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Verheul’s trade secrets

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Apr 25, 2023 View in browser
 
Ottawa Playbook

By Nick Taylor-Vaisey, Maura Forrest and Zi-Ann Lum

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Thanks for reading Ottawa Playbook. I'm your host, Nick Taylor-Vaisey, with Maura Forrest and Zi-Ann Lum. Today, we have an interview with the bureaucrat who saved NAFTA. Plus, a check-in on PIERRE POILIEVRE's relationship with the premiers. Also, the bets keep coming on when the public service strike will come to an end.

DRIVING THE DAY

Trade negotiator Steve Verheul stands in the centre of Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland.

Trade negotiator Steve Verheul, in the centre of Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland, on Oct. 1, 2018. | Sean Kilpatrick, The Canadian Press

FREE TRADESMAN — Remember STEVE VERHEUL?

The Toronto Star once called him the most important Canadian their readers had never heard of. He served as his country's top agriculture negotiator at ill-fated World Trade Organization talks at the turn of the millennium.

He led years-long negotiations on a Canada-Europe trade deal.

And then there was NAFTA. Verheul capped his career with a star turn as chief negotiator during fractious renegotiations to save free trade from DONALD TRUMP.

Spoiler alert: He struck a new deal.

— Second act: The veteran bureaucrat's 33-year run in government ended last year. He eventually resurfaced as principal at GT and Company, a strategic advisory firm founded by longtime politicos DON GUY and BRIAN TOPP.

Verheul recently took on a new title: fellow at the Public Policy Forum. He's onstage Thursday at the PPF's Canada Growth Summit, where he'll join SEAN SPEER in a fireside chat about trade policy in an era of geopolitical change.

Verheul hasn't granted many interviews to reporters. Your host can attest to the reticence, having tried repeatedly — and unsuccessfully — over the years to secure a conversation.

But he sat down for an interview with Playbook this month. Verheul talked about where climate change fits into trade policy, why he never said no to a meeting request from a lobbyist, and which NAFTA renegotiation memory sticks out above the rest.

That and much, much more. Read the extended transcript here, and watch for five key takeaways from the interview later today.

— Climate at the table: In a long run of negotiations, Verheul said his job eventually included ensuring that "trade policy didn't prevent environmental actions from being pursued" by governments.

But he was never tasked with solving the next problem: "If a government is taking actions for environmental reasons, in many cases, it's making itself less competitive than some of the other countries it's trading with, who may not be doing those kinds of things."

Today's dominant question: "How do you maintain a proper competitive relationship between countries if one is doing a lot more on the environment than another one is?"

— Never say 'no': Ask any stakeholder who joined a trade delegation. Few will have a negative word to say about Verheul. Most marvel at the amount of space on his calendar. Some of them were even represented by another country.

"When we did the new NAFTA negotiations, I would often get requests from U.S. stakeholders to brief them, because the U.S. officials were not briefing," he told Playbook. "I gave them briefings regularly. I didn't think that would do any harm. I thought it could help our own position to explain it."

That feels like a bit of a gift, Playbook observed. "Yeah. And I was happy to take it."

— War stories: Verheul relayed a few, including a stare-down in early New NAFTA talks.

The Canadians wanted to negotiate a dispute resolution mechanism, and they knew the Americans weren't keen. But they underestimated the stubbornness across the way.

"We got to the table and the U.S. said, 'We don't even want to talk about that. In fact, we refuse to talk about that issue at the table.' My response to that was, 'Well, if you don't want to talk about an issue that's of great importance to us, then we don't want to talk about issues that are of importance to you.' And I shut down the meeting. And we all walked away."

Verheul was on the receiving end of "a few concerned calls from Ottawa that night." But the gambit paid off. The Americans agreed to talk it out. And the new deal included a chapter on dispute resolution. Said the negotiator: "In some cases, you do have to go to the mat."

On Thursday, Verheul will be at the Public Policy Forum’s Canada Growth Summit 2023. The event is sold out, but you can email registration@ppforum.ca to be added to the waitlist. A handful of tickets to PPF's Testimonial Dinner remain here. POLITICO is a media partner.

Know someone who could use Ottawa Playbook? Direct them to this link . Five days a week, zero dollars.

TODAY'S HIGHLIGHTS

From left, Jeremy Hansen, Victor Glover, Reid Wiseman and Christina Hammock Koch, celebrate on stage as they are announced as the Artemis II crew during a NASA ceremony naming the four astronauts who will fly around the moon by the end of next year, at a ceremony held in the NASA hanger at Ellington airport Monday, April 3, 2023, in Houston. (AP Photo/Michael Wyke)

From left, Jeremy Hansen, Victor Glover, Reid Wiseman and Christina Hammock Koch, celebrate on stage as they are announced as the Artemis II crew. | AP

— Prime Minister JUSTIN TRUDEAU will chair the Cabinet meeting and attend question period. He'll also speak with African Union Commission Chairperson MOUSSA FAKI MAHAMAT.

The PM will spend part of the afternoon with the Artemis II crew: commander REID WISEMAN, pilot VICTOR GLOVER, mission specialist CHRISTINA HAMMOCK KOCH and mission specialist JEREMY HANSEN (he's the Canadian one).

They'll meet at 4:15 p.m., talk to industry experts and youth at 4:35, and participate in a panel at 5:15. Trudeau will attend the Space Canada and Aerospace Industries Association of Canada reception. He will be joined by Innovation Minister FRANÇOIS-PHILIPPE CHAMPAGNE for each event.

— Deputy Prime Minister CHRYSTIA FREELAND will attend Cabinet and QP.

— Governor General MARY SIMON is in Northwest Territories, where she'll meet Commissioner MARHARET THOM and Premier CAROLINE COCHRANE.

11 a.m. Anti-nuclear forces are holding a press conference: Green leader ELIZABETH MAY, Bloc Québécois MP MARIO SIMARD, Liberal MP JENICA ATWIN and NDP MP ALEXANDRE BOULERICE will join SUSAN O'DONNELL from the Coalition for Responsible Energy Development in New Brunswick and GINETTE CHARBONNEAU from Ralliement contre la pollution radioactive.

11 a.m. JEREMY BROADHURST, senior adviser to the prime minister, will be at the House procedure and House affairs committee’s study of foreign election interference. Also on the witness list: Liberal Party national director AZAM ISHMAEL, ex-CPC national campaign manager FRED DELOREY and the CPC’s 2019 campaign manager HAMISH MARSHALL.

3:30 p.m. It’s MARCO MENDICINO’s day to take questions about the government’s gun control bill at the House public safety committee.

For your radar

NEGOTIATING IN PUBLIC — Treasury Board President MONA FORTIER tried a new tack in her government's fight with the Public Service of Canada, which includes many of her constituents in east-end Ottawa: divide and conquer.

Fortier published an open letter to striking workers and every other Canadian who watched as a work stoppage extended into its sixth day.

— Over 570: The number of demands Fortier says PSAC brought to the negotiating table. "We have managed to reach agreement on most of them during our negotiations, in particular over the past three weeks of mediation," she wrote.

— 4 sticking points: wage increases; telework rights; reduced outsourcing; seniority rules.

— The PSAC response: "We came to the table with demands that reflect the need for significant change in our members’ workplaces," the union said in a statement from president CHRIS AYLWARD.

— C$6,250: The average annual pay bump in the government's offer of a 9 percent increase over three years (retroactive to 2021). The union wants 14.5 percent in that timeframe (and tax agency employees in particular are gunning for 22.5 percent).

— The PSAC rebuttal: "Without a wage increase since the beginning of the pandemic, our members have fallen behind inflation to the tune of nearly 11 percent of their earnings."

— Remote work: Fortier is open to a review of the federal telework directive, which "has not been re-assessed for a post-pandemic world." A review, conducted alongside unions, "would help ensure that our approach is modern, fair, and supportive [of] our employees, while ensuring our teams can deliver on our core purpose: serving Canadians."

— Contracting: Fortier reiterated the Budget 2023 commitment to axe billions in outsourced contracting work. But not to eliminate it. "We hope everyone can understand that reducing it to zero would severely compromise the government’s ability to deliver services and work for Canadians," the letter reads.

— Seniority: Euphemism alert. Fortier has proposed asking the Public Service Commission to consider seniority over merit in the case of job cuts. But Fortier didn't say cuts, and she didn't say attrition, and she definitely didn't say layoffs. What she did say: "...in the event that the size of the workforce needs to be adjusted."

Oh, the work "needs" is doing in that sentence.

PICKET PROGNOSTICATORS — A plurality of betting redditors are predicting the Public Service Alliance of Canada strike will last at least until Saturday, and possibly longer. Thirty-seven percent of 894 players took that bet. One in five said Wednesday.

Elsewhere in strike predictions, 55 percent of 968 predictors say a negotiated settlement will end the work stoppage. An additional 14 percent speculated an employer-imposed final offer vote would end the dispute. Only 9 percent tapped the poll's back-to-work legislation option.

— Out on the line: A rainy dance party outside the towering monuments to bureaucracy in downtown Hull was the most April possible scene for a public service strike.

BEATING A DEAD TUNNEL — PIERRE POILIEVRE is doubling down on his support for a car tunnel connecting Quebec City to suburbs on the south shore of the St. Lawrence River, even though it pits him against Quebec’s right-leaning provincial government.

In an interview with the Journal de Québec published Monday, the Conservative leader said his government wouldn’t finance the project if cars are excluded. He drove the point home in a tweet later on, saying his position is “common sense.”

Last week, Quebec’s CAQ government announced it was breaking a major election promise to build a tunnel that would accommodate cars. Instead, the so-called “third link” will be reserved for public transit. The government says reduced car traffic since the pandemic meant the project could no longer be justified.

— Shots fired: Poilievre blamed Prime Minister JUSTIN TRUDEAU for the collapse of the project, accusing the Liberals of “waging war on cars.” Still, it’s Quebec Premier FRANÇOIS LEGAULT — not Trudeau — who pulled the plug. That’s the same FRANÇOIS LEGAULT who effectively endorsed Poilievre’s predecessor, ERIN O’TOOLE, in 2021.

“I honestly don’t know what Poilievre is thinking here,” 338Canada founder and POLITICO contributor PHILIPPE J. FOURNIER tells Playbook. “He’s putting himself and his Quebec caucus in the crosshairs with the promise of a project that never made any sense anyway.”

Fournier said it’s “incredibly risky” to campaign against Legault or the CAQ in Quebec, given their popularity. “If there is one thing we know about the CAQ, it’s how much they like to be told what to do (or not to do) from federal politicians,” he said.

Over the weekend, CHANTAL HÉBERT noted in a column for the Toronto Star that Poilievre has yet to meet with Legault, more than six months since his election as Conservative leader.

— In search of allies: It’s no secret that Poilievre isn’t exactly on friendly terms with Ontario Premier DOUG FORD, either. Conservative MPs have made it known they’re not thrilled about Ford’s seemingly chummy relationship with Trudeau and Deputy Prime Minister CHRYSTIA FREELAND.

The Conservative leader has met with Alberta Premier DANIELLE SMITH, and says he shares her concern about the Liberals’ energy and climate policies.

But he hasn’t exactly embraced close ties with Smith, either. On her controversial sovereignty act, for instance, he had little to say, except to claim that such bills would be “unnecessary” when he becomes prime minister.

MEDIA ROOM

Tucker Carlson

Tucker Carlson in a Fox News studio, March 2, 2017. | Richard Drew/AP Photo

— Top of POLITICO: The keys to a hypothetical Tucker Carlson 2024 campaign

— The Globe's IAN BAILEY with a Monday night scoop: Former Tory MP DAVE MACKENZIE will endorse the Liberal candidate in the byelection that sends his successor to Ottawa. The party nomination battle left frayed nerves locally. Said Mackenzie: "I am not knocking Pierre. Pierre’s got some people around him that he might question at some point."

— The Post reports: MPs exempt Trudeau's brother from testifying about controversial Trudeau Foundation donation

— On THE DECIBEL: The bloody struggle for power in Sudan.

— Also from POLITICO: Your guide to the upcoming trial in E. Jean Carroll v. Donald Trump

— Global's JEFF SEMPLE returns from a trip to Taiwan with a heap of wrap-up coverage. One headline: What lessons Taiwan is learning from the Russian invasion of Ukraine

— Via Substack, Tory MP MICHELLE REMPEL GARNER offers tongue-in-cheek bargaining tips for striking public servants.

PROZONE

For POLITICO Pro subscribers, our latest policy newsletter from ZI-ANN LUM: German president to talk hydrogen in B.C.

In news for POLITICO Pro subscribers:

— EU’s intellectual property overhaul faces lobbying battle
— Lawyers suggest a way around abortion pill restrictions but doctors may be afraid to try it
— U.N. food relief agency ‘stands ready’ to help EU shift glut of Ukraine grain
— Biden's newest big climate rule will rest on rarely used technology
— U.S. carbon management investment opportunity could hit $600B by 2050: DOE

PLAYBOOKERS

Birthdays: HBD to Halifax MP ANDY FILLMORE and former Cabinet minister JANE STEWART.

Belated weekend HBDs to JACKIE CHOQUETTE, head of government affairs at 3M Canada; and SUSAN SMITH, principal and co-founder of Bluesky Strategy Group.

Spotted: Former PM STEPHEN HARPER, pledging to raise C$250,000 in 30 days for the Conservative Party, part of his mission to be "doing whatever I can to make PIERRE POILIEVRE our next prime minister." Party members are getting texts with a recorded plea for donations.

Former ethics commissioner and voracious tweeter MARIO DION, posting bite-sized opinions Monday on the Trudeau Foundation, the cocktail circuit, Volkswagen subsidies, JUSTIN TRUDEAU and CHRYSTIA FREELAND's absence from QP, the "special rapporteur" on foreign influence, and filing taxes without the help of an accountant.

New Brunswick Liberal Leader SUSAN HOLT, elected to the legislature.

Press Progress editor LUKE LEBRUN, playing Six Degrees of KEVIN BACON with anti-Trudeau Twitter.

Out of towners: The German business delegation travelling with President FRANK-WALTER STEINMEIER scored a grip-and-grin with Trudeau Monday included billion-dollar smiles from Volkswagen CEO OLIVER BLUME, Volkswagen executive THOMAS SCHMALL-VON WESTERHOLT, LUTZ BERTLING of OHB, Merantix Momentum CEO NICOLE BÜTTNER-THIEL, Tectumedia CEO DANUTA FLORCZYK, Evonic Industries management board member JOHANN-CASPAR GAMMELIN, Cellcentric CEO MATTHIAS JURYTKO, Knauf CEO ALEXANDER KNAUF, Deutsche Messe CEO JOCHEN KÖCKLER, K+S CEO BURKHARD LOHR and DB Engineering & Consulting CEO NIKO WARBANOFF.

Inside the National Arts Centre following an evening program marking Steinmeier’s visit: CATHERINE TAIT, former Bank of Canada governors DAVID DODGE and MARK CARNEY walking together with DIANA CARNEY, STEPHANIE KUSIE, Japanese Ambassador KANJI YAMANOUCHI and Housing and Diversity and Inclusion Minister AHMED HUSSEN.

Movers and shakers: PHYLLIS CLARK was reappointed chair of the Royal Canadian Mint's board of directors for another five years. EVAN PRICE was named to the board.

LEAH ANDERSON was appointed president and CEO of the Canada Deposit Insurance Corporation. Anderson has held the role on an interim basis since August 2021.

On the Hill

→ Find the latest on House committee meetings here.

→ Keep track of Senate committee meetings here.

9 a.m. JENNIFER MOORE RATTRAY will be at the Senate Indigenous peoples committee, along with executives from the Canadian Human Rights Commission.

9 a.m. Officials from VIA Rail and VIA High Frequency Rail Inc. will be at the Senate national finance committee where main estimates will be the focus of discussion.

9 a.m. Canadian Heritage’s THOMAS OWEN RIPLEY is back at the Senate transport and communications committee where senators are studying Bill C-18.

9 a.m. KONRAD VON FINCKENSTEIN, former Chair, Canadian Radio-television and Telecommunications Commission, will be first up at the Senate transport and communications committee as it discusses C-18.

9:30 a.m. Senators ROSA GALVEZ, PAUL MASSICOTTE, SALMA ATAULLAHJAN, WANDA BERNARD and former senator NANCY HARTLING are listed as witnesses at the Senate rules and procedures committee meeting to talk about committee structure and mandates.

11 a.m. Ukrainian Ambassador YULIYA KOVALIV will be up first at the House foreign affairs committee to update members about the situation at the Ukraine-Russian border. The second half of the meeting is dedicated to taking Bill C-281 through clause-by-clause consideration.

11 a.m. “Senior officials” will attend the House finance committee’s study of Bill C-47.

11 a.m. The House science committee meets to study support for commercialization of intellectual property. First though, it must elect a chair.

11 a.m. Breast implants oversight is the topic of the day at the House health committee.

3:30 p.m. BRIAN JENKINS, RAND Corporation special adviser to the president, will speak to members of the House national defense committee to give an update on the situation in Ukraine.

3:30 p.m. The House access to information committee will get a visit by journalist DEAN BEEBY and Democracy Watch co-founder DUFF CONACHER.

3:30 p.m. The House human resources committee gears up to take Bill C-35 through clause-by-clause consideration.

6:30 p.m. Writer VIVIAN KRAUSE is up as a witness at the House procedure and House affairs committee’s evening study of foreign election interference.

— Behind closed doors: Inter-city bus transport is up for discussion at the House transport committee; the House natural resources committee will look over its report on federal assistance for various industries; the House official languages committee meets; the Senate national finance committee meets to consider a draft of its supplementary estimates report.

TRIVIA

Monday’s answer: The eight Books of Remembrance commemorate the names of fallen Canadian soldiers. They are typically displayed in the Memorial Chamber in Centre Block. During that building's massive ongoing renovations, the books are currently displayed in the Room of Remembrance in the Hill's visitor welcome center.

Props to BOB GORDON, GEORGE SCHOENHOFER, CAMERON RYAN, NANCI WAUGH, WAYNE EASTER, DOUG RICE, ROBERT MCDOUGALL, DANIEL KOMESCH, ALLAN FABRYKANT, SHAUGHN MCARTHUR, and DAN MCCARTHY.

Today’s question: On this day in 1940, women were granted the right to vote in this province (the last one to do so in Canada).

Send your answers to ottawaplaybook@politico.com.

Want to grab the attention of movers and shakers on Parliament Hill? Want your brand in front of a key audience of Ottawa influencers? Playbook can help. Contact Jesse Shapiro to find out how: jshapiro@politico.com.

Playbook wouldn’t happen without: Luiza Ch. Savage, Sue Allan and David Cohen.

 

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