Kurt Hübner, University of British Columbia
March 17, 2025
Radical times ask for radical ideas. When it comes to Canada’s future, I see three options in play. One is to insist on Canada’s sovereignty and thus to move along on its given political path, but with a substantial change of the underlying growth model. A second option worth considering is Canada applying for EU membership and thus negotiating away substantial elements of its sovereignty in exchange for economic and security benefits. The third is to launch a common market with the US, followed by the introduction of a common currency. This option includes the transfer of political power of both entities to jointly governed new institutions.
Let me briefly discuss those options, starting with the launch of a common market between the US and Canada. Compared to what is in place, and getting violated by the Trump administration daily, a common market is a far superior framework. It includes the free mobility of goods, services, money, capital, and people and thus creates an economic space without artificial internal hurdles. It requires common standards and norms, and thus a North American equivalent of the acquis communautaire of the EU. It also requires the willingness to transfer political power in distinct areas, particularly in foreign trade, to jointly governed new institutions. At a later point in time, a common market may even be completed with the introduction of a common currency run by a new jointly governed central bank. Even writing down these lines makes me giddy. And yet, such an option for North America, with the chance to open up for new partners in the South, would come with excellent economic prospects for its member states and give Canada a prominent level of political and economic freedom.
Is it a better option in terms of political-economic benefits than the option to stay put and to drastically change the current growth regime ? I am not sure. As my former student Marko Papic, today the chief strategist at BCA Research, was cited in the Financial Times: “Canada absolutely has the potential to be a global superpower. […] Global warming could increase agricultural yields, open up large swaths of the country to mineral exploration, and allow for new trade routes through the Arctic”. Canada’s vast amounts of critical resources needed for the technologies of the 21st century and its abundance of things like potash (used to make fertilizer), forests, and freshwater put the country in an advantageous position. Given the internal lack of animal spirits, one could see the future in inviting, in selective ways, foreign companies to make use of those riches, particularly in the Canadian Arctic. I am not a friend of a project that would consist of furthering the resource-economy growth regime of the country – for climate reasons, but also because we know that resource economies tend to foster clientelism and high levels of economic inequality. And yet, radically turning Canada into a resource economy is a political option that comes with promises and opportunities. If one adds a Norwegian component by sharing the economic fruits on a broad scale, such a project may get political traction.
The third option, applying for membership in the EU, has a considerable track record. In 2006, before the onset of the global financial crisis, Timothy Garden Ash made the case in The Guardian. More recently, in January 2025, The Economist argued that such a move would be the best way for Canada to succeed in the face of a potentially violent neighbour. Frédéric Mérand takes up the case in Policy Options, and as a recent poll shows, 46% of Canadians are in line with such an idea. Now, if one would ask those in favour of what the EU is all about and how it works, the number would probably shrink dramatically. Nevertheless, applying for membership is not a bad idea per se. As Frédéric Mérand mentions, Canada would easily pass the Copenhagen Criteria; given the per capita income of Canada, the country would become one of the few net contributors to the EU, something the Commission would welcome, given its budget constraints. I still would say, be careful what you wish for. Unlike Frédéric Mérand, who seems to see the EU as a defender of multilateralism and the home of liberal democracy, I have my doubts whether the centre continues to hold in the vast majority of EU member states. With Macron leaving soon, the Conservative block moving sharply to the right and the Social Democratic and Green block in retreat, one key pillar of the project of European integration is under severe threat. The turn towards harsh anti-migration policies in a constellation of over-ageing and the downplay of previously ambitious climate policies, as well as the turn towards a military-led growth policy, are all changes that come with the potential to dramatically change the character of the EU.
The EU is on its way to throw away what made it attractive and a model for many other countries. Why should Canada join such a project? I fear that the idea is driven by a romantic view of the EU, something that may have been closer to reality ten years ago than it is today. And yet, in times of threats and pressures, we need to carefully discuss all options. Standstill is no option.
コメント