U.S midterms: Baltimore wants a manufacturing comeback. Can Canada fit into those plans?

Click to play video: 'America’s hopes and fears: taking the pulse of voters on eve of U.S. midterms'
America’s hopes and fears: taking the pulse of voters on eve of U.S. midterms
The state of America is weighly heavily on the minds of voters before the midterm elections. Dawna Friesen is in Washington, D.C. to speak with some voters about their hopes and fears for their country – Nov 7, 2022

The Baltimore Museum of Industry’s “most ambitious” exhibit in recent years documents the history of Sparrows Point steel mill, once the world’s largest steel producer.

Over the 125 years the Bethlehem Steel mill was in operation, it produced material for America’s warships, the Golden Gate Bridge and parts of the Empire State Building. It shuttered for good in 2012, roughly a decade after Bethlehem went bankrupt.

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Baltimore, and Maryland more broadly, can see a future when that kind of heavy industry and manufacturing operation isn’t a museum piece – but the driver of the state’s economy.

In August, outgoing Gov. Larry Hogan – a Republican who enjoyed a recent approval rating of 62 per cent in a thoroughly blue state – credited Maryland’s manufacturing sector as driving an “economic turnaround.” The state is making investments in what they call “Industry 4.0,” a fourth industrial revolution, led by advanced manufacturing and a highly educated workforce.

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President Joe Biden recently echoed the sentiment. At a Volvo plant in nearby Hagerstown last month, which recently began producing components for electric vehicles, Biden wondered where it was “written that America can’t be the leader in manufacturing.”

Click to play video: 'U.S. midterms: Biden, Obama and Trump make final push in Pennsylvania'
U.S. midterms: Biden, Obama and Trump make final push in Pennsylvania

It’s a question resonating in Ottawa, where the Liberal government has latched onto U.S. notions of “friendshoring” – increasing trade with like-minded democratic countries, while ratcheting back dealings with authoritarian and belligerent nations – and the Biden administration’s push for domestic supply of advanced technology like semiconductors.

The era of friendshoring?

“We are entering an era of friendshoring,” Deputy Prime Minister Chrystia Freeland said while introducing the government’s fall economic update last week.

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Freeland holds that “democratic partners and their most important companies” are looking to shelter themselves from the whims of undemocratic and unpredictable trading partners – read: China, Russia – and boost economic relations with more like-minded countries.

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Freeland went on to mention a specific way Canada could contribute to a newer, “friendlier” kind of international trade.

“We have the natural resources to power the global net-zero transition and to support our allies with their energy security as that transition continues to pick up speed,” she said.

Just days ahead of Freeland’s economic update, Industry Minister Philippe-Francois Champagne ordered three Chinese companies to sell their interests in Canadian critical mineral firms. Critical minerals like lithium, nickel and cobalt are crucial components of products like batteries for electric vehicles and high-tech consumer goods.

While Champagne based his order on a national security review, the decision – along with Freeland’s newfound focus on friendshoring, a term promoted by U.S. Treasury Secretary Janet Yellen – dovetails neatly with the Biden administration’s economic aspirations.

Maryscott Greenwood, the CEO of the Canadian-American Business Council, described the U.S. push to source more critical minerals from democratic countries as a significant opportunity for Canada.

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Click to play video: 'Canada can contribute global minerals, metals, energy in place of Russia, China: Freeland'
Canada can contribute global minerals, metals, energy in place of Russia, China: Freeland

“I think it’s giant. The U.S. can’t do everything by itself, and countries like Australia come to the U.S. to say, ‘Come to us for your critical minerals,’” Greenwood said in a recent interview with Global News.

But while both Australia and Canada have deposits of those minerals, Canada doesn’t have the Pacific Ocean between those minerals and the world’s largest economy.

“Canada’s proximity combined with various modern regulatory regimes means that Canada should be a partner of choice for any kind of resource development, manufacturing, et cetera,” Greenwood added.

Read more: Election deniers, officials gearing for fight over U.S. midterms

Tuesday’s midterm elections in Maryland lack the level of drama being played out in swing states like Pennsylvania, Arizona or Michigan.

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The Democratic nominee to replace Hogan, Wes Moore, enjoys a comfortable lead in the governor’s race over Republican Dan Cox – who has the backing of former president Donald Trump, but seemingly not many Marylanders.

Hogan, a centrist Republican, has referred to Cox – who denies the results of the 2020 presidential election – as a “QAnon whack job” and said his party had little chance of holding the governor’s mansion after Tuesday.

But Greenwood said that, regardless of the results following Tuesday’s vote, Canada needs to pay close attention to the new makeup of Congress – especially which new or returning players end up with plum and powerful committee chairs.

Those new committees – which, unlike in Canada, exert a significant amount of power in the U.S. system – also may not carry the baggage of the at-times difficult negotiations for the new NAFTA deal hammered out during the Trump years, Greenwood added.

“Regardless of the outcome, it’s important for Canada to understand who has the gavels of power,” Greenwood said.

Is gridlock good for Canada?

There’s a line of thinking that holds that the Republicans taking control of both the House and Senate, while a Democratic president is in power, is actually good for Canada.

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The argument goes that an administration with its hands tied by an opposition-controlled Congress means things will largely remain status quo, which in turn means some stability for partners like Canada that depend on things remaining stable.

What that argument arguably overlooks is the fundamental political issues facing America in 2022 that, if left unaddressed, could render “stable” and “status quo” as much of a historical relic as the Sparrows Point mill.

Teams within Global Affairs Canada, within the Canadian embassy in Washington, and within the government’s political staff are watching these midterm elections closely – but at a macro level, focused on implications for Ottawa and the rest of Canada.

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“We’re definitely watching closely and we’ll be paying close attention to what Tuesday brings,” said a senior government official, who was not authorized to speak publicly on behalf of the government.

“But we have a strong track record of working closely with whoever the United States elects, whether it’s in the White House, the Senate or the House governor’s races.… Although there are some threats and some challenges, the Line 5 (pipeline in Michigan) being one example, we will continue to work in Canada’s interests and work with our partners the best way we can.”


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