That's correct. But, no, I think that on many issues -- for instance, if you -- if you take whether -- you alluded to Burma before. Secretary of State Clinton, as well as myself, were at the ASEAN meeting, where our Burmese counterpart was. We've spoken on numerous occasions. We've made it very clear that we want to see change in that -- in that regime. We want to make sure that human rights are supported. We want to make sure, as well, that -- Aung San Suu Kyi at the time was still under house arrest. We wanted that -- her liberation, her freedom -- before any elections. We wanted the elections to be fair. Obviously, Burma hasn't come up and stood up the way we wanted it, so our position is exactly similar on that. On Israel, we are also calling for the two parties to come back. We have always had a position where we believe in the two-state solution. There are not very many issues -- as a matter of fact, I'm trying to -- trying to -- I'm going through my mind here to find out what issues actually we are -- indeed have different positions on. There are not -- there are not very many issues. I mean, I've got a heck of a lot trouble trying to find one. My deputy minister is here and he -- he's -- MR. : (Off mic.) CANNON: Well, there's two, but yes. MR. : (Laughs.) CANNON: But I mean, this is -- this is a long and outstanding -- since the 1970s. Is it still an issue that differentiates us? I can tell you that from my conversations with my counterpart, I've never had -- this issue has never been raised with me. So we -- I think we are all pushing for a more democratic Cuba, a more -- a Cuba that will, indeed, respect human rights, to free the political prisoners. But here -- again, here's a generation -- I'll be quite honest here -- here's a generation of people that have grown up -- you and I can talk about democracy here, but do they know democracy? They don't know democracy. They have no notion of what democracy might look like. They've been with this government, with Fidel Castro and his brother for the last -- long, long -- number of decades, and they have never known democracy. So here's a -- here's a challenge that we need to put forward in terms of promoting democracy: How do we go about and speak to those young folks that are -- that are looking for and want to seek democracy? It's not just holding elections. I mentioned before: It's to be able to build those institutions. So those are things that we commonly work on, but our position -- you're right -- is different from the United States' position regarding Cuba. But there are far and very few of those distinctions between our policies. THOMAN: Thank you. Yes. QUESTIONER: I'm Ken Roth from Human Rights Watch. I was very happy that in your opening remarks you did talk about the importance of human rights and democracy. And of course, historically Canada, you know, really has played a leadership role in building various institutions and standards, whether it's peacekeeping or the International Criminal Court, the landmine treaties and responsibility to protect doctrine. But I -- I'm probably not telling you anything new that in recent years, the -- you know, the human rights community has been more disappointed with Canada's role. It passed on a leadership role on the Cluster Munitions Convention. It is, you know, the only Western government not to repatriate its citizens from Guantanamo. It was reluctant to investigate allegations that Canadian forces sent detainees to be tortured by Afghan troops. It's been cutting off funding to Canadian NGOs that criticize Israel's troublesome human rights record. And so my question really is, you know, does Canada today aspire to the real leadership role on human rights issues that it traditionally has played, and not on the easy cases of, you know, Burma or Zimbabwe or even Libya today, but on the tough cases where, you know, a difficult position is taken to advance institutions or standards for human rights? CANNON: Well, my first reaction would be to talk to you about those different issues that you've raised. But I don't think that Canada's position on human rights has changed. I think that Canada's position on human rights, as a matter of fact, has strengthened itself over the course of the last several years. You take the case in point in Iran. We have been extremely outspoken. We've just spoken about Cuba. We've been extremely outspoken on Cuba as well in terms of the political prisoners that find themselves behind bars there. We've spoken about that. Ahmadinejad's Iran is outrageous. We -- you'll probably recall from your knowledge the Kazemi case, who's that photojournalist from Montreal who found herself there accused -- wrongly -- of wrongdoings in that country, was literally murdered and with no consequences whatsoever. We've kept a very close eye on Iran, over the course of the last several years, much more so than I don't think any other country has actually -- has actually put out there. China as well: I mean, we've got relations with China, but I can list a number of cases that are raised at every opportunity at the highest level. Both my prime minister as well as myself, when I meet with my counterpart, raise these issues. We push for them. And so, you know, I don't -- I don't at all feel guilty for not pushing human rights. On the contrary, as I mentioned before, we have been pushing human rights around the world, and much more so than I -- than the previous government has done. QUESTIONER: Thank you. Charles Heck. I wonder if you could speak a bit about issues in the seas north of Canada, in the Arctic seas? Am I wrong in thinking that this may be an area where there are some differences between Washington and Ottawa in the legal character of some of these waters? What's under -- what falls within Canadian sovereignty? What other areas or international straits or international in some other way? And are there broader multilateral tasks to be accomplished with other coastal states, like Russian, Denmark, Norway? CANNON: We actually -- both Canada and the United States are partners and members of the Arctic Council, which bring together a number of Arctic countries, Russia and Denmark and Sweden and Norway. And so we do manage a number of issues with the same energy and with the same commitment. There are bilaterally between Canada and the United States, as you know, a couple of issues there but that are well-managed. The Northwest Passage, for instance, is a well-managed issue and that's since, I guess, about 15, 20 years ago when President Reagan as well as Prime Minister Mulroney were able to agree on a memorandum of understanding as to how on a going-forward basis that issue, which is basically an issue that deals with navigation, not Canada's sovereignty, but navigation in that area. The Beaufort Sea is another area where the boundary is disputed. But Secretary of State Clinton as well as myself have tasked our officials to start working on and scoping out what would eventually -- what would a negotiation look like eventually. But we are working cooperatively together the -- in mapping the continental shelf. We want to be able to table a submission to the United Nations convention or at least the commission on the United Nations convention to the law of the seas by 2013. I know that the United States -- and I'll come back to one of the issues (du jour ?) I would hope that the United States would ratify UNCLOS at the first possible occasion. I think that would be extremely helpful. And -- but, you know, I'd say that the issues that are there are well managed. We have put out a foreign policy statement on the north and on the Arctic. What is our number-one priority is Canada's sovereignty in that area. And the United States respects our sovereignty in that area. So I don't see any problem with a potential or a divergent opinion with the U.S. on that. THOMAN: Okay. And I think we're up to 2:00. I just want to remind you that on Monday, February 28th from 12:30 to 2:00 is our next meeting on global solutions for the global economic crisis, with Justin Lin of the World Bank Group; and on Wednesday, March 2nd, with Thomas Hoenig, president and CEO of the Federal Reserve Bank of Kansas City. Mr. Minister, thank you very much. CANNON: Thank you. Thank you very much. THOMAN: Thank you very much. (Applause.) (C) COPYRIGHT 2011, FEDERAL NEWS SERVICE, INC., 1000 VERMONT AVE. NW; 5TH FLOOR; WASHINGTON, DC - 20005, USA. ALL RIGHTS RESERVED. ANY REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION IS EXPRESSLY PROHIBITED. UNAUTHORIZED REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION CONSTITUTES A MISAPPROPRIATION UNDER APPLICABLE UNFAIR COMPETITION LAW, AND FEDERAL NEWS SERVICE, INC. RESERVES THE RIGHT TO PURSUE ALL REMEDIES AVAILABLE TO IT IN RESPECT TO SUCH MISAPPROPRIATION. FEDERAL NEWS SERVICE, INC. IS A PRIVATE FIRM AND IS NOT AFFILIATED WITH THE FEDERAL GOVERNMENT. NO COPYRIGHT IS CLAIMED AS TO ANY PART OF THE ORIGINAL WORK PREPARED BY A UNITED STATES GOVERNMENT OFFICER OR EMPLOYEE AS PART OF THAT PERSON'S OFFICIAL DUTIES. FOR INFORMATION ON SUBSCRIBING TO FNS, PLEASE CALL 202-347-1400 OR E-MAIL [email protected]. THIS IS A RUSH TRANSCRIPT.-------------------------
    Event with Lawrence Cannon and G. Richard Thoman February 23, 2011
  • Canada
    Our Common Cause and Shared Responsibility
    Play
    Lawrence Cannon, Canadian minister of foreign affairs, examines how the new economic goals set forth by President Obama can be realized in Canada and how both countries continue to work together in addressing issues abroad and trans-nationally.
    Event February 23, 2011
  • Fossil Fuels
    An Oil Import Fee?
    I’m skeptical about the potential for significant progress on energy policy over the next two years. One dark horse, though, is a fee on imported oil. The politics could work: climate hawks could back it because it would cut greenhouse gas emissions; security hawks could back it because it would cut oil imports; deficit hawks could back it because it would raise revenues without raising taxes. It was particularly intruiging to see Mitch Daniels, whom some are trying to draft for a (long shot) bid for the Republican presidential nomination, float the idea a few weeks ago. I’m ambivalent on the matter, mainly because I haven’t seen a good analysis of it. Here are the questions I think need to be answered: How much revenue could a realistic fee raise? This one is relatively simple. What impact would a fee have on U.S. oil consumption? How would that split between transportation (which is the least flexible and hence matters most for economic security) and other sectors? What impact would a fee have on U.S. oil production? A fee on imports will raise the price of oil seen by U.S. consumers but will not raise the cost of producing oil for U.S. producers. This means that an oil import fee would increase U.S. production.  How big would this effect be? How would these changes in U.S. consumption and production affect U.S. imports from key producers? How would those producers react? What net impact would a fee have on U.S. GDP? It would presumably help GDP growth by reducing U.S. exposure to high prices and volatility while hurting GDP growth because of economic distortions. How would the effects of a fee differ depending on whether it was applied only to oil or also to refined products like gasoline and diesel? Could an oil import fee be squared with U.S. obligations under the WTO and NAFTA? How? What would the distributional impacts of a fee be? Regional and income variations could both matter. What might the politics look like? I presented a simple argument above, but there are complications. Environmentalists would have mixed reactions because of a fee’s impact on U.S. production. Free trade supporters might blanch depending on the WTO and NAFTA implications. Refiners might oppose a fee; so might auto manufacturers. Economic purists might insist that a broad-based tax applied to all oil consumption would be better. Anyone could demagogue the policy, if they wanted to, by pointing out that it would raise the pump price for gasoline. These are all answerable. Anyone interested in taking a shot?
    Post by Michael Levi November 9, 2010 Energy, Security, and Climate
  • Fossil Fuels
    A Low Carbon Fuel Standard Could Be Ugly
    E&E News reports this morning that senators are considering including a low-carbon fuel standard (LCFS) in the impending energy bill. The (laudable) idea would be to force more low-carbon biofuels and electricity into the transportation system. They should proceed with great caution, though, since most standard variations on the theme could be dangerous. There are, however, some simple potential fixes that would probably take the rough edges off. Each gallon of transportation fuel consumed in the United States has “lifecycle” or “well-to-wheels” (WTW) emissions associated with it. With oil, for example, this includes the emissions entailed in producing, transporting, and refining the oil, as well as the emissions generated when the final product (gasoline, diesel, or jet fuel) is ultimately burned. With electric cars, this includes the emissions generated in producing the electricity used to charge the car. With biofuels, it includes the emissions created in making the fuel and burning it in a car, minus a credit for the carbon captured while growing the original feedstock (like corn or sugarcane). An LCFS would require the average WTW emissions associated with transportation fuels used in the United States to drop to some set (declining) target each year. This would increase the proportion of low-carbon biofuels and electrified transportation in the U.S. system while decreasing the proportion of carbon-intensive fossil fuels. It would, in the typical conception, do this by requiring refiners, blenders, and importers to hold special permits for their fuels. Those permits would be tradable – if I produced gasoline, I could buy permits from a biofuels producer to cover my extra emissions. This is basically cap-and-trade restricted to a small slice of the emissions picture. The impact on markets works similarly to cap-and-trade too: high-carbon fuels would get more expensive, leading people to reduce their relative consumption of them. This may sound elegant, but it is an extraordinarily inefficient way to cut emissions, and could get very ugly in practice. Let me highlight two big problems. There are three ways to hit any target for cutting the average WTW emissions of U.S. transportation fuel. First, we increase the proportion of low-carbon biofuels and electric cars. Second, we cut the use of higher-carbon fossil fuels (like fuels from California, Canada, Mexico, and Nigeria; more on this below). The mechanics of these two make obvious sense. Third, we cut the use of all fossil fuels. This helps meet the target because it ensures that low-carbon biofuels electricity make up a larger fraction of all fuels combined. (Basically, we’re cutting the denominator rather than increasing the numerator.) Depending on how the target is set, it’s eminently possible that the combination of more low-carbon biofuels / electricity and less high-carbon fossil fuels won’t be enough to meet the target, simply because not enough low-carbon fuels will be available, and because there won’t be enough high-carbon fuels to cut. In that case, we’ll need to drop overall fuel consumption to hit our goals. That’s fine (actually, desirable) in principle, but the way this happens gets messy. Basically, the LCFS becomes a potentially huge gasoline and diesel tax. (That’s how you get people to consume far less fuel.) One simulation of a superficially attractive LCFS predicts gasoline price increases of $3-$20/gallon over a decade (above business as usual). That curbs fuel demand and allows the LCFS targets to be met. I have some problems with this specific analysis, and am very skeptical of the high end of the spectrum, but it’s the only decent one out there, and gives some indication of how things could turn out unexpectedly, even near the low end. (If what we want is a gasoline tax, we should just do that, an eliminate the risk that it will end up being $10/gallon because of some quirks in the system.) The other problem with the LCFS is the mess that it could create for different sources of imported oil. Oil and fuels from the Canadian oil/tar sands and from Nigeria have unusually high WTW emissions (10-20% higher than the typical barrel consumed in the United States). Mexico is almost as bad. Algeria is much better than average. Middle Eastern countries are all over the map. A simple LCFS could create large financial incentives to totally reorder the patterns oil imports, with little if any environmental impact (since, unless we reduced our overall fuel consumption at the same time, they’d just send their fuel somewhere else). We’d cut imports from Canada and Mexico and switch them to Algeria and the Middle East. The international political consequences would be a mess. The upside to an LCFS, of course, is that it would encourage the use of low-carbon biofuels and electricity for transportation. There are other ways to do this, but if senators are dead-set on using an LCFS, there are a couple tweaks they could use to keep things under control. In order to avoid the danger of the LCFS becoming a ridiculously large gas tax (as opposed to a modest and sensible one), they could impose a price ceiling on the permits that refiners, blenders, and importers would be required to hold. To avoid creating an international political mess, they could declare that the system would treat all petroleum-derived fuels as having the same WTW emissions. That would mean that all oil, whether from Mexico, Algeria, Canada, or the United States, would be treated the same – it would be penalized, but not differentially. Bottom lines: An LCFS could get ugly. There are some simple fixes, though these could make it harder for the LCFS to achieve its goals. Senators would be wise to think about better ways to achieve their ends. But if they go with an LCFS, they should do that with care.
    Post by Michael Levi July 20, 2010 Energy, Security, and Climate
  • Canada
    G8, G20: A View of Canada’s Summits
    The upcoming G8 and G20 conferences mark a shift to a "multipolar age," particularly if the G20 is able to agree on a continuing path to a stable global recovery, says CFR’s Stewart Patrick.
    Expert Brief by Stewart M. Patrick June 18, 2010 Greenberg Center for Geoeconomic Studies
  • Canada
    The Canadian Oil Sands
    Overview Rhetoric in Washington often focuses on areas where energy security and climate change, two increasingly prominent elements of U.S. domestic and foreign policy, align. Many important decisions, though, will require difficult tradeoffs between them. The Canadian oil sands—a massive but emissions-intensive source of oil—presents policymakers with precisely such a challenge. Unfettered production in the oil sands would increase greenhouse gas emissions but strengthen U.S. energy security with a supply of oil from a friendly and stable neighbor. Sharply curtailed oil sands operations would harm U.S. energy security but cut emissions. This Council Special Report, written by Michael A. Levi, explores both the energy security and climate change implications of expanded oil sands production. It assesses current and future trends in the oil sands, including in the scale and cost of production and in the oil sands’ impact on world oil markets, and evaluates the potential impacts of a range of policy options. The report concludes that the oil sands are neither critical to U.S. energy security nor catastrophic for climate change. It also argues, though, that their security benefits and climate costs cannot be ignored. Its recommendations focus on policies that would provide incentives to cut the emissions generated in producing each barrel of crude from the oil sands, but in a way that is careful to avoid directly discouraging increased production. The recommended measures balance energy security and climate change concerns rather than picking one as a clear priority over the other, providing insight both into how policymakers should approach the oil sands and into the broader challenge of addressing the intersection of energy security and climate change.
    Council Special Report by Michael Levi May 7, 2009 Greenberg Center for Geoeconomic Studies
  • Canada
    American Myths
    Overview Despite generations of talking, trading, intermarrying, and fighting together as allies--not to mention sharing a border--Canadians cherish ideas about the United States that may not be true, ideas that often lead to a distorted perception of American society. American Myths challenges this conventional wisdom with fifteen essays on topics including multiculturalism, health care, diplomacy, the environment, and America's role as the world's peacekeeper. Intelligent and thought-provoking, the book is required reading for anyone interested in future relations between the two nations.
    Report by Jessica LeCroy October 8, 2008
  • Arctic
    Policy Framework for Managing Canada's Fisheries and Oceans
    Testimony by Scott G. Borgerson April 8, 2008
  • Canada
    A Conversation with Stephen Harper
    Play
    MARIE-JOSEE KRAVIS:  Hello.  I'm Marie-Josee Kravis, and I'm very happy to be able to introduce to you Canada's prime minister.  But before I do so, I'd like to ask everyone to please turn off cellphones and BlackBerries -- conceived-in-Canada BlackBerries, I should say.  (Chuckles.)  And also I should say that this meeting is on the record, and it's being webcast to all of the council's members across the country.I'll be brief because we're running a little late.  But many of you, when you think of Canada, I think, recently have really been thinking about the Canadian dollar and the exchange rate, but there's much to the country.  As you know, it's -- Canada is the United States' most important trading partner.  It's its largest supplier of oil.  In fact it's the world's second-largest oil producer. So I think we will have interesting discussions with the prime minister as to how all of that -- what all of that means going forward in terms not only of North American relationships on security and prosperity, but also in terms of our military alliances, humanitarian alliances, and also the issue of climate change, all issues that the prime minister has agreed to discuss with you today.Stephen Harper comes to us with a very interesting background because not only is he the leader of the Conservative Party, but he is unique among Canadian politicians and, I think, many politicians around the world in that he created his own political party, the Canadian Alliance Party.  And he then brought that party together with the Conservative Party to then assume the leadership of the Conservative Party and become prime minister.  And he's now the prime minister, leading a minority government that technically speaking is probably the minority government with the largest -- that's the longest minority government in Canada's history.So I welcome Stephen Harper.  And he will make a presentation and then take questions.  Thank you very much.Please, Mr. Prime Minister.  (Applause.)PRIME MINISTER STEPHEN HARPER:  "Merci beaucoup," Marie-Josee.  Thank you very much, Chairman Rubin, President Haass.  Our consul general, Dan Sullivan, is here.  And thank you all, ladies and gentlemen, for attending here today. Let me just say at the outset how delighted I am to have this opportunity to address the Council on Foreign Relations.  In our judgment, there is no better forum, no organization more respected or influential than the council when the subject matter is the complex area of foreign policy.  Your independent, nonpartisan work helps provide policymakers with the insight and perspective needed to build a better world.  So it is for me a great honor, and I do greatly appreciate the opportunity to be here today.We all know it is a challenge to understand the world we live in and the competing interests and values that shape international events.  This challenge would not be so great if all the countries of the world were free, open, pluralist societies like ours, committed to democracy and equality of opportunity, committed to free and fair trade, aspiring to the principles and values that we as Canadians and Americans share.But sadly, they are not.  All of us here believe in a world in which freedom, democracy human rights and the rule of law are paramount and pervasive, but the reality in which we live is unfortunately otherwise. And therefore, the tasks before us are sometimes -- are often difficult, I should say, and sometimes daunting:  preventing terrorism from reaching our shores; stopping the spread of nuclear, biological and chemical weapons; bolstering fragile states; helping rebuild societies shattered by chronic conflict; tackling climate change at the global level; sustaining and spreading economic growth and prosperity.No country acting alone can successfully meet all of these challenges. They are too complex and too enduring to be addressed even by the world's single most powerful nation.  (Speaks in French.)So success in this global environment requires concerted action among capable, committed like-minded nations.  Success requires middle powers who can step up to the plate and do their part.  Success demands governments who are willing to assume responsibilities; seek practical, doable solutions to problems; and who have a voice and influence in global affairs because they lead not by lecturing but by example. (Speaks in French.)  Since assuming office 19 months ago, our government has been making a deliberate effort to be that kind of a government, to bring Canada back as a credible player on the world stage.  Canada's back not because of new rhetoric or electoral promises but because we are rebuilding our capabilities.  We have rebuilt Canada's national balance sheet with ongoing budget surpluses, a falling tax burden and the lowest debt among G-7 countries.  We are building an energy superpower with the largest potential for free-market-based supplies of oil and gas in the entire world.  We are reasserting our sovereignty and presence in our Arctic.  We are renewing our military, both personnel and hardware.  And we will be bringing new focus and effectiveness in the near future to our international assistance.  Domestically and internationally my government is preparing Canada for leadership.  Take Afghanistan as an example.  Canada did not hesitate a little more than six years ago when terrorists hit this great city and Washington, DC.  The United Nations Security Council authorized military action to remove the Taliban regime, and Canada was there immediately. (Speaks in French.)  We are part of the United Nations mission in Afghanistan because we believe it is noble and necessary, a cause completely consistent with our country's proud history of supporting international action to fight oppression and brutality, and to assist our fellow human beings.  Since 2005, Canadian troops have been in one of the most violent regions of Afghanistan -- the southern province of Kandahar.  And there has been a significant price, as we were reminded yesterday with the death of a Canadian soldier and the wounding of three others.  71 Canadian soldiers and one of our diplomats have fallen in Afghanistan, as well as a Canadian carpenter who was murdered by the Taliban after he built a school for the children of a remote Afghan village.  The stark reality is that there can be no progress in Afghanistan without security: the security provided by the sacrifice and determination of our men and women in uniform.  Without security, development workers cannot provide reconstruction or humanitarian assistance.  Police and corrections officers cannot ensure justice and peace.  Diplomats cannot help rebuild democracy or enhance human rights.  In short, without security, there can be no hope of any kind for the people who live in Afghanistan, and that is what we are providing.  Take education.  In Afghanistan in 1991, there were barely 700,000 children in school, all of them boys.  Today, there are 6 million children in school, and a third of them are girls -- 2 million.  Education means all the things to Afghan families that it means to our families -- a future for the young and for society, hope and progress incarnate for men and for women alike.  And as a consequence, it will mean a more secure future for all of us.  Now of course, I am in your city this week on another matter, excuse me, where Canada intends to lead by example, and that is the challenge of climate change.  Yesterday at the U.N. climate change meeting and at last night's dinner, leaders joined with the secretary-general to discuss solutions to the problems of rising greenhouse gas emissions. (Speaks in French.)  Let me be clear.  Canada believes we need a new international protocol that contains binding targets for all of the world's major emitters, including the United States and China.  And it is through such targets that the development and deployment of new clean energy technology will be stimulated.  That is what we are doing in Canada.  We're implementing a national system of mandatory greenhouse gas emission reduction across major industrial sectors.  Our plan will reduce Canada's total emissions by 20 percent to the year 2020, and 60 to 70 percent by 2050.  And make no mistake; this system will impose real cost on the Canadian economy.  At the same time, by basing our early targets on emissions intensity, we are balancing effective environmental action with the reality that Canada has a growing population and growing economic output.  The message is that we need to take action.  We owe it to future generations, just as we owe them the opportunity to have the economic prosperity that we do today.  We owe them both -- sustainable environment and a prosperous economy.  In the global fight against climate change, Canada will do everything in its power to help develop an effective, all-inclusive international environmental framework that recognizes national economic circumstances, just as we did with the successful Montreal Protocol on the protection of the ozone layer, on which I should add that international progress could not have come without the leadership at the table demonstrated by the United States and China.The solution to climate change cannot and will not be one size fits all, but neither can nations treat this issue as simply somebody else's responsibility.  This is the message we've delivered at home to Canadians.  It's the message we brought to our G-8 colleagues in June at the summit there in Heiligendamm.  It's the message we gave to APEC countries and business leaders in Sydney, Australia, two weeks ago, and it's the message I conveyed during discussions here in New York.  Now let me turn to the main issue I want to discuss today, and that is our own neighborhood, the Americas.  (Speaks in French.)  Our new government has committed Canada to active and sustained reengagement with the hemisphere to advance security, prosperity, and democracy.  I visited the region this summer.  The contrasts were stark, and they are worrisome.  While many nations are pursuing market reform and democratic development, others are falling back to economic nationalism and protectionism, to political populism and authoritarianism.  Democracy, economic progress and social equality are still very much a work in progress in the region.  That is why it is so important for countries like Canada to engage, to demonstrate that there are workable models that can meet the aspirations of citizens.  We cannot let the choice be characterized as simply unfettered capitalism, on the one hand, or old socialist models, on the other.  I suggested that there are other ways, such as the Canadian approach, a model of constitutional democracy and economic openness combined with the social safety nets, equitable wealth creation and regional sharing arrangements that prevent the start of exploitation still seen far too often in the Americas.  The Canadian model has resonance.  Leaders, experts, businesspeople, social advocates in the region want Canada's assistance in building their institutions for democratic governance, their human rights systems and their economy.  I told them that we would be there to help. (Speaks in French.)  In Haiti, the visceral linkage between security and development is most evident, and Canada is deeply involved in the promotion of both.  I visited a Canadian-funded hospital in the slums of Cite Soleil.  Until last January, when U.N. troops led by Brazil cleaned up a cesspool of warlords and gangs, such a visit would have been unthinkable.  That's what I mean by the inherent linkage between security and development.  On my hemispheric tour, I also went to Colombia, where our government is undertaking free trade negotiations.  This is in Canada's own strategic trade interests, but it will also assist that country to continue on its path of overcoming a long, dark history of terror and violence, and moving its people to a future of economic and democratic development.  In my view, Colombia needs its democratic friends to lean forward and give them a chance at partnership and trade with North America.  I am very concerned that some in the United States seem unwilling to do that.  What message does that send to those who want to share in freedom and prosperity?(Speaks in French.)There is a lot of worry in this country about the ideology of populism, nationalism and protectionism in the Americas and the governments that promote it, but frankly, my friends, there is nowhere in the hemisphere that those forces can do more real damage than those forces in the United States itself.  And if the U.S. turns its back on its friends in Colombia, this will set back our cause far more than any Latin American dictator could hope to achieve.I say this because I believe it is incumbent upon all of us to defend our shared interests and values at home as well as abroad, and more open trade in the hemisphere is consistent with our values and in all of our interests.  Let me take NAFTA.  Now, I know NAFTA has become somewhat of a whipping boy to some the United States just as it is to some in Mexico and even to some in Canada, but the fact is that NAFTA has been unequivocally good for all of our countries.  In spite of the naysayers and the doomsayers, I could recite a litany of economic statistics to demonstrate its success, which is why virtually nobody, not even the critics, actually do suggest we whip it up.But I would say, more importantly, look south of your own border.  Today Mexico's economy is not only growing, but it now has genuine democratic elections and peaceful transfers of political power, and it is engaging with the United States and Canada on security matters.  All of these things were unthinkable in the era before NAFTA was signed.  I could farther south to Chile, a country with which Canada signed a free trade agreement exactly 10 years ago.  Today Chile is so stable and prosperous that after years of turmoil, violence and dictatorship, it is now a member of the OECD.Let me conclude by returning to the theme of security.  It is security and prosperity that bind our two nations.(Speaks in French.)At the North American summit that Canada hosted in Montebello last month, I was struck by the power of the message sent to us by leaders from the American and Canadian private sectors.  They appealed to us to see the connection between security and prosperity.  They told us that without the "and" we won't have either.  Frankly, that is why we continue to be concerned about the U.S.-Western Hemisphere Travel Initiative.  We understand and support and are working with the U.S. government on the principle, that is security, but we don't think that the WHTI is currently conceived as either well thought-out or practical.And we regret that we have not been able to make land pre-clearance happen today, just as we made air pre-clearance happen in the past.  Canada and the United States must be capable of managing our border in a way that does not turn it into a barrier to commerce or to our shared prosperity.  Of course, our commitment to security and to our shared values, as I've said today, extends well beyond our borders.(Speaks in French.)Working with other middle powers, Canada can and Canada is making a real contribution to protecting and projecting our collective interests, while serving as a model of a prosperous, democratic and compassionate society, independent yet open to the world.  It is a contribution that I believe is increasingly important as we meet today's challenges, challenges that the United States cannot succeed in addressing alone, nor should we expect it to.  These challenges need the different perspectives, concerns and capabilities that partnership brings.  It only makes sense to consult, to compare notes and to share challenges. Canada is doing its part, taking an assertive role on the world stage, leading by example, taking risks, making investments, extending our voice and our influence.  In our Arctic, in Afghanistan, in the Americas, on climate change, on secure borders, in each of these we may not always be in agreement with the United States, but we are committed, engaged and working for real and positive results, working for a world that is open, for a world of opportunity, a world where human potential is unlocked by freedom and made possible through democracy, working for a safe and prosperous world for all of us.Thank you.  "Merci beaucoup."  And I look forward to your questions.  (Applause.)KRAVIS:  "Merci" -- (off mike).I'd like to perhaps just start the discussion and invite also any of you who have questions that when you do pose your questions, to please identify yourself and your affiliation.  But I will maybe just pursue one of the points that you mentioned with regards to NAFTA.HARPER:  Sure.KRAVIS:  And the point that you made is that no one, even the staunchest opponents, is willing to tear the agreement up.  But my question is, is anyone willing to extend the agreement?  I know that you've extended the agreement to Chile and you're considering other such pacts, but here in this country there seems to be resistance to extending this any further, and I wonder if you might comment on populism and protectionism.HARPER:  Well, first of all let me just say that Canada is engaged right now in -- we've kind of revived our interest in signing free trade agreements after some years of absence.  We just recently signed one with the European Free Trade Association.  I mentioned we have negotiations with Colombia and also with Peru, with the Dominican Republic, with CARICOM, with the Central American Four, and we're talking to Jordan on similar projects.  So we're engaged in trying to diversify and deepen our trade linkages.You know, I believe that Canada's economic relationship with the United States is its most important relationship in the world.  I believe we should do everything we can to strengthen that.  That's been my long-standing position.  I've always supported the free trade agreement, continue to think that we can build upon it, and I think history has demonstrated a candidate can do that and maintain its independence on the things that matter to Canada's unique national character.My own sense is that -- my own sense is that any talk of deepening NAFTA or strengthening trade relationships on this continent is not going to happen in the immediate future.  My conclusion after a year and a half in this job is that notwithstanding the reasonably good relationship I think we have with the United States government, that the United States government post-September two thousand eleventh -- I'll attribute it to that -- has very much become preoccupied with security, and security that has very much a strong emphasis on national sovereignty and national borders.  And I think that until we're able to couple that somewhat better, that the prospects of deepening our economic relationship are limited.  What we want to do is make sure we don't go backwards in any way.  That's why we're working with the administration and other interests in the United States to make sure the WHTI, when it's implemented, is implemented in a way that does not impede commerce and economic relations.  But as I say, I think security, as opposed to -- you know, as opposed to the economy, is the primacy -- is the primary focus of policymakers in the administration, and not just in the relationship with Canada, but in all relationships.KRAVIS:  Well, that became clear in the immigration debate also, also in the U.S.  My question, I guess, more whether you thought the U.S. had the stomach -- and putting aside the security issue -- but have the stomach to go along with the efforts that you have been -- have put forth to deepen and expand the trade -- the trade agreements.HARPER:  Well, I can give one example where there was willingness.  The administration shortly after our government took office took initiatives with us to resolve the long-standing softwood lumber dispute.  Softwood lumber is a major part of our trade.  It has been a problematic area since it was not included in the very first FTA signed in the late 1980s, and we did -- we did manage to put in a long-term softwood lumber arrangement between our two countries that was, I think, broadly supported in the United States but certainly abroad, had and has brought industry support in Canada.  So that was an example of resolving a significant trade problem in a way that, I think, provided some framework and stability, that deepened what we had before.But you know, as I said in my remarks, I'm -- I am deeply concerned about -- you know, and I'm not pointing the finger here; I'm talking about an overall discourse as the United States is in this electoral cycle, a discourse that I see populism, protectionism and nationalism in an unhealthy sense running through it.  It bothers me, it concerns me, particularly vis-a-vis Canada.  Canada and the United States have the closest relationship of -- probably of any two countries in history, and certainly the most integrated and important economic relationship of any two countries in history.  And I think anything that, on either side of the border, anybody who questions the importance of that or who works contrary to those interests, I think is not serving the public very well.KRAVIS:  Yes, please.QUESTIONER:  Thank you.  Mr. Prime Minister, I'm -- (name inaudible).  I'm a writer and journalist.  You spoke about bilateral trade agreements and some limited multilateral trade agreement, but what about the WTO and the current attempts to try and revive Doha Round, which would liberalize the world trade regime?  The perception (is), as you know, among third-world countries that the developed countries, this one in particular, are refusing rather adamantly to end the subsidies to the farmers.  How do you feel about that?  Do you feel that the Doha Round can be indeed revived?And related to that question, on the question of immigration, there's also a perception that as -- (inaudible) -- open to free trade and to immigration, Canada may be in a sense a recipient of the kind of immigration that could perhaps jeopardize the security of North America.Thank you.HARPER:  Yeah, well, thanks for both questions.First, on the WTO, Canada wants to see a successful and ambitious outcome to the world trade talks.  I'm -- I guess the word we're supposed to use these days is guarded optimism.  I may be a little bit less than that in my assessment, but Canada is pushing for a successful outcome.  I agree with you, developing countries perceive there's not been enough openness on the agricultural front in developed countries.  Developed countries perceive developing countries have not been willing enough to open up the non-agricultural sectors at the same time.I think probably the truth is that everybody is right, and what I have said to other leaders is that I think the way to get a successful world trade deal is for everybody to aim very high and be very ambitious.  I think if we aim for an incremental, a small incremental trade deal just to say we'll get one, I think what we find is that in all our countries the forces who are the sectors that are damaged by more open trade will be very vocal, and the winners will not be obvious.  I think we should all aim high so that the winners are obvious in every country and so that there is some political support.So I think the solution is to be more ambitious, not less ambitious, on the WTO, but clearly it's struggling.  And fast track authorities expire here, and that's going to be a significant problem.On immigration, first of all, let me just say, in Canada, like the United States, we're an immigrant-receiving country.  You know, I think it's -- immigration is much more of a consensus in Canada.  I think there's agreement, you know, across the mainstream of the political spectrum that immigration has been overwhelmingly positive for Canada historically.  We see some challenges on the economic side in recent years, but socially, culturally.  And Canada has -- not unlike the United States, but I think Canada is particularly proud of the reasonably strong record we have of integrating immigrants into the mainstream, of overcoming the social divisions and ghettoization that you see in a lot of immigrant-receiving countries.  Now, we're not perfect.  We have our problems but Canadians are -- you know, in spite of or, I think, actually because of our commitment to multiculturalism, I think we've been a success in that.  And we take a view in Canada -- yes, we expect immigrants to adapt, and particularly over time, the generations to adapt to the Canadian way of life, become Canadians.  But we also believe that Canadian society changes to some degree to reflect immigrants themselves.  And we believe that's a good thing.  You know, we have -- there was, I'm sure, in this country, widely reported -- we had some arrests of, you know, terrorist suspects last year in Toronto.  That investigation was assisted by large numbers of people in the immigrant communities themselves.  You know, we have a good commitment to the Canadian way of life and to our values.  And I believe overwhelmingly that when people come to Canada, or for that matter to the United States, they come because they want to belong.  That's why they come.  And we should welcome them and celebrate that. I do want to respond a little bit more detail, if you don't mind me asking.  Because there has been and continues to be suggestions that the relatively generous nature of Canada's immigration, or more particularly its refugee system, constitutes a security threat, either to Canada or to the continent.  I would agree, we have a very liberal refugee system compared to most countries.  That said, it's a big leap to go from, it's a liberal immigration system, to, it's a security threat.  We have security screening procedures.  We do deport people.  We deported 12,000 people last year.  We identify security threats, in most cases, long before they ever arrive at our shores, and deal with them there.  As I say, we do deport.  We do incarcerate people.  We do monitor people and we work closely with all agencies in the United States in terms of these responsibilities.  They're shared responsibilities towards our continent.  So you know, we do bristle when I hear these suggestions.  There was a report recently.  It was -- it talked about a terror suspect that was arrested at the Canadian border some years ago for travel in the United States.  First of all, this was not a refugee.  This was an immigrant.  But in any case, that arrest took place through the cooperative action of Canadian and American authorities.  So we take our responsibilities very seriously.  The United States has no more secure border -- no more secure border -- than its northern border.  And I don't just mean its southern border; I mean its eastern and its western border as well.  The most secure border of the United States is its northern border by far, and we take that responsibility seriously.  KRAVIS:  Thank you.  I know there are many hands that have gone up, so I'm going to ask everyone to limit themselves to one question, please. Over here, ma'am.  QUESTIONER:  (Audio break.)  Paula DiPerna, Chicago Climate Exchange.  You alluded to a change in overseas development assistance and a tweaking of that.  I wonder if you could elaborate and whether your views about conditionality, and particularly whether you intend to introduce a higher degree of environmental screening or conditionality of any kind.  HARPER:  The short answer is no, I can't answer that.  We intend to have a policy announcement on that in the upcoming weeks.  We have done, over the past several months, a thorough review of our foreign aid, concluded that it's not nearly as effective as it could be.  And we will be announcing a number of measures to make it more effective in terms of promoting a range of Canadian interests and values.  QUESTIONER:  Thank you, Marie-Josee.  My name is Peter Goldmark.  I work for Environmental Defense.  On the subject of climate, Prime Minister, you were very clear this afternoon on your support for binding limits.  That would place you, on the eve of the emitters conference, on a different course from President Bush, who has resisted binding limits, and seem to put you more in the camp of the Europeans, who are supporting binding limits, and many of whom view the major emitters conference as the last chance for the Bush administration to show some seriousness on this subject.  Can you talk to us a little bit about what role you plan to play starting Thursday at this conference and what courses you plan to advocate there?HARPER:  Well, I --QUESTIONER:  You want two minutes in French -- (laughter) --HARPER:  It's up to you.KRAVIS:  I think this is fine.HARPER:  You know, very quickly, we -- as I mentioned, we had a high-level meeting yesterday through the Office of the Secretary-General.  We had a dinnertime discussion last night with a smaller group of leaders.  And as you know, there are a whole series of other processes ongoing.  I think we're -- you know, I think it's a step-by-step process.  I don't think we're necessarily going to head an agreement very quickly.But, you know, I do think Canada has somewhat of a middle-ground position on this, and I described it this way.  You know, we share with the United States -- and the United States's president, I should say, assured everybody last night that his process is intended to supplement, to complement the U.N. process, not to detract from it -- that's what he told all the leaders.On the issue of targets, the United States has signed on to statements at the G-8 and at APEC that would seem to imply targets, although admittedly they sound like self-described targets as opposed to being part of a binding international regime, and that's where we differ.  We do believe that technological change is what's going to solve this problem, but that technological change isn't going to happen in earnest until signals are sent pretty clear to the market that it must happen and it must happen on some kind of a realistic timeline.You know, on the one hand, there are some countries that are pushing for a framework that looks like the current framework.  I think the deficiencies of that are obvious.  If you go for hard pacts as the only kind of target, by definition, the only kinds of countries that will sign on are countries that have no population growth and fairly limited economic growth.  That's what happened with Kyoto.  And then you end up exempting the developed world, and, quite frankly, for countries like Canada and I think the United States and Australia and a number of others, that kind of a framework creates real difficulty.  Then the upshot is you have what you have with the Kyoto Accord, which is basically now two-thirds of world emissions outside the regime.So I think that we do need binding international targets.  I think it's a global problem.  I actually don't think we're going to get there just through a series of national targets.  I think there has to be an international framework, but those targets have to be described and established in a way that recognize not just poor countries but different economic circumstances, and so that they can apply to a range of economic conditions.I happen to believe strongly that you'll -- if one takes this seriously, you'll conclude that you need targets based on intensity of emission for economic unit of economic output.  That's the kind of targets, I think, will -- the only kind of target, I think, will work globally.  But certainly not all other countries share that view, and some -- at the dinner last night, I would still say there's a wide range of disagreement on where we need to go.  But we are certainly trying to pull people towards, you know, targets, yes, but flexible targets that accommodate different circumstances.KRAVIS:  But you've also announced that Canada has joined the Asia-Pacific Initiative.HARPER:  Yeah.KRAVIS:  And what -- in that vein, what --HARPER:  Well, we had asked -- we had expressed interest in that some time ago.  It's a, as you know, an organization designed primarily to promote the development and spread of technology to deal with climate change.  It's not an organization that -- you know, that is advocating targets or advocating some particular overall framework.In fairness, it was reported in Canada yesterday, for instance -- there was an anti-Kyoto group -- it's not really true, because Japan is a member and Japan is a signatory and a reasonably successful signatory of the Kyoto Protocol, so it's -- it is a group, though, that, as I say, is doing important work, and more importantly, represents one-half of global emission, over one-half.  And my strong view is if you don't get leadership from the United States and the developed world and from China in the developing world, we will not get an effective protocol.On the other hand, if we do have leadership and participation from those two countries, I believe that everyone else will follow.  So we want to be in various forums where we can work to make that a possible outcome.KRAVIS:  Thanks.QUESTIONER:  Well, thank you.  I'm Allen Hyman, Columbia University Medical Center.  For many decades, the Antarctic continent has been recognized as international territory open to nations all over the world for exploration and for scientific study.  Very recently, the Russians have sunk their flag at the bottom of the Arctic Ocean near the North Pole.  What do you think the message from Putin was, and do you recognize the Arctic Ocean to be analogous to the Antarctic continent?HARPER:  I'll comment on the latter.  No, obviously we don't recognize an exact parallel to the Antarctic continent, where, as you know, all territories south of 60 degrees is essentially international territory, and much of Canada's land mass lies above 60 degrees north, so that would not be a position.  Now, there is an international convention on which Russia and other countries are working to delineate basically the continental shelf and the relevant economic and other claims that may proceed from that.  I think my former foreign minister was pretty clear about Canada's displeasure with the Russian stunt -- I think that would be the best way to put it.  (Laughter).  President Putin assured me that he meant no offense, nor any -- (laughter) -- nor any intention to violate any international understanding or any Canadian sovereignty in any way, and needless to say, I always listen carefully when Mr. Putin speaks.  (Laughter).KRAVIS:  Please.  Yes?QUESTIONER:  I'm Ted Sargent (sp) from Paul Ice (ph), Mr. Prime Minister.  Thank you for your initial remarks outlining the long history of shared values and beliefs between our two countries.  We are -- we've been told since 9/11 that we are hated for our values and beliefs by Islamists and -- (inaudible word) -- and others who mean harm to the United States.  Canada is not hated.  How do you explain this?  (Laughter).HARPER:  Well -- (laughter) -- I'm trying to think of how to answer that one.  (Laughter.)MS. KRAVIZ:  We have a different way of expressing -- HARPER:  I'm not sure, first of all --MS. KRAVIZ:  You can answer -- (inaudible).HARPER:  Yeah, sure.  (Laughter).  I'm not sure, in all fairness, that the United States is hated.  It's certainly hated in some circles, the United States as a nation.  I suspect in the circles where the United States as a nation is genuinely hated, and you mentioned a couple of them, I suspect Canada is equally hated, as are all countries that stand for those values.  The American administration, to be frank, is more widely unpopular than the United States itself, but that's ultimately an issue for American domestic politics.  I've always taken the view that the Canadian prime minister and the Canadian government have a responsibility -- Canadian prime minister has a responsibility to establish a good working relationship with the president of the United States regardless of political party or regardless of political discourse in either country, and we do our best to work productively with the American administration.  Canada is perceived differently.  I think Canada is different, but Canada is also perceived differently internationally.  You know, Canada has no history anywhere in the world of conquest or domination.  It's probably hard to perceive of Canada being in that kind of a position.  Canada is also perceived, you know, as a -- maybe a less pure model of values of the United States, but a more complex one.  We are a bicultural country, which I think gives Canadian political leaders and its foreign policy people a more inherent understanding of the importance of cultural difference in a pluralistic world.  We have different social systems, we have different government structures, some of which resonate much better in other parts of the world than the equivalent American model.  And in that sense, I think Canada's both a positive and a non-threatening force, and what my government is trying to do is make sure we can use those values to promote positive change in concert with our allies.  What I don't want to do is what Canadian governments have sometimes done in the past, which is to stand on the sidelines bragging about our differences, lecturing and not really accomplishing anything.  We want to take a different tack.  We want to take a different tack.QUESTIONER:  Mr. Prime Minister, I understand that one of the things that is galling to Canadians about the United States is that while the U.S. looms very large to Canadians, Americans are largely oblivious of our northern neighbor.HARPER:  Right.QUESTIONER:  But one of the things that brings Canada to my awareness is communications that I receive from animal rights organizations.  And they report on the continued policies that permit the clubbing of baby seals in Canada.  At a time when there's a commodity boom that is bringing the Canadian dollar into parity and even perhaps to an appreciation relative to the U.S. currently, can't the Canadian government find more humane employment opportunities for those citizens who are engaged in this field clubbing?HARPER:  Sure.  Well, first of all, that is a falsehood, but it continues to be spread.  The -- in Canada the practice of clubbing and, frankly, the culling of baby seals has been outlawed for 20 years.  Yet some organizations continue to say that, continue to use stock footage from decades ago, to fundraise.  We have a small sealing industry.  It's dedicated today to humane and regulated practices.  The seal population is exploding in Canada and it's not an endangered species by any means.  And in fact, we've invited the European Union, who has been most vocal on this, to send representatives and to do a(n) on-the-ground inspection of the industry.  They can see for themselves what we're doing.I guess the position of Canadian governments historically, and it's our position as well, is that this is a small industry of animal husbandry, there is no reason to discriminate against it any more than any other industry of animal husbandry, and that we will not be bullied or blackmailed into forcing people out of that industry, who depend on the livelihood, based on things that are simply on stories and on allegations that are simply not true.KRAVIS:  Thank you.In the back.  And I'm just going to -- as you're getting the microphone -- I'm surprised no one's raised the issue of water with you.HARPER:  Oh, yeah.KRAVIS:  Maybe we can come to that after this question.  (Laughter.)QUESTIONER:   Unfortunately, not my question.  My name is Kate Kroeger.  I'm with the American Jewish World Service.  And my question for you, Prime Minister, is a broad one.  Do you think that in Canada you're entering the era of minority government?  And if so, what do you think the implications are for Canada projecting and executing a coherent foreign policy?HARPER:  Well, Canada now has had two minority governments in a row.  If the various conservative parties had been united over the past 14 years, which they weren't until recently, we would have had minority government over that entire period as well.  So I think with the current political alignment -- I'm probably not supposed to say this, my election strategist won't like it -- but with the current political alignment, I think the possibility of minority government at any election, including one in the near future, would loom very high.Does it affect Canada's foreign policy?  You know, in terms of the day-to-day setting of priorities and taking of positions on the world stage, not very directly, because quite frankly, this is largely under executive authority.  I may be criticized in Parliament for it, but in most cases, if I can make my case to the Canadian people, I can pursue, you know, an aggressive or well-defined foreign policy.  And I don't think our government, on anything from the Middle East to -- you know, to Afghanistan to climate change, has had any hesitation in taking well-defined stands and stands that are sometimes highly criticized in Parliament itself.  At the same time, I believe, and we're committed as a government to ensuring that when we actually deploy Canadian resources, Canadian troops around the world, that that is supported by Parliament.  And so, you know, we have a big challenge, obviously, with the deployment in Afghanistan.  It's -- we've had a lot of casualties.  And unfortunately, those who committed us originally to the engagement now see political points in being against it.  That said, I guess I believe what a former Canadian leader told me.  I believe that when it comes to foreign affairs and global security, this is one area where you do what is right in the long-term interest of the country, your allies and the world, and that Canadians, whether they agree or disagree with an individual decision, will support a government that it thinks conducts foreign policy in that manner.  If they think a government conducts foreign policy not in that manner, or has a weak or visionless foreign policy, then you're in trouble.  So I will put it this way:  that under a minority government, this government's foreign policy will not change -- will not be any different than it would be under a majority government.  KRAVIS:  Please.  Don't -- just behind you.QUESTIONER:  My name is Richard Erb, and I'm a council member from western Montana, just below Glacier Park and Flathead Lake.  But I'm tempted to ask you a question about the coal project and the coal methane project, but I'm not going to ask that question.  (Laughter.)  What I want to -- HARPER:  I'm not going to answer.  (Laughter.)QUESTIONER:  I'm glad you didn't -- (off mike).HARPER:  Sure.QUESTIONER:  When you look around the world, in many countries with conflicts among ethnic groups, indigenous tribes, religious groups that cause tension and sometimes bloodshed, what lessons from Canada's experience in dealing with these issues do you think would be most relevant to the rest of the world?HARPER:  That's -- it's a really good question, and obviously one of the things that Canadian diplomats try and do is, you know, do try and work with other countries where there is ethnic or tribal conflict to impart lessons from Canada.  Now, you know, one of the biggest lessons from Canada is that these problems aren't solved overnight.  I mean, Canada as a peaceful, prosperous society took a long time to develop, and we had our ups and downs along the way.  You know, I think that there's, first of all, a lesson that comes from all democratic societies, and that is that the process of democratic government is not about final victory.  It is a process.  And it's about not just the legitimacy of this year's election, but the legitimacy of the next one as well, where the same people will air many of the same issues over again and may get a different verdict.  One of the problems in pre-democratic or non-democratic societies is that the political culture of leaders of all factions is aimed at total and complete domination forever.  And you don't just -- you know, you don't just win an election; you then figure out how you're going to wipe out your opposition for good, you know, through any means necessary.  And I'm concerned about this.  I'm concerned that as Western nations, we don't fully understand this.  And you know, I think we often rush into certain types of democratic processes in non-democratic societies where the outcome will not be a free and democratic society.  The outcome will be the majority outvoting the minority or some group, you know, and I've -- if I can speak bluntly, thinking of Hamas and Hezbollah, who see the vote as only one of a number of tools to pursue their political objective, not as a commitment to the democratic process inherently.  So I think, you know, all countries -- all of us as Western countries need to think carefully about how we project and what we understand about our democratic values and how we project those abroad, so that as we promote democracy, we get democracy, not something else.In terms of Canada, you know, I think Canada's unique experience is the reasonable -- it's not problem-free, but the reasonable accommodation of major cultural and linguistic differences in the country.  And you know, I would say it's an extension of what I said earlier, particularly on the part of the majority, you know, to -- I guess that probably we would say in Canada there's no real majority.  Today we're such as a -- you know, a regional and multiethnic, multicultural society.  But to the extent that there's historically a majority, getting the majority to understand that accommodation of the minority and of the minority's needs and of the minority's -- the difficult position of being a minority is critical to the overall health of the body politic in the long term.  It is not simply ever -- it can't ever be simply a matter of the majority, defined in an ethnic sense, imposing its will on a smaller part of the country.  And I think if you look at Canadian history -- and I don't just think English/French, but I think of way back, Catholic/Protestant, or east versus west -- whenever we have had -- and Alan would know this -- whenever we have had an incident where one section of our country, either defined regionally or ethnically or linguistically, has imposed something on the other against its will, we have lived with the consequences of that for decades.  And that must be avoided at all costs.  So there's more to putting together a majority in governing our country than simple math.KRAVIS:  Well, Mr. Prime Minister, thank you very much.  This has been a very, very informative session.  (Applause.)  ####      (C) COPYRIGHT 2007, FEDERAL NEWS SERVICE, INC., 1000 VERMONT AVE.NW; 5TH FLOOR; WASHINGTON, DC - 20005, USA.  ALL RIGHTS RESERVED.  ANY REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION IS EXPRESSLY PROHIBITED.      UNAUTHORIZED REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION CONSTITUTES A MISAPPROPRIATION UNDER APPLICABLE UNFAIR COMPETITION LAW, AND FEDERAL NEWS SERVICE, INC. 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MARIE-JOSEE KRAVIS:  Hello.  I'm Marie-Josee Kravis, and I'm very happy to be able to introduce to you Canada's prime minister.  But before I do so, I'd like to ask everyone to please turn off cellphones and BlackBerries -- conceived-in-Canada BlackBerries, I should say.  (Chuckles.)  And also I should say that this meeting is on the record, and it's being webcast to all of the council's members across the country.I'll be brief because we're running a little late.  But many of you, when you think of Canada, I think, recently have really been thinking about the Canadian dollar and the exchange rate, but there's much to the country.  As you know, it's -- Canada is the United States' most important trading partner.  It's its largest supplier of oil.  In fact it's the world's second-largest oil producer. So I think we will have interesting discussions with the prime minister as to how all of that -- what all of that means going forward in terms not only of North American relationships on security and prosperity, but also in terms of our military alliances, humanitarian alliances, and also the issue of climate change, all issues that the prime minister has agreed to discuss with you today.Stephen Harper comes to us with a very interesting background because not only is he the leader of the Conservative Party, but he is unique among Canadian politicians and, I think, many politicians around the world in that he created his own political party, the Canadian Alliance Party.  And he then brought that party together with the Conservative Party to then assume the leadership of the Conservative Party and become prime minister.  And he's now the prime minister, leading a minority government that technically speaking is probably the minority government with the largest -- that's the longest minority government in Canada's history.So I welcome Stephen Harper.  And he will make a presentation and then take questions.  Thank you very much.Please, Mr. Prime Minister.  (Applause.)PRIME MINISTER STEPHEN HARPER:  "Merci beaucoup," Marie-Josee.  Thank you very much, Chairman Rubin, President Haass.  Our consul general, Dan Sullivan, is here.  And thank you all, ladies and gentlemen, for attending here today. Let me just say at the outset how delighted I am to have this opportunity to address the Council on Foreign Relations.  In our judgment, there is no better forum, no organization more respected or influential than the council when the subject matter is the complex area of foreign policy.  Your independent, nonpartisan work helps provide policymakers with the insight and perspective needed to build a better world.  So it is for me a great honor, and I do greatly appreciate the opportunity to be here today.We all know it is a challenge to understand the world we live in and the competing interests and values that shape international events.  This challenge would not be so great if all the countries of the world were free, open, pluralist societies like ours, committed to democracy and equality of opportunity, committed to free and fair trade, aspiring to the principles and values that we as Canadians and Americans share.But sadly, they are not.  All of us here believe in a world in which freedom, democracy human rights and the rule of law are paramount and pervasive, but the reality in which we live is unfortunately otherwise. And therefore, the tasks before us are sometimes -- are often difficult, I should say, and sometimes daunting:  preventing terrorism from reaching our shores; stopping the spread of nuclear, biological and chemical weapons; bolstering fragile states; helping rebuild societies shattered by chronic conflict; tackling climate change at the global level; sustaining and spreading economic growth and prosperity.No country acting alone can successfully meet all of these challenges. They are too complex and too enduring to be addressed even by the world's single most powerful nation.  (Speaks in French.)So success in this global environment requires concerted action among capable, committed like-minded nations.  Success requires middle powers who can step up to the plate and do their part.  Success demands governments who are willing to assume responsibilities; seek practical, doable solutions to problems; and who have a voice and influence in global affairs because they lead not by lecturing but by example. (Speaks in French.)  Since assuming office 19 months ago, our government has been making a deliberate effort to be that kind of a government, to bring Canada back as a credible player on the world stage.  Canada's back not because of new rhetoric or electoral promises but because we are rebuilding our capabilities.  We have rebuilt Canada's national balance sheet with ongoing budget surpluses, a falling tax burden and the lowest debt among G-7 countries.  We are building an energy superpower with the largest potential for free-market-based supplies of oil and gas in the entire world.  We are reasserting our sovereignty and presence in our Arctic.  We are renewing our military, both personnel and hardware.  And we will be bringing new focus and effectiveness in the near future to our international assistance.  Domestically and internationally my government is preparing Canada for leadership.  Take Afghanistan as an example.  Canada did not hesitate a little more than six years ago when terrorists hit this great city and Washington, DC.  The United Nations Security Council authorized military action to remove the Taliban regime, and Canada was there immediately. (Speaks in French.)  We are part of the United Nations mission in Afghanistan because we believe it is noble and necessary, a cause completely consistent with our country's proud history of supporting international action to fight oppression and brutality, and to assist our fellow human beings.  Since 2005, Canadian troops have been in one of the most violent regions of Afghanistan -- the southern province of Kandahar.  And there has been a significant price, as we were reminded yesterday with the death of a Canadian soldier and the wounding of three others.  71 Canadian soldiers and one of our diplomats have fallen in Afghanistan, as well as a Canadian carpenter who was murdered by the Taliban after he built a school for the children of a remote Afghan village.  The stark reality is that there can be no progress in Afghanistan without security: the security provided by the sacrifice and determination of our men and women in uniform.  Without security, development workers cannot provide reconstruction or humanitarian assistance.  Police and corrections officers cannot ensure justice and peace.  Diplomats cannot help rebuild democracy or enhance human rights.  In short, without security, there can be no hope of any kind for the people who live in Afghanistan, and that is what we are providing.  Take education.  In Afghanistan in 1991, there were barely 700,000 children in school, all of them boys.  Today, there are 6 million children in school, and a third of them are girls -- 2 million.  Education means all the things to Afghan families that it means to our families -- a future for the young and for society, hope and progress incarnate for men and for women alike.  And as a consequence, it will mean a more secure future for all of us.  Now of course, I am in your city this week on another matter, excuse me, where Canada intends to lead by example, and that is the challenge of climate change.  Yesterday at the U.N. climate change meeting and at last night's dinner, leaders joined with the secretary-general to discuss solutions to the problems of rising greenhouse gas emissions. (Speaks in French.)  Let me be clear.  Canada believes we need a new international protocol that contains binding targets for all of the world's major emitters, including the United States and China.  And it is through such targets that the development and deployment of new clean energy technology will be stimulated.  That is what we are doing in Canada.  We're implementing a national system of mandatory greenhouse gas emission reduction across major industrial sectors.  Our plan will reduce Canada's total emissions by 20 percent to the year 2020, and 60 to 70 percent by 2050.  And make no mistake; this system will impose real cost on the Canadian economy.  At the same time, by basing our early targets on emissions intensity, we are balancing effective environmental action with the reality that Canada has a growing population and growing economic output.  The message is that we need to take action.  We owe it to future generations, just as we owe them the opportunity to have the economic prosperity that we do today.  We owe them both -- sustainable environment and a prosperous economy.  In the global fight against climate change, Canada will do everything in its power to help develop an effective, all-inclusive international environmental framework that recognizes national economic circumstances, just as we did with the successful Montreal Protocol on the protection of the ozone layer, on which I should add that international progress could not have come without the leadership at the table demonstrated by the United States and China.The solution to climate change cannot and will not be one size fits all, but neither can nations treat this issue as simply somebody else's responsibility.  This is the message we've delivered at home to Canadians.  It's the message we brought to our G-8 colleagues in June at the summit there in Heiligendamm.  It's the message we gave to APEC countries and business leaders in Sydney, Australia, two weeks ago, and it's the message I conveyed during discussions here in New York.  Now let me turn to the main issue I want to discuss today, and that is our own neighborhood, the Americas.  (Speaks in French.)  Our new government has committed Canada to active and sustained reengagement with the hemisphere to advance security, prosperity, and democracy.  I visited the region this summer.  The contrasts were stark, and they are worrisome.  While many nations are pursuing market reform and democratic development, others are falling back to economic nationalism and protectionism, to political populism and authoritarianism.  Democracy, economic progress and social equality are still very much a work in progress in the region.  That is why it is so important for countries like Canada to engage, to demonstrate that there are workable models that can meet the aspirations of citizens.  We cannot let the choice be characterized as simply unfettered capitalism, on the one hand, or old socialist models, on the other.  I suggested that there are other ways, such as the Canadian approach, a model of constitutional democracy and economic openness combined with the social safety nets, equitable wealth creation and regional sharing arrangements that prevent the start of exploitation still seen far too often in the Americas.  The Canadian model has resonance.  Leaders, experts, businesspeople, social advocates in the region want Canada's assistance in building their institutions for democratic governance, their human rights systems and their economy.  I told them that we would be there to help. (Speaks in French.)  In Haiti, the visceral linkage between security and development is most evident, and Canada is deeply involved in the promotion of both.  I visited a Canadian-funded hospital in the slums of Cite Soleil.  Until last January, when U.N. troops led by Brazil cleaned up a cesspool of warlords and gangs, such a visit would have been unthinkable.  That's what I mean by the inherent linkage between security and development.  On my hemispheric tour, I also went to Colombia, where our government is undertaking free trade negotiations.  This is in Canada's own strategic trade interests, but it will also assist that country to continue on its path of overcoming a long, dark history of terror and violence, and moving its people to a future of economic and democratic development.  In my view, Colombia needs its democratic friends to lean forward and give them a chance at partnership and trade with North America.  I am very concerned that some in the United States seem unwilling to do that.  What message does that send to those who want to share in freedom and prosperity?(Speaks in French.)There is a lot of worry in this country about the ideology of populism, nationalism and protectionism in the Americas and the governments that promote it, but frankly, my friends, there is nowhere in the hemisphere that those forces can do more real damage than those forces in the United States itself.  And if the U.S. turns its back on its friends in Colombia, this will set back our cause far more than any Latin American dictator could hope to achieve.I say this because I believe it is incumbent upon all of us to defend our shared interests and values at home as well as abroad, and more open trade in the hemisphere is consistent with our values and in all of our interests.  Let me take NAFTA.  Now, I know NAFTA has become somewhat of a whipping boy to some the United States just as it is to some in Mexico and even to some in Canada, but the fact is that NAFTA has been unequivocally good for all of our countries.  In spite of the naysayers and the doomsayers, I could recite a litany of economic statistics to demonstrate its success, which is why virtually nobody, not even the critics, actually do suggest we whip it up.But I would say, more importantly, look south of your own border.  Today Mexico's economy is not only growing, but it now has genuine democratic elections and peaceful transfers of political power, and it is engaging with the United States and Canada on security matters.  All of these things were unthinkable in the era before NAFTA was signed.  I could farther south to Chile, a country with which Canada signed a free trade agreement exactly 10 years ago.  Today Chile is so stable and prosperous that after years of turmoil, violence and dictatorship, it is now a member of the OECD.Let me conclude by returning to the theme of security.  It is security and prosperity that bind our two nations.(Speaks in French.)At the North American summit that Canada hosted in Montebello last month, I was struck by the power of the message sent to us by leaders from the American and Canadian private sectors.  They appealed to us to see the connection between security and prosperity.  They told us that without the "and" we won't have either.  Frankly, that is why we continue to be concerned about the U.S.-Western Hemisphere Travel Initiative.  We understand and support and are working with the U.S. government on the principle, that is security, but we don't think that the WHTI is currently conceived as either well thought-out or practical.And we regret that we have not been able to make land pre-clearance happen today, just as we made air pre-clearance happen in the past.  Canada and the United States must be capable of managing our border in a way that does not turn it into a barrier to commerce or to our shared prosperity.  Of course, our commitment to security and to our shared values, as I've said today, extends well beyond our borders.(Speaks in French.)Working with other middle powers, Canada can and Canada is making a real contribution to protecting and projecting our collective interests, while serving as a model of a prosperous, democratic and compassionate society, independent yet open to the world.  It is a contribution that I believe is increasingly important as we meet today's challenges, challenges that the United States cannot succeed in addressing alone, nor should we expect it to.  These challenges need the different perspectives, concerns and capabilities that partnership brings.  It only makes sense to consult, to compare notes and to share challenges. Canada is doing its part, taking an assertive role on the world stage, leading by example, taking risks, making investments, extending our voice and our influence.  In our Arctic, in Afghanistan, in the Americas, on climate change, on secure borders, in each of these we may not always be in agreement with the United States, but we are committed, engaged and working for real and positive results, working for a world that is open, for a world of opportunity, a world where human potential is unlocked by freedom and made possible through democracy, working for a safe and prosperous world for all of us.Thank you.  "Merci beaucoup."  And I look forward to your questions.  (Applause.)KRAVIS:  "Merci" -- (off mike).I'd like to perhaps just start the discussion and invite also any of you who have questions that when you do pose your questions, to please identify yourself and your affiliation.  But I will maybe just pursue one of the points that you mentioned with regards to NAFTA.HARPER:  Sure.KRAVIS:  And the point that you made is that no one, even the staunchest opponents, is willing to tear the agreement up.  But my question is, is anyone willing to extend the agreement?  I know that you've extended the agreement to Chile and you're considering other such pacts, but here in this country there seems to be resistance to extending this any further, and I wonder if you might comment on populism and protectionism.HARPER:  Well, first of all let me just say that Canada is engaged right now in -- we've kind of revived our interest in signing free trade agreements after some years of absence.  We just recently signed one with the European Free Trade Association.  I mentioned we have negotiations with Colombia and also with Peru, with the Dominican Republic, with CARICOM, with the Central American Four, and we're talking to Jordan on similar projects.  So we're engaged in trying to diversify and deepen our trade linkages.You know, I believe that Canada's economic relationship with the United States is its most important relationship in the world.  I believe we should do everything we can to strengthen that.  That's been my long-standing position.  I've always supported the free trade agreement, continue to think that we can build upon it, and I think history has demonstrated a candidate can do that and maintain its independence on the things that matter to Canada's unique national character.My own sense is that -- my own sense is that any talk of deepening NAFTA or strengthening trade relationships on this continent is not going to happen in the immediate future.  My conclusion after a year and a half in this job is that notwithstanding the reasonably good relationship I think we have with the United States government, that the United States government post-September two thousand eleventh -- I'll attribute it to that -- has very much become preoccupied with security, and security that has very much a strong emphasis on national sovereignty and national borders.  And I think that until we're able to couple that somewhat better, that the prospects of deepening our economic relationship are limited.  What we want to do is make sure we don't go backwards in any way.  That's why we're working with the administration and other interests in the United States to make sure the WHTI, when it's implemented, is implemented in a way that does not impede commerce and economic relations.  But as I say, I think security, as opposed to -- you know, as opposed to the economy, is the primacy -- is the primary focus of policymakers in the administration, and not just in the relationship with Canada, but in all relationships.KRAVIS:  Well, that became clear in the immigration debate also, also in the U.S.  My question, I guess, more whether you thought the U.S. had the stomach -- and putting aside the security issue -- but have the stomach to go along with the efforts that you have been -- have put forth to deepen and expand the trade -- the trade agreements.HARPER:  Well, I can give one example where there was willingness.  The administration shortly after our government took office took initiatives with us to resolve the long-standing softwood lumber dispute.  Softwood lumber is a major part of our trade.  It has been a problematic area since it was not included in the very first FTA signed in the late 1980s, and we did -- we did manage to put in a long-term softwood lumber arrangement between our two countries that was, I think, broadly supported in the United States but certainly abroad, had and has brought industry support in Canada.  So that was an example of resolving a significant trade problem in a way that, I think, provided some framework and stability, that deepened what we had before.But you know, as I said in my remarks, I'm -- I am deeply concerned about -- you know, and I'm not pointing the finger here; I'm talking about an overall discourse as the United States is in this electoral cycle, a discourse that I see populism, protectionism and nationalism in an unhealthy sense running through it.  It bothers me, it concerns me, particularly vis-a-vis Canada.  Canada and the United States have the closest relationship of -- probably of any two countries in history, and certainly the most integrated and important economic relationship of any two countries in history.  And I think anything that, on either side of the border, anybody who questions the importance of that or who works contrary to those interests, I think is not serving the public very well.KRAVIS:  Yes, please.QUESTIONER:  Thank you.  Mr. Prime Minister, I'm -- (name inaudible).  I'm a writer and journalist.  You spoke about bilateral trade agreements and some limited multilateral trade agreement, but what about the WTO and the current attempts to try and revive Doha Round, which would liberalize the world trade regime?  The perception (is), as you know, among third-world countries that the developed countries, this one in particular, are refusing rather adamantly to end the subsidies to the farmers.  How do you feel about that?  Do you feel that the Doha Round can be indeed revived?And related to that question, on the question of immigration, there's also a perception that as -- (inaudible) -- open to free trade and to immigration, Canada may be in a sense a recipient of the kind of immigration that could perhaps jeopardize the security of North America.Thank you.HARPER:  Yeah, well, thanks for both questions.First, on the WTO, Canada wants to see a successful and ambitious outcome to the world trade talks.  I'm -- I guess the word we're supposed to use these days is guarded optimism.  I may be a little bit less than that in my assessment, but Canada is pushing for a successful outcome.  I agree with you, developing countries perceive there's not been enough openness on the agricultural front in developed countries.  Developed countries perceive developing countries have not been willing enough to open up the non-agricultural sectors at the same time.I think probably the truth is that everybody is right, and what I have said to other leaders is that I think the way to get a successful world trade deal is for everybody to aim very high and be very ambitious.  I think if we aim for an incremental, a small incremental trade deal just to say we'll get one, I think what we find is that in all our countries the forces who are the sectors that are damaged by more open trade will be very vocal, and the winners will not be obvious.  I think we should all aim high so that the winners are obvious in every country and so that there is some political support.So I think the solution is to be more ambitious, not less ambitious, on the WTO, but clearly it's struggling.  And fast track authorities expire here, and that's going to be a significant problem.On immigration, first of all, let me just say, in Canada, like the United States, we're an immigrant-receiving country.  You know, I think it's -- immigration is much more of a consensus in Canada.  I think there's agreement, you know, across the mainstream of the political spectrum that immigration has been overwhelmingly positive for Canada historically.  We see some challenges on the economic side in recent years, but socially, culturally.  And Canada has -- not unlike the United States, but I think Canada is particularly proud of the reasonably strong record we have of integrating immigrants into the mainstream, of overcoming the social divisions and ghettoization that you see in a lot of immigrant-receiving countries.  Now, we're not perfect.  We have our problems but Canadians are -- you know, in spite of or, I think, actually because of our commitment to multiculturalism, I think we've been a success in that.  And we take a view in Canada -- yes, we expect immigrants to adapt, and particularly over time, the generations to adapt to the Canadian way of life, become Canadians.  But we also believe that Canadian society changes to some degree to reflect immigrants themselves.  And we believe that's a good thing.  You know, we have -- there was, I'm sure, in this country, widely reported -- we had some arrests of, you know, terrorist suspects last year in Toronto.  That investigation was assisted by large numbers of people in the immigrant communities themselves.  You know, we have a good commitment to the Canadian way of life and to our values.  And I believe overwhelmingly that when people come to Canada, or for that matter to the United States, they come because they want to belong.  That's why they come.  And we should welcome them and celebrate that. I do want to respond a little bit more detail, if you don't mind me asking.  Because there has been and continues to be suggestions that the relatively generous nature of Canada's immigration, or more particularly its refugee system, constitutes a security threat, either to Canada or to the continent.  I would agree, we have a very liberal refugee system compared to most countries.  That said, it's a big leap to go from, it's a liberal immigration system, to, it's a security threat.  We have security screening procedures.  We do deport people.  We deported 12,000 people last year.  We identify security threats, in most cases, long before they ever arrive at our shores, and deal with them there.  As I say, we do deport.  We do incarcerate people.  We do monitor people and we work closely with all agencies in the United States in terms of these responsibilities.  They're shared responsibilities towards our continent.  So you know, we do bristle when I hear these suggestions.  There was a report recently.  It was -- it talked about a terror suspect that was arrested at the Canadian border some years ago for travel in the United States.  First of all, this was not a refugee.  This was an immigrant.  But in any case, that arrest took place through the cooperative action of Canadian and American authorities.  So we take our responsibilities very seriously.  The United States has no more secure border -- no more secure border -- than its northern border.  And I don't just mean its southern border; I mean its eastern and its western border as well.  The most secure border of the United States is its northern border by far, and we take that responsibility seriously.  KRAVIS:  Thank you.  I know there are many hands that have gone up, so I'm going to ask everyone to limit themselves to one question, please. Over here, ma'am.  QUESTIONER:  (Audio break.)  Paula DiPerna, Chicago Climate Exchange.  You alluded to a change in overseas development assistance and a tweaking of that.  I wonder if you could elaborate and whether your views about conditionality, and particularly whether you intend to introduce a higher degree of environmental screening or conditionality of any kind.  HARPER:  The short answer is no, I can't answer that.  We intend to have a policy announcement on that in the upcoming weeks.  We have done, over the past several months, a thorough review of our foreign aid, concluded that it's not nearly as effective as it could be.  And we will be announcing a number of measures to make it more effective in terms of promoting a range of Canadian interests and values.  QUESTIONER:  Thank you, Marie-Josee.  My name is Peter Goldmark.  I work for Environmental Defense.  On the subject of climate, Prime Minister, you were very clear this afternoon on your support for binding limits.  That would place you, on the eve of the emitters conference, on a different course from President Bush, who has resisted binding limits, and seem to put you more in the camp of the Europeans, who are supporting binding limits, and many of whom view the major emitters conference as the last chance for the Bush administration to show some seriousness on this subject.  Can you talk to us a little bit about what role you plan to play starting Thursday at this conference and what courses you plan to advocate there?HARPER:  Well, I --QUESTIONER:  You want two minutes in French -- (laughter) --HARPER:  It's up to you.KRAVIS:  I think this is fine.HARPER:  You know, very quickly, we -- as I mentioned, we had a high-level meeting yesterday through the Office of the Secretary-General.  We had a dinnertime discussion last night with a smaller group of leaders.  And as you know, there are a whole series of other processes ongoing.  I think we're -- you know, I think it's a step-by-step process.  I don't think we're necessarily going to head an agreement very quickly.But, you know, I do think Canada has somewhat of a middle-ground position on this, and I described it this way.  You know, we share with the United States -- and the United States's president, I should say, assured everybody last night that his process is intended to supplement, to complement the U.N. process, not to detract from it -- that's what he told all the leaders.On the issue of targets, the United States has signed on to statements at the G-8 and at APEC that would seem to imply targets, although admittedly they sound like self-described targets as opposed to being part of a binding international regime, and that's where we differ.  We do believe that technological change is what's going to solve this problem, but that technological change isn't going to happen in earnest until signals are sent pretty clear to the market that it must happen and it must happen on some kind of a realistic timeline.You know, on the one hand, there are some countries that are pushing for a framework that looks like the current framework.  I think the deficiencies of that are obvious.  If you go for hard pacts as the only kind of target, by definition, the only kinds of countries that will sign on are countries that have no population growth and fairly limited economic growth.  That's what happened with Kyoto.  And then you end up exempting the developed world, and, quite frankly, for countries like Canada and I think the United States and Australia and a number of others, that kind of a framework creates real difficulty.  Then the upshot is you have what you have with the Kyoto Accord, which is basically now two-thirds of world emissions outside the regime.So I think that we do need binding international targets.  I think it's a global problem.  I actually don't think we're going to get there just through a series of national targets.  I think there has to be an international framework, but those targets have to be described and established in a way that recognize not just poor countries but different economic circumstances, and so that they can apply to a range of economic conditions.I happen to believe strongly that you'll -- if one takes this seriously, you'll conclude that you need targets based on intensity of emission for economic unit of economic output.  That's the kind of targets, I think, will -- the only kind of target, I think, will work globally.  But certainly not all other countries share that view, and some -- at the dinner last night, I would still say there's a wide range of disagreement on where we need to go.  But we are certainly trying to pull people towards, you know, targets, yes, but flexible targets that accommodate different circumstances.KRAVIS:  But you've also announced that Canada has joined the Asia-Pacific Initiative.HARPER:  Yeah.KRAVIS:  And what -- in that vein, what --HARPER:  Well, we had asked -- we had expressed interest in that some time ago.  It's a, as you know, an organization designed primarily to promote the development and spread of technology to deal with climate change.  It's not an organization that -- you know, that is advocating targets or advocating some particular overall framework.In fairness, it was reported in Canada yesterday, for instance -- there was an anti-Kyoto group -- it's not really true, because Japan is a member and Japan is a signatory and a reasonably successful signatory of the Kyoto Protocol, so it's -- it is a group, though, that, as I say, is doing important work, and more importantly, represents one-half of global emission, over one-half.  And my strong view is if you don't get leadership from the United States and the developed world and from China in the developing world, we will not get an effective protocol.On the other hand, if we do have leadership and participation from those two countries, I believe that everyone else will follow.  So we want to be in various forums where we can work to make that a possible outcome.KRAVIS:  Thanks.QUESTIONER:  Well, thank you.  I'm Allen Hyman, Columbia University Medical Center.  For many decades, the Antarctic continent has been recognized as international territory open to nations all over the world for exploration and for scientific study.  Very recently, the Russians have sunk their flag at the bottom of the Arctic Ocean near the North Pole.  What do you think the message from Putin was, and do you recognize the Arctic Ocean to be analogous to the Antarctic continent?HARPER:  I'll comment on the latter.  No, obviously we don't recognize an exact parallel to the Antarctic continent, where, as you know, all territories south of 60 degrees is essentially international territory, and much of Canada's land mass lies above 60 degrees north, so that would not be a position.  Now, there is an international convention on which Russia and other countries are working to delineate basically the continental shelf and the relevant economic and other claims that may proceed from that.  I think my former foreign minister was pretty clear about Canada's displeasure with the Russian stunt -- I think that would be the best way to put it.  (Laughter).  President Putin assured me that he meant no offense, nor any -- (laughter) -- nor any intention to violate any international understanding or any Canadian sovereignty in any way, and needless to say, I always listen carefully when Mr. Putin speaks.  (Laughter).KRAVIS:  Please.  Yes?QUESTIONER:  I'm Ted Sargent (sp) from Paul Ice (ph), Mr. Prime Minister.  Thank you for your initial remarks outlining the long history of shared values and beliefs between our two countries.  We are -- we've been told since 9/11 that we are hated for our values and beliefs by Islamists and -- (inaudible word) -- and others who mean harm to the United States.  Canada is not hated.  How do you explain this?  (Laughter).HARPER:  Well -- (laughter) -- I'm trying to think of how to answer that one.  (Laughter.)MS. KRAVIZ:  We have a different way of expressing -- HARPER:  I'm not sure, first of all --MS. KRAVIZ:  You can answer -- (inaudible).HARPER:  Yeah, sure.  (Laughter).  I'm not sure, in all fairness, that the United States is hated.  It's certainly hated in some circles, the United States as a nation.  I suspect in the circles where the United States as a nation is genuinely hated, and you mentioned a couple of them, I suspect Canada is equally hated, as are all countries that stand for those values.  The American administration, to be frank, is more widely unpopular than the United States itself, but that's ultimately an issue for American domestic politics.  I've always taken the view that the Canadian prime minister and the Canadian government have a responsibility -- Canadian prime minister has a responsibility to establish a good working relationship with the president of the United States regardless of political party or regardless of political discourse in either country, and we do our best to work productively with the American administration.  Canada is perceived differently.  I think Canada is different, but Canada is also perceived differently internationally.  You know, Canada has no history anywhere in the world of conquest or domination.  It's probably hard to perceive of Canada being in that kind of a position.  Canada is also perceived, you know, as a -- maybe a less pure model of values of the United States, but a more complex one.  We are a bicultural country, which I think gives Canadian political leaders and its foreign policy people a more inherent understanding of the importance of cultural difference in a pluralistic world.  We have different social systems, we have different government structures, some of which resonate much better in other parts of the world than the equivalent American model.  And in that sense, I think Canada's both a positive and a non-threatening force, and what my government is trying to do is make sure we can use those values to promote positive change in concert with our allies.  What I don't want to do is what Canadian governments have sometimes done in the past, which is to stand on the sidelines bragging about our differences, lecturing and not really accomplishing anything.  We want to take a different tack.  We want to take a different tack.QUESTIONER:  Mr. Prime Minister, I understand that one of the things that is galling to Canadians about the United States is that while the U.S. looms very large to Canadians, Americans are largely oblivious of our northern neighbor.HARPER:  Right.QUESTIONER:  But one of the things that brings Canada to my awareness is communications that I receive from animal rights organizations.  And they report on the continued policies that permit the clubbing of baby seals in Canada.  At a time when there's a commodity boom that is bringing the Canadian dollar into parity and even perhaps to an appreciation relative to the U.S. currently, can't the Canadian government find more humane employment opportunities for those citizens who are engaged in this field clubbing?HARPER:  Sure.  Well, first of all, that is a falsehood, but it continues to be spread.  The -- in Canada the practice of clubbing and, frankly, the culling of baby seals has been outlawed for 20 years.  Yet some organizations continue to say that, continue to use stock footage from decades ago, to fundraise.  We have a small sealing industry.  It's dedicated today to humane and regulated practices.  The seal population is exploding in Canada and it's not an endangered species by any means.  And in fact, we've invited the European Union, who has been most vocal on this, to send representatives and to do a(n) on-the-ground inspection of the industry.  They can see for themselves what we're doing.I guess the position of Canadian governments historically, and it's our position as well, is that this is a small industry of animal husbandry, there is no reason to discriminate against it any more than any other industry of animal husbandry, and that we will not be bullied or blackmailed into forcing people out of that industry, who depend on the livelihood, based on things that are simply on stories and on allegations that are simply not true.KRAVIS:  Thank you.In the back.  And I'm just going to -- as you're getting the microphone -- I'm surprised no one's raised the issue of water with you.HARPER:  Oh, yeah.KRAVIS:  Maybe we can come to that after this question.  (Laughter.)QUESTIONER:   Unfortunately, not my question.  My name is Kate Kroeger.  I'm with the American Jewish World Service.  And my question for you, Prime Minister, is a broad one.  Do you think that in Canada you're entering the era of minority government?  And if so, what do you think the implications are for Canada projecting and executing a coherent foreign policy?HARPER:  Well, Canada now has had two minority governments in a row.  If the various conservative parties had been united over the past 14 years, which they weren't until recently, we would have had minority government over that entire period as well.  So I think with the current political alignment -- I'm probably not supposed to say this, my election strategist won't like it -- but with the current political alignment, I think the possibility of minority government at any election, including one in the near future, would loom very high.Does it affect Canada's foreign policy?  You know, in terms of the day-to-day setting of priorities and taking of positions on the world stage, not very directly, because quite frankly, this is largely under executive authority.  I may be criticized in Parliament for it, but in most cases, if I can make my case to the Canadian people, I can pursue, you know, an aggressive or well-defined foreign policy.  And I don't think our government, on anything from the Middle East to -- you know, to Afghanistan to climate change, has had any hesitation in taking well-defined stands and stands that are sometimes highly criticized in Parliament itself.  At the same time, I believe, and we're committed as a government to ensuring that when we actually deploy Canadian resources, Canadian troops around the world, that that is supported by Parliament.  And so, you know, we have a big challenge, obviously, with the deployment in Afghanistan.  It's -- we've had a lot of casualties.  And unfortunately, those who committed us originally to the engagement now see political points in being against it.  That said, I guess I believe what a former Canadian leader told me.  I believe that when it comes to foreign affairs and global security, this is one area where you do what is right in the long-term interest of the country, your allies and the world, and that Canadians, whether they agree or disagree with an individual decision, will support a government that it thinks conducts foreign policy in that manner.  If they think a government conducts foreign policy not in that manner, or has a weak or visionless foreign policy, then you're in trouble.  So I will put it this way:  that under a minority government, this government's foreign policy will not change -- will not be any different than it would be under a majority government.  KRAVIS:  Please.  Don't -- just behind you.QUESTIONER:  My name is Richard Erb, and I'm a council member from western Montana, just below Glacier Park and Flathead Lake.  But I'm tempted to ask you a question about the coal project and the coal methane project, but I'm not going to ask that question.  (Laughter.)  What I want to -- HARPER:  I'm not going to answer.  (Laughter.)QUESTIONER:  I'm glad you didn't -- (off mike).HARPER:  Sure.QUESTIONER:  When you look around the world, in many countries with conflicts among ethnic groups, indigenous tribes, religious groups that cause tension and sometimes bloodshed, what lessons from Canada's experience in dealing with these issues do you think would be most relevant to the rest of the world?HARPER:  That's -- it's a really good question, and obviously one of the things that Canadian diplomats try and do is, you know, do try and work with other countries where there is ethnic or tribal conflict to impart lessons from Canada.  Now, you know, one of the biggest lessons from Canada is that these problems aren't solved overnight.  I mean, Canada as a peaceful, prosperous society took a long time to develop, and we had our ups and downs along the way.  You know, I think that there's, first of all, a lesson that comes from all democratic societies, and that is that the process of democratic government is not about final victory.  It is a process.  And it's about not just the legitimacy of this year's election, but the legitimacy of the next one as well, where the same people will air many of the same issues over again and may get a different verdict.  One of the problems in pre-democratic or non-democratic societies is that the political culture of leaders of all factions is aimed at total and complete domination forever.  And you don't just -- you know, you don't just win an election; you then figure out how you're going to wipe out your opposition for good, you know, through any means necessary.  And I'm concerned about this.  I'm concerned that as Western nations, we don't fully understand this.  And you know, I think we often rush into certain types of democratic processes in non-democratic societies where the outcome will not be a free and democratic society.  The outcome will be the majority outvoting the minority or some group, you know, and I've -- if I can speak bluntly, thinking of Hamas and Hezbollah, who see the vote as only one of a number of tools to pursue their political objective, not as a commitment to the democratic process inherently.  So I think, you know, all countries -- all of us as Western countries need to think carefully about how we project and what we understand about our democratic values and how we project those abroad, so that as we promote democracy, we get democracy, not something else.In terms of Canada, you know, I think Canada's unique experience is the reasonable -- it's not problem-free, but the reasonable accommodation of major cultural and linguistic differences in the country.  And you know, I would say it's an extension of what I said earlier, particularly on the part of the majority, you know, to -- I guess that probably we would say in Canada there's no real majority.  Today we're such as a -- you know, a regional and multiethnic, multicultural society.  But to the extent that there's historically a majority, getting the majority to understand that accommodation of the minority and of the minority's needs and of the minority's -- the difficult position of being a minority is critical to the overall health of the body politic in the long term.  It is not simply ever -- it can't ever be simply a matter of the majority, defined in an ethnic sense, imposing its will on a smaller part of the country.  And I think if you look at Canadian history -- and I don't just think English/French, but I think of way back, Catholic/Protestant, or east versus west -- whenever we have had -- and Alan would know this -- whenever we have had an incident where one section of our country, either defined regionally or ethnically or linguistically, has imposed something on the other against its will, we have lived with the consequences of that for decades.  And that must be avoided at all costs.  So there's more to putting together a majority in governing our country than simple math.KRAVIS:  Well, Mr. Prime Minister, thank you very much.  This has been a very, very informative session.  (Applause.)  ####      (C) COPYRIGHT 2007, FEDERAL NEWS SERVICE, INC., 1000 VERMONT AVE.NW; 5TH FLOOR; WASHINGTON, DC - 20005, USA.  ALL RIGHTS RESERVED.  ANY REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION IS EXPRESSLY PROHIBITED.      UNAUTHORIZED REPRODUCTION, REDISTRIBUTION OR RETRANSMISSION CONSTITUTES A MISAPPROPRIATION UNDER APPLICABLE UNFAIR COMPETITION LAW, AND FEDERAL NEWS SERVICE, INC. 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    Event with Stephen Harper and Marie-Josée Kravis September 25, 2007