TORONTO—The Carney government is making a big push to expand our exports to other countries, making us less dependent on the American market. This is important, but will not be easy. Canada has spent much of its history seeking to cement close ties with the United States while failing to seek opportunities elsewhere. Moreover, we have failed to develop the Canadian-controlled companies with the scale and scope to serve world markets with unique products and services.

But our trade dependency is only part of the story. The reality is that the reach of the U.S. extends into almost every aspect of our daily lives. Either through imports from American multinationals or the output of their Canadian branch plants, we simply cannot avoid U.S. goods and services. 

This is not an argument about boycotting everything American. Rather, it is about enabling the growth of Canadian firms that can also serve our own market—and in some cases become able to supply global markets. These are our lost opportunities to create our own national treasure.

We now face a big new challenge: a choice between becoming a vassal state, serving the interests of U.S. business and U.S. foreign policy, or working to strengthen our own prosperity and sovereignty. This is the challenge of data sovereignty. 

Data sovereignty means owning our own intellectual property and our own data, ensuring that Canadian suppliers of data services—such as cloud computing, artificial intelligence, and quantum computing—are provided by Canadian companies wherever possible, and investing in our universities and colleges to develop the talent and commercialize new knowledge It also means finding alternatives to the foreign takeover of promising home-grown firms, and restructuring our financial system so that our financial markets will fulfil their obligation to provide long-term capital Canadian businesses need to scale up. 

On procurement, for example, while the federal government has committed to buying wherever possible from domestic companies in meeting its technology and other needs, Prime Minister Mark Carney needs to challenge our banks, insurance companies, utilities, telcos and other industries, as well as provinces, municipalities and hospitals to do the same. 

Today, though, we also face strong U.S. opposition on our efforts to achieve next-generation data sovereignty and the related industries that are the keys to the future. As U.S. President Donald Trump declared in a recent executive order, “the United States must not only lead in developing general-purpose and frontier AI capabilities,” it must also ensure, he said, that “American AI technologies, standards, and governance models are adopted worldwide” and “secure our continued technological dominance.” 

This dominant role of U.S. business in our daily lives came to me while reading a British book, Vassal State: How America Runs Britain, by British entrepreneur Angus Hanton. “Most of our digital infrastructure and even our principal system of exchange—card payments—are overwhelmingly U.S. owned,” he found. What this means is that, increasingly, “British consumers are paying a royalty to U.S. businesses on most transactions, moving from one-off purchasers to renters and subscribers, who slog away on payment treadmills to the benefit of shareholders on the other side of the Atlantic. The consequences could not be graver: impoverishment, loss of autonomy, and a drain on talent and treasure.”

This experience would be similar in Canada.  

Start with a trip to the supermarket. Costco, Walmart, and Whole Foods are possible shopping destinations. Most breakfast cereals come from Kellogg’s, Post Holdings or General Mills (as well as Cheerios it also makes Green Giant frozen foods, Pillsbury baking products, Haagen-Dazs ice cream, Betty Crocker items and El Paso products). Mondelez controls Cadbury and Mars supplies many confectionaries, as well as Uncle Ben’s Rice and pet food such as the Pedigree brand. PepsiCo owns Tropicana orange juice and Quaker Oats. Coca-Cola also makes Minute Maid orange juice. Then there’s Campbell Soups. Cleaning and washing supplies come from Procter & Gamble (it also makes Pampers diapers) and Colgate-Palmolive. Kimberly-Clark’s products include Kleenex and Huggies diapers. Kraft Heinz provides ketchup, Kraft dinners and peanut butter. And that’s just a partial list!

When you check out you are probably dealing with a National Cash Register machine and using Visa, Mastercard, American Express, PayPal, Google Pay or Apple Pay. If you use an ATM, it is quite likely to be another NCR product. And if you want fast food on the way home you can go to McDonald’s, Starbucks, Pizza Hut, Subway, KFC, Taco Bell—or go shopping at Nike, Gap, Apple, or Timberland, Costco, Pet Valu, eBay or Amazon. For delivery by Amazon there’s FedEx or UPS.

According to the U.S. Internal Revenue Service, in 2023, some 1,491 subsidiaries of major American multinationals (annual global revenues of US$850 million or more) operating in Canada had revenues of US$667-billion, pre-tax profits of US$46.3-billion, and paid taxes of US$16.9-billion. They had 1.1 million employees in Canada. 

That’s just the tip of the iceberg. In the world of high tech, Microsoft dominates much of the software business. Meta/Facebook and Alphabet/Google dominate the pipes that enable much of our commerce to take place, and Amazon, Microsoft, Google and Salesforce dominate cloud computing. Netflix, Amazon Prime, Disney, HBO, and Spotify are leading providers of stream services in Canada, undermining Canadian culture and identity. Mailchimp, Eventbrite, LinkedIn, Microsoft’s Outlook  and Google’s Gmail dominate our  channels of communication, while Ancestry.com collets vast personal data as it traces our roots. 

These are all part of the digital sovereignty battleground where the goal is not to bock the use of any American technology, but to ensure there is space and opportunity for Canadian technology and ensure, as well, that U.S. control of the “pipes” does not prevent the exercise of this country’s sovereignty and opportunity.

We will always benefit from import competition that pushes innovation and expands consumer choice. But we have to ensure as well that the oligopolistic power of foreign multinationals does not prevent Canadians from achieving our own potential, creating our own national treasure, achieving prosperity and protecting our sovereignty. Are we up for it?

David Crane can be reached at crane@interlog.com.

The Hill Times

 

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