This paper considers a case study of the challenges posed to interventionist economic policy-making by the existence and operation of the free trade institutions. The paper reviews the experience of Canada's automotive manufacturing industry. Canada possesses a disproportionately large and successful auto industry, that owes its existence to a history of strong and effective interventions in trade and investment decisions by successive Canadian governments. This paper also challenges the pessimistic conclusion that national policy latitude has been largely eliminated. It is argued that the national government could still take powerful measures to sustain investment and employment in Canada's automotive industry.