Canada Changes Course

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Reagan this month will decide one major issue dividing the two countries: whether to include Canada in any new limits on foreign steel imports, which are hurting the U.S. steel industry. Canada, whose steel shipments to the U.S. totaled nearly 2.4 million tons last year, has asked to be exempted from the quotas. They could cost the country up to 3,000 jobs, and the Ottawa government contends that Canadians buy more steel-related products from the U.S., notably automobiles, than they sell to the U.S.

In addition, the World Court at The Hague is expected to rule soon on a longstanding fishing dispute between Nova Scotia and the New England states. The U.S. has laid claim to all of the Georges Bank, off the Massachusetts coast, while the Canadians contend that about half the bank belongs to them. The contested area is rich in scallops and other seafood (the annual harvest totals some $75 million), and may also hold abundant reserves of oil and natural gas.

Some U.S. officials predict that Mulroney will eventually have to take a more critical stance toward the U.S., if only for domestic reasons. Canadians have a historical ambivalence toward the colossus to the south, proud of their status as one of the world's leading industrialized nations but keenly aware their neighbor is about ten times Canada's size in production and population. "Mulroney will have to give the Americans the back of his hand every so often," says a Capitol Hill expert. The Reagan Administration expects that relations will remain warm because of Mulroney's oft-proclaimed affection for the U.S., his attitude that, as he has said, "the U.S. is our greatest friend, neighbor and ally."

Mulroney may find that his most trying moments are spent dealing not with Washington but with his Tory colleagues. The new Prime Minister won the election partly because he succeeded so well in uniting a fractious party. With victory secured, however, the Progressive Conservatives could easily regain their penchant for bickering over ideological and regional issues. In a parliamentary majority this lopsided, Tory backbenchers may grow restless, or find it safe to dissent from the government line, or even−form cabals to pursue narrow issues. The 58 Tory members from Quebec may prove especially difficult to control. Most of them are parliamentary newcomers with little experience in the customs and folkways of Ottawa−and with much dedication to their province's distinct identity. Mulroney is no doubt aware of the hazards. Diefenbaker, his onetime mentor, won a large majority in 1958 but could not hold it together. Some members grew tired of hewing the party line; others championed regional questions. The government crumbled after five years.