Octavian Report: What’s your take on NATO’s durability and the big strategic challenges facing it?
John Baird: I think NATO was in danger, after the Cold War, of becoming obsolete. Certainly, 9/11 had an impact, but I think the growing Russian aggression in Crimea, eastern Ukraine, in Moldova and Georgia, and their tough talk in the Baltic, is making NATO more relevant.
I think Trump’s — and a large segment of the American people’s — problems with globalization have an impact on their perception of NATO, particularly the notion of free riders: NATO members not spending their share. It’s a legitimate concern. Trump has, perhaps, been undiplomatic and inelegant. But I think there’s a larger issue there.
OR: How have the issues that raised their heads on this front during your time as foreign minister continued to play out?
Baird: In two ways. NATO’s most effective when it serves as a deterrent. I was troubled when Russia — a nuclear power — annexed Crimea and invaded eastern Ukraine. Obviously, Ukraine is not a NATO country, or even a NATO candidate country. What really concerned me was that had Latvia or Estonia been invaded, I couldn’t say definitively what the NATO response would be.
Of course, it should be crystal clear. With any invasion of a NATO country, Article V would be invoked immediately, and there would be a military consequence. If I couldn’t be sure that that would happen, I’m sure the Russians — or any other adversary — wouldn’t be sure either. That’s a problem.
OR: How best should the organization increase its strategic communication, apart from military or policy planning?
Baird: I think it’s beyond strategic communication. When I was a cabinet minister, if I were under criminal investigation I know for a fact I’d have to resign. It’s black and white, it’s crystal clear. That would be the consequence. I’m not sure what the discussion would be around the NATO table if Latvia’s borders had been breached by a hostile party. I know what I would be saying: that this attack on one is an attack on all, and there would have to be a clear military response. The fact that I wasn’t certain that the others around the table would feel the same way I find disturbing.
OR: What do you attribute that lack of certainty to?
Baird: Under President Obama, I think there was a sense among many countries that he wasn’t a loyal friend and ally that could be counted on.
Then there was the weariness of war among the American public, not just because of Iraq and Syria, but because of the campaign against ISIS. I think a lot of Americans are becoming more inward-looking and are just weary of battle and war.
OR: Do you think that the vision of the U.S. as the crucial leadership player in NATO is accurate?
Baird: Absolutely. In NATO the U.S. is the leader, period. There’s an old saying, but it’s incredibly true. If there is no U.S. leadership there is no leadership.
Even when President Obama said they were leading from behind in Libya, there was American leadership. That’s a good example where countries like the United Kingdom, France, and Canada, stepped up to the plate with some Arab colleagues and did the heavy lifting and did not count on the United States to do it all. I thought that was a good day. But I’m not sure. Like I said, during my time as foreign minister, if the border in Estonia has been breached by five or 10 kilometers, what would be the response? I think there would be a lot of debate and a lot of hesitance about a military response. I think the adversaries to freedom should fear the response. I’m not sure they do.
I’m hardcore. I would want a response. I believe in NATO, I believe in Article V. That is the whole reason it exists, and we can’t have any namby-pamby diplomatic sanctions efforts on something that grave.
OR: Why do you think Russia is enjoying this newfound geopolitical strength and importance?
Baird: Putin is a forward-leaning leader. I’m not saying that as a compliment, but he is a strong leader who wants to make the Russian Federation relevant again. He’s been very clear in saying that the dissolution of the Soviet Union was a catastrophe of great consequence. I think he wants respect, and I think the regime change in Libya deeply offended Russian sensibilities. Look at their vote in the Security Council. There’s been a real consequence to that in the day-to-day conduct of foreign policy. They want to be relevant. There were the allegations of interference in the American election. There is the Catalonia issue in Spain. There’s been some suggestions about the Brexit referendum. They want to be relevant again in a way that perhaps they weren’t after the fall of the USSR.
George H. W. Bush’s leadership — bringing them into the G8, et cetera — was good as an initial step, but there really wasn’t enough tending to that relationship.
OR: Do you see Trump as able to counter this?
Baird: I suspect the trajectory has not changed. The trajectory was going a certain way under Obama, and I think it certainly is continuing under Trump.
OR: What’s your take on the standoff around NAFTA?
Baird: I think this is one of the few core things that Donald Trump cares about, and I think there’s a growing concern about globalization in many parts of the United States where people think it hasn’t worked for them, or believe that it hasn’t worked for them, and this is on the Left and the Right. I think Bernie Sanders spoke to it on the Left on isssues like economic inequality, and Trump to the Right on things like national security and the changing face of America. They look at the trade deficits with countries like Mexico or China, and the whole architecture of trade internationally just doesn’t work for Trump and his people. I’m not just talking about the mass public. Look at his people, whether it’s Peter Navarro, Robert Lighthizer, or Wilbur Ross. They don’t believe the whole trade architecture works for the United States and the American people.
Obviously, for the United States, given its size, leadership, and economic power, it will always be better to go bilaterally than to go multilaterally. For Canada, we don’t have a huge debate. The United States has a $42 billion trade deficit on goods. And we have a $44 billion trade deficit on services. With Mexico, it’s $56 billion and with China it’s over $300 billion, and his sole goal is to reduce those deficits.
When it comes to Mexico, obviously there are lower regulatory barriers there, lower wages there, and if people want to buy a good or product it can be made cheaper in Mexico than it can in the United States where labor laws are stricter and wage rates and regulatory standards are higher.
I think in the current discussions, of the five big issues that the United States is pushing three are complete non-starters for Canada or Mexico. The difference is, in Canada there’s growing support for NAFTA. The official opposition has, by and large, been backing the government and the re-negotiations. I think the Canadian government has handled it about as effectively as they could.
I think the real challenge is in Mexico. Trump is toxic in Mexico, whether it’s because of the wall, immigration, or trade. I don’t think Peña Nieto is capable of giving any ground in these negotiations, particularly so close to the presidential election, where his party remains quite competitive. Lopez Obrador nipping on the heels of the PRI makes it a lot tougher.
OR: What’s your take on TPP and the U.S. withdrawal?
Baird: What we shouldn’t forget is both the Republican and Democratic candidates were not supportive of TTP. I know Hilary Clinton, I like her, I admire her. She made a pretty clear commitment. I think she would’ve honored it, so I think the TPP was going be walked out of regardless.
I think it’s a bit ridiculous. The U.S. led the development of the TPP. We joined because of that leadership in order to pursue it. They’re a sovereign country, it’s their sovereign right. Obviously there was a real concern about it with a large part of the American electorate, but they could hardly have some sort of a veto from Canada wanting to participate. For us, it’s free trade with Japan, the world’s third-largest economy. Free trade with a growing powerhouse, Vietnam. But also it would be to begin a free trade deal with Mexico if article 2205 of NAFTA were to be invoked with a six-month notice. It would at least give us a back door into the Mexican market.
OR: In general, is there a stronger consensus about free trade in Canada than in the U.S.?
Baird: Absolutely. In 1988, we had a general election, and the entire election was a referendum on the Canada-U.S. trade agreement. So we had a big national debate about this in the late 1980’s under Brian Mulroney. Canadians see globalization positively; they see trade as crucial to our future economic prosperity.
The United States never really had any debate about the Canada-U.S. free trade deal. They had a little bit of one on NAFTA, but I think the United States has two problems. One, no one’s out defending free trade. Two, they haven’t had some labor transitional measures. A lot of this is automation and technological innovation. I understand Nike is building a shoe plant in the United States right now, one of their largest shoe plants in the world — and it’s only going to hire around 120 people because you just don’t take many people with automation.
I’m on the board of the second-largest lumber company in the world, Canfor. We have mills all over the United States and Canada. These mills, 50 or 60 years ago, would’ve employed 700 to 1000 people. Today they employ 150. And it’s because everything’s automated.
OR: Canada and a number of our other close allies joined the Asian Infrastructure Investment bank over U.S. objections. Do you see Canada and Australia, and some of our other core allies, moving more towards China in the face of U.S. pullback in the Pacific?
Baird: Well, President Obama led the effort in the West to stop countries from joining the Development Bank. The United Kingdom, one of America’s two closest friends, under David Cameron joined anyway. Australia joined anyway. President Obama, I’m told, personally reached out to try to stop them. I think, increasingly, people are going their own way.
OR: Do you think that’s part and parcel of a more general American retreat?
Baird: It was President Obama, like a loyal friend and ally. In Canada, we had the Keystone XL Pipeline. We couldn’t get an answer on it for seven years of Obama’s presidency. You don’t treat friends like that. We understood that he had to get over his 2012 re-election bid, and they had to use him to raise money for the 2014 midterm, and then for his presidential library. In Canada, we knew that. Still, what do you expect?
OR: What is your take on the question of Israel and its friends and enemies in the West?
Baird: Well, that’s one issue where I give the President huge kudos, not just for his support for Israel but for his returning to the traditional American policy of being close to the Sunni Arab world, in and outside of the Gulf. So I think, if anything, American leadership in the Middle East is demonstrably stronger than it was one year ago — and demonstrably more positive.
People are astounded when I tell them that whether it’s Israel or Egypt or Saudi Arabia or the United Arab Emirates — indeed, throughout the entire Middle East — there’s just a much greater appreciation of the direction of the American administration.
OR: How big of a threat do you see the de-legitimization campaign and BDS?
Baird: It’s a huge problem with the Left in western countries. It’s a huge problem in large swathes of Europe where you see the re-emergence of anti-Semitism. Instead of demonizing the individual Jew, they’re demonizing the collective Jew. Popular opinion, whether it’s in France or the Netherlands — two close allies of Canada — is deeply disturbing. I think we’ve got to take BDS incredibly seriously. In the 1950’s and 60’s, the problem might’ve been on the Right, but I think the problem now is on the Left: the politically correct crowd, university campuses, even (briefly) in some trade unions. Bernie Sanders got 40 percent of those votes, and he was somewhat hostile to Israel.
OR: What is the current temperature of that in Canada? What’s the current view of the War on Terror?
Baird: I think, politically, Israel enjoys broad support among the Conservative party and large segments of the Liberal party. Obviously, the Left is not as supportive, and that’s a problem. We do see political correctness and anti-Israel sentiment popping up here and there. It is a concern. With respect to the War on Terror, I think there’s huge fatigue on it, and people have got to recognize that. My grandfather fought in the Second World War, and then stayed in the Canadian armed forces for 25 years. The great struggles of his generation were fascism and then communism. Now, fascism was defeated in six years but communism took a generation. The fight against terrorism has been the great struggle of our generation. It’s not going to be ended on a single battlefield. It’s going to be a constant struggle.