That Davos Speech: What We Missed

Do countries earn the right to a principled foreign policy, only once they've reduced vulnerability to retaliation?

“Diversification internationally is not just economic prudence, it's a material foundation for honest foreign policy, because countries earn the right to principled stands by reducing their vulnerability to retaliation”

In the seven months since Canadian Prime Minister Mark Carney’s Davos speech, the takes have been plentiful. But one line has flown under the radar, and I’m increasingly convinced explains the different paths countries have taken since the election of the Trump administration in the United States.

So, we can interpret the above line in two ways. Either, Carney says principles are a second-order, nice-to-have, once the economic fundamentals are safe. Or, he says principles are a hinderance to economic security, because a larger power will punish us for them. In effect, principles in foreign policy are a luxury or a liability.

On one hand, there’s a truism in his words. In this new world, there is a much finer balance in what countries can say and do. Decisions involve more serious risk and harder trade-offs, between what we want to do (digital tax, supply management, protecting our own International Criminal Court judge from sanctions), and the possible economic retaliation for those acts. It would be naive not to see this.

Carney is also right that it’s wise not to rise to the bait every time. That is to say, the United States in particular lays provocative ideological bait, in hopes of instigating a pig-wrestling contest about Woke. As tempting as a Hugh Grant moment is, that’s for the movies. Sometimes, we need to let it slide.

It is also true countries have been punished for their perceived principles. Spain has been called out because of its stances on immigration, equality and Gaza. And we can argue Spain can afford these stances in part due to the protective umbrella of the European Union. Spain can’t face tariffs itself, for example. But we should note the US has threatened retaliation for perceived principles far more than it has delivered. Thus far, a country is more likely to be subject to a deranged Stephen Miller speech about the fall of western civilization, than an 80% tariff on its honey industry.

Plus, economic retaliation has been driven more by US domestic politics than by any ideological stance the receiving country has taken. For example, the United States does not want to annex Canada because of some principled stance we’ve taken. It wants to annex Canada because expansionism is a defining feature of a state sliding into fascism. The US cites principles as a pre-text for punishment, but the motivation is more likely weak domestic polls, distraction from foreign policy quagmires, or the monthly ‘Spin The Wheel, Pick A Punching Bag’ game at the White House.

All this to say, the idea there is no values-based foreign policy in an economic foxhole, is incorrect.

Carney says we earn rights, but rights are not earned, they are inherent. Sure, this is a concept normally applied to people, and countries don’t have rights per se. But the point remains. We have rights. We may choose not to exercise them, or they may be denied, but they are not earned. Applied in this case, it means there is no magic US export percentage at which rights suddenly kick in. There is no global level of trade dependence on a hostile hegemon, at which, rights no longer apply. We have the right to a principled foreign policy, by virtue of being a sovereign country that decides its own affairs.

Secondly, and critically, values (principles) and interests (economic security) are not opposing ideas at odds with each other. Our values are our interests and vice versa. It is in our interests for other countries to be democratic, follow the rule of law, and have healthy, educated populations. It is in our interests that the countries we work with play by agreed rules, treat their people well, and don’t make rash moves that endanger everyone. Conversely, our values make us attractive, stable, trusted partners in a transactional world.

Values are not a luxury you can only afford once you face no consequences for them. Our economic resilience rests on values. Particularly in the post war periods, values came from a generation who learned the hardest way what happens when, to paraphrase Carney, the large powers are submitted to no limits, no constraints. The strong do what they can, and the weak suffer what they must. And people died in their millions, economies were destroyed, and countries razed to the ground. Without principles, we do bad, short-sighted things that don’t keep us safe or make us stronger. Upon our principles rests almost everything good we’ve achieved as societies.

And if principles are either a luxury or liability, why do other states spend so much political capital trying to advance them? Why does the US threaten Europe with tariffs over its free speech laws? Why does the US want to dismantle various United Nations entities? Other states advance ideology in their foreign policy because they see considerable value in it. Relatedly, swapping one regressive, retaliatory trading partner (the United States), for another regressive, retaliatory trading partner (China, Saudi Arabia), doesn’t help us much either.

“Collective investments in resilience are cheaper than everyone building their own fortresses. Shared standards reduce fragmentations. Complementarities are positive sum”

“Building coalitions that work – issues by issue, with partners who share enough common ground to act together”……What it’s doing is creating a dense web of connections across trade, investment, culture, on which we can draw for future challenges and opportunities”

Back to Carney’s own speech, he’s using economic, McKinsey-esque language, but what he describes is building long-term, trusting communities bound by shared interests and values, often against a common external threat. Another name for that is solidarity. And solidarity is a value.

Finally, sometimes, principles are so fundamental, they’re worth the economic cost. Particularly when that principle is sovereignty. And sometimes, the cumulative impact of a hundred decisions to put short term economic gain above long-term foundational values, is effectively a loss of sovereignty.

This month saw the 15th anniversary of the far-right terrorist attack in Norway. In the immediate days after 77 people were massacred, then Prime Minister Jens Stolenberg gave a speech. He argued when a country is subjected to ugly, awful, violating behaviour, our response should be to double down on our values, to be more truly ourselves. “Our response is more democracy, more openness, and more humanity. But never naivety”

Our response to ugly coercion should not acquiescence. It should be to double down on our own values, with more democracy, more openness and more humanity.