“Half Measures on the Half Shell”: Are import duties on oysters a solution to Cross-Border Internet

In March of this year, the Canadian Government announced that it would finally retaliate against American tariffs on softwood lumber. Canada has since applied import duties on American live swine, frozen talapia, ornamental fish, and oysters. These levies are expected to generate Canadian Customs revenues in the range of $14 million, in compensation for the roughly $3.6 billion which the American have illegally docked from Canadian lumber exporters since 1986.

Who says we Canadians can’t be tough? I imagine those duties on oysters really have the Americans quaking in their boots!

Now, our southern neighbours are planning to pass legislation to authorise the bulk importation of Canadian drugs into the USA. It seems that from an American perspective, cheap Canadian lumber is a thoroughly bad thing but cheap Canadian drugs are good (our drugs are cheaper because we control prices and our provinces buy drugs in bulk). Apparently too, the American FDA is no longer publicly wringing its bureaucratic hands over worries about the “safety” of Canadian medications.

Once the new American legislation is in place, Americans will be in a position to make a commercial “clear cut” through the Canadian drug supply, providing mass US outlets like Wal-Mart and Walgreen with our medications. Canadians, in turn, will almost certainly face supply shortages and, inevitably, drug price increases. Bulk purchases of Canadian drugs will exacerbate problems we have already faced with the exporting activities of Internet pharmacies. Jeff Poston, Executive Director of the Canadian Pharmacists Association, warns that: “We will pay the price by seeing an erosion of our own health-care system, which is designed to look after 32.5 million Canadians, not millions of uninsured or under-insured Americans who cannot afford the price of US drugs.”

Health Minister Ujjal Dosanjh is said to be “contemplating” a ban on bulk drug exports to the USA. However, he apparently has no immediate plans to limit Internet pharmacies supplying individual Americans with Canadian drugs.

Let’s hope Minister Dosanjh and the Federal government plan to respond to the drug export problem with a whole lot more courage and vigour than they have displayed to-date on the beef and lumber files.

But don’t count on it ---unless consumers and concerned citizens get involved in pressing for solutions and registering their concerns with persistence and tenacity, Ottawa will likely keep playing around with more policy “oysters”.

I suggest that the time has come for Canada to impose export taxes on all Canadian pharmaceutical drugs destined for the American market. Such taxes would be designed to bring our drugs up to US domestic prices for both individual and bulk orders and would be explicitly linked to the redress of injury arising from egregious US protectionist measures applied to our beef and lumber products.

Why do this, rather than simply banning bulk exports? First, an export tax would address both individual drug exports flowing through Internet pharmacies, as well as the admittedly larger potential problem of bulk sales. Additionally, it will hit many US states that have expressly pushed for protectionist measures against our lumber and beef exports while pressing for opportunities to siphon off Canadian drugs. But, of overriding importance, Canadian action taken to link our drug exports to other vital Canadian trade issues like lumber and beef, is an essential consciousness raising exercise for our southern neighbours. The US governing and commercial classes need to learn that we are not going to be an unquestioning (and spineless) provider of commodities that Americans covet while Americans, in turn, remain free to dispense with any legal obligations they have assumed (but subsequently find awkward to observe) for open trade under NAFTA and WTO rules. **

Canada is at a crossroads in its NAFTA / trade relationship with the USA. We are either going to move forward on trade (and other related issues) on a platform of established law and mutual respect, or enter into a protracted period of conflict ---to the severe detriment of the world’s largest trading relationship.

And on the Canadian side, let’s have no more of these “half measures of the half-shell variety”. Write your MP and insist on the imposition of a retaliatory Canadian export tax on Canadian pharmaceuticals destined to the USA.

• The sole comments pertaining to Canada that could be found and clearly attributed to newly appointed US Ambassador to Canada, David Wilkins, were in support of US tariffs on softwood lumber.