President Obama (and 37 States) Agree To Let Canadian Firms Get Stimulus Money

Last week, the U.S. and Canada reached an agreement to permit Canadian firms to bid on projects funded by U.S. stimulus money based on the legislation enacted last year. The confusing part is just how exactly this will occur.  According to CTV,

Canadian firms will be exempted from “Buy American” restrictions under seven of the stimulus programs, in 37 U.S. states that signed on to the World Trade Organization. Those states will be able to use American stimulus money to buy Canadian manufactured goods.

Apparently, the whole deal is being done via an executive agreement, an executive order, and some sort of subsequent agreement with some (but not all) of the states. (The USTR website confirms the report, but has no further details).

The interesting part of this agreement to me is my belated realization that only 37 of the 50 U.S. states are bound by the WTO procurement agreement.  I somehow didn’t know that, although I am all for foreign policy federalism.  Canadians seem to realize that this agreement with the U.S. government will only get them so far.  As one Canadian opposition leader notes (correctly).

“The American government machinery is so amorphous, that a deal signed with the administration in Washington is a long way away from applying to the municipal government in Cleveland, or in Bangor, Maine,”

It’s really not such a great deal for Canada. They are getting, one year later, the legal access (in 37 states) that they should have had a year ago. But I suppose you have to take what you can get.