Vice President Kamala Harris speaks during the American Federation of Teachers' 88th national convention, on July 25, in Houston.Tony Gutierrez/The Associated Press
Donald Trump is right about one thing: “Kamala Harris is Joe Biden 2.0.″
Don’t worry: I am not becoming a MAGA-phile. But Mr. Trump, the Republican presidential nominee, is on to something – at least where Ms. Harris’s economic and business record is concerned.
Harris hoopla is in full swing now that Mr. Biden has dropped his re-election bid, and the furore is spreading far beyond the United States. Her mother’s ancestral village in India, for instance, is celebrating the prospect of a “lotus POTUS.” Her first name – Kamala – means lotus in Sanskrit.
Ms. Harris may well be the Democratic Party’s best shot at beating Mr. Trump at the ballot box in November. But Canadians should avoid the temptation of romanticizing a potential Harris presidency.
Sure, Ms. Harris spent some of her formative years in Montreal and may have fond memories of Canada. But she is an American through and through. Nothing about her track record suggests that Canada would regain any special consideration if she wins the White House.
Ms. Harris was part of the same Democratic administration that doubled down on Buy America policies, and that protectionist streak could spell more trade trouble for Canada over the coming years. Her support of contentious Biden policies on energy pipelines and bank mergers, meanwhile, doesn’t exactly bode well for the prospects for two other key Canadian industries.
Let’s start with the trade file. Relations with Canada didn’t exactly improve under the Biden administration.
On the contrary, there is a growing list of bilateral irritants including softwood lumber, dairy and Ottawa’s digital services tax. The Office of the United States Trade Representative is currently assessing potential retaliation against that 3-per-cent tax, which targets U.S. technology companies, Dow Jones Newswires reported this month.
A 2026 review of USMCA, the U.S.-Mexico-Canada agreement, will stoke trade tensions. Expand free trade? Forget it: The best Ottawa can do is minimize further concessions to Washington. It’s unlikely that a Harris administration would cut Canada any slack.
After all, Ms. Harris was one of 10 U.S. senators who voted against USMCA in 2020 when Mr. Trump, as president, introduced it as a replacement for the NAFTA agreement.
“By not addressing climate change, the USMCA fails to meet the crises of this moment,” Ms. Harris stated at the time.
As Vice-President, she also supported Mr. Biden’s protectionist Inflation Reduction Act and his decision to revoke a key permit for the Keystone XL pipeline on the first day of his presidency – moves that caused much consternation north of the border.
Regarding the former, Ottawa initially scrambled to ensure the U.S. legislation’s electric vehicle incentives extended to all North-American-built cars. The Canadian government then spent big on green subsidies of its own, even though it lacked the heft to truly compete.
The Keystone XL decision, meanwhile, forced Calgary-based TC Energy Corp. to pull the plug on the US$9-billion pipeline project, which would have carried more Alberta crude to U.S. refiners, allowing Canada to increase its energy exports.
There are reasons to worry that Ms. Harris’s climate agenda (recall that she was a co-sponsor of the Green New Deal, a 2019 initiative by Senator Edward Markey and Representative Alexandria Ocasio-Cortez) could create more headwinds for Canada’s energy sector if she wins the Oval Office.
A Harris presidency could also spell more headaches for Canadian banks. President Biden’s administration-wide approach to anti-trust is dialling up the scrutiny of bank mergers. It is worth considering whether this could curb expansion prospects for big Canadian banks in their main growth market.
I’ve previously argued that fears Canadian banks would face increased deal risk were overblown. But that was before U.S. regulators effectively killed Toronto-Dominion Bank’s US$13.4-billion acquisition of First Horizon Corp. by withholding approvals.
We’ve since learned that particular deal died because of TD’s money-laundering woes. But it is also apparent that U.S. regulators are thinking laterally about prudential risks in the wake of last year’s regional banking crisis.
“Merger applications that would diminish competition, hurt communities, or present systemic risks should be withdrawn or rejected,” said Michael Hsu, acting comptroller of the currency, this past March. His office is the primary regulator for national banks.
As for Ms. Harris, she has a history of showing the banking industry who’s boss. When she was California’s attorney-general, she took aim at predatory lending practices and launched a criminal probe of Wells Fargo’s fake accounts scandal. Then, as senator, she sponsored the Accountability for Wall Street Executives Act.
More recently, as Vice-President, she has backed financial consumer protection measures, tougher capital rules and opposed industry deregulation – worthwhile measures that nonetheless drive up costs for banks.
Don’t get me wrong: Ms. Harris is the least harmful option for Canada. Mr. Trump’s proposal to slap a 10-per-cent tariff on all imported goods, no matter the country of origin, is a scary prospect for our exporters.
But let’s be clear-eyed about Ms. Harris. Much like Mr. Trump, she won’t hesitate to stick it to Canada, too.