SPECIAL REPORT

THE NAFTA TAPES

September 21 1992
SPECIAL REPORT

THE NAFTA TAPES

September 21 1992

THE NAFTA TAPES

SPECIAL REPORT

For the second time in four years, the federal government is facing a major political battle over free trade. Last month, International Trade Minister Michael Wilson signed a new North American Free Trade Agreement (NAFTA) with the United States and Mexico, which if ratified would create the world’s largest trading bloc, with 370 million consumers. At the outset of the 1988 general election, Prime Minister Brian Mulroney’s advisers tried to play down the significance of the thenunratified Canada-U.S. Free Trade Agreement—but the strategy backfired and nearly cost Mulroney his job. This time, the Conservatives appear to be taking a far more aggressive approach to selling free trade. On the following pages are excerpts from a transcript of a telephone conference call involving more than a dozen senior ministerial aides on Aug. 26— one in a series of weekly discussions among Tory advisers that are routinely taped and transcribed for future reference. The transcript, a copy of which was obtained by Maclean’s, reveals that the Conservatives have organized an extensive, and costly, campaign to convince Canadians of the need for NAFTA and to discredit its opponents, particularly Ontario Premier Bob Rae, Canadian Labor Congress president Bob White and Council of Canadians head Maude Barlow.

Mixing confidential poll results and other practical details with cynicism and dark humor, the aides discuss plans for a series of profree trade “tabloids,” or newsletters, a $ 1.8million purchase of radio advertising time, a succession of trade conferences in major cities and a computer bank to keep track of the deal’s critics. One of the call’s participants also expresses frustration at the failure of many Conservative MPs to become active in the pro-NAFTA drive, adding that the issue is a “sleeping tiger” that, if aroused, could threaten the party’s chances for re-election.

The conference call’s organizer was James Ramsay, a veteran Tory adviser and Wilson’s chief of staff. Among the other participants, not all of whom are identified in the transcript, were: Patricia Vance, special assistant to Indian Affairs and Northern Development Minister Thomas Siddon; Edward Arundell, chief of staff to National Health and Welfare Minister Benoit Bouchard; Maureen Murphy-Makin, special assistant to Public Works Minister Elmer MacKay; William Crosbie, chief of staff to Fisheries Minister John Crosbie; Marjorie LeBreton, deputy chief of staff in the Prime Minister’s Office; Susan Norquay, chief of staff to Western Economic Diversification Minister Charles Mayer; Greg Ebel, chief of staff to Finance Minister Donald Mazankowski; Michael Dearden, executive assistant to Small Business and Tourism Minister Thomas Hockin; Marc Sicard, special assistant to Labor Minister Marcel Danis; and Micheline Racette, Danis’s communications assistant. Maclean’s confirmed the date of the conference call with three participants and the existence of a transcript. Excerpts:

Ramsay: I’d like to start with you out in British Columbia. How did your session go... ? Vance: It’s Trish Vance from Tom Siddon’s office. ... I did get an update on the Michael Harcourt briefing yesterday. I think there was about 50 business people in attendance.... It went quite well and it was very helpful. Ramsay: How would you report on B.C. reaction to date on NAFTA and free trade?

Vance: Not a lot of coverage____The minister

himself has done some local interviews and we’ve had very little coverage as far as the NAFTA aspect.... We’re going to have a NAFTA breakfast the second week in September and invite the media and, you know, try to get some coverage that way.

Ramsay: OK.... As you know, we went out with some polling, a sample of 1,500,1 think it was, in April, Canada-wide.... It showed that we only had 30-, 27-per-cent support for

NAFTA____Well, we just completed our second

survey this week—1,500 people all across Canada, up to a 45-minute survey, a massive one. And I’ve got some good news for you. '

On the [Canada-U.S.] Free Trade Agreement, we had seven per cent strongly support it and now we’ve gone to 10. Moderately support we had previously 30 [per cent]; we’ve now gone to 35. So, we’ve now got 45 per cent support for free trade. . . .

The other thing, with respect to NAFTA— previously, in April, we had six per cent strongly support it. We’ve now gone to 10. Somewhat

support was 23____We’ve now gone from 23 to

36. Somewhat opposed have strengthened from 21 to 24, but strongly opposed have dropped from 46 to 24. So the good news is, the bottom line is, that we’re right out in the battle again.

But you know we’ve been pounding away on this prior to the NAFTA announcement, with our TV commercials, with previous tabloids, etc., like this. We’ve got where we are by pounding day in, day out—speeches, opportunities and everything else like this. And we’ll be going out with our radio commercials, a massive radio buy, $1.8 [million], and a week after we’ll be hitting with another tabloid.

And our strategy, again, just to repeat it, is to kind of go . . . from NAFTA into free

trade into prosperity____Any

comments on what I’ve just said?

Arundell:... Do you have a regional break on those numbers? ... Do we have any specific trouble spots like B.C.?

Ramsay: We’ll be able to do it province by province.

We’ve got a lot of good breakouts—social, economic and

everything else like this. So, it’ll be very helpful to us in targeting. We do find in the survey unbelievable ignorance out there. . . . Unidentified: We could encourage members to send their 10-per-centers [the 10 per cent of Canadians who, according to government polling, strongly support NAFTA] ... to specific parts of their riding. That would be helpful. Ramsay: We’ll do that. We’ve been getting the [press] clippings coast to coast. They’re quite small. . . . Nevertheless, we are seeing articles and letters starting to come out by what I’ll call that old left-wing, crypto-communist, anti-free trade, NDP-Liberal con group. They’re starting to write letters alleging plots, the dollar and everything else like that.... For example ... I see where that George Proud of P.E.I. [Liberal MPfor Hillsborough] has slashed it. . . .

Fundamentally, we want every single negative story and letter to the editor answered. That’s our bottom line. It’s how we’re going to turn this into a winning election issue. Atlantic Canada, anybody from there on the phone here?

Murphy-Makin: Yes, Jim, it’s Maureen Murphy-Makin from Elmer MacKay’s office. We’ve followed that story that George Proud had in and I’ll certainly see. . . .

Ramsay: Thank you. Anybody else got anything to report? British Columbia? Unidentified: Well, there is one thing. Ken Georgetti [president of the B.C. Federation of Labor] in today’s paper saying that there ought to be a system of social tariffs on Mexico, that they would be allowed to export [only] if they increased their environmental and social benefits to the workers. . . .

Ramsay: Oh. Anything to price Mexican labor out of the market. Crosbie: Jim ... responding to articles in the media, you know, [John] Crosbie would be delighted to respond. . . .

Ramsay: Thank you. Yeah, I think that replies, for example, in Newfoundland should come from Crosbie.. . . What do you think? Crosbie: I guess in some instances it would be better to have Mr. Wilson. I mean, Crosbie is in the paper an awful lot. So, sometimes it’s useful to have another minister saying the same thing.

LeBreton: Jim, I just have a question____Has

the rush of the loony left that came out the first day of the announcement, does that precipitate anybody . . . coming to our side?. . . Ramsay: I don’t know. .. . There's no doubt that third-party support is the best thing we’ve got—it’s what sells best. We’ve got a lot of third-party support organized nationally. . . . GM is considering writing to all of their employees. We’ve got most of the big associations out now. We’ve got a lot lined up. But we’re kind of pushing stuff out almost every day to keep the ball rolling.. . .

Unidentified: Just as long as they

say it, Jim, that’s the thing____As long

as it’s a nice headline, that somewhere in the story they attribute this to free trade. You know, have you got that much influence or control... that you can get these third-party people to say this and it’s not left to osmosis? Ramsay: Good point, and we’re working on that with them. . . . But I still think the way we’re going to win this is just drive it day after day after day. And lookit, my God, we’re at 45 per cent. When had we last been there? . . . Susan, you’ve usually got some good stuff coming out of the West.

Norquay: I’m sorry, Jim, I’m just back from holidays. ... If I had anything just from my own travels in Western Canada, the issue is less NAFTA and more the basic fundamentals of free [trade].... We have to go back and resell that whole concept and get the success stories out. . . . The only way we’re going to do it is to not duck the issue and to make it front and centre all the time.

Ramsay:... [During the] last week in September... we’re bringing back all the trade commissioners from around the world. We’ll be doing very large [trade] shows, oneand two-day shows in Toronto, Montreal, Vancouver, Calgary. . . . We’re not neglecting Atlantic Canada, but we need a different type of show based on response previously.

The idea on the Toronto one would be [that] trade commissioners are there from all around the world. . . . It’ll be massively covered by the business press. We expect about 1,000 people and a oneor two-day event, and then we put a different show into

On governments we’ve had [support from] New Brunswick, Nova Scotia qualified, Newfoundland supportive, Quebec, Ontario not. And that suits us. We did focus groups—or friends of ours did focus groups—and they tested the credibility of a number of speakers on this issue. And every time Bob Rae and Bob White get out there blasting us, we go up.

... If you’re to do a TV announcement—for example, with Wilson—we’re going to try to get him in a factory site surrounded by the company president and workers. Much higher in credibility than having a talking head down in the national press gallery.

Montreal, targeted to that area. We put one into Calgary targeted to the oil and gas and other things. This also allows us to resell free trade and NAFTA and get a lot of good mileage.. ..

Ebel: Jim, it’s Greg. Remember a couple of weeks ago we spoke about, I guess in our first phone call, that we’d be putting some [information] modules together here at Finance on the trade issue? We’ve got three of them which

should be in your hands today____And they’re

put in a context of, this is part of an overall plan of trading with the world, it’s not just the United States, which was a problem we had to face in the ’88 election....

Ramsay:... We’ll get it out, Greg. We’ve also got the StatsCan. We’re doing some minor changes to it, and we’re holding that off at the key moment. We’ll probably launch it next week if there’s a quiet day or two, which again will give us much more intellectual substance for the fact that free trade wins.

I think there’s kind of a lesson. ... To my mind there’s no way to do it but to get out and grind it out with them toe by toe, riding by riding, paper by paper, outlet by outlet, on all

these issues____I mean, you’ve got to figure on

a four-month sell....

But as you can see we’re moving the numbers and the proof is in the pudding. I’m quite surprised how far they’ve moved. I guess the opposition have left us these empty heads to fill and we’ve been getting in there.... Norquay: It’s Susan Norquay. Is anybody at your office sort of doing an opposition watch, not just elected opposition but the Maude Barlows of the world ... ?

Ramsay:... Watching all the opposition ... got the comments by all of them. We've got them on a computer. The big thing is, if we’re going to get them to people, we want to know they’re going to use them. Because if they’re not going to use them, we’ll use them. And I know that there’s no problem in your area, Susan. I meant that for others.

But we’ve got it, we’ve got tons of it. I wish we could get more people to use some of the

material we’ve gotten out____I would estimate

that probably [at] the most 25 to 30 per cent of the MPs that we’ve sent material to have availed themselves of it.

Norquay: Well, they’re going to have to when they start going door-to-door Arundell: Jim, Ed Arundell. It seems to me that... the first couple of days of the House coming back are going to be critical. Because . . . you know,

Steve what’s-his-face [NDP MP Steven Langdon] from Windsor and that are going to come at us on the first couple

of days____I’m kind of nervous when I

hear Mike [Wilson] might be away in the middle of September in case the House comes back in that period, because he’d have to be there to knock the ball out of the park a couple of times with [NDP leader Audrey] McLaughlin and some of the others.

Ramsay: . . . It’s too bad we can’t motivate more of our MPs to at least look at the material that we’ve sent them....

Unidentified: ... I think there’s a little bit of a lull around the party right now that we’re doing so well on this [issue]. You know, ‘We just don’t have to do any more.’ And of course we know what happened to us the last time we got lulled into that.

Ramsay: This is just a sleeping tiger here____

Do you want to summarize, Derek, just what it is that we have sent out?...

Unidentified: All of the ministers received a

full briefing book____And then the members [of

Parliament] received the exact same thing except the Q and A’s [questions and answers]

were a little shorter and more to the point____

Then, to field organizers right across the country... as well as our key party associations, as well as the campaign chairs from right across the province ... they all received that full kit. And then we sent out letters with key points, the highlights, the press release and the statement, to 17,000 business associations as well

as 1,000 CEOs from across the country____The

day that the agreement was signed we faxed to all of these people the press release, the highlights and the statement.

Ramsay: Didn’t we do 100,000 to somebody, too? Or was that...

Unidentified: No, that was 50,000 businesses.

Unidentified: We’ve also been in contact with BCNI [Business Council on National Issues], the Chamber of Commerce, and they’ve all got kits and they’re taking the material and sending it out to their key people. We’ve been passing on information to the bankers’ association, the Canadian Exporters’ Association. All of these people are on side....

Ramsay: . . . We’ve also been calling . . . leading Canadian companies. So far we’ve called 168.1 guess, all in all, we must have sent out close to a quarter of a million pieces, right? That’s in 10 days. So we’re hitting it pretty hard, but as I say, it’s those rifle shots that we need.... Any other comments, suggestions? Dearden: Mike Dearden here. . . . Can you give us some sort of calendar ... that tells us key dates or events that we can work around in our own regions to make good news on this story?...

Ramsay: Be happy to. . . . Anything out of Quebec?

Unidentified:... [It’s] all very positive. The only negative article I saw was that the environmentalists in Quebec wouldn’t like the NAFTA.

Ramsay: ... Same thing in B.C. . . .

Isn’t there [an] announcement coming out of Maz’s office on Monday on textiles that is going to be beneficial, Greg? Greg Ebel?

Unidentified: Gone for a pee. Unidentified: Have you seen any of the articles from Hamilton? The steel companies seem to be endorsing the free trade deal. . . . It's not like overwhelming, but it’s not been bad. And also the editorials we’ve had have been very good.

Ramsay: What are our chances of getting third-party spokesmen active and out in the Niagara Peninsula? Unidentified: ... I’ll work on the steel people. We’ve got some people who have been doing some business, and it means good news for them. I don’t know if they would actually go out there. They feel that they would have been able to do it with or without the NAFTA deal. But, I mean, obviously, this is going to make things a lot better for them. I’ll see what we can do to hit them up.

One of the quotes, by the way, in... one of the editorials states, and it sounds good: “If nothing else, the Tories have once again offered a choice in economic policy. They have aligned themselves behind the aggressive pursuit of expanded trade to stimulate economic growth and boost competitiveness.” That’s not so bad. Ramsay: Yeah? Which paper is that?. . . Unidentified: The Hamilton Spectator. Ramsay: Oh, God.

Unidentified:

‘The Maude Barlows of the world may use it as a platform . . .

You know how they jump on every train going to fight the free trade/

Ramsay:

‘If they want to come on to this issue, though, we’ll give them a real barroom brawl/

Unidentified: I know. They’re actually saying something nice in the editorial... .

Ramsay: Thank you. Anything else? Unidentified: Just one defensive note. In The Globe and Mail and in Maclean ’s they had the

water-diversion project [a proposal by a Vancouver-based company to divert water from British Columbia to the United States] mentioned last week. And [Forestry Minister] Frank Oberle sent out a press release on Monday basically saying that it was nonsense, it was hooey and the time has come to nail the truth to their skulls and give five reasons why it’s not going to happen. ...

Ramsay:... In Canada with all the rain we’ve had this summer we might want to look more favorably on water diversion. We’re almost flooded over here.... Any other alerts?... Unidentified: Jim, again stating the obvious, when and if a referendum campaign starts, coordination with... the NAFTA conversation ... is going to be absolutely critical, because it’ll be a very good second string in Quebec during that period.

Ramsay: Good.

Unidentified: And of course on the other side of it, Ed, you know, that the Maude Barlows of the world may use it as a platform. . . . You know how they jump on every train going to fight the free trade. So they could cause some problems in a national referendum campaign by trying to take the issue away, or even talk about our sovereignty in other manners. So we should be careful about what they’re going to do.

Ramsay: If they want to come on to this issue, though, we’ll give them a real barroom brawl. I’ve never really felt they’ve had staying power, that a lot of their influence has come from the fact they’ve been able to work in vacuums. Harvie Andre said... that if we’ve got to go out in an election we need enemies—this will be news to some of you—but we, this is not a bad

issue to fight them on. We beat them on this before. If we can keep those percentages up we can draw them in on it.

... As our focus groups showed, the more we’ve got Bob Rae and Maude Barlow—but particularly Bob Rae and Bob White, and maybe there’s other equivalents—out there attacking us, it’s forcing that coalition which has been sitting on their hands over the past two or three years, forcing them out behind us again. They don’t want Rae. Chrétien is invisible. And we know from other polling that you’ve all had that we are conceived [sic] as having the right economic policies for the country. They just don’t like the way we’re doing it... . Unidentified: Mr. Ramsay?

Ramsay: Yeah?

Sicard:... Sicard from Ministry of Labor____

I’m with the press attaché, Micheline [Racette]. We have three things. There’s one thing about Bombardier that’s, I don’t know, Micheline can talk to you about it. It’s about a contract.

Racette: Someone earlier was alluding to

good news out of Quebec regarding NAFTA____

There was an article about Bombardier being very unhappy. It appears it’s going to be losing a big contract with Mexico, and it seems to be setting a negative tone for how major Quebec companies can profit from NAFTA. I’m just flagging this.

Ramsay: Yeah, we’re aware of that situation. Wilson spoke to the Mexicans about it and Bombardier even bought the plant down in Mexico. But... I understand [Bombardier’s bid was] very high. .. . Looks like they’ve lost it. Should have used a sharper pencil.... Sicard: I haven’t finished. My other point is we target a thousand unions in Canada to send them something on labor____The idea is

that if we can hit the smallest unions we can defeat the Bob Whites and the others, because we know that they’re on the left side and they’re not really . . . they don’t understand nothing. .. . Ramsay: We’ll get on it right away. Thank you for letting us know. This is the

first we’ve heard about it____

Unidentified:... I also just wanted to bring up that [President George] Bush announced an adjustment program [a $2 billion-a-year plan to retrain workers who lose their jobs] yesterday or two

days ago____What it means is

that in real dollar terms, not per capita, we’re still outspending the U.S. ... Ramsay: OK, apart from getting it over to us, are you going to get it out that this is the case? Because it did get some pretty big play. Unidentified: Jim, the other point on that is, too, that of

Unidentified: Can we make sure that we’re not too critical of that? I mean, that’s kind of the policy of this government, that we find ways to reallocate as opposed to spend new dollars all

the time____I mean, put the facts out there, but

I don’t think we should criticize them for reallocating....

Ramsay: . . . We’re going to find that Bob White and Maude Barlow and those others kind of compare one job in the United States, one job [in] Canada, etc., like that. So we’ve got to be fast on our feet to get back on them. And by fast I mean we’re trying to speed it up here. We’re taking too long. By the time we . . . find out what somebody said and we get our own reply out, it’s almost two weeks....

Marge LeBreton, you know that those locations we’re lining up and the crowds we’re going to have there, they could also provide a useful venue for a couple of other messages? LeBreton: Yes, that’s right.

Ramsay:... If you all of a sudden need to get somebody up there to address a thousand ... people, we’ve got them. □

the $2 billion, apparently $700 million was old money just reallocated....