There’s a reason Trudeau’s Washington visit starts at the Capitol

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It’s inevitable that when a Canadian prime minister visits Washington, the trip to the White House generates the most attention — a reality of cross-border politics as enduring as the recycling of quotes from JFK and old jokes about mice sleeping with elephants.

That tradition continues this week, with Prime Minister Justin Trudeau in Washington for a two-day visit culminating in meetings Thursday with the presidents of the United States and Mexico.

But this time, one of the most important stories in continental relations might be unfolding elsewhere, a day early, a dozen blocks east of the White House.

Trudeau will be on Capitol Hill on Wednesday meeting with congressional leaders in both the Senate and House of Representatives.

Democrats there are putting the finishing touches on a massive piece of legislation with both domestic and international implications — a nearly $2 trillion US bill that is the most important legislative act of Joe Biden’s presidency.

One element in particular has Canadian policy-makers terrified: a tax credit for electric vehicles that favours cars assembled in the U.S., prompting warnings from Ottawa of lost jobs, disrupted supply chains and a retreat from six decades of co-operation in auto production.

It’s no accident that Biden will be in Detroit on Wednesday; he’ll be promoting his agenda at a General Motors electric-vehicle plant that would benefit from the credit.

Politicians from Canada and elsewhere have been pleading with their American counterparts to either drop or modify the plan, arguing it violates trade agreements and could prompt trade cases.

The other Joe with power in Washington

And the key American to convince doesn’t necessarily work in the White House. The destiny of this bill could be decided by another Joe, who works on the other end of Pennsylvania Avenue.

Sen. Joe Manchin of West Virginia is regarded as the 50th and final vote that Democrats need to pass a budget bill in the Senate — and he’s been wavering on parts of it.

There’s a reason he attracts a media mob of congressional reporters who trail him and make note of his every utterance on the bill. After all, he may decide the fate of legislation whose multi-year price tag exceeds Canada’s entire annual gross domestic product.

There’s a reason so many reporters follow Joe Manchin around. This one senator from West Virginia could decide the fate of a bill worth more than Canada’s entire annual GDP. (Leah Millis/Reuters)

He’s among the rare holdouts who have watered down the bill’s provisions on climate policy, family assistance and health care.

The electric vehicle tax incentive is arguably the most important climate policy left standing in the bill, and last week Manchin made clear he doesn’t like it.

He’s spoken at length with Canadian Ambassador Kirsten Hillman about the policy and has never quite laid his cards on the table about what he wants next.

In his public and private remarks, Manchin has criticized the car credit but hasn’t said what changes he wants, nor has he explicitly said whether he’d vote down the legislation over this.

So the inscrutable oracle of Capitol Hill maintained that calculated ambiguity when CBC News caught up with him on Tuesday as he left a committee meeting for a Senate vote.

Asked about the vehicle plan, Manchin alluded to a fear that Americans will shift to electric vehicles while those cars still depend on China for components.

“The whole thing about electric vehicles — [is] I don’t want to be held captive by China. And with foreign supply chains,” he told CBC News.

“We go down this road to EVs, we have a foreign supply chain that’s controlling our transportation mode? That’s my biggest concern.”

The politics behind the car tax credit

It’s been frequently noted that the coal-state senator has a personal history in the fossil-fuel sector and financial connections to it.

Yet there’s more at play.

His state of West Virginia also hosts a plant belonging to Toyota, which is the world’s biggest investor in the technology competing with electric batteries: hydrogen fuel cells.

Manchin said he was fine with incentives for that technology: “We can do hydrogen,” he said, as he stepped into an elevator on his way down toward the Senate floor.

When asked about the effects on Canada, he smiled and kept silent as the elevator doors closed and carried him down to a vote.

And that, prime minister, is a snapshot of daily life in the U.S. capital you’re visiting.

But there are other potential snags that could trip up Biden’s legislative agenda on Capitol Hill, including the vehicle credit.

The Senate parliamentarian has yet to rule on whether that credit counts as budget policy that belongs in a budget bill or whether it’s primarily labour policy, since it offers $4,500 in credits for union-made vehicles assembled in the U.S., growing to $12,500 in 2027.

Trudeau, right, and U.S. President Joe Biden are shown at the last G7 summit in June. The two leaders will be meeting on Thursday with Mexican President Andrés Manuel López Obrador. (Kevin Lamarque/Reuters)

That’s another reason Manchin dislikes the plan: Those union plants are primarily in the north, while the non-union shops proliferate in the south, including his West Virginia.

And there’s a final potential snag for Biden’s electric-vehicle plan: It involves the Congressional Budget Office (CBO).

Manchin and other Democrats have said they’re worried the whole bill costs too much, and some are awaiting the CBO’s assessment this week on the fiscal effects before deciding how to vote.

One Canadian business lobby group said Trudeau and the ministers visiting Washington this week need to press their case with anyone they can.

Trevor Kennedy of the Business Council of Canada said the vehicle credit as designed is that much of a concern to Canada.

“It could be quite serious,” said Kennedy, the council’s director of trade and international policy, noting that the move violates the spirit not only of decades of cross-border auto co-operation but of the new North American trade pact.

“The question is: Why do this? If we just ratified this [trade] agreement…. Maybe we need to more forcefully make the case that this harms our relationship and undermines what our countries are trying to do on multiple fronts.”

Line 5: Also unfolding elsewhere

Another major bilateral issue is unfolding away from the White House.

Trudeau is expected to press Biden to ensure that the Line 5 pipeline keeps flowing to Eastern Canada, amid a bid from Michigan’s state government to shut down a portion that runs under the Great Lakes.

Biden faces countervailing pressure from some political allies to shut it down immediately.

What the White House has done instead is punt the issue, for now, to the court system: A Biden spokesperson said he will not take any action for now, while the issue plays out in court.

It just so happened that on Tuesday, a Michigan court refused the state government’s bid to have the case heard in a county court.

The judge’s ruling said the litigation involves constitutional issues and relations with Canada and belongs in a federal court.

WATCH | What to expect from the North American leaders’ summit:

What to expect from North American leaders’ summit | At Issue

The At Issue panel looks at what Canada should expect from the first North American leaders’ summit in more than five years. Plus, the panellists weigh in on Conservative Leader Erin O’Toole’s response to possible Liberal-NDP talks. 18:11

And that pipeline episode underscores another truism about Canada-U.S. relations.

No, not the old John F. Kennedy quote so many politicians repeat when they cross the border: “Geography has made us neighbours. History has made us friends. Economics has made us partners.”

Another truth: The action so often unfolds away from 1600 Pennsylvania Avenue.



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