“Millions of jobs are at stake on both sides of the border”

So says British Columbia Premier Gordon Campbell. At a meeting of Canada’s provincial premiers held in Regina, Saskatchewan, last week, slapping retaliatory tariffs on U.S. goods was barely averted.

Harper and his Trade Minister Stockwell Day scored an important victory Friday when provincial premiers finally agreed not to retaliate. “We’ve made it clear we won’t ask the U.S. for anything we are not willing to give the U.S.,” said British Columbia Premier Gordon Campbell, who attended a meeting of premiers held in Regina, Sask. this week.

For months Canada’s premiers, who are that country’s equivalent of state governors, have spoken out forcefully against the Buy-American clause, which requires that stimulus-financed public works projects use American materials. But until now they have been unable to agree on reciprocity. Since most government procurement happens at the provincial and municipal levels, this lack of consensus has allowed Washington to easily deflect Ottawa’s efforts to secure an exemption from its Buy-American position.

Failure to make a deal on procurement has already cost Canadian companies billions of dollars, and spread pain far beyond the stimulus business. “Buy American has created a trade chill,” says Jayson Myers, president of Canadian Manufacturers & Exporters, the country’s largest trade and industry association, noting some U.S. companies are dropping Canadian suppliers to avoid filing waivers that prove they are playing by the new rules.

While a trade war with Canada doesn’t seem to be on the immediate horizon, Canadians are rightfully upset by the Obama administration’s and Congress’s belligerent and idiotic trade agenda. This week, President Obama is meeting with Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon in Guadalajara to discuss the future of North American relations. Unfortunately, the press and most observers are already declaring the chances of progress on trilateral trade dead on arrival.

As the global recession drags on, expect more outrage from the United States’ global trade partners. CEI’s Ryan Young mentioned a few potential future trade flashpoints in a post this morning. For a good crash course on the absurdity of “Buy American,” see Reason.tv’s short video, Is Your iPod Unpatriotic?, which brilliantly debunks the tired, baseless claims of protectionists.