Cable Viewer

Currently released so far... 12613 / 251,287

### Browse latest releases

2010/11 2010/12 2011/01 2011/02 2011/03 2011/04 2011/05
2010/11/28 2010/11/29 2010/11/30
2010/12/01 2010/12/02 2010/12/03 2010/12/04 2010/12/05 2010/12/06 2010/12/07 2010/12/08 2010/12/09 2010/12/10 2010/12/11 2010/12/12 2010/12/13 2010/12/14 2010/12/15 2010/12/16 2010/12/17 2010/12/18 2010/12/19 2010/12/20 2010/12/21 2010/12/22 2010/12/23 2010/12/24 2010/12/25 2010/12/26 2010/12/27 2010/12/28 2010/12/29 2010/12/30
2011/01/01 2011/01/02 2011/01/04 2011/01/05 2011/01/07 2011/01/09 2011/01/10 2011/01/11 2011/01/12 2011/01/13 2011/01/14 2011/01/15 2011/01/16 2011/01/17 2011/01/18 2011/01/19 2011/01/20 2011/01/21 2011/01/22 2011/01/23 2011/01/24 2011/01/25 2011/01/26 2011/01/27 2011/01/28 2011/01/29 2011/01/30 2011/01/31
2011/02/01 2011/02/02 2011/02/03 2011/02/04 2011/02/05 2011/02/06 2011/02/07 2011/02/08 2011/02/09 2011/02/10 2011/02/11 2011/02/12 2011/02/13 2011/02/14 2011/02/15 2011/02/16 2011/02/17 2011/02/18 2011/02/19 2011/02/20 2011/02/21 2011/02/22 2011/02/23 2011/02/24 2011/02/25 2011/02/26 2011/02/27 2011/02/28
2011/03/01 2011/03/02 2011/03/03 2011/03/04 2011/03/05 2011/03/06 2011/03/07 2011/03/08 2011/03/09 2011/03/10 2011/03/11 2011/03/13 2011/03/14 2011/03/15 2011/03/16 2011/03/17 2011/03/18 2011/03/19 2011/03/20 2011/03/21 2011/03/22 2011/03/23 2011/03/24 2011/03/25 2011/03/26 2011/03/27 2011/03/28 2011/03/29 2011/03/30 2011/03/31
2011/04/01 2011/04/02 2011/04/03 2011/04/04 2011/04/05 2011/04/06 2011/04/07 2011/04/08 2011/04/09 2011/04/10 2011/04/11 2011/04/12 2011/04/13 2011/04/14 2011/04/15 2011/04/16 2011/04/17 2011/04/18 2011/04/19 2011/04/20 2011/04/21 2011/04/22 2011/04/23 2011/04/24 2011/04/25 2011/04/26 2011/04/27 2011/04/28 2011/04/29 2011/04/30
2011/05/01 2011/05/02 2011/05/03 2011/05/04 2011/05/05 2011/05/06 2011/05/07 2011/05/08 2011/05/09 2011/05/10 2011/05/11 2011/05/12 2011/05/13 2011/05/14 2011/05/15 2011/05/16 2011/05/17

### Browse by creation date

66 72 73 75 79 85 86 87 88 89 90 91 92 93 94 96 97 00 01 02 03 04 05 06 07 08 09 10
1966/12
1972/02 1972/08
1973/04
1975/03
1979/08
1985/03 1985/05 1985/06
1986/05
1987/06
1988/01 1988/03 1988/07
1989/12
1990/01 1990/07 1990/08 1990/10
1991/05
1992/01 1992/03 1992/06 1992/09 1992/12
1993/01 1993/10
1994/12
1996/11
1997/06 1997/12
2000/05 2000/06 2000/09 2000/11
2001/02 2001/03 2001/06 2001/07 2001/09 2001/10 2001/11
2002/01 2002/02 2002/03 2002/04 2002/07 2002/08 2002/09 2002/11
2003/01 2003/02 2003/03 2003/04 2003/05 2003/06 2003/07 2003/08 2003/09 2003/10 2003/11 2003/12
2004/01 2004/02 2004/03 2004/04 2004/05 2004/06 2004/07 2004/08 2004/09 2004/10 2004/11 2004/12
2005/01 2005/02 2005/03 2005/04 2005/05 2005/06 2005/07 2005/08 2005/09 2005/10 2005/11 2005/12
2006/01 2006/02 2006/03 2006/04 2006/05 2006/06 2006/07 2006/08 2006/09 2006/10 2006/11 2006/12
2007/01 2007/02 2007/03 2007/04 2007/05 2007/06 2007/07 2007/08 2007/09 2007/10 2007/11 2007/12
2008/01 2008/02 2008/03 2008/04 2008/05 2008/06 2008/07 2008/08 2008/09 2008/10 2008/11 2008/12
2009/01 2009/02 2009/03 2009/04 2009/05 2009/06 2009/07 2009/08 2009/09 2009/10 2009/11 2009/12
2010/01 2010/02

### Browse by origin

A B C D F G H I J K L M N O P Q R S T U V W Y Z
Embassy Athens Embassy Asuncion Embassy Astana Embassy Asmara Embassy Ashgabat Embassy Apia Embassy Ankara Embassy Amman Embassy Algiers Embassy Addis Ababa Embassy Accra Embassy Abuja Embassy Abu Dhabi Embassy Abidjan Consulate Auckland Consulate Amsterdam Consulate Adana American Institute Taiwan, Taipei
Embassy Bujumbura Embassy Buenos Aires Embassy Budapest Embassy Bucharest Embassy Brussels Embassy Bridgetown Embassy Bratislava Embassy Brasilia Embassy Bogota Embassy Bishkek Embassy Bern Embassy Berlin Embassy Belmopan Embassy Belgrade Embassy Beirut Embassy Beijing Embassy Banjul Embassy Bangkok Embassy Bandar Seri Begawan Embassy Bamako Embassy Baku Embassy Baghdad Consulate Barcelona
Embassy Copenhagen Embassy Conakry Embassy Colombo Embassy Chisinau Embassy Caracas Embassy Canberra Embassy Cairo Consulate Curacao Consulate Ciudad Juarez Consulate Chennai Consulate Casablanca Consulate Cape Town Consulate Calgary
Embassy Dushanbe Embassy Dublin Embassy Doha Embassy Djibouti Embassy Dili Embassy Dhaka Embassy Dar Es Salaam Embassy Damascus Embassy Dakar Consulate Dubai
Embassy Freetown Consulate Fukuoka
Embassy Guatemala Embassy Gaborone Consulate Guayaquil Consulate Guadalajara
Embassy Helsinki Embassy Harare Embassy Hanoi Consulate Ho Chi Minh City Consulate Hermosillo Consulate Hamilton Consulate Hamburg Consulate Halifax
Iran RPO Dubai Embassy Islamabad Consulate Istanbul
Embassy Jakarta Consulate Jerusalem Consulate Jeddah
Embassy Kyiv Embassy Kuwait Embassy Kuala Lumpur Embassy Kinshasa Embassy Kingston Embassy Kigali Embassy Khartoum Embassy Kathmandu Embassy Kampala Embassy Kabul Consulate Kolkata
Embassy Luxembourg Embassy Luanda Embassy London Embassy Ljubljana Embassy Lisbon Embassy Lima Embassy Lilongwe Embassy La Paz Consulate Lahore Consulate Lagos
Mission USOSCE Mission USNATO Mission UNESCO Embassy Muscat Embassy Moscow Embassy Montevideo Embassy Monrovia Embassy Minsk Embassy Mexico Embassy Mbabane Embassy Maputo Embassy Manila Embassy Manama Embassy Managua Embassy Malabo Embassy Madrid Consulate Munich Consulate Mumbai Consulate Montreal Consulate Monterrey Consulate Milan Consulate Melbourne
Embassy Nicosia Embassy Niamey Embassy New Delhi Embassy Ndjamena Embassy Nassau Embassy Nairobi Consulate Naples Consulate Naha
Embassy Ouagadougou Embassy Ottawa Embassy Oslo
Embassy Pristina Embassy Pretoria Embassy Prague Embassy Port Of Spain Embassy Port Louis Embassy Port Au Prince Embassy Phnom Penh Embassy Paris Embassy Paramaribo Embassy Panama Consulate Peshawar
Embassy Quito Consulate Quebec
REO Basrah Embassy Rome Embassy Riyadh Embassy Riga Embassy Reykjavik Embassy Rangoon Embassy Rabat Consulate Rio De Janeiro Consulate Recife
Secretary of State Embassy Suva Embassy Stockholm Embassy Sofia Embassy Skopje Embassy Singapore Embassy Seoul Embassy Sarajevo Embassy Santo Domingo Embassy Santiago Embassy Sanaa Embassy San Salvador Embassy San Jose Consulate Strasbourg Consulate St Petersburg Consulate Shenyang Consulate Shanghai Consulate Sapporo Consulate Sao Paulo
Embassy Tunis Embassy Tripoli Embassy Tokyo Embassy The Hague Embassy Tel Aviv Embassy Tehran Embassy Tegucigalpa Embassy Tbilisi Embassy Tashkent Embassy Tallinn Consulate Toronto Consulate Tijuana
USUN New York USEU Brussels US Office Almaty US Mission Geneva US Interests Section Havana US Delegation, Secretary UNVIE Embassy Ulaanbaatar
Embassy Vilnius Embassy Vienna Embassy Vatican Embassy Valletta Consulate Vladivostok Consulate Vancouver
Embassy Windhoek Embassy Wellington Embassy Warsaw
Embassy Yerevan Embassy Yaounde
Embassy Zagreb

### Browse by tag

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
AS AM AR AMGT ASEC AFIN AL AORC AU AG AF APER ABLD ADCO ABUD AID AMED AJ AEMR AE ASUP AN AY AIT ADPM APEC ACOA ANET APECO ASIG AA ASEAN AGAO AADP AMCHAMS ARF AGR ATRN ALOW ACS APCS AFFAIRS ADANA AECL ACAO AORG AROC AO AODE ACABQ AGMT AX AMEX AFGHANISTAN AZ AND ARM AQ ATFN AMBASSADOR ACBAQ AFSI AFSN AC AUC ASEX AINF AER AVERY AGRICULTURE ASCH AFU AMG ATPDEA ASECKFRDCVISKIRFPHUMSMIGEG AORL ADM
BA BM BR BL BH BO BK BD BEXP BU BILAT BTIO BF BT BX BG BY BE BP BC BBSR BB BRUSSELS BIDEN BMGT BWC BN BTIU
CO CS CA CD CR CPAS CH CDG CI CU CE CBW CVIS CASC CDC CONS CMGT CV CY CIA CW CIDA CWC CG CJAN CODEL CT CM CAPC CTR CACS CLINTON CBSA CEUDA COM CF CARSON CN CIC COPUOS CONDOLEEZZA CICTE COUNTER COUNTRY CBE CFED CL CKGR CHR CVR COUNTERTERRORISM CITEL CLEARANCE COE CARICOM CB CSW CITT CACM CDB CJUS CTM CAN CLMT CBC CAC CNARC CROS CIS
DEAX DA DHS DAO DCM DJ DR DOD DOMESTIC DO DK DPRK DEPT DEA DISENGAGEMENT DE DOE DTRA DS DEFENSE
ETTC EN ENRG EAGR EAID ECIN EFIN EINT EINV ETRD EUN ECON EAIR EWWT EG EPET EMIN EU EFIS ELTN ELAB EC EIND ECPS ENVR EZ ET ENERG EI ETRN EUREM EINVECONSENVCSJA ER EEPET EUNCH EFTA EXIM EK ES ETRDEINVECINPGOVCS ESENV ENNP ENVI ESA ELN ETRDECONWTOCS EFINECONCS EUMEM ENGR ERNG ELECTIONS ECA EPA ETRC EXTERNAL EINVEFIN EUR ETC EAP ENIV ECONOMY EINN ECONOMIC EXBS ECUN ENGY ECONOMICS EIAR EINDETRD ECONEFIN EURN EDU ETRDEINVTINTCS ECIP EFIM EAIDS EREL EINVETC ECONCS ETRA ECINECONCS EAIG ETRO EUC ERD
FR FI FTAA FJ FBI FO FM FDA FAO FAS FREEDOM FTA FISO FOR FARC FAC FINR FINANCE FOI FOREIGN FMLN
GG GV GM GH GT GR GA GE GY GANGS GTIP GAERC GOI GOV GTMO GL GF GCC GZ GAZA GLOBAL GERARD
HR HEBRON HSTC HA HUMOR HU HO HK HILLARY HI HURI HUMAN HYMPSK
IR IS IC IZ IAEA IN ICRC IT ID IDA IWC IO ICJ ICAO IV IAHRC IBRD IMF IQ INRA INRO ILC IGAD IMO ITRA ICTY ITU ILO ISLAMISTS ICTR IBET IRC IRAQI ITALY IPR ISRAELI IIP INMARSAT ITPGOV ITALIAN INTERNAL IRS IA INTERPOL IEA INRB IL INR IZPREL IRAJ ITF IF ITPHUM ISRAEL IACI IEFIN INTELSAT INDO IDP
JA JO JM JP JUS JAMES JOHNNIE JOSEPH JOHN
KSCA KSUM KIPR KTEX KJUS KIDE KDEM KIRF KV KNNP KTIA KN KGHG KG KISL KTFN KUNR KCRM KPWR KPAL KTIP KFRD KWMN KOLY KPAO KMDR KCOR KPRP KU KZ KPKO KO KOMS KAWC KMCA KMPI KFLU KGIC KOMC KRVC KVRP KS KSEP KIRC KSPR KVPR KWBG KACT KFLO KFSC KHIV KHSA KMFO KCIP KENV KHLS KDRG KSAF KRAD KNSD KBCT KBTR KFRDCVISCMGTCASCKOCIASECPHUMSMIGEG KCFE KE KSTC KCGC KR KPOA KPLS KICC KRIM KAWK KWMM KPRV KVIR KTDB KX KCRS KMOC KCRCM KBTS KSEO KHDP KFIN KSTH KOCI KGIT KNUP KTBT KPAONZ KNUC KNNPMNUC KWAC KERG KSCI KBIO KTLA KCSY KTRD KNAR KMRS KNPP KJUST KCMR KTER KRCM KNEI KCFC KSAC KCHG KGCC KREL KFTFN KCOM KLIG KDEMAF KAID KPAI KICA KFRDKIRFCVISCMGTKOCIASECPHUMSMIGEG KHUM KREC KSEC KPIN KESS KDEV KWWMN KOM KWNM KRFD KMIG KDDG KRGY KIFR KID KWMNCS KPAK
LE LY LH LU LI LG LO LA LTTE LAB LOG LT LABOR
MTCRE MNUC MARR MOPS MASS MX MK MO MCAP MIL MAS ML MR MEDIA MAR MC MD MG MI MY MU MTRE MA MQADHAFI MASC MW MARAD MPOS MRCRE MTCR MAPP MZ MP MOPPS MTS MLS MILI MEPN MEPI MEETINGS MERCOSUR MT MCC MIK MAPS MV MILITARY MDC MEPP MASSMNUC MUCN
NL NZ NI NPT NATO NO NK NS NU NP NG NA NSG NT NW NE NSF NR NPA NAFTA NASA NSFO NDP NGO NORAD NSSP NATIONAL NIPP NZUS NH NC NEW NRR NAR NV NATOPREL NPG NSC
OREP OSCE OSCI OTRA OVIP OPDC OAS OIIP OPRC OPAD OBSP OEXC OECD OFDP OFFICIALS ODIP OPIC OHUM OES OPCW OVP OCS OIE OTR OMIG OSAC OFDA OIC ON OCII
PARM PGOV PREL PTER PE PHUM PINR PINS PREF PM PK POL PBTS PNAT PHSA PAS PA PO PDOV PL PHUMPGOV PAK PGIV PAO PHUMPREL PCI PROP PP PTBS PINL POV PEL PG PREO PAHO PREFA PSI POLITICAL POLITICS PAIGH POSTS PMIL PRAM PALESTINIAN PARMS PROG PBIO PTERE PRGOV PORG PS PGOF PKFK PSOE PEPR PPA PINT PMAR PRELP PINF PNG PFOR PUNE PGOVLO PHUMBA PSEPC POGOV POLICY PNR POLINT PGOVE PHALANAGE PARTY PDEM PECON PROV PBT PGOC PY PLN PHUH PF PRL PHUS PU PARTIES PCUL PGGV PSA PGOVSMIGKCRMKWMNPHUMCVISKFRDCA
QA
RS RU REGION REACTION REPORT RO RW RP RFE RM RCMP RSO ROBERT RICE RSP RF ROOD RIGHTS RIGHTSPOLMIL RUPREL RELATIONS
SNAR SENV SY SP SU SOCI SMIG SR SCUL SF SO SA SI SARS SZ SW SG SIPRS SEVN SNARCS SYR SN STEINBERG SH SAARC SC SCRS SYRIA SL SENVKGHG SAN ST SIPDIS SNARIZ SNARN SSA SK SPCVIS SOFA SANC SWE SHI SEN SHUM SPCE
TSPA TU TBIO TD TT TS TRGY TINT TF TPHY TN TH TSPL TW TC TX TZ THPY TL TV TNGD TI TP TBID TK TERRORISM TIP TO TRSY TURKEY TFIN TAGS TR
UNESCO UK UNGA UN UNMIK UNHRC UP UNSC USTR US UNDC UY UNICEF UV UNDP UNAUS UNCSD USUN USOAS USNC UNEP UNHCR UNCND UNFCYP UNIDROIT UG UZ UNCHC UNCHR USEU USPS USAID UE UNVIE UAE UNO UNODC UNCHS UNFICYP UNDESCO UNC UNPUOS
VZ VT VE VI VM VTPREL VN VTIZ VTEG VAT VC
WHTI WTRO WTRQ WBG WHO WFP WI WS WMD WIPO WTO WHA WZ WB WWARD WITH WEU WMO WA
XR XS XA XV XH XF XL XG XM XT XK XD XI XE XW XB XQ XX XTAG XY XZ XU XC
YI YM YE YMCS
ZI ZP ZR ZK ZO ZU ZL ZOELLICK ZF ZB ZJ ZEALAND ZN ZA ZANU

### Browse by classification

CONFIDENTIAL CONFIDENTIAL//NOFORN SECRET SECRET//NOFORN UNCLASSIFIED UNCLASSIFIED//FOR OFFICIAL USE ONLY

### Community resources

Follow us on Twitter Check our Reddit Twitter this Digg this page Contact us on IRC

courage is contagious

### Viewing cable 05OTTAWA268, PLACING A NEW NORTH AMERICAN INITIATIVE

If you are new to these pages, please read an introduction on the structure of a cable as well as how to discuss them with others. See also the FAQs
Understanding cables
Every cable message consists of three parts:

- The top box shows each cables unique reference number, when and by whom it originally was sent, and what its initial classification was.
- The middle box contains the header information that is associated with the cable. It includes information about the receiver(s) as well as a general subject.
- The bottom box presents the body of the cable. The opening can contain a more specific subject, references to other cables (browse by origin to find them) or additional comment. This is followed by the main contents of the cable: a summary, a collection of specific topics and a comment section.

To understand the justification used for the classification of each cable, please use this WikiSource article as reference.
Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol). Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #05OTTAWA268.

Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
05OTTAWA268 | 2005-01-28 15:56 | 2011-04-28 00:00 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Ottawa

`

    This record is a partial extract of the original cable. The full text of the original cable is not available.

    281556Z Jan 05

` `

    UNCLAS SECTION 01 OF 03 OTTAWA 000268

    SIPDIS

    SENSITIVE

    STATE FOR WHA/CAN - BREESE AND HOLST

    WHITE HOUSE/NSC - SHIRZAD

    STATE PASS USTR FOR CHANDLER

    USDOC FOR 4320/OFFICE OF NAFTA/GWORD/TFOX;
    3134/OIO/WESTERN HEMISPHERE

    TREASURY FOR IMI

    GENEVA FOR USTR

    E.O. 12958: N/A
    TAGS: ETRD EINV CA
    SUBJECT:  PLACING A NEW NORTH AMERICAN INITIATIVE
           IN ITS ECONOMIC POLICY CONTEXT

    REF:  (A) 04 Ottawa 3431  (Regulatory agenda)

          (B) 04 Ottawa 066   (Canadian trade policy)

    SUMMARY/INTRODUCTION
    --------------------

    ¶1. THIS MESSAGE IS SENSITIVE BUT UNCLASSIFIED.  NOT FOR
    DISTRIBUTION OUTSIDE USG CHANNELS.

    ¶2.    (SBU) An incremental and pragmatic package of tasks
    for a new North American Initiative (NAI) will likely gain
    the most support among Canadian policymakers.  Our research
    leads us to conclude that such a package should tackle both
    "security" and "prosperity" goals.  This fits the
    recommendations of Canadian economists who have assessed the
    options for continental integration.  While in principle
    many of them support more ambitious integration goals, like
    a customs union/single market and/or single currency, most
    believe the incremental approach is most appropriate at this
    time, and all agree that it helps pave the way to these
    goals if and when North Americans choose to pursue them.

    ¶3.    (SBU) The economic payoff of the prospective North
    American initiative - in terms of higher incomes and greater
    competitiveness - is available, but its size and timing are
    unpredictable, so it should not be oversold.  Still, a
    respectable economic case has been made for such an
    initiative, and this message spells it out.  We believe
    that, given growing Canadian concern about "border risk" and
    its effects on investment, a focus on the "security" side
    could also produce the most substantial economic/trade
    benefits.

    END SUMMARY/INTRODUCTION

    CANADIAN ECONOMIC PERSPECTIVE
    -----------------------------

    ¶4.   (SBU) Canadian economists in business, academia and
    government have given extensive thought to the possible
    options for further North American integration.  Nearly all
    of this work assumes that each of the three countries is
    pursuing standard economic policy goals - growth,
    productivity and competitiveness (rather than more specific
    concerns raised by Mexican analysts such as migration
    management, regional development, or environmental
    protection).  Since 9/11, Canadian economists working in
    this area have generally endorsed a comprehensive initiative
    with the United States on security, trade, and immigration.
    Following is our summary of the professional consensus:

    PROCESS:  At this time, an "incremental" approach to
    integration is probably better than a "big deal"
    approach.  However, governments should focus on
    choosing their objectives, and not on choosing a
    process.

    BORDER VS. PERIMETER:  Even with zero tariffs, our land
    borders have strong commercial effects.  Some of these
    effects are positive (such as law enforcement and data
    gathering), so our governments may always want to keep
    some kind of land border in place.  Canada and the
    United States already share a security perimeter to
    some degree; it is just a question of how strong we
    want to make it.

    BORDER RISK:  The risk that business will be obstructed
    at the border by discretionary U.S. actions, such as
    measures to defend against terrorism or infectious
    disease, in addition to growing congestion, have become
    major risks to the economy, inhibiting investment in
    Canada.  For small businesses, the complexities of
    navigating the border are apparently even more
    intimidating than the actual costs.  Reducing this risk
    is Canada's top motive for pursuing further
    integration.

    LABOR MARKETS:  Many Canadian economists point to labor
    markets - both within and among countries - as the
    factor market where more liberalization would deliver
    the greatest economic benefits for all three countries.
    They advocate freeing up professional licensing laws,
    and developing a quick, simple, low-cost work permit
    system, at least for U.S. and Canadian citizens.

    REGULATION:  Canadian economists agree that Canadian
    regulations (if not their standards, then their
    complexity) are needlessly restricting foreign
    investment and impeding food, communications and other
    industries.  (Inter-provincial differences are
    important here, since Canada's federal government does
    not have the benefit of a U.S.-style "interstate
    commerce" clause).  While much of the problem is
    domestic in nature, an international initiative could
    help to catalyze change.

    CUSTOMS UNION:  A common external tariff, or a customs
    union which eliminated NAFTA's rules of origin (ROO),
    is economically desirable.  NAFTA's ROO are so
    restrictive that importers often prefer to pay the
    tariff rather than try to prove North American origin.
    However, economists differ on the size of the benefits
    available and on whether these would justify the effort
    of negotiation.  One study estimated that a full
    customs union which eliminated ROO would only raise
    national income by about one percent.

    CURRENCY UNION:  Canadian economists are split on
    whether a return to a fixed exchange rate, or adopting
    the U.S. dollar, would benefit Canada in current
    circumstances.  (Canada last tied its dollar to the
    U.S. dollar from 1962 to 1970).  The central bank
    governor has taken the position that "monetary union is
    an issue that should be considered once we have made
    more progress towards establishing a single market."

    NORTH AMERICAN INTEGRATION:  WHAT WE KNOW
    -----------------------------------------

    ¶5. (SBU) Past integration (not just NAFTA but also many
    bilateral and unilateral steps) has increased trade,
    economic growth, and productivity.  Studies suggest
    that border efficiency and transportation improvements
    (such as the lower cost and increased use of air
    freight) have been a huge part of this picture.
    Indeed, they may have been more important to our
    growing prosperity over the past decade than NAFTA's
    tariff reductions.  Freight and passenger aviation are
    critically important to our continent's
    competitiveness, and businesses are very sensitive to
    the timing, security, and reliability of deliveries -
    hence the "border risk" which so concerns Canadian
    policymakers.

    ¶6. (SBU) A stronger continental "security perimeter"
    can strengthen economic performance, mainly by
    improving efficiency at land borders and airports.  It
    could also facilitate future steps toward trilateral
    economic integration, such as a common external tariff
    or a customs union, if and when our three countries
    chose to pursue them.  Paradoxically, the security and
    law enforcement aspects of the envisioned initiative
    could hold as much - or more - potential for broad
    economic benefits than the economic dimension.
    WHERE'S THE UPSIDE?
    -------------------
    ¶7. (SBU) Some international economic initiatives (such
    as FTAs) produce across-the-board measures that
    generate broad benefits for a country's industries and
    consumers on a known time-line.  This was true of NAFTA
    but it is less likely to be true of the economic
    aspects of the NAI.  Non-tariff barriers such as
    standards and regulations generally must be tackled one-
    by-one.  This is a piecemeal process and the ratio of
    payoff to effort is likely to be lower than with across-
    the-board measures.  Governments naturally focus on
    resolving the problems which their firms or citizens
    bring to their attention.  While this approach has
    merits, it tends to deliver the payoffs toward
    particular interests.  If there are hidden costs, there
    might be little impact on national performance.  As we
    move toward a list of barriers to tackle, it will
    remain important to balance those interests.  For
    example, some Canadian economists have suggested that
    NAFTA fell short of expectations with respect to
    increasing consumer choice in Canada; that may be a
    theme we should stress as efforts to promote further
    integration take shape.

    ¶8. (SBU) In contrast, cooperative measures on the
    "security" side, a critical focus of current bilateral
    efforts,  can deliver substantial, early, and
    widespread economic benefits.  Security and law
    enforcement within North America have evolved rapidly
    since 9/11, leading to many less-than-perfect processes
    for handling legitimate international traffic.
    Collaboration to improve these processes could yield
    efficiency improvements which would automatically be
    spread widely across the economy, leading to general
    gains in trade, productivity, and incomes.

    A NOTE OF CAUTION
    -----------------

    ¶9. (SBU) There is little basis on which to estimate the
    size of the "upside" gains from an integration
    initiative concentrating on non-tariff barriers of the
    kind contained in NAI.  For this reason, we cannot make
    claims about how large the benefits might be on a
    national or continental scale.  When advocating NAI, it
    would be better to highlight specific gains to
    individual firms, industries or travelers, and
    especially consumers.

    CELLUCCI

`