What Built the Canada–U.S. Relationship

Donald Trump’s renewed hostility toward Canada has revived an old question: how much of the Canada-U.S. relationship rests on friendship, and how much rests on need? The history of energy and environmental diplomacy suggests the answer is mostly the latter.

For decades, Canada and the United States have sustained one of the largest bilateral trading relationships, driven less by affinity than by geography and resources. Shared borders, integrated infrastructure, and abundant energy and water systems made cooperation practical and often unavoidable. The result is a relationship shaped as much by pipelines, rivers, and minerals as by diplomacy or culture.

The two countries have made more than fifty bilateral arrangements, more than any other pair of countries. When it comes to international environmental law, the U.S.-Canada relationship has frequently been a global trendsetter through the creation of accords and settlements such as the Boundary Waters Treaty, the Trail Smelter case, and the Great Lakes Water Quality Agreements. 

Canada has long been the United States’ major foreign energy supplier. After 1945, various types of energy infrastructure (e.g., transmission lines and pipelines) were constructed that bound the two together. And that continues even in the midst of today’s cross border antagonisms: in 2025, more than half of U.S. imports of crude oil, and 99% of natural gas imports, still came from Canada, which remained the largest foreign source of uranium and electricity for the U.S.

The constant contacts, exchanges, and negotiations required to manage day-to-day environmental and energy issues fostered integration and helped anchor the bilateral relationship. Meanwhile, certain resource negotiations, such as the St. Lawrence Seaway, Columbia River Treaty, and acid rain, became punctuated controversies that were the major irritant for a time in government-to-government relations.

Building the Relationship

Natural resources were an important part of the bilateral relationship from the beginning. Most of the early diplomatic relations between the United States and the newly created Dominion of Canada, with Britain the intermediary, revolved around the natural world, particularly fish and water. Environmental diplomacy in the half-century after Canadian Confederation was central to a Canadian-British-American “cleaning of the slate” and creating an amicable continental relationship (as well as better US-British relations). Many of these agreements have proven to be well-known precedents in the history of global environmental governance, such as the 1909 Boundary Waters Treaty. 

Environmental diplomacy negotiations demonstrated that Canada was capable of independently controlling its foreign policy. The first treaty to which Canada appended its signature alone was the 1923 Halibut Treaty. In many ways, Canada diplomatically cut its teeth on resource issues, since British officials didn’t have the local expertise to effectively negotiate with Washington; this process expedited Canada’s road towards controlling its own foreign policy. Ottawa confirmed this independence by negotiating a series of water development accords during the interwar years (though most of these could not get through the US Congress), as well as handling the Trail Smelter case.

The Second World War and ensuing Cold War ushered in the intensification of these integrations and exchanges. The early Cold War has been called the “golden age” of Canadian external relations and the high point of the “special relationship” between Canada and the United States. Both adages involve hyperbole, even myth. Nevertheless, they do speak to Canada’s relative importance on the world scene in this period and the level of cooperation the two countries manifested. Both countries were committed to liberal international markets and organizations as well as western security against communism through multilateral organizations such as NATO.

As the scope of subjects dealt with by the two diplomatic services markedly widened, so too did the range of environmental issues. With the completion of several transborder hydro power megaprojects in the 1950s and 1960s  – Niagara Falls, St. Lawrence Seaway and Power Project, Columbia River –  as well as the beginning of Canadian fossil fuel exports, energy became an even more crucial facet of the bilateral relationship. 

Cold War environmental diplomacy frequently involved other resources critical to national security and nation-building, such as steel, aluminum, nuclear materials, and minerals. At the same time, decades of binational hydropolitics reached their apogee with the construction of hydro megaprojects, and oil and gas were superseding electricity as the foremost concern of energy diplomacy. Fossil fuels were the most contentious form of energy relations during the 1970s. 

Acid rain and air pollution became major diplomatic issues, where they were joined by Law of the Sea and other maritime issues, fish, invasive species, and the Arctic. The 1988 and 1994 free trade agreements, along with the end of the Cold War, reset the nature of Canada-US environmental and energy diplomacy. Energy integration and trade accelerated while new challenges, including softwood lumber and climate change, rose to the fore. 

During the Mulroney years, Canada was even a leading nation when it came to addressing climate change. Since then, however, Canada has often tied its climate stance to that of the United States. If the U.S. did not pledge to limit emissions, neither did Canada. Both became climate villains and remain so. 

Prosperity vs Sovereignty 

After the depredations of the Great Depression and Second World War, many Canadians were willing to ride American coattails, shelter under their nuclear umbrella, and send resources south if it meant prosperity. The big question, however, was how to balance prosperity with potential losses of sovereignty? If not outright reductions of sovereignty, then further Americanization. Was it better for Canada to be prosperous and safe, or poorer and vulnerable but more independent? 

One way of negotiating this dichotomy was the use of soft law: nonbinding diplomatic agreements have been a common refrain in northern North American relations, in no small part because of their experiences with environmental and energy diplomacy. Until recently, the United States has rarely played the type of power politics where binding accords are ignored or broken by the stronger nation when they become inconvenient. Nevertheless, both countries frequently engaged in issue “linkage” when it came to ecopolitics. 

Multilateralism made sense for a country like Canada. But it is easy to exaggerate how much of this came from a penchant for cooperation – it was in Canada’s self-interest to support these types of international organizations and systems since what benefitted the United States economically and in terms of collective security would likely redound to Canada. Multi-party forums and alliances were a way to ensure, from the Canadian perspective, that the Americans did not retreat into isolationism. At the same time, multilateral forums also provided counterweights and checks on American unilateralism. 

American policy towards Canada throughout the last half of the twentieth century wasn’t consistent or coherent. It tended to reflect circumstances and personalities. To the extent that there was resource colonialism or imperialism, it was more often American financial interests and capital taking advantage of free markets rather than the direct decisions of American policymakers. Granted, those free markets, and many economic and security imperatives, were ensured and directed by the postwar economic systems set up at the behest of the US government and American multinational corporations. 

Canadian authorities pushed the US to buy their nation’s resources, rather than the US pressuring Canada to sell them. In those Canadian sectors where the US came to directly or indirectly dominate, Canadian policymakers and elites generally were not coerced or forced into it. Canadian governments and financial leaders entered into transborder arrangements with eyes wide open – and sold it to the masses as the rising tide lifting all boats. 

Canada sometimes received special treatment relative to other countries, such as in the field of uranium and fossil fuels. However, that was as much a result of pragmatic and strategic considerations as it was a special cultural or political affinity between the two countries. The history of bilateral environmental diplomacy helps explain why, despite the power asymmetry, Canada often does well in direct negotiations with the United States government. Canada usually puts its top officials on the US file, which the State Department does not. Canadian officials generally know more about the United States than their American counterparts do about Canada, and invest greater governmental resources into bilateral relations, which includes mastering the technical minutiae of fish and kilowatts. 

In the National Interest?

All this is not to suggest that cultural similarities and affinities between the two nations aren’t important. Writing the history of Canadian-American relations without emphasizing environmental and energy factors fails to provide a full picture of the bilateral relationship. Environmental and energy diplomacy has deeply shaped North America and the Canada-U.S. relationship, explaining the patterns and cooperative foundations that underpin their shared prosperity.

Shared interests, particularly during the Cold War, frequently made Canada and the United States close allies. When those interests diverge, as in the current moment, policies and alignments can diverge with them. The same history underscores the scale of the ecological challenges both countries now face. Together, they have transformed shared ecosystems on a continental scale and remain among the largest per capita contributors to global environmental crises, including climate change.