With the success of the Liberals in the Canadian general election of last June, a forceful new Prime Minister (elected leader of his party only a couple of months earlier) received a clear mandate for political action. Attracted by the swinging style and obvious intellectual calibre of Pierre Elliott Trudeau, observers in other countries have been taking a greater interest than usual in Canadian affairs. And they have naturally been especially concerned to know about the new administration's views on international issues.

Mr. Trudeau has provided several examples of his thinking on foreign affairs, the most definitive appearing in a policy statement issued by the Prime Minister's Office in May, during the course of the election campaign. It was stated there that Canada planned "to recognize the People's Republic of China government as soon as possible and to enable that government to occupy the seat of China in the United Nations, taking into account that there is a separate government in Taiwan." The Canadian authorities would "explore new avenues of increasing our political and economic relations with Latin America, where more than four hundred million people will live by the turn of the century and where we have substantial interests." By way of "reflecting in our foreign relations the cultural diversity and the bilingualism of Canada," Ottawa intended to "strive to develop a close relationship with the francophone countries." And so on.

The Canadian position in the Atlantic community was given only a rather guarded reference in the May statement. The Canadian military presence in Europe, and "the whole range of our economic, political and cultural ties" with the European countries would, it observed, be subjected to detailed examination by a special "task force." In earlier verbal comments, however, Mr. Trudeau had argued that Europe "no longer needs us" militarily, as it used to, and that "our natural area of defence is in the North American continent." On the other hand, he had also expressed support for a free trade area of "the whole Atlantic region," if it could be brought about through the mechanism of the multilateral tariff negotiating system.

The observation about defense raised quite a storm of controversy in Canada, and not a few ripples elsewhere. And the reactions grew more intense later in the summer, when the Soviet invasion of Czechoslovakia suggested a renewal of the threat of war in Central Europe. The reference to a trading alignment among Atlantic countries aroused less concern, but it was received with much interest in academic and business circles.

The task force on Canada's relations with Europe is now hard at work, and is aiming to produce first drafts on its report within a few weeks. The operation is an internal one (though some outside the government will ultimately be drawn into it) and, since it is not yet possible to say what recommendations will emerge, this article will give a purely personal assessment of the problems; but it will make an evaluation of past history and contemporary events such as must lie behind any attempt to gauge the requirements of Canadian foreign policy in the Atlantic area today.

II

Canada's participation in what we describe, rather vaguely, as the Atlantic community has two principal aspects: the political-strategic, and the economic. The former of these roles is expressed primarily, of course, through its military contribution to NATO-plus its more localized role in NORAD, the North American Air Defense Agreement. The economic involvement, on the other hand, has not advanced so far toward a true community. However, in all the postwar discussion of measures to promote closer economic links between the Atlantic countries, the accent has been mainly on trade arrangements; and the framework within which such arrangements have to be made is GATT (General Agreement on Tariffs and Trade). Therefore, it seems most profitable to concentrate on an examination of Canadian attitudes toward these two international instrumentalities, NATO and GATT.

In broad terms, it can be said that there are two basic political issues in Canada: the problem of the country's relationship with the United States, and the problem of the relationship between English-speaking and French- speaking Canada. The first of these difficulties is evident enough. Canada, a nation of twenty million people, lies on the doorstep of the immense, rich, strong and dynamic United States of America, the leader of the Western world. Its history, ethnic composition and general "way of life" are sufficiently similar to those of its giant neighbor to provide little natural insulation against influences from the south, such as to some extent preserves Mexico's identity from a similar "cultural infection" from across the border. Since Canadians therefore tend to have much the same aspirations as Americans, and every opportunity to check at first hand how close they are coming to the U.S. performance, the price a Canadian electorate will be prepared to pay for national sovereignty cannot be very great. As a consequence, governments in Canada are, in effect, engaged in a constant attempt to minimize the economic cost of political independence. In a general way, they also endeavor to draw the attention of the public somewhat away from things American and toward Canada's own interests and achievements. However, because these domestic features are always overshadowed by comparison with the U.S. equivalent, it has long been the custom to seek to redress the balance by stressing the importance of links with, and events in, other nations outside the North American continent.

GATT and NATO are both very relevant to these traditional Canadian government attitudes. The first offers an opportunity to reduce trade barriers, one of the more important factors contributing to the gap between Canadian and American living standards, which averages between 25 and 30 percent. And the attempt to liberalize trade is made on a multinational basis, a method that has seemed to Canadians less likely to endanger their country's sovereignty than would a lowering of tariffs vis-à-vis the United States alone.

The North Atlantic Treaty Organization has a rather similar appeal. Among all the extra-continental relationships that might be suggested to provide Canada with the necessary additional foreign-policy dimension, the most obvious is that with the nations of Western Europe, ancestral homeland of the vast majority of Canadians. The inclusion of Canada and the United States within an Atlantic grouping that embraces West European countries has thus appeared to Canadians a particularly congenial arrangement. Although NATO's purposes are essentially military, and in this respect relatively unattractive to a people with a pacific tradition, the idea of defending the European wellsprings of Canadians' cultural heritage has been viewed sympathetically, at least until recent years, by almost everyone in Canada.

Turning to Canada's second major political problem-the achievement of a satisfactory basis for Canadian-Canadien relations-one finds a situation in many ways more subtle and complex, but not dissimilar. Both problems have the feature of asymmetry. Just as Canada as a whole has to find a satisfactory accommodation on a continent dominated by the overwhelmingly powerful United States, so the six million or so French-Canadians are faced with a challenge to their cultural survival from fourteen million English- speaking Canadians (and, at one remove, another two hundred million English- speaking people south of the border).

GATT and NATO are not as obviously relevant to the French-English situation within Canada. Nevertheless, their reference to the wider world, multilingual and multicultural, has given some promise of helping Canada to transcend parochial domestic squabbles. For young intellectuals at least- and these are the people most interested in such matters-international organizations with headquarters in Geneva and Paris or Brussels, using English and French as their main working languages, help to show that there is for Canada a political context larger than North America, and that the French tongue has considerable usefulness far beyond the confines of "La Belle Province."

III

So much for the background. How have postwar events in fact affected Canada's goals?

A major feature of U.S. foreign policy for the past twenty years has been (as it still remains) to promote the integration of all Western Europe, which would then form the eastern "pillar" of an Atlantic partnership between a United States of Europe and the United States of America. This aim found a ready response in most of continental Europe, where it was apparent that only through unification could the relatively small countries of the Old World hope to compete with enormous nations like the United States and the Soviet Union. Initially, it was less popular, of course, in Britain, which was convinced that it had a maritime, rather than a continental, destiny and felt that its connections with the United States and the Commonwealth gave it an opportunity to hold its own against the giants without full integration into the European union.

What is less well known, although far more obvious, is that the "two- pillar" idea was very far from ideal for Canada. A partnership between a United States of Europe and the United States of America was likely to leave Canada as the "Outer One"-or as a minor appendage of the American pillar. Neither of these prospects was much relished by Canadians. On the other hand, the broader international objectives of Canadian policy favored British inclusion in a unified Europe, to add strength and political stability to a part of the world which two generations of Canadians knew mainly as a battleground. So long as Britain remained aloof from the European experiment the issue did not arise. But in the early 1960s, when the British decided to seek membership in the EEC after all, Canadians faced a real problem of accommodating to a trend of events that ran counter to long established (if poorly comprehended) national policies.

As noted earlier, one of these policies has been the encouragement of extra- continental relationships to offset partially the manifold influences from the United States; a primary alternative relationship has been provided by the Commonwealth connection. Greatly though the Commonwealth has declined in the Canadian scheme of things-both as a symbol and as a basis for political and economic arrangements-it has continued to be valued, in a vague way, as a counterweight to the American involvement in Canadian life. In specific economic terms, this principle gave rise to the "British preference" tariff system, which was clearly incompatible with EEC membership. The Canadian Government offered all kinds of objections to this threatened loss of trade, but as events turned out, there was no need to worry. The French lowered the boom against British membership in 1963 and once again the problem of Canada's stance in Atlantic economic affairs receded. This time, however, Canadians concerned about their country's international economic position did not relax; they began to think hard about where their interests lay and what changes in policy should be made to conform to the new situation. When the British tried again for EEC membership four years later, Canada accepted the event calmly enough, for in that interval an extensive reappraisal had been launched. While it was (and still is) very far from complete, Canadians had already gained an increased sense of direction in their external economic policy.

What did this reëxamination show? More than anything else, it revealed a number of simple facts which had long been recognized by experts but were only poorly appreciated by the general public. One of these facts was the changed orientation of Canadian trading relations. Whereas in the 1920s and 1930s the United States took about 40 percent of Canada's exports, Britain 40 percent, and the rest of the world 20 percent, in the 1950s and 1960s the proportions altered to approximately 60 percent, 15 percent and 25 percent respectively. Clearly, the policy of encouraging extra-continental economic relationships as a counterweight to trade with the United States was unlikely to succeed if it remained focused primarily on Britain.

Another point which became obvious was the ineffectiveness of tariffs in fostering the development of an autonomous domestic industrial complex and thus strengthening Canada's independence of the United States. Not only had the tariff failed to prevent the rise in Canadian dependence on U.S. markets to its current level of 60 percent of all export trade-and an even more startling growth in Canada's reliance on American sources of supply to 70 percent of total imports-but it had positively encouraged U.S. businesses to establish plants in Canada, thus augmenting the growth of American ownership of Canadian industry. By the mid-1960s almost one-half of Canada's manufacturing sector was owned or controlled by U.S. interests, a situation which many observers considered far more dangerous to the country's political sovereignty than was the orientation of its foreign trade.

Along with these second thoughts about the efficacy of the tariff in achieving economic autonomy, however, was the recognition that it had almost certainly helped speed up the process of industrialization, which had put Canada into the front rank of modern, dynamic Western societies. The question now was whether protection remained necessary or was in fact preventing what had become a mature and technically efficient manufacturing sector from shedding the constraints of undue fragmentation and inadequate scale, which inhibited full economic efficiency.

IV

Turning to defense policy, feelings about NATO have also changed. Like Americans, Canadians see it as part of a broad military strategy, in which the joint effort for the protection of Western Europe contributes indirectly to the general defense and well-being of North America. But though Canada has from the start been a willing participant in European defense, for reasons that are evident enough, NATO has never been viewed as immediately relevant to the problem of Canada's security at home. Also, Canadians have been less able than Americans to look upon their involvement in European defense as crucially significant. Whereas the presence of the very large U.S. contingents in Europe has clearly been vital in providing a credible deterrent to aggression from the East, the Canadian army brigade and small naval and air units have seemed hardly likely to tip the scales in NATO's favor in any European war.

Even so, for a long time Canada did not seriously waver in its wholehearted support of NATO. The reason was that, once again, the broad defense alignment between a group of Atlantic nations seemed to be more healthy politically than a purely continental system of partnership with the United States, in which the Canadians played a very subordinate role. In fact, of course, the continental arrangement existed too, in NORAD, but the involvement in NATO contributed that other dimension so important to the Canadian feeling of political balance.

In the mid-1960s, however, the Canadian views of NATO began to alter somewhat. The evidence of changing attitudes among the European members as to the usefulness of the Alliance, at least in its prevailing form, increased Canadians' doubts about the value of their own role in Europe. Revived European pride, not limited entirely to France, made the presence of non-European troops and military installations seem less welcome than they were after the War. And the immensely enhanced U.S. capacity for airlifting men across the Atlantic in a few hours suggested that, in fact, such a physical presence might no longer be critical to Europe's defense.

Canada's contribution to NATO thus came more and more to appear to the public as a symbolic gesture of solidarity with allies and no longer as an operation that could be justified in military terms. The official view in Ottawa remained that Canadian forces in Europe were necessary, both to maintain the solidarity of the alliance and to hold on to the "second dimension" in Canadian foreign policy. But popular opinion swung noticeably away from the uncritical support that had been the rule ever since the end of the War, and it is perhaps noteworthy that the eight squadrons of F-104 aircraft that Canada provided to NATO in the early 1960s had been allowed to diminish, "as a result of attrition," to six squadrons by the end of 1967.

At the same time that the commitment to NATO was coming under scrutiny, a similar hard look was being taken at the North American aspect of Canadian defense policy, which is obviously closely related to any broader Atlantic military strategy. The odd feature about North American defense is that, with or without an alliance, any attack on Canada would necessarily be considered as an attack on the United States. And the corollary of that situation is that, by defending themselves, the Americans are bound incidentally to defend Canada. Therefore, many Canadians reason, why not leave the protection of the whole of North America to the vast U.S. military machine and employ Canadian armed forces (which can contribute only a mite to a joint defense effort) in some more significant and useful activity?

For many Canadians, the joint defense system with the United States had seemed worthwhile so long as a Soviet bomber threat required radar and other facilities on Canadian territory, as well as use of Canada's airspace by American fighters and antiaircraft missiles. Canada could hardly countenance the idea of U.S. military installations on Canadian soil without any involvement by its own forces. Nor could it afford to envisage the prospect of Russian bombers being engaged over Canadian cities by U.S. planes or rocket artillery, while the Canadian air force was busy elsewhere. By the mid-1960s, however, it was generally believed that ICBMs and not bombers would be the principal means of any Soviet attack on the North American continent, and this prospect began to create doubt about the need for far-north radar barriers, Bomarc sites or the use of Canadian airspace by U.S. fighters. The validity of Canada's contribution to NORAD came to be questioned more widely than before.

Such feelings have continued to spread, so that by now the Canadian involvement in both NATO and NORAD is not to be taken for granted. Needless to say, the Soviet invasion of Czechoslovakia has given pause to critics of defense policy, but it remains to be seen whether it will really change the course of the debate. On the whole, Canadians seem to consider the Czecho- slovakian development as only a temporary setback to the process of gradual détente between Russia and the West, rather than a fundamental obstacle to the reconciliation of cold war differences. If that is so, it implies merely a postponement, and not a change, in any plans for overhauling the Canadian position in the Atlantic defense system.

There is no significant evidence, it should be stressed, that Canadians favor a pacifist, or even a strictly neutralist, policy. The most general feeling is that Canada is morally bound to assist in the defense of the Western world, in one way or another, to approximately the same proportional extent as its friends and allies. Moreover, those for whom morality is less important than self-interest suggest that American good will, which is worth a great deal to Canada in bread-and-butter terms, would clearly be jeopardized by a Canadian refusal to contribute its share to the common load. The argument centers on the form of the Canadian contribution and, specifically, on the merits of a larger participation by Canada in military and other functions in the Third World as opposed to full involvement in the strategic arrangements of the great powers.

The rationale for Canadian concentration on the Third World is as follows. Rightly or wrongly, the United States is distrusted in many Asian, African and Latin American countries simply because it is big and powerful. In addition, all the larger European nations, as well as Japan, are suspect because of their imperial or neo-imperial behavior in the past. This problem provides an opportunity for a few countries that are not powerful or ex-imperial, but are wealthy enough to have some resources to spare, to fulfill an especially useful function in the underdeveloped and uncommitted regions of the world. Canada, like Switzerland, the Scandinavian nations and a handful of others, has become very active in this type of endeavor. There have been Canadian contingents in virtually all the peacekeeping forces and international supervisory operations since the War-Indochina, Palestine, Kashmir, Yemen, Gaza, the Congo, Cyprus.

It is certainly arguable that such contributions may have done more for the peace and stability of the world over the past twenty years than have the Canadian military activities at home and in Europe. By extension it has been suggested that Canada could engage in more such operations if its available forces were committed primarily, if not exclusively, to peacekeeping-first, because there would simply be larger numbers of men and matériel to devote to that purpose, and second, because the measure of nonalignment implied would presumably make Canadian servicemen that much more acceptable in the Third World. The further point is made that American good will would not be sacrificed by a switch from the conventional contribution to Western defense if the burden the new role imposed on Canada were approximately comparable to that borne at present.

V

What are the implications of this analysis for the future shape of Canadian policy in the Atlantic area, and to what extent will these same implications be drawn by the current official foreign-policy review? Dealing with the second question first, it seems likely that the present government review will produce very little in the way of changes in Canada's international economic or defense policies. The new Prime Minister and his cabinet have been too short a time in office to have fully thought through these major issues, and the public service is still largely in thrall to the philosophy of the previous administration. However, within a longer time-horizon-perhaps five years-the new ideas and attitudes that are now taking shape will, I believe, have begun to be translated into policy.

The most striking feature of the Canada of the 1970s will be, in my view, a readiness on the part of Canadians to accept, and even welcome, the fact that their country is not quite "a nation like the others." There will be a recognition of the very special relationship with the United States and a greater willingness to seek ways to exploit this unique position rather than to worry and complain about it. What this will mean is, first, an increasing determination to choose the nature of their manifold links with their southern neighbor instead of simply accepting the accidents of events. The Canadian Government, backed by private interests, will launch a rigorous and far-reaching "cost-benefit analysis" with respect to the relationship, designed to weigh the options and arrive at an optimum proportion of independence and of interdependence. Where this analysis indicates that a particular feature of Canadian life has a high "sovereignty content," the policy will emphasize independence more strongly than before. But where the benefits of continental integration appear great and the adverse effects slight, there will be a preparedness to enter more fully into the American orbit.

A major result of this cost-benefit analysis will be the conclusion that Canada has little to fear, and a great deal to gain, from a closer interlocking of certain aspects of the two countries' economic systems, particularly as it can be achieved through elimination of trade barriers. Enhanced industrial effectiveness, gained through a "continental rationalization" of manufacturing operations on each side of the border, will come to appear irresistibly attractive, because of its potential for increasing Canada's wealth and thus lessening the real political restraints imposed by the difference in Canadian and U.S. living standards. Or, to put it another way, such an alignment will appear not only relatively free of adverse consequences for political sovereignty, but capable of permitting Canada to pay a higher price for independent policies desired in other sectors.

Among the sectors in which more independence will be sought, in my view, is overall foreign policy-including defense. A degree of disengagement would permit Canada to shift its military investment into peacekeeping activities of a kind that would give Canadians a sense of adequate national involvement in the world's problems-as their present major defense functions do not. Such a policy, while fostering a feeling of national purpose in Canada, will in no way aim at hurting the interests of the United States. Indeed, I suspect that the U.S. Government, which has come to recognize the limitations which its position places on it in certain types of international situations, will increasingly rely upon the sort of special role that a freer agent like Canada can perform.

The implications of such a general philosophy for Canadian economic and military policy in the Atlantic area are fairly simple in principle, though far more subtle in practice. If the crucial factor in Canada's economic prospects comes to be the freeing of impediments to trade with the United States, relations with all other trading partners will seem much less important. And because Canada will be more and more ready to perform a particular military role on the world scene, its interest in defense alliances will obviously be greatly reduced.

To be specific, in regard to trade I would envisage that the efficacy of GATT, in Canadian eyes, will appear by the 1970s to hinge on its ability to provide a mechanism whereby Canada can mutually eliminate tariffs with the United States in a manner appropriate to its particular requirements. The obvious means to that end is a free-trade area (as permitted under Article 24 of the Agreement) with the United States. However, quite apart from Canadian attitudes toward such a widespread integration with the American giant, there is not much likelihood of U.S. interest in a purely bilateral scheme, which would provide only minor benefits to American industry and would be prejudicial to Washington's frequently proclaimed belief in multilateral trading arrangements. A more feasible method of achieving the same objective would be some form of free-trade area among a broad group of industrialized countries-a concept that would seem politically more comfortable to Canadians and might well have the appeal in Washington that a U.S.-Canadian alignment does not.

Such an idea has been advanced in recent years under the name of NAFTA-a North Atlantic Free Trade Area. The proposition, which was first formulated by the Canadian-American Committee in 1966, and has found many of its strongest supporters among Canadians, has been viewed in some quarters abroad as essentially anti-EEC. It is not seen that way in Canada, where the concern is to use an approved GATT technique, the regional free-trade arrangement, to move rapidly, and under conditions bound by treaty, to full freedom of trade with a major group of countries-hopefully including the Common Market.

It was this type of scheme to which Prime Minister Trudeau was apparently alluding when he referred to a free-trade area of the whole Atlantic region brought about through the medium of the multilateral tariff negotiating system. In fact, like many of his off-the-cuff remarks, it was intended more as an expression of personal interest than as any kind of prescription for government policy. There is no likelihood at all that Canada will embrace NAFTA in the short term. Ottawa is keen on various ideas for multilateral free trade in individual product sectors. And it would like to develop some special deals with the United States in particular areas of the economy. But the Government is nowhere near ready-and business is, on the whole, equally unprepared-to go for an across-the-board free-trade plan.

However, over the longer term the prospects for Canadian support of something like NAFTA seem very good. More of the kind of success in exports that Canadian secondary industry has been enjoying in recent years-a tripling of exports of "end products" (excluding food items) which jumped from less than one-sixth to almost one-third of Canada's total shipments abroad between 1965 and 1968-will convince manufacturers of their ability to compete internationally without tariffs. Thus I would speculate that by the mid-1970s Canada will be an ardent promoter of a broadly based free- trade arrangement, the core of which will be some sort of Atlantic economic unit.

But the whole purpose of such increased economic links with the United States and Europe, it must be repeated, will be the maximization of industrial efficiency so that Canada will be able to afford-and Canadians prepared to finance-more independent action in other aspects of foreign policy. And crucial to this aim, I think, will be a degree of disengagement from military alliances. Thus, while the desire not to contribute to a centrifugal trend in NATO at a critical time will keep Canada committed to a European presence for the balance of the 1960s and perhaps into the 1970s, I would doubt very much whether Canadian forces will remain in the European theater over a longer period. Moreover, I expect that Canada's involvement in the defense of North America will be greatly revised within the next five years, and that the operation of the joint U.S.-Canadian system in NORAD will be completely reorganized.

My reasons for these forecasts will be clear from the earlier analysis. However, there is one rather slippery assumption in the argument: namely, that Canada can find an alternative purpose for its military contribution sufficiently useful and significant as to persuade the other Atlantic countries-and particularly the United States-that Canada is fulfilling its international obligations. If they are not so satisfied, they will be disinclined to coöperate with Canada economically and in other ways. And the trouble with peacekeeping in this connection is, of course, that there has not until now been enough demand for it to keep a fair-sized army busy. Thus, if Canada concentrated its main efforts in this direction, it might not spend enough on its military budget to appear to be pulling its weight.

Part of this problem can probably be overcome by two developments: the effective increase in the scope for Canadian peacekeeping-including conciliation commissions, larger supervisory forces in problem areas and so forth-that might be expected to occur as a result of a more "detached" foreign policy; and by an attempt, already foreshadowed by the huge increase in Canada's foreign-aid program (at a time when that of most countries is shrinking), to mesh peacekeeping efforts into overseas development assistance, and to suggest that the two together should be considered as complementary aspects of a Canadian "peacemaking" function. This concept is evidently embodied in the Government's sponsorship, recently announced, of an imaginatively conceived "Canadian International Development Centre," which is intended to undertake basic research of a unique scope and diversity into the problems of the Third World.

Evidence that this might be the mix of policies ultimately adopted by Canada was offered in the much publicized speech of the Prime Minister on November 8. He suggested that the threat of open racial conflict in the United States, along with somewhat similar dangers arising from the tension between affluent palefaces and darker-hued poor people on the world scene, represent a more valid subject for Canadian concern than does the possibility of military attack on the West by the Soviet Union or China. A few days later, a NATO Ministerial meeting in Brussels was assured, after much urging, that Canada would guarantee to maintain its contribution to the Atlantic Alliance over the following twelve months; but these developments have been widely interpreted as heralding a major change in the Canadian defense posture at some not-too-distant date.

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