Canadian House to Tackle Free Trade Pact in 3 Weeks

TORONTO — A confident and determined Prime Minister Brian Mulroney, fresh from his impressive national electoral victory, announced Tuesday that he will call the new House of Commons into session in three weeks to ratify the controversial U.S.-Canada free trade agreement before year-end.

The 49-year-old Mulroney, in a nationally televised news conference from his home town of Baie Commeau in Quebec, also disclosed that President-elect George Bush had invited him to confer sometime before Bush is inaugurated Jan. 20. “I . . . would expect to be getting together in the reasonably near future,” the prime minister said.

President Reagan, telephoning from his Santa Barbara ranch, also spoke with Mulroney and congratulated him on his reelection. In a further statement issued by the White House, Reagan repeated his hopes for early implementation of the free trade agreement and described recent U.S.-Canadian relations as “marked by cooperative dialogue and a remarkable record of mutually beneficial achievement.”

Mulroney, in the news conference, dismissed all suggestions that he lacked a mandate for free trade because of his failure to win a majority of the popular vote after a bitter campaign fought almost entirely on the issue of the agreement with the United States. Although Mulroney and his Progressive Conservatives kept majority control of the House of Commons in Monday’s parliamentary election, more than 50% of the voters cast ballots for the two parties that opposed free trade.

Mulroney said that talk of settling issues by majority vote of the people is “more reserved for plebiscites and systems like that.” Canada has a parliamentary system, he said, and “the fundamental nature of the parliamentary system is on the basis of the people deciding in each district whom to send to Ottawa.” Canada, the prime minister said, forges its majorities that way.

“We have received considerable support in all regions,” Mulroney went on. “. . . I think we have a right to say we have a national mandate. The people have spoken.”

Mulroney, moreover, denied that Canada was bitterly divided on free trade. “Some people had the notion that this nation was irretrievably and irrevocably divided on this issue,” the prime minister said. “Not so!”

All politicians appeared to accept Mulroney’s interpretation of Canadian parliamentary tradition, and it was widely expected that the losing Liberal and New Democratic parties would not try to obstruct or delay ratification of the free trade agreement. The agreement, signed by Mulroney and Reagan last January and already ratified by the U.S. Congress, is scheduled to go into effect Jan. 1, starting a 10-year process of eliminating all tariffs between the two countries, the largest trading partners in the world.

Although the prime minister tried to sound conciliatory at the news conference, he could not hold back his bitterness about some aspects of the campaign waged against him and the free trade agreement by Liberal leader John N. Turner and New Democratic leader Ed Broadbent.

Turner and Broadbent had insisted that the agreement threatened Canadian nationalism and sovereignty by subjecting Canada to an onslaught of American commercialization and by exposing Canadian health insurance and other social programs to possible demands by American manufacturers to curtail the programs as unfair subsidies to Canadian business.

No Need to Allay Fears

In reply to a question from an American reporter, Mulroney said, “There is in Canada and other industrialized countries a well of anti-Americanism. It isn’t enough to elect a dog catcher. But that doesn’t stop people from trying to whip it up.”

Mulroney was even more bitter about the argument over the possible loss of social programs. This, he said, had frightened old-age pensioners and others. “What emerged (from the campaign) is that fear can be a powerful instrument,” he said.

The prime minister insisted, however, that there was no need to allay those fears by negotiating with the Americans for guarantees for social programs. “We don’t need any guarantees,” he said. “We have them all.”

Although Mulroney and his Progressive Conservatives lost to the Liberals in the Atlantic provinces and to the socialist New Democratics in the Pacific province of British Columbia, they swept across the rest of the country, taking almost all the seats in Mulroney’s native province of Quebec, winning the most seats in Ontario, Canada’s largest province, and holding on to a majority of the seats in the prairie provinces.

In all, Mulroney’s Progressive Conservatives took 170 of the 295 seats in the House of Commons. Turner’s Liberals had 82 seats and Broadbent’s New Democrats 43. The Progressive Conservative total represented a considerable decline from the record-breaking 211 seats won by the party in Mulroney’s first victory four years ago, but it still was a comfortable majority.

In the popular vote, the Progressive Conservative victory was less impressive. The party took 43% of the vote, while the Liberals had 32%, the New Democrats 20% and other small parties 5%. But the situation was not unusual. Because of the existence of a strong third party, most parliamentary majorities in the past half a century have been formed in Canada on the basis of only a little more than 40% of the popular vote.

Tariffs Removed

Canadian economists have estimated that the free trade agreement, by eliminating tariffs and increasing trade, would increase employment in Canada by 120,000 to 350,000 jobs at the end of 10 years. Several thousand jobs, however, would be lost in Canadian industries that exist now only because of protection from tariffs. Mulroney has promised swift job-retraining programs to deal with this unemployment.

The agreement, which is lengthy and complex, also lifts some of the Canadian restrictions on American investment in Canada. This concession upset many Canadian nationalists. American policy already allows unlimited foreign investment in the United States.

In the field of energy, the agreement removes all tariffs on Canadian petroleum and petroleum products. But, in another provision that upset nationalists, the agreement does not allow Canada to charge Canadians a lower price for oil, hydroelectric power and other energy than it charges American customers.

Mulroney told the news conference that he was calling the new House of Commons into session during the week of Dec. 12. He estimated that legal technicalities, like the official signing of election documents, would not allow the members to meet earlier than that.

The old House of Commons passed the free trade agreement earlier this year, but the accord languished in the Liberal-controlled Senate, a weak parliamentary body that has no more than delaying powers. Turner had asked the Senate, whose members are appointed, to hold back its approval so that the issue of free trade could be settled in a national election.

Turner had pledged not to try to obstruct passage of the agreement if Mulroney won a majority of seats in the election. Mulroney told the news conference that he had already spoken with some Liberal senators and that “the Senate will no doubt respect the will of the elected representatives.”