From July 17-20, 2011, the Honourable Art Eggleton,
P.C., Senator, and Mr. Jeff Watson, M.P., Vice-Chair, represented the Canadian
Section of the Canada-United States Inter-Parliamentary Group at the 66th
Annual Meeting of the Midwestern Legislative Conference (MLC) of the Council of
State Governments in Indianapolis, Indiana. The delegation was accompanied by
Mr. Mohamed Zakzouk, Advisor to the Canadian Section.
THE EVENT
The MLC, which meets annually, is a regional
association of state legislators from 11 U.S. states, and includes provincial
legislators from four affiliate Canadian provinces (see Appendix). The purpose
of the MLC is to foster regional intergovernmental cooperation in the U.S.
Midwest through the consideration of common problems, the exchange of
information and ideas, the sharing of knowledge and experience, and – as
appropriate – the pursuit of collaborative efforts to improve state government.
DELEGATION OBJECTIVES FOR THE EVENT
Canada and the 11 MLC states share a mutually
beneficial relationship. According to recent figures, more than 1.6 million
jobs in the 11 MLC states rely on Canada-U.S. trade. Annual merchandise trade
between Canada and these states was recently valued at about US$197billion:
about US$81 billion was exported from these states to Canada, while they
imported more than US$116 billion from Canada. Recent data suggest that, in a
recent 12-month period, Canadians made more than 4.4 million visits to the MLC
states and spent more than US$1.3 billion, while residents of these states made
more than 2.9 million visits to Canada and spent more than US$1.4 billion.
The IPG aims to find points of convergence in
respective national policies, to initiate dialogue on points of divergence, to
encourage the exchange of information and to promote better understanding among
legislators on shared issues of concern. Members of the Canadian Section of the
IPG meet regularly with their federal counterparts and, in recent years, have
attended meetings of governors and state legislators. At these events, Canadian
delegates take the opportunity to engage in the conversations that will help to
achieve the Group’s objectives, and to communicate the nature and scope of the
bilateral relationship.
Members of the Canadian Section found the 2011 Annual
Meeting of the MLC to be a valuable opportunity to discuss the numerous
opportunities for Canada and the U.S. Midwest to collaborate on improving
regional trade links and establishing perimeter security. Furthermore, members
of the Canadian Section benefited from presentations focused on a variety of
policy areas, including economic growth, healthcare and education. Feeling that
members of the Canadian Section were able to achieve their objectives for the
event, the Canadian Section intends to attend future annual meetings of the MLC
to continue its work in advocating Canadian interests in the U.S. Midwest.
ACTIVITIES DURING THE EVENT
During the 2011 Annual Meeting of the MLC, the
following plenary and concurrent sessions took place:
Economic Gardening
The Changing Dynamics of Electric
Generation
Electric Transmission in the Midwest:
Expanding Capacity, Enhancing Reliability and Assessing Costs
Nuclear Energy: Safety, Security,
Storage and the Future of Nuclear Power
The Use of Alternative and Renewable
Energy Sources: Where We Are Now and Where Technology Can Take Us
Medicaid Reform/Cost Containment
Long-Term Care
Health Insurance Exchanges
U.S.-Canada Integrated Supply Chains
Implementation of the Canada-U.S.
Perimeter Security Agreement
Moving Toward a Comprehensive
Government Procurement Accord
Agriculture’s Environmental
Challenges: Separating Myth from Reality
State Responses to Animal Rights
Activists
Ethanol and Commodity Prices: The
Economic Impact
A Path to Growth: Economic Gardening
Models and Pilot Programs
Regional Collaboration on Economic
Development Policies
Health Care: The Challenge of
Balancing Concerns about Access, Quality and Costs
Local Government Ethics: The Potential
Role of States in Improving Financial Disclosure and Accountability
Moral Conscience vs. Federal
Preemption: Lessons from Indiana’s Effort to Defund Planned Parenthood
America at a Crossroads: Today’s
Critical Policy Making Challenges and Opportunities
America at a Cross Roads: Perspectives
from the Midwest
The Crossroads of America – Finding
the Midwest’s Future through its Past
Strategies for Improving the
Performace of State Election Systems
Collective Bargaining and Public
Employee Labor Law
Long-term Strategies for Financing
State Transportation Infrastructure
Addressing the Shortage of Health Care
Workers: How to Expand the Number of Professionals in your State
Improving Schools Locally and
Collaboratively: A Case Study from Indiana
Leading the Way – The States’ Role in
Transforming K-12 Education
E-12 Education Finance
College and Career Readiness
Putting Quality Teachers in the
Classroom
Patchwork Midwest: What Demographics
Tell Us about the Fabric of the Midwest
The Beltway and Beyond
Midwestern Higher Education Compact
Report
An Economic Long View: What Can We
Learn from the Past?
Building a Stronger Midwest: Growing Together
through Regional Cooperation.
This report summarizes the
plenary and selected concurrent discussions that occurred at the meeting.
U.S.-CANADA INTEGRATED
SUPPLY CHAIN
Mark Cooper, Director,
U.S. Department of Commerce
The nature of the global economy has
changed; exportation to global markets is essential for economic success.
The gross domestic product (GDP) of
Brazil, Russia, India and China, the “BRIC” economies, is rising rapidly.
For example:
ØChina’s GDP surpassed
the GDP of France and of the United Kingdom in 2005 and of Germany in 2008, and
is projected to surpass the GDP of Japan by 2013 and of the United States
between 2030 and 2040.
ØIndia’s GDP is
projected to surpass the GDP of France and of the United Kingdom by 2015, of
Germany by 2020, of Japan by 2025 and of the United States between 2040 and
2045.
About 95% of the world’s consumers
live outside U.S. borders. The United States could benefit from additional
export opportunitites.
Small and medium-sized enterprises
(SMEs) are the engine of the U.S. economy and need to participate in
global markets. The most dynamic growth comes from firms with fewer than
20 employees that export.
Exports support 12 million U.S. jobs,
and export-oriented jobs pay over 18% more than the U.S. national average.
A willingness to travel is essential
for doing business globally. In-person communication is necessary to
establish trust and maintain close business relations.
U.S. businesses should take advantage of the North
American Free Trade Agreement (NAFTA), and should consider Canada and
Mexico as strategic export markets.
Corinne Pohlmann,
Vice-President, National Affairs, Canadian Federation of Independent Business
(CFIB)
In Canada and the United States, SMEs
represent 98% to 99% of businesses, employ 50% to 60% of the working-age
population, and produce about half of the GDP in each country.
About 76% of Canadian SMEs do not
export to the United States, 16% export only goods, 4% export only
services, and 4% export both goods and services.
About 51% of Canadian SMEs do not
import from the United States, 42% import only goods, 5% import both goods
and services, and 1% import only services.
SMEs that trade with the United States
typically do not export and import on a regular basis. One bad experience
could discourage an SME from pursuing international trade in the future.
In a CFIB survey conducted in
2008-2009, survey respondents identified “border and trade rules” among
the most burdensome federal regulations.
SMEs are often unaware of the programs
available to help improve their trade across the Canada-U.S. border.
Legislators could improve the business
environment for SMEs in Canada and the United States by:
Ømaking border and trade
programs and policies more relevant and accessible to SMEs, including through
measures that facilitate importing and exporting processes for low-risk,
small-volume traders
Øsimplifying and
harmonizing regulations and paper work in Canada and the United States
Øimproving customer service and
communication with small businesses by providing readily accessible information
in easy-to-understand language.
Bernard Swiecki, Director
of Market Analysis, Center for Automotive Research
Canada is signing free trade
agreements with a number of markets around the world. The Canadian economy
is more globally competitive when the North American market is as
efficient and well-integrated as possible.
North American vehicles are at a
disadvantage compared to foreign vehicles due to inefficiencies at the
Canada-U.S. border. For example, because North American vehicles often
have to cross the border more than once during manufacturing, 4,000 North
American-produced vehicles would undergo 28,000 customs transactions at
the Canada-U.S. border, while 4,000 foreign vehicles would undego only one
transaction at a port of entry.
The consumer ultimately pays the price
for the added costs that result from border delays and inefficiencies.
Michigan is especially vulnerable to
border delays. For example, in 2010, New York State had far fewer delays
associated with crossing the Canadian border.
Adding a second crossing between
Michigan and Ontario would improve the overall efficiency of trade between
Canada and the United States.
The automotive industry has the highest
multiplier effect of any manufacturing industry in the United States. For
every job created in the automotive sector, 10 jobs are created in the
U.S. economy.
IMPLEMENTATION OF THE
CANADA-U.S. PERIMETER SECURITY AGREEMENT
Eric Miller, Senior Policy
Advisor (Industry), Embassy of Canada
It is difficult to over-estimate the
importance of the Canada-U.S. border for North America’s economy. Canada
represents the top trading market for 35 of the 50 U.S. states.
On February 4, 2011, Prime Minister
Stephen Harper and U.S. President Barack Obama issued a declaration on a
shared vision for perimeter security and economic competitiveness between
Canada and the United States.
Canada and the United States will
develop a joint action plan that will set out a range of initiatives in
four key areas of cooperation:
Øcollaborating to
address threats before they reach North America, by improving intelligence and
information sharing, and by conducting joint threat assessments to support
informed risk management decisions;
Øpursuing creative
solutions to manage the flow of people and goods between Canada and the United
States, by investing in modern infrastructure and technology at the busiest
ports of entry;
Øbuilding on existing
bilateral law enforcement programs to develop the next generation of integrated
cross-border law enforcement operations in order to identify, assess and
interdict persons and organizations involved in transnational crime; and
Øworking to prevent,
respond to and recover from physical cyber disruptions of critical
infrastructure and to implement a comprehensive cross-border approach to
strengthen the resiliance of North America’s cyber infrastructure.
The goal of the joint action plan is
not to eliminate the Canada-U.S. border, but rather to improve the
management of the common border as well as to streamline programs and
develop a plan to ensure the ongoing modernization of border
infrastructure.
Canada and the United States have a shared
responsibility for the safety, security and resilience of North America in
an increasingly integrated and globalized world.
HEALTH CARE: THE CHALLENGE
OF BALANCING CONCERNS ABOUT ACCESS, QUALITY AND COSTS
Senator Ron Grooms, State
of Indiana
Indiana operates a variety of
Medicaid-funded initiatives tailored to different populations.
Indiana’s approximately $1.9 billion
in budgeted Medicaid spending for 2012 and 2013 represents 13.3% of the
two-year state budget.
The Patient Protection and
Affordable Care Act (PPACA) mandates an expansion of Medicaid starting
in 2014 so that any legal U.S. resident making up to 133% of the federal
poverty income level will be eligible for Medicaid, unless she or he is
eligible for Medicare.
The Congressional Budget Office
estimates that the national Medicaid expansion will bring about 17 million
more people into the Medicaid program by 2021.
In order to reduce the costs of the Medicaid
system in Indiana, Governor Mitch Daniels’ administration proposed
substituting the Healthy Indiana Plan (HIP) for the PPACA’s Medicaid
expansion. Indiana will need permission from the federal government in
order to implement this substitution.
AMERICA AT A CROSSROADS:
PERSPECTIVES FROM THE MIDWEST
Ron Brownstein, Political
Director, Atlantic Media Company
The U.S. political system is
undergoing a period of volatility.
Partisanship has increased
significantly since the 1960s, which has changed the political nature of
the United States.
The social and cultural diversity of
the United States is not expected to change in the near future.
U.S. politicians face the challenge of building working
majorities for effective change in the United States.
Dr. Erin Goss, Jack A.
MacAllister Chair in Regional Economics, Creighton Univeristy
The U.S. economy is slowing down.
In order to achieve full economic
recovery in the United States, the housing sector must recover, which is
not likely to happen in the near future. Government intervention in the
housing market has not been effective.
Raising corporate tax rates is not
good policy. Market forces are most effective in determining the success
of businesses.
The manufacturing sector is expected
to play a major role in U.S. economic growth.
Many international students do not work in the
United States after graduating from U.S. colleges and universities. The
retention of an educated workforce is a requirement for economic
competitiveness.
Mr. William Testa, Vice
President and Director of Regional Programs, Federal Reserve Bank of Chicago
Spending cuts by government are not
good for the economy.
Reduced financing for community
colleges is not good policy at a time when retraining is needed to improve
the future prospects of economic growth in the United States.
The Midwest has a significant
manufacturing industry that exports large amounts of manufactured products
to global markets.
Creating jobs and training a qualified
workforce should be priorities for the U.S. government.
The retention of local expertise is a problem in
a globalized world. Many college graduates choose to leave the U.S.
Midwest in order to seek employment elsewhere.
Mr. Dartanian “Doc” Warr,
Regional Vice President, RUAN
The aging workforce is one of the main
obstacles to economic growth in the U.S. Midwest.
Fewer people are interested in certain
kinds of jobs, such as truck driving.
The U.S. government should focus on technology as
a key area of investment to improve economic growth in the United States.
Mr. David Yepsen,
Director, Paul Simon Public Policy Institute, Southern Illinois University
Carbondale
Community colleges are one of the best
places for states to invest.
The manufacturing industry is critical
to the U.S. Midwest.
Facilitating an international
workforce is key to economic development. Furthermore, embracing a diverse
workforce is important. For example, homophobia is counterproductive to
economic growth.
In order to improve
telecommunications, the government must move forward on improving
broadband connections as soon as possible.
The lack of risk-taking is one of the greatest
obstacles facing economic growth in the U.S. Midwest.
LEADING THE WAY – THE
STATES’ ROLE IN TRANSFORMING K-12 EDUCATION
Ms. Sarah Brown Wessling,
High School Teacher, Johnson County High School, Iowa, and 2010 National
Teacher of the Year
Teachers operate in a space between
the ideals of teaching and the reality of the classroom. This space should
be embraced by teachers and viewed as a learning opportunity, rather than
as a learning gap.
It is important for teachers to make
use of positive and innovative learning spaces. For example, at Google,
the café is considered the most important working space: good food brings
people together where they can share ideas in a constructive environment,
and thereby be innovative.
Every student has a different learning
style and should be approached as an individual “case study.”
The process of teaching and learning
is not always efficient.
In order to foster growth and
constructive learning, students need to have permission to fail. They need
to be allowed to practise without penalty.
Achievement and enlightenment are not
the same thing. Achievement can be attained only by action, not by
words.
Society’s obsession with perfection precludes
innovation. Failure should be considered an opportunity, rather than a
mistake.
PATCHWORK MIDWEST: WHAT
DEMOGRAPHICS TELL US ABOUT THE FABRIC OF THE MIDWEST
Dante Chinni, Director of
PatchworkNation.org
The U.S. two-party political system
leads to social and cultural stereotypes that do not account for the
immense diversity of the United States.
A community can sometimes have less in
common with the dominate stereotype of the state in which it is located
than with other communities in different states.
Patchwork Nation segments the United
States into 12 sociocultural community types in an effort to move beyond
the “red” and “blue” stereotypes, while at the same time avoiding an
overly complex or detailed portrayal of diversity in the United States.
The major trends in the U.S. Midwest
include:
Øa large number of
“Service Worker Centers,” where many people are experiencing economic
challenges and often lack health insurance; and
Øa large number of
“Emptying Nests,” characterized by an aging population, with a high percentage
of “boomers” or retirees living on fixed incomes
”Emptying nest” communities are
expected to experience significant changes in the next decade.
“Service Worker Centers” and “Emptying
Nests” were the most affected by the economic downturn.
While conservative by nature, “Service
Worker Centers” have seen dramatic political swings in the past few
elections. These communities will likely be critical in the 2012
presidential election.
Between 2001 and 2005, the number of
manufacturing jobs has declined in 11 of the 12 U.S. community types
identified by Patchwork Nation.
The United States is experiencing
long-term economic changes that will not affect all communities equally.
The culture and politics of the United States is
expected to change within the next 10 years. Populist movements are
expected to rise and the sociocultural splits in the 12 Patchwork Nation
community types are expected to shift.
AN ECONOMIC LONG VIEW:
WHAT CAN WE LEARN FROM THE PAST?
John Steele Gordon,
Business and Financial Historian
The United States has been the world’s
largest economy since the late 19th century, the centre of the
global financial system since World War One, and the world’s leading
military power since World War Two.
The United States entered a financial
crisis of “epic” scale in 2008, which caused a number of economic and
social issues, including rising unemployment.
The United States is rapidly
approaching World War Two levels of debt.
The United States has experienced many
rececessions in the past; some caused long-term impacts and others were
followed by swift recoveries.
The United States was “born in debt
and financial destress” by having to fight Great Britain.
The U.S. Civil War is the greatest
“existential” crisis the United States has ever experienced. The war was
also a great economic crisis.
There are only three ways for a government
to raise money: taxing, borrowing and printing money. The U.S. government
has used different methods to raise money in previous economic crises.
The recovery from the 2008 crisis has
been slow.
In order to improve the current
economic situation, the U.S. government must signal definitively that it
is moving to put the government’s “fiscal house” in order. The inability
of a government to live within its means is at the heart of the U.S.
economic issue.
Respectfully submitted,
Hon. Janis Johnson, Senator,
Co-Chair,
Canada-United States Inter-Parliamentary Group