Gwyn Morgan is the retired founding CEO of EnCana Corp.
President Barack Obama's first 100 days are history, the worst of the U.S.-led banking crisis seems to be passing, and stock markets are grasping at every bit of positive news.
Will the resilient culture of free enterprise, innovation and renewal overcome America's seemingly intractable problems and turn those "green shoots" into fields of prosperity?
A recent visit to Washington made it clear that, unfortunately, Mr. Obama's misguided populist actions are like a deadly herbicide to those fragile seedlings of hope.
Here are some of the ways that the U.S. government has declared war on Corporate America:
1. In a lawful bankruptcy proceeding, secured bondholders rank ahead of unsecured creditors and unions. Ignoring investor rights, the White House struck a deal giving unions the majority of Chrysler's stock.
Under huge pressure and fearing the prospect of being blacklisted from government business, some fund managers capitulated. Mr. Obama then labelled the remaining holdouts "greedy hedge funds."
This bullying rhetoric deliberately ignores the fiduciary responsibility of fund managers to salvage whatever they can for the individual investors who have helped keep Chrysler alive. So much for that fragile green shoot called investor confidence.
2. An economic crisis would seem to be a poor time to attack your strongest enterprises, but clearly the Obama administration thinks otherwise. The U.S. Justice Department's top antitrust official recently announced a reversal of previous guidelines to "stop abuses ... while avoiding ... interference with the rough and tumble of beneficial competition."
Ironically, that announcement came on the same day the European Commission levied a €1-billion ($1.58-billion) antitrust fine against computer chip giant Intel.
The commission's previous victim was Microsoft, leading the Bush White House to accuse the EU of taking the action as a protectionist measure against American companies that were simply more innovative and capable than their European counterparts.
The U.S. Justice Department is infamous for its win-at-all-costs trophy-hunting lawyers, so now, being big and successful will be as hazardous at home as abroad. That should ensure those green shoots get whacked down if they grow too tall.
3. The huge stable of American-headquartered international corporations is the country's No. 1 competitive advantage. Contrary to popular impression, the principal wealth-generation component of global production chains is not in manufacturing the products but rather in creation of the technology, branding and control of the value chain from design to component acquisition to assembly to customer.
A Dell computer ordered by a student in Toronto is made of components supplied by manufacturers from around the globe and sent to factories in Asia for final assembly. The manufacturers might make 2 per cent on their part of the supply chain, while the margin for Dell is 20 to 40 per cent of the final sales price.
Global companies operate through subsidiaries in each of the countries where they do business, but the best jobs are almost always in the country where the head office is located.
So what is Mr. Obama proposing to do? Besides higher corporate and personal tax rates at home, he has announced plans to disallow the deduction of taxes paid to host countries of foreign subsidiaries. This double taxation plan isn't so much killing the green shoots as toppling the strongest oaks in the forest.
4. Mr. Obama's "I love this country," as he departed from a rock-star-like whirlwind visit to Canada, gave us hope that he was genuinely committed to living up to his anti-protectionism assurances. Fast forward three months and Canadians might be recalling the Black Eyed Peas' 2003 hit Where is the Love?
The image on the lead page of this newspaper's May 11 Report on Business shows the proprietor of Toronto-based pipe supplier Ipex standing beside a rack of his brand new "Made in Canada"-stamped pipes that were ripped out of the ground and replaced with "Made in U.S.A." pipes at an American military base.
While Mr. Obama warns the G20 against "giving in to protectionism," Canadian goods and services are being surreptitiously rejected where it counts, at the actual project level. Given the de facto shutout of Canadian steel products in American stimulus projects, it's only right that Industry Minister Tony Clement is pressing U.S. Steel to live up to commitments made at the time of the Stelco takeover, rather than shutting Canadian plants in favour of their U.S.-based ones.
So, what should Canada do when our closest neighbour and most important trading partner takes action against its own investors and business enterprises, while failing to address actions that violate cross-border trade agreements?
First, we should push as hard as possible for those trade undertakings to be honoured.
Then, we should let global value chain enterprises know that they are welcome to move their head offices from a country with one of world's highest tax and ideologically anti-business regimes to one that is lowering taxes and welcomes enterprise and investment.
And to where the love really is.
Gwyn Morgan