Category: Free Trade

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Job Outsourcing As A Profession, Stagnant Wages, Mass Migration

(the Business Development Bank of Canada on outsourcing)
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(Deloitte’s Global Outsourcing Survey)

(The Privacy Commissioner of Canada)

(the International Chamber of Commerce)

(Pew Research on wage stagnation)

(Conservative Party of Canada’s specific policies are to turn “temporary” workers into permanent residents wherever possible)

1. Offshoring, Globalization, Free Trade

The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

2. Important Links

(1) https://canucklaw.ca/remittances-the-hidden-cost-of-economic-immigration/
(2) https://www2.deloitte.com/content/dam/Deloitte/nl/Documents/operations/deloitte-nl-s&o-global-outsourcing-survey.pdf
(3) https://www.forbes.com/sites/deeppatel/2017/07/17/the-pros-and-cons-of-outsourcing-and-the-effect-on-company-culture/#25179527562d
(4) https://codeable.io/top-companies-outsourced-development/
(5) https://sidebysidereviews.com/hr-outsourcing-review/
(6) https://www.bdc.ca/en/articles-tools/operations/operational-efficiency/pages/outsourcing-pros-cons.aspx
(7) https://www.cbc.ca/news/business/cibc-outsourcing-jobs-india-1.4045759
(8) https://www.priv.gc.ca/en/privacy-topics/employers-and-employees/outsourcing/02_05_d_57_os_01/
(9) https://iccwbo.org/media-wall/news-speeches/icc-releases-global-outsourcing-guide/
(10) https://www.chamberofcommerce.org/best-human-resources-outsourcing-companies
(11)https://www.epi.org/publication/charting-wage-stagnation/
(12) https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

3. Context For Anti-Free Trade Take

So-called “Conservatives” and “Libertarians” trumpet the values of free trade, or economic liberty. They claim that removing barriers to trade and employment will result in the enrichment of society as a whole.

Worth noting that these same groups support massive immigration from the 3rd world. The fraudulently titled “Temporary Foreign Worker Program” is a great example. It forces Canadians to compete for jobs against imported, foreign (often subsidized) competition. This hurts workers who struggle to find work which will pay a living wage. Now, we all know the vast majority of these “temps” will never leave, though that has been addressed in other articles.

Corporatists and business leaders support both: (a) free trade; and (b) mass economic migration. This allows companies to get people to work for less, and to outsource jobs much more easily. But while these are profitable, there is little to no societal benefit.

4. Stagnant, Even Declining Wages

A quote from the left leaning Economic Policy Institute. This covers the main causes of wage stagnation. Although written in the U.S, Canada is experiencing the same issues. We should take note of this:

This paper provides a brief overview of some of the causes of wage stagnation and inequality. Sources in the references section provide a more complete analysis. Excessive unemployment, not only during and after the Great Recession but over most years since 1979, has suppressed wage growth, adversely affecting low-wage workers more than middle-wage workers but having little impact on high-wage workers. Global integration with low-wage countries, accelerated by particular trade policies (e.g., admission of China to the World Trade Organization in the late 1990s) has adversely affected wages of non–college educated workers. The erosion of labor standards (beyond the decline in the real value of the minimum wage) and weak enforcement have also put downward pressure on wages. Extensive wage theft, worker misclassification, weakened prevailing wage laws and overtime protections, and the failure to modernize our labor standards to provide sick leave, family leave, or minimum vacation schedules all hurt wage growth. The increased presence of undocumented workers who are vulnerable to employer exploitation also undercuts not only the wages of these workers but also those in similar fields.

A lot of reasons wages in the U.S. are stagnant. Two big reasons are: increased (often illegal) immigration; and trade policies which outsource jobs to nations with a lower standard of living.

Take this message away: “More” people are now competing for “less” jobs. From a supply-and-demand perspective, it can’t help but push down wages. Pew Research has studied this trend, and concluded it to be a real issue.

5. Connecting: Outsourcing Jobs, Wages, Economic Migration

Mass (economic) migration and outsourcing jobs a.k.a. “free trade”, actually end up serving the same goal, which is to displace workers in their home countries.

How so? Outsourcing high-paying jobs to the third world drives down the SUPPLY of work that is available to Canadians (and to others in 1st World countries). Importing large numbers of cheap foreign workers has the effect of driving up the DEMAND for what jobs remain. The public gets screwed at both ends.

Far more workers available, competing for far fewer jobs. It becomes an employer’s market, where workers are forced to compete based off on who can live off of less. As a result, the real purchasing power of wages has declined over the years.

True, there are factors besides increased immigration and outsourcing jobs. However, they are two big ones, and the impacts cannot be ignored.

6. Lack Of Privacy Safeguards In Outsourcing

There is nothing in PIPEDA that prevents organizations from outsourcing the processing of data. However, regardless of where information is being processed—whether in Canada or in a foreign country—organizations subject to PIPEDA must take all reasonable steps to protect that information from unauthorized uses and disclosures while it is in the hands of the third-party processor.

Organizations must also be satisfied that the third party has policies and processes in place, including training for its staff and effective security measures, to ensure that the information in its care is properly safeguarded at all times.

Organizations need to make it plain to individuals that their information may be processed in a foreign country and that it may be accessible to law enforcement and national security authorities of that jurisdiction. They must do this in clear and understandable language. Ideally they should do it at the time the information is collected. Once an informed individual has chosen to do business with a particular company, they do not have an additional right to refuse to have their information transferred.

When personal information is in the hands of a third-party service provider operating on foreign soil, it is subject to the laws of that country and no contract can override that. This could mean, for instance, that the organization may be obliged to respond to a subpoena or other mechanism that would give law enforcement officials access to personal information.

To be fair, it is acknowledged that the Privacy Act came into effect 30 years ago, and couldn’t possibly have taken this information age into account.

But think about this for a moment. If you are an employee, your information may still be shared and viewed on foreign lands by third parties. This can happen even if your job has not been outsourced. Potentially, this can happen if any major part of the business has been outsourced.

This is not limited to employees either. Customers or clients can have their personal information used in ways that would violate privacy in Canada, just as long as it takes place in another country. Seems to be an end run around real privacy.

7. Business Development Bank of Canada On Outsourcing

Here are some advantages of outsourcing
.
Financial benefits
-Clean up your balance sheet by eliminating assets, and have a more stable cash flow
-Strategic optimization—Think about your company’s core mission and whether it is relevant to continue certain operations
-Better management of the outsourced activity—In theory, you can choose a supplier that is a leader in the field
-Market discipline—You can align your costs with those of suppliers in the field
-Technology—In theory, you gain access to state-of-the-art technologies
Flexibility—The resources no longer used in one area can be redirected to the company’s core operations
.
Here are some risks of outsourcing
-Loss of expertise—You lose know-how and skills that may prove critical to your long-term competitiveness. –Information from suppliers helps in new product development.
-Dependence on the supplier—If you resume carrying out the outsourced activity yourself, it can take years to reach the level of performance you used to enjoy. But if the supplier’s service deteriorates, or if their price rises, you may want to take back the activity.
-Loss of control over costs—Improved production facilities may generate larger gains than outsourcing. Look at internal solutions before considering external solutions.
.
Here are some reasons not to outsource a production facility
-You have highly qualified employees
-You need contact with suppliers and customers
-Research and development is done in the plant
-Production operations are properly focused
-You have control over production costs
.
Here are some lessons on outsourcing
-Look for compatible goals
-Focus on the best solution, not the lowest price
-Use a very detailed contract and up-to-date legal experts
-Share risks
-Involve key players
-Document the transition phase
-Communicate clearly from the beginning

Notice the link never talks about the social costs of outsourcing jobs. People are hurt by mass layoffs. In no way does this advocate for communism or socialism, but there is a real impact to be taken into account when jobs are sent out of country. Not just the workers themselves, but families — especially children — are impacted by this.

There is no mention, or even implication that a company owes any sense of duty or loyalty to employees. This applies not only to newer employees, but to longer term ones. People who may have contributed greatly to an organization are clearly expendable in this mindset.

This is short sighted for another reason. If good paying jobs leave the community en masse, then who exactly is going to buy your products? You need a job, and an income, to buy things.

Furthermore, the same people pushing for outsourcing to lower costs are often the same ones who advocate for mass migration to fill jobs. Why the contradiction? Because it is about creating a larger pool of cheap labour.

8. Forbes: Outsourcing & Company Culture

3. Lower Labor Cost
Did you know there are approximately 300,000 jobs outsourced by the United States each year?
Every company has its own reason for doing this, with many chasing lower labor costs. You don’t want to trade quality for price, but outsourcing often allows you to get the best of both worlds. By searching a global talent pool, it’s easier to find the right talent at the right price.

This Forbes article from 2016, is more balanced in its approach that the last one. This author is blunt about it: outsourcing is mainly done in order to cut production costs.

A positive work culture leads to a higher level of productivity, so you don’t want to do anything to jeopardize this. Some of the ways outsourcing can negatively affect company culture include:
• Upset employees as they may feel they are being replaced

Here, a major downside is admitted: employees may feel like they’re being replaced. However, we don’t need the words “may feel”, because they are being replaced by outsourcing. There’s nothing ambiguous about it.

9. CBC And Outsourcing At Banks

As part of the transition, staff losing their positions must train other local CIBC employees. Those employees then train the workers in India who will be taking over the jobs.

Although they aren’t directly training their replacements, the situation isn’t sitting well with some affected staff who spoke with CBC News. They asked that their identity be protected because they fear repercussion from CIBC — one of Canada’s largest banks.

“It’s very, well, depressing,” said one employee about having to pass on his work knowledge so that someone in another country can replace him.

“A lot of people would have rather just been let go immediately than to sort of, if you will, suffer [through this].”

“It feels like no one cares for us,” said another employee. “The environment is really bad. People are bitter.”

A surprisingly good article from the CBC outlines outsourcing at CIBC. To add insult to injury, the workers being let go are forced to train their replacements as a last act. In fairness, RBC pulled a similar stunt, and was also publicly ridiculed.

While these banks outsourcing jobs caught a lot of public attention, there are many such actions that do not. As such, the public likely has no idea of how prevalent this issue is, or how many industries it threatens to hit.

10. There Is Always A Cost

Globalist Conservatives and Libertarians love to trumpet the free market, and the potential for economic growth. Yet they never discuss the downsides of these ideals.

They never talk about economic immigration drives up the number of workers in a country, forcing competition against actual citizens. Two such programs are the Temporary Foreign Worker Program, and the International Mobility Program. Students can also work up to 20 hours/week while in school. With more workers, wages don’t rise to keep up with inflation, as there are now more workers to help depress them.

All of these “temps” can usually apply to become permanent residents. This not only solidifies the imbalance, but imports other cultures into Canada. However, this has been addressed elsewhere.

They never talk about how “free trade” policies lead to the outsourcing of jobs, eliminating work opportunities in the host countries. Examples are NAFTA, the Tran-Pacific Partnership, and the proposed CANZUK. Sure, there will be some jobs coming back, though they are likely lower paid, and for less hours.

Who exactly is going to be buying your manufactured goods, if people are losing jobs? Or how will they afford them if the jobs don’t pay enough? How do communities benefit from exporting their employment opportunities?

There is always something else to consider.

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Why Trump Left The Trans-Pacific Partnership

(Straight from the source)

(Trump: T.P.P. is “rape” of our country)

(Trump says T.P.P. would have to be much better)

(Video from Brookings Creative Lab, omits key details)

(Government link for TPP, now referred to as CPTPP)

(Canada’s Bill C-79, October 2018)

1. Offshoring, Globalization, Free Trade

The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

2. Important Links

(1) https://www.parl.ca/LegisInfo/BillDetails.aspx?Language=E&billId=9970461&View=5
(2) https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cptpp-ptpgp/index.aspx?lang=eng
(3) https://www.forbes.com/sites/peterpham/2017/12/29/why-did-donald-trump-kill-this-big-free-trade-deal/#28d62e0b4e62
(4) https://www.brookings.edu/blog/unpacked/2017/03/24/trump-withdrawing-from-the-trans-pacific-partnership/
(5) https://www.nbcnews.com/business/economy/why-trump-killed-tpp-why-it-matters-you-n710781
(6) https://www.businessinsider.com/heres-why-trump-hates-the-trans-pacific-partnership-so-much-2016-11
(7) https://www.reuters.com/article/us-usa-trump-business-idUSKBN1571FD

3. Media Reviews On T.P.P. Withdrawal

President Trump believes otherwise. Throughout his election campaign, he referred to the TPP as a “horrible deal”, and would withdraw the U.S. from it when elected. When he became president, getting the U.S. out of the TPP was one Trump’s first acts, since he believed that it steals American jobs while benefiting large corporations.

Trump wasn’t entirely wrong. Companies from developed countries that signed up to the deal, such as Japan and the United States, would have outsourced to developing countries that have low-cost labor and fewer labor laws, such as Vietnam. In which case, unemployment in developed countries could have risen.

The Forbes article very bluntly points out that Donald Trump viewed TPP not as an opportunity, but as a threat to American jobs and American prosperity. While corporate heads would have gained from the treaty, those gains would not be shared with the U.S. public. The following NBC article, goes on to explain further.

As divisive as that language sounds, whoever got into the White House was likely to ditch the TPP. Hillary Clinton, adopting a progressive issue from Bernie Sanders, also came out against the deal during her run, saying in August, “I will stop any trade deal that kills jobs or holds down wages, including the Trans-Pacific Partnership. I oppose it now, I’ll oppose it after the election and I’ll oppose it as president.”

The idea was that if everyone brought down taxes on exported goods, U.S. companies would pay less for imports — while benefiting from cheaper labor overseas.

“Companies love free trade,” said Velshi. “Companies get to share profits with shareholders, the government gets the taxes, but workers don’t get their fair share.”

The article is extremely critical of free trade agreements, such as T.P.P. In short, jobs can and are outsourced to the 3rd world because it is so much cheaper. In turn, workers on the developed world are forced to accept much lower standards of living in order to compete.

Other media reports much the same content. Overall, Donald Trump believes that T.P.P. would be incredibly harmful to America as a whole.

In a Reuters article, Trump laid it out very plainly what he thinks of exploitive trade agreements:

“A company that wants to fire all of its people in the United States, and build some factory someplace else, and then thinks that that product is going to just flow across the border into the United States – that’s not going to happen,” he said.

Is this an attack on international trade as a whole? No. It is a rejection of lopsided treaties which one side benefits greatly at the expense of another. It is not a rejection of trade agreements which are MUTUALLY beneficial.

4. “National Treatment” Clause Returns

The so-called “national treatment” provisions were a very harmful part of NAFTA, which was signed in 1995. It allowed governments and companies to sue other governments if their business plans or environmental laws were considered unprofitable. From Chapter 11 of NAFTA.

Article 1102: National Treatment
1. Each Party shall accord to investors of another Party treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
2. Each Party shall accord to investments of investors of another Party treatment no less favorable than that it accords, in like circumstances, to investments of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
3. The treatment accorded by a Party under paragraphs 1 and 2 means, with respect to a state or province, treatment no less favorable than the most favorable treatment accorded, in like circumstances, by that state or province to investors, and to investments of investors, of the Party of which it forms a part.
4. For greater certainty, no Party may:
(a) impose on an investor of another Party a requirement that a minimum level of equity in an enterprise in the territory of the Party be held by its nationals, other than nominal qualifying shares for directors or incorporators of corporations; or
(b) require an investor of another Party, by reason of its nationality, to sell or otherwise dispose of an investment in the territory of the Party.

This clause has caused all sorts of headaches in the name of “free trade”. (See Free Trade #2 for more details). No longer are there countries, but merely “economic zones”.

Now take a look at the Trans-Pacific Partnership.

Article 9.4: National Treatment
1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments in its territory of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
3. For greater certainty, the treatment to be accorded by a Party under paragraphs 1 and 2 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment accorded, in like circumstances, by that regional level of government to investors, and to investments of investors, of the Party of which it forms a part.

Look familiar? It should. It is virtually the identical language that formed the basis of lawsuits (many successful), in Canada. Being a part of this agreement means signing away a good deal of your sovereignty.

5. Impact Of Previous “Free Trade” Deals

The Economic Policy Institute, a think-tank in Washington, releases reports and findings related to trade and commerce. Here are some of the their more interesting reports.

claims that trade with China has grown the bilateral trade deficit between 2001 and 2017 cost 3.4 million U.S. jobs, with losses in every state and congressional district. Keep in mind this wasn’t really free trade, but liberal trade.

This one claimed in 2003 that NAFTA had led to a net loss of 879,000 jobs in the United States, with most of them going to Mexico, where wages are much lower.

This one outlines the growing trade deficit with Canada and Mexico under NAFTA. While some deficit or surplus is to be expected in trade, it should never be one sided.

This one is another report about the mounting job losses as work continues to be outsourced, hurting American families.

This one outlined many harmful effects of free trade policies. One particularly rough one was forcing workers to accept much lower pay in order to keep their jobs. These trade policies bring cheap foreign labour into the equation as new competitors, and have the effect of driving down wages.

There are many other articles on these topics, but the 5 provided here should be enlightening on the dark side of putting profit over societies.

6. Currency Manipulation In “Free Trade”

Donald Trump has repeatedly called out the practice of currency manipulation, particularly with China. By manipulating the currency, nations can sell goods at what amounts to a much lower price.

First, a bit of background. The Chinese currency, called the renminbi, is what’s known as a policy currency. That means that unlike the U.S. dollar, which rises and falls in value in free market trading, the currency’s value against the dollar is set by the People’s Bank of China, an arm of the Chinese government.

While the PBOC has gradually tried to make the value of the renminbi more reflective of market forces, setting trading bands in which the renminbi is allowed to fluctuate every day, in the last analysis it is still under government control. Put another way, the value of the renminbi is manipulated by the government and always has been. It’s just that when Beijing was manipulating the value so that the renminbi appreciated against the dollar in the last few years, nobody in Washington complained.

When the Chinese Government manipulates its currency, it does so in order to artificially cheapen the costs of its products, and to gain an advantage over competitors.

In a “free market” world, this sort of thing should never be allowed.

It’s not free trade if all the nations involved aren’t playing by the same rules. It causes resentment and reduces goodwill.

7. Populism Is Protecting Your People

Leaders should protect the employment prospects of their citizens. The livelihood of the nation depends on there being opportunities for people to work and create lives for themselves. Countries should not be signing one-sided agreements which benefits others exclusively to the detriment of themselves.

So-called economic libertarianism promotes free trade throughout the world. This is sold as economic freedom, but it glosses over the hard truths involved. Outsourcing the employment of your nation is just corporate globalism. There is nothing populist or nationalist about throwing your people out of work en masse.

Perhaps Tucker Carlson lays it out the best. He uses the example of automated truck driving putting millions of drivers out of work.

Donald Trump’s pledge to pull the U.S. out of the Trans-Pacific Partnership was the right decision for the American public. He promised to bring jobs back to the country and create opportunities at home, and that was extremely popular.

In fairness, he has dangled the possibility of rejoining at some point, though the terms would have to be much better.

Posted on

The Trans-Pacific Partnership, Bill C-79

(Government link for TPP, now referred to as CPTPP)

(Canada’s Bill C-79, October 2018)

1. Offshoring, Globalization, Free Trade

The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

2. Important Links

(1) ttps://www.parl.ca/LegisInfo/BillDetails.aspx?Language=E&billId=9970461&View=5
(2) https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cptpp-ptpgp/index.aspx?lang=eng
(3) https://www.epi.org/publication/the-china-toll-deepens-growth-in-the-bilateral-trade-deficit-between-2001-and-2017-cost-3-4-million-u-s-jobs-with-losses-in-every-state-and-congressional-district/
(4) https://www.epi.org/publication/webfeatures_snapshots_archive_12102003/
(5) https://www.epi.org/blog/naftas-impact-workers/
(6) https://www.epi.org/publication/webfeatures_snapshots_archive_11052003/

Note: After the US withdrew from the agreement, it was renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

3. Trading Partner Brunei, Stoning Gays

On a side note, Brunei, a small nation governed by Islamic law, announced it would stone gays to death in accordance with religious law. It seems extremely hypocritical for the virtue-signaling Prime Minister Trudeau to have such a trading partner. However, under public pressure, Brunei has apparently backed down from the measure.

4. Portions Of Bill C-79

Causes of action under sections 9 to 13
.
8 (1) No person has any cause of action and no proceedings of any kind are to be taken, without the consent of the Attorney General of Canada, to enforce or determine any right or obligation that is claimed or arises solely under or by virtue of sections 9 to 13 or an order made under those sections.

Causes of action under Agreement
.
(2) No person has any cause of action and no proceedings of any kind are to be taken, without the consent of the Attorney General of Canada, to enforce or determine any right or obligation that is claimed or arises solely under or by virtue of the Agreement.
.
Exception
.
(3) Subsection (2) does not apply with respect to causes of action arising out of, and proceedings taken under, Section B of Chapter 9 or Article 11.‍22 of the TPP.

Right away is a red flag. If you are a private party, there may be instances where litigation is required to protect your interests (from unfair trade practices perhaps). However, the wording makes it clear that legal action is not possible here unless the Attorney General signs off on it.

As for the exceptions, Chapter 9, Section B refers to disputes among investors, and encourages the parties to resolve the problems themselves. Article 11.22 outlines dispute mechanisms for financial services.

Payment of expenditures
.
12 The Government of Canada is to pay its appropriate share of the aggregate of
(a) any expenditures incurred by or on behalf of the Commission,
(b) the general expenses incurred by the committees, working groups and other bodies established under the Agreement and the remuneration and expenses payable to representatives on the Commission and those committees and to members of those working groups and other bodies, and
(c) the expenses incurred by panels and arbitration tribunals established under the Agreement and the remuneration and expenses payable to the panellists on those panels, to arbitrators and to any experts retained by those panels or arbitration tribunals.

Not only will Canada be forced to pay its “share” for Commission expenses, but will in effect pay to set up an alternative quasi-judicial system. Not only will Canada have to pay for that, but legal and expert expenses, and any judgements awarded against.

Orders — Article 28.‍20 of TPP
.
13 (1) The Governor in Council may, for the purpose of suspending benefits in accordance with Article 28.‍20 of the TPP, by order, do any of the following:
(a) suspend rights or privileges granted by Canada to another party to the Agreement or to goods, service suppliers, investors or investments of investors of that party under the Agreement or any federal law;
(b) modify or suspend the application of any federal law, with respect to a party to the Agreement other than Canada or to goods, service suppliers, investors or investments of investors of that party;
(c) extend the application of any federal law to a party to the Agreement other than Canada or to goods, service suppliers, investors or investments of investors of that party; or
(d) take any other measure that the Governor in Council considers necessary.

The Governor in Council can apparently:

  • Suspend rights or privileges
  • modify or suspend application of Federal law
  • extend Federal law to others not previously included
  • Do anything else deemed necessary

Without clarification or at least guidance of the topic, this is extremely vague. Worse, is the Governor in Council can make these changes without requiring consent of the public.

Most of the rest of the Bill goes into detail about how tariffs on many different items will be reduced to zero.

However, like with most free trade agreements, Bill C-79 does not address an important topic: protection of jobs for people at home. That will be addressed later.

5. Sections Of CPTPP Text

While the agreement is very long, let’s look mainly at Article 9, as it has some of the more unsettling information in it. To be blunt, it removes nations’ abilities to protect their people from foreign competition. The downside to free trade.

Article 9.4: National Treatment
1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments in its territory of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
3. For greater certainty, the treatment to be accorded by a Party under paragraphs 1 and 2 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment accorded, in like circumstances, by that regional level of government to investors, and to investments of investors, of the Party of which it forms a part.

This is basically the same language used in NAFTA, where no preference could be given to host countries. In short, it doesn’t matter if another party can outbid and outcompete you. Terms just as favourable must be given.

Article 9.5: Most-Favoured-Nation Treatment
1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments in its territory of investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
3. For greater certainty, the treatment referred to in this Article does not encompass international dispute resolution procedures or mechanisms, such as those included in Section B (Investor-State Dispute Settlement).

This is much the same idea. If you treat a non-party (someone outside the agreement) a certain way, then a party within the agreement must get at least the same, if not better, treatment.

A bit misleading is the use of the term investment. Most people think of stocks and bonds as investments. While true, this agreement considers basically anything to be an investment. Here is a quote from the definitions section of Article 9.

investment means every asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk. Forms that an investment may take include:
(a) an enterprise;
(b) shares, stock and other forms of equity participation in an enterprise;
(c) bonds, debentures, other debt instruments and loans;
(d) futures, options and other derivatives;
(e) turnkey, construction, management, production, concession, revenue-sharing and other similar contracts;
(f) intellectual property rights;
(g) licences, authorisations, permits and similar rights conferred pursuant to the Party’s law; and
(h) other tangible or intangible, movable or immovable property, and related property rights, such as leases, mortgages, liens and pledges,

Beyond the traditional sense of investments there is more. Any business itself, business contracts, property, or tangible or intangible items are also considered investments.

And what about countries wanting to nationalise (take public ownership), of their “investments”? Remember, under the definition provided, an investment is pretty much anything.

Article 9.8: Expropriation and Compensation
1. No Party shall expropriate or nationalise a covered investment either directly or indirectly through measures equivalent to expropriation or nationalisation (expropriation), except:
(a) for a public purpose
(b) in a non-discriminatory manner;
(c) on payment of prompt, adequate and effective compensation in accordance with paragraphs 2, 3 and 4; and
(d) in accordance with due process of law.
2. Compensation shall:
(a) be paid without delay;
(b) be equivalent to the fair market value of the expropriated investment immediately before the expropriation took place (the date of expropriation);
(c) not reflect any change in value occurring because the intended expropriation had become known earlier; and
(d) be fully realisable and freely transferable.
3. If the fair market value is denominated in a freely usable currency, the compensation paid shall be no less than the fair market value on the date of expropriation, plus interest at a commercially reasonable rate for that currency, accrued from the date of expropriation until the date of payment.
4. If the fair market value is denominated in a currency that is not freely usable, the compensation paid, converted into the currency of payment at the market rate of exchange prevailing on the date of payment, shall be no less than:
(a) the fair market value on the date of expropriation, converted into a freely usable currency at the market rate of exchange prevailing on that date; plus
(b) interest, at a commercially reasonable rate for that freely usable currency, accrued from the date of expropriation until the date of payment.

This actually does make some sense, as it provides some protections to companies and insures that their property won’t just be converted into the government’s.

However, the wording is such that any legitimate measures a nation might make to go about its business might be construed as “expropriating” or as “nationalising”. The language seems worded poorly on purpose.

And it doesn’t mention that nations have legitimate interests in protecting the jobs of its people, and the local economy. Governments are supposed to protect their people first and foremost.

Article 9.9: Transfers
1. Each Party shall permit all transfers relating to a covered investment to be made freely and without delay into and out of its territory. Such transfers include:
(a) contributions to capital;
(b) profits, dividends, interest, capital gains, royalty payments, management fees, technical assistance fees and other fees;
(c) proceeds from the sale of all or any part of the covered investment or from
the partial or complete liquidation of the covered investment;
(d) payments made under a contract, including a loan agreement;
(e) payments made pursuant to Article 9.7 (Treatment in Case of Armed Conflict or Civil Strife) and Article 9.8 (Expropriation and Compensation); and
(f) payments arising out of a dispute.

Pull the covered investments freely and without delay? Again, almost anything is an investment under this agreement. This actually has the potential to do serious harm. Businesses wishing to leave could pull all of their “investments” and drain the country of its wealth quite quickly.

Article 9.11: Senior Management and Boards of Directors
1. No Party shall require that an enterprise of that Party that is a covered investment appoint to a senior management position a natural person of any particular nationality.
2. A Party may require that a majority of the board of directors, or any committee thereof, of an enterprise of that Party that is a covered investment, be of a particular nationality or resident in the territory of the Party, provided that the requirement does not materially impair the ability of the investor to exercise control over its investment.

This ignores a basic reality. People are loyal first and foremost to their homes and their tribes. Do people want a bunch of foreigners, with in-group preference for their homelands to be controlling so much? Probably not, but free trade deals do not deal with nations, but “economic zones”.

Inserting a condition that it not “materially impair” is vague and open to interpretation. As such, it seems almost worthless.

Article 9 is the most troubling in the agreement. But it is worth addressing one point in Article 28, which covers dispute resolution.

Article 28.4: Choice of Forum
1. If a dispute regarding any matter arises under this Agreement and under another international trade agreement to which the disputing Parties are party, including the WTO Agreement, the complaining Party may select the forum in which to settle the dispute.
2. Once a complaining Party has requested the establishment of, or referred a matter to, a panel or other tribunal under an agreement referred to in paragraph 1, the forum selected shall be used to the exclusion of other fora.

An interesting detail, parties filing complaints can shop around. There is no fixed place to do so. While this sounds fine on the surface, such could be open to gaming the system.

6. Potential For Huge Job Losses

Companies close down and new ones start up. That is normal in a capitalist society. However, free trade deals in general pose a complication. When it becomes more advantageous (ie “cheaper”) to produce a good in another country, there is always a risk. What will stop a company from closing down, laying off all its staff, and relocating in the foreign nation? Legally, nothing, at least in many cases.

The previous pieces on NAFTA addressed some on the downsides to free trade deals. The CPTPP would likely cause the same sorts of issues.

Let’s use the United States as an example. It lost 3.4 million jobs to China between 2001 and 2017 due to “liberalized trade”. Further, another 879,000 jobs have been lost as a direct result of NAFTA.

Beyond the direct job losses, trade deals have the effect of driving down wages. This is especially true for manufacturing jobs, which are traditionally well paid. The reason is leverage. If a company can threaten to relocate in order to pay its (new) workers much less, then current employees can be forced to accept significantly less compensation. One reason tariffs are applied to goods is to counter the vast discrepancies that can exist between nations.

In very lopsided trading arrangements, the benefits are not equal. Again, referring to the US, trade deficits can balloon very quickly. While some surplus or deficit is inevitable, the trading relations cannot continue unless the parties benefit fairly equally. Large trade deficits drain wealth from a nation. This is money being taken out of the country and not being spent on people here.

The CPTPP addresses NONE of these issues. Is this a form of protectionism? Yes, and there’s nothing wrong with that.

7. Conclusions Regarding C-79 & CPTPP

NAFTA was tricky enough, even with just 3 nations, all on one continent. CPTPP has more, and it covers a much larger geographic area. The wealth discrepancies are even larger.

While this is touted as an economy growth tool, the CPTPP doesn’t indicate at all how the citizens will benefit. Under the “National Treatment” provisions, foreigners must be given the same considerations as locals. If it becomes more economical to lay off people and move assets, then it’s done. There can be no protection for locals, which is what a government should be doing.

Free trade agreements tend to create a “race to the bottom”. If it becomes more profitable to ship work and jobs to another country, it is done. Locals will have to accept far less in order to compete, driving down their standards of living.

Communities benefit when there is work and wealth. Exporting it for overall economic growth is cold, and reduces people to mere cogs in a machine.

Difficult to see how average people will benefit from CPTPP.

Posted on

Free Trade #3: NAFTA, And The Costs Its Supporters Ignore

(Tucker Carlson on protecting your citizens)

1. Offshoring, Globalization, Free Trade

The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

2. Important Links

(1) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/gov.aspx?lang=eng
(2) ttps://www.state.gov/nafta-investor-state-arbitrations/
(3) http://replacenafta.org/jobs-lost/
(4) https://www.epi.org/publication/webfeatures_snapshots_archive_12102003/
(5) https://www.epi.org/publication/heading_south_u-s-mexico_trade_and_job_displacement_after_nafta1/
(6) https://www.epi.org/blog/naftas-impact-workers/
(7) https://www.epi.org/publication/webfeatures_snapshots_archive_11052003/
(8) https://www.epi.org/publication/the-china-toll-deepens-growth-in-the-bilateral-trade-deficit-between-2001-and-2017-cost-3-4-million-u-s-jobs-with-losses-in-every-state-and-congressional-district/
(9) https://www.cfr.org/backgrounder/naftas-economic-impact
(10) https://www.nytimes.com/1992/10/16/us/the-1992-campaign-transcript-of-2d-tv-debate-between-bush-clinton-and-perot.html?pagewanted=all
(11) https://www.politicalresearch.org/2014/10/11/globalization-and-nafta-caused-migration-from-mexico/

3. Lawsuits Against Canada, Chapter 11

Resolved Cases

Company Suit Amount Amount Settled
AbitibiBowater $500M $130M
Centurion Health $160M $0, fees unpaid
Chemtrade $78.6M $0, dismissed
Detroit Int’l Bridge $3.5B $0, dismissed
Dow Agro Sciences $2M $0, withdrew
Ely Lily and Co. $500M $0, dismissed
Ethyl Corp. $201M settled
Mercer International $232M $0, dismissed
Merrill & Ring $50M $0, dismissed
Mesa Power Group $658M $0, dismissed
Mobil Inv. & Murphy Oil $66M $17.3M
Pope & Talbot $500M $527M, USD
S.D. Myers $53M $6.9M,
St. Mary’s VNCA $275M $0, no standing
United Parcel Services $160M $0, dismissed
V.G. Gallo $105M $0, dismissed
Windstream Energy $475M $28M

For these “finished” claims, Canada has had to pay out $709 million, plus a substantial amount in paying its own lawyers. Also, consider the following:
-DowAgro sale, under the terms of the settlement, is still allowed to use its pesticide in Canada.
-Ethyl Corp still allowed to use MMT additive.

Resolved Cases

Company Suit Amount Information
Clayton/Bilcon $101M Lost, awaiting damages
Lone Pine Resources $119M Awaiting verdict
Mobile Investments $20M Awaiting verdict
Resolute Forest Products $70M Awaiting verdict
Tennant Energy Ltd $116M Awaiting verdict
Westmorehead Coal $470M Awaiting verdict

Potentially another $896 million

To summarize, Canada has already paid out $709 million in various actions under Chapter 11 of NAFTA (plus the settlement from Ethyl Corp), and may be on the hook for $896 million more. And this doesn’t take legal fees and other court costs into account.

4. Job Losses Resulting From NAFTA

Research has been done on the effects of NAFTA. This released 2003 study, estimates that 879,000 jobs have been lost in the US as a direct result of NAFTA over a decade.

The conclusions were also troubling:

Since the North American Free Trade Agreement (NAFTA) was signed in 1993, the rise in the U.S. trade deficit with Canada and Mexico through 2002 caused the displacement of production that supported 879,280 U.S. jobs. NAFTA is a free trade and investment agreement that provided investors with a unique set of guarantees designed to stimulate foreign direct investment in Mexico and Canada. It has facilitated the movement of factories from the United States to Canada and Mexico. Most of these jobs were high-wage positions in manufacturing industries.

Proponents of new trade agreements that build on NAFTA, such as the proposed Free Trade Agreement of the Americas (FTAA), have frequently claimed that such deals create jobs and raise incomes in the United States. These claims are based only on the positive effects of exports (known as “export effects”), ignoring the negative effects of imports (known as “import effects”). Such arguments are an attempt to hide the costs of new trade deals in order to boost the reported benefits.

The problem with these claims is that they misrepresent the real effects of trade on the U.S. economy: trade both creates and destroys jobs. Increases in U.S. exports tend to create jobs in this country, but increases in imports tend to reduce jobs by displacing goods that otherwise would have been made in the United States by domestic workers. Ignoring imports and counting only exports is like balancing a checkbook by counting only deposits but not withdrawals.

This is blunt and truthful. It is high paying jobs mainly in manufacturing that have been exported in the name of “free trade”, and has harmed the US workforce.

Now, here, is another study, released in 2011, dealing specifically with Mexico and NAFTA.

As of 2010, U.S. trade deficits with Mexico totaling $97.2 billion had displaced 682,900 U.S. jobs. Of those jobs, 116,400 are likely economy-wide job losses because they were displaced between 2007 and 2010, when the U.S. labor market was severely depressed.

There is a cost to these free trade agreements. Jobs are lost domestically when it becomes cheaper to ship them to another country. Often it is manufacturing, one of the better paid jobs, where higher education isn’t needed.

Abstract promises about increased jobs and exports misrepresent the real overall effects of trade on the U.S. economy. Trade both creates and destroys jobs. While exports tend to support domestic employment, imports lead to job displacement: As imports are substituted for domestically produced goods, production that supports domestic jobs falls, displacing existing jobs and preventing new job creation.

Simply out, there are winners and losers in trade deals. Countries win if they export more than they import, and vice versa. While some trade surplus or deficit is inevitable, it is sustained deficits that drain wealth from the country and put people out of work.

While Canada or Mexico may sit smugly and know that they benefit from the trade deal with the US, this must be considered. With ever proposed expansion of free trade and liberalized trade, there is nothing to stop jobs from Canada and/or Mexico from being exported elsewhere.

For example, the US lost 3.4 million jobs to China since 2001. Canada could end up in that situation one day.

5. Free Trade Drives Down Wages

Ross Perot ran for President in 1992. He faced the incumbent, George H.W. Bush (Republican), and Bill Clinton (Democrat). While he came in third, Perot drove home this hard truth about free trade: it drives down wages. It forces Americans to compete for third world wages.

To those of you in the audience who are business people, pretty simple: If you’re paying $12, $13, $14 an hour for factory workers and you can move your factory South of the border, pay a dollar an hour for labor, hire young — let’s assume you’ve been in business for a long time and you’ve got a mature work force — pay a dollar an hour for your labor, have no health care — that’s the most expensive single element in making a car — have no environmental controls, no pollution controls and no retirement, and you don’t care about anything but making money, there will be a giant sucking sound going south.

“Why won’t everybody go South?” They say, “It’d be disruptive.” I said, “For how long?” I finally got them up from 12 to 15 years. And I said, “well, how does it stop being disruptive?” And that is when their jobs come up from a dollar an hour to six dollars an hour, and ours go down to six dollars an hour, and then it’s leveled again. But in the meantime, you’ve wrecked the country with these kinds of deals. We’ve got to cut it out.

Perot is completely right here. It will raise the wages in Mexico, while driving down American wages. And to reiterate, Canadians should not think they are immune from this sort of practice.

The Council on Foreign Relations added:

Debate persists regarding NAFTA’s legacy on employment and wages, with some workers and industries facing painful disruptions as they lose market share due to increased competition, and others gaining from the new market opportunities that were created.

But it is the common worker with a family to provide for who will really feel the pinch. It is cold comfort to be out work and be told “well, it raises trade and GDP”.

6. NAFTA Causes Carnage To Middle Class

Yet another EPI article. This one sums up the problems of NAFTA in very blunt terms.

  1. Job losses
  2. Pushes wages down
  3. Destruction of farms and small businesses
  4. Sets standards for globalization

The article is directly on point.

NAFTA affected U.S. workers in four principal ways. First, it caused the loss of some 700,000 jobs as production moved to Mexico. Most of these losses came in California, Texas, Michigan, and other states where manufacturing is concentrated. To be sure, there were some job gains along the border in service and retail sectors resulting from increased trucking activity, but these gains are small in relation to the loses, and are in lower paying occupations. The vast majority of workers who lost jobs from NAFTA suffered a permanent loss of income.

Second, NAFTA strengthened the ability of U.S. employers to force workers to accept lower wages and benefits. As soon as NAFTA became law, corporate managers began telling their workers that their companies intended to move to Mexico unless the workers lowered the cost of their labor. In the midst of collective bargaining negotiations with unions, some companies would even start loading machinery into trucks that they said were bound for Mexico. The same threats were used to fight union organizing efforts. The message was: “If you vote in a union, we will move south of the border.” With NAFTA, corporations also could more easily blackmail local governments into giving them tax reductions and other subsidies.

Third, the destructive effect of NAFTA on the Mexican agricultural and small business sectors dislocated several million Mexican workers and their families, and was a major cause in the dramatic increase in undocumented workers flowing into the U.S. labor market. This put further downward pressure on U.S. wages, especially in the already lower paying market for less skilled labor.

Fourth, and ultimately most important, NAFTA was the template for rules of the emerging global economy, in which the benefits would flow to capital and the costs to labor. The U.S. governing class—in alliance with the financial elites of its trading partners—applied NAFTA’s principles to the World Trade Organization, to the policies of the World Bank and IMF, and to the deal under which employers of China’s huge supply of low-wage workers were allowed access to U.S. markets in exchange for allowing American multinational corporations the right to invest there.

Who actually benefits from NAFTA, or similar types of deals? Not the workers, who are now forced to compete for third world wages. Not communities, who see major employers pack up and leave for better opportunities.

7. NAFTA Makes Illegal Immigration Problem Worse

NAFTA, however, did not lead to rising incomes and employment in Mexico, and did not decrease the flow of migrants. Instead, it became a source of pressure on Mexicans to migrate. The treaty forced corn grown by Mexican farmers without subsidies to compete in Mexico’s own market with corn from huge U.S. producers, who had been subsidized by the U.S. Agricultural exports to Mexico more than doubled during the NAFTA years, from $4.6 to $9.8 billion annually. Corn imports rose from 2,014,000 to 10,330,000 tons from 1992 to 2008. Mexico imported 30,000 tons of pork in 1995, the year NAFTA took effect. By 2010, pork imports, almost all from the U.S., had grown over 25 times, to 811,000 tons. As a result, pork prices received by Mexican producers dropped 56%

When nations are reduced to “economic zones”, it forces workers to compete against those in other nations for the same piece of the pie. If jobs are eliminated on a massive scale, then the pressure is on to find work. For many Mexicans, it has meant going to the US, often illegally.

Note: this not to condone illegal immigration. However, it becomes more understandable when factors like these are considered.

The “surplus labour” sure helps large employers, and further helps to drive down wages, which of course is the entire point.

8. NAFTA Makes US Trade Deficit Worse

Here is a 2003 study on the trade deficit the US has experienced due to NAFTA.

As mentioned earlier, it is true Canada currently benefits from the US trade deficit. But as free trade expands, Canada (and other nations) could easily find themselves in the same dilemma as the US.

Sustained trade deficits bleed money from a nation.

9. NAFTA Can Override Environmental Protections

Think this is crazy? Consider some of the court action Canada has faced

CLICK HERE, for Ethyl Corp wanting $201M over MMT additive ban.
CLICK HERE, for SD Myers wants $53M for PCB ban.
CLICK HERE, for Pope & Talbot’s $500M softwood lumber suit.
CLICK HERE, for Sun Belt wanting $1.5B-$10B for lost water rights.

10. Is NAFTA Worth The Price?

Yes, it has led to economic growth and more trade. That much is indisputable. But it isn’t fair to omit some of the real costs to engaging in these free trade deals, such as TPP, or FTAA.

  • Litigation over new “rights”
  • Massive job losses
  • Wages driven down
  • Destruction to middle class
  • Increased illegal immigration
  • Unsustainable trade deficits
  • Environmental protections are secondary

But hey, as long as the GDP keeps growing.

Posted on

Free Trade #2: NAFTA: Lawsuits, Sovereignty, Massive Job Losses, Conflict Of Interest

Bev Collins, giving a talk on NAFTA

(Some of the litigation going on over NAFTA)

(Multilateral Agreement on Investment — MAI)

(Trilateral Commission)

(Tucker Carlson: Social Costs to Communities Most Important)

(A man who gets it, Lou Dobbs)

1. Offshoring, Globalization, Free Trade

The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

2. Important Links

(1) https://www.wto.org/english/res_e/booksp_e/casestudies_e/case9_e.htm
(2) https://laws-lois.justice.gc.ca/eng/acts/w-11.8/index.html
(3) http://trilateral.org/download/doc/Vancouver_1996.pdf
(4) Vancouver_1996 Trilateral Commission
(5) https://ipolitics.ca/2019/04/30/investor-state-dispute-system-puts-strain-on-poorer-countries-report/
(6) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/nafta.aspx?lang=eng
(7) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/gov.aspx?lang=eng
(8) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/ethyl.aspx?lang=eng
(9) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/SDM.aspx?lang=eng
(10) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/pope.aspx?lang=eng
(11) https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/parcel.aspx?lang=eng
(12) https://www.cbc.ca/news/canada/u-s-firm-sues-canada-for-10-5-billion-over-water-1.180821
(13) https://www.oecd.org/investment/internationalinvestmentagreements/multilateralagreementoninvestment.htm
(14) http://www1.oecd.org/daf/mai/pdf/ng/ng987r1e.pdf
(15) MAI Draft Agreement 1998
(16) https://blogs.imf.org
(17) http://trilateral.org/download/files/membership/TC_list_3_2019.pdf
(18) Trilateral Commission List 2019
(19) http://trilateral.org
(20) https://www.bloomberg.com/research/stocks/private/person.asp?personId=2158742&privcapId=3103423&previousCapId=6908053&previousTitle=Ontario%20Heritage%20Trust
(21) https://www.epi.org/publication/webfeatures_snapshots_archive_12102003/
(22) https://www.epi.org/publication/the-china-toll-deepens-growth-in-the-bilateral-trade-deficit-between-2001-and-2017-cost-3-4-million-u-s-jobs-with-losses-in-every-state-and-congressional-district/

3. Interesting Points From Bev Collins Video

-Semiconductor, aerospace, telecommunications industries were dismantled and sold off
-Mulroney gave QC special negotiating powers in event of succession
-Business Council on National Issues had $56M to market NAFTA
-600,000 jobs lost to free trade
-Small businesses gutted, corporations thrived
-92% of foreign investment came in to take over Canadian companies
-13,000 Canadian companies lost in meantime
-10,000 of those taken over by US transnationals
-1993 election, NAFTA huge issue, Mulroney/Campbell Gov’t wiped out
-Concern over water being sold off as commodity
-Liberals signed NAFTA “as is” in January 1994
-Roy MacLaren “both” Minister for International Trade and sat on the Trilateral Commission, a lobbying group.
-Canada push for a World Trade Body (Bill C-57)
-UN has 3 pillars:

  • Financial pillars (IMF)
  • World Bank
  • World Trade Organization

    • -Costs Canada $275M/annually to sit on committee
    -IMF supposed to arrange short term loans to 3rd World
    -World Bank set up for long term development funds
    -Canada funded 3 Rivers Gorges Dam in China
    -Export Development Corporation spends $40B, unaudited, unaccountable
    -“Investor State Suit” Clause allows Trans-Nats
    -Ethyl Corp sued Canada b/c of MMT gasoline additive ban
    -SD Myers sued Canada over PCB ban
    -Pope & Talbot sued over softwood lumber quota
    -Much of Ontario manufacturing base lost
    -Multilateral Agreement on Investment launched not long after NAFTA
    -lawsuit against MAI, Judge Dube friends with PM Jean Chretien
    -29 MAI delegates shut out of talks
    -MAI eventually destroyed, but content moved over to Free Trade Area of the Americas
    -Prelude to mass migration. If goods and money are borderless, then isn’t this the next logical step?
    -Canada can find its wages driven down
    -Unions themselves now seen as barrier to trade
    -WTO ruled against airline subsidizes
    -43,000 agricultural producers lost to bankruptcy
    -Many SK farms bought up at huge discount

    4. Canada’s Bill C-57

    From the WTO page:

    In 1994 the Canadian Parliament adopted legislation to implement the Uruguay Round with virtually no opposition. The measure was easily passed by the House of Commons with a vote of 185-7. There was general acceptance that the World Trade Organization (WTO) was a necessity for Canada both to participate and to compete in the new international order. Not only did legislators believe that the WTO Agreement would enhance and facilitate Canadian exports, but there also was an expectation among parliamentarians that the new rules-based dispute settlement mechanism would act as a counter-force to US unilateralism in the international arena. Roy McLaren, the Minister for International Trade, explained that the arrangements would particularly benefit ‘small and medium-size trade players like Canada, which are inherently vulnerable to the threat of unilateralism by the economic giants’

    McLaren was wrong. This arrangement does not benefit small and medium trade players like Canada. In fact, it will weaken Canada immensely, and lead to job losses and erosion of our sovereignty. Jere a few quotes from the WTO Agreement Implementation Act.

    Prohibition of private cause of action under Agreement

    6 No person has any cause of action and no proceedings of any kind shall be taken, without the consent of the Attorney General of Canada, to enforce or determine any right or obligation that is claimed or arises solely under or by virtue of the Agreement.

    This is a red flag. Nothing happens in Court unless the Attorney General of Canada signs off on it.

    Non-application of Agreement to water
    7 (1) For greater certainty, nothing in this Act or the Agreement, except the Canadian Schedule to the General Agreement on Tariffs and Trade 1994 set out in Annex 1A to the Agreement, applies to water.

    This is promising though. Water was specifically excluded from NAFTA. Concerns were that once exports started, there would be no way to stop it.

    Suspension of concessions to non-WTO Members
    (2) The Governor in Council may, with respect to a country that is not a WTO Member, by order, do any one or more of the following:
    (a) suspend rights or privileges granted by Canada to that country or to goods, service providers, suppliers, investors or investments of that country under any federal law;
    (b) modify or suspend the application of any federal law with respect to that country or to goods, service providers, suppliers, investors or investments of that country;
    (c) extend the application of any federal law to that country or to goods, service providers, suppliers, investors or investments of that country; and
    (d) take any other measure that the Governor in Council considers necessary.

    In short, this allows Canada to screw over non-WTO countries. Great way to force 3rd World nations in jumping on board. This is economic extortion.

    5. Chapter 11, National Treatment Clause

    This clause has been the basis of many lawsuits, since the text states that foreign companies must be treated the same as domestic companies.

    Article 1102: National Treatment
    1. Each Party shall accord to investors of another Party treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
    2. Each Party shall accord to investments of investors of another Party treatment no less favorable than that it accords, in like circumstances, to investments of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
    3. The treatment accorded by a Party under paragraphs 1 and 2 means, with respect to a state or province, treatment no less favorable than the most favorable treatment accorded, in like circumstances, by that state or province to investors, and to investments of investors, of the Party of which it forms a part.
    4. For greater certainty, no Party may:
    (a) impose on an investor of another Party a requirement that a minimum level of equity in an enterprise in the territory of the Party be held by its nationals, other than nominal qualifying shares for directors or incorporators of corporations; or
    (b) require an investor of another Party, by reason of its nationality, to sell or otherwise dispose of an investment in the territory of the Party.

    And “who” has been suing Canada under Chapter 11 of NAFTA?

    Cases filed against the Government of Canada

    Ongoing arbitrations to which Canada is a party

    • Clayton/Bilcon
    • Lone Pine Resources Inc.
    • Mobil Investments Canada Inc.
    • Resolute Forest Products Inc.
    • Tennant Energy, LLC.
    • Westmoreland Coal Company

    Concluded arbitrations to which Canada was a party

  • AbitibiBowater Inc.
  • Centurion Health Corporation
  • Chemtura Corp.
  • Detroit International Bridge Company
  • Dow AgroSciences LLC
  • Eli Lilly and Company
  • Ethyl Corporation
  • Mercer International Inc.
  • Merrill & Ring Forestry L.P.
  • Mesa Power Group LLC
  • Mobil Investments Inc. and Murphy Oil Corporation
  • Pope & Talbot Inc.
  • S.D. Myers Inc.
  • St. Marys VCNA, LLC
  • United Parcel Service of America, Inc. (UPS)
  • V. G. Gallo
  • Windstream Energy LLC

    • Withdrawn or inactive claims

    • Contractual Obligation Productions, LLC, Charles Robert Underwood and Carl Paolino
    • GL Farms LLC and Carl Adams
    • J.M. Longyear
    • William Jay Greiner and Malbaie River Outfitters Inc.

    open access to information, about the various court proceedings. But do take a look. They almost all involve an alleged breach of the “National Treatment” Clause.

    Now, this “only covers lawsuits against Canada. There have also been plenty of them against the US and Mexico for violating NAFTA.

    6. Multilateral Agreement on Investment

    2. Investment means:
    Every kind of asset owned or controlled, directly or indirectly, by an investor, including: 1, 2
    (i) an enterprise (being a legal person or any other entity constituted or organised under the applicable law of the Contracting Party, whether or not for profit, and whether private or government owned or controlled, and includes a corporation, trust, partnership, sole proprietorship, branch, joint venture, association or organisation);
    (ii) shares, stocks or other forms of equity participation in an enterprise, and rights derived therefrom;
    (iii) bonds, debentures, loans and other forms of debt, and rights derived therefrom;
    (iv) rights under contracts, including turnkey, construction, management, production or revenue-sharing contracts;
    (v) claims to money and claims to performance;
    (vi) intellectual property rights;
    (vii) rights conferred pursuant to law or contract such as concessions, licenses, authorisations, and permits;
    (viii) any other tangible and intangible, movable and immovable property, and any related property rights, such as leases, mortgages, liens and pledges.

    And remember that “National Treatment Clause”?

    III. TREATMENT OF INVESTORS AND INVESTMENTS
    NATIONAL TREATMENT AND MOST FAVOURED NATION TREATMENT
    1. Each Contracting Party shall accord to investors of another Contracting Party and to their investments, treatment no less favourable than the treatment it accords [in like circumstances] to its own investors and their investments with respect to the establishment, acquisition, expansion, operation, management, maintenance, use, enjoyment and sale or other disposition of investments.

    This would be the investment equivalent of NAFTA. All forms of investments would have to be given equal considerations. Although it was eventually stopped, the contents are still being considered for other opportunities.

    7. Trilateral Commission

    So, who founds the Trilateral Commission?
    Where are they from?

    Founding Members
    David Rockefeller was the principal founder of the Trilateral Commission in mid-1973. He served on the executive committee and was North American chairman from mid-1977 through November 1991. He is now honorary chairman and a lifetime trustee of the Commission.

    Zbigniew Brzezinski played an important role in the formation of the Commission and served as its first director from 1973 to 1976. After serving in the Carter administration, Dr. Brzezinski rejoined the Commission in 1981 and served on the executive committee until 2009.

    Other early North Americans leaders were Gerard C. Smith, first North American chairman; Jean-Luc Pepin, who headed the Canadian Group; and George S. Franklin, regional secretary. Richard Cooper, Henry Owen, and Philip Tresize were members of the first political, monetary, and trade task forces to report to the Commission.

    Max Kohnstamm of the Netherlands was the first European chairman and Wolfgang Hager the first regional secretary. Georges Berthoin of France, one of the first members from the European Community and a former European chairman, is now an honorary European chairman. Otto Graf Lambsdorff, another original European member and former European chairman, served as honorary European chairman until his death in 2009. François Duchène, Claudio Sergré, and Don Guido Colonna di Paliano were the European authors of the first task force reports.

    If nothing else, it is refreshing to be honest about who is founding it. Now to get to the trickier question of why it was formed.

    I. What is the Trilateral Commission? When and why was it formed?
    The Trilateral Commission is a non-governmental, policy-oriented discussion group of about 390 distinguished citizens from Europe, North America, and Pacific Asia formed to encourage understanding and closer cooperation among these three regions on shared global problems.

    The idea of the Commission was developed in the early 1970s. This was a time of considerable discord among the United States and its democratic industrialized allies in Western Europe, Japan, and Canada. There was also a sense that the international system was changing in some basic ways with rather uncertain implications. Change was most obvious in the international economy, as Western Europe and Japan gained strength and the position of the U.S. economy became less dominant. The increase in global interdependence was affecting the United States in ways to which it was not accustomed.

    When they talk about closer cooperation and understanding, these are really code words for “globalism”. Eliminate borders to trade, to financial services, and eventually, to people moving.

    This all sounds lovely, but it is incrementally erasing nations. Not an accident, and quite intentional.

    8. Commission/Parliament Conflict of Interest

    Bev Collins is absolutely right about conflict of interest going on in the Canadian Parliament. Here are two egregious examples:

    Roy Maclaren, is a former Minister of International Trade (1996-2000). He was also sitting on the Trilateral Commission the entire time it seems.

    Bill Graham is a former Minister of Foreign Affairs, and also a member of the Trilateral Commission.

    Canada’s Minister of International Trade, and also Minister of Foreign Affairs were also sitting on a Commission that promotes ever growing free trade agreements?! How does that look? But that’s hardly the whole picture.

    NORTH AMERICAN GROUP
    .
    Bertrand-Marc Allen, President, Boeing International, Arlington Graham Allison, Director, Belfer Center for Science and International Affairs, and Douglas Dillon Professor of Government, John F. Kennedy School of Government, Harvard University, Cambridge; former Dean, John F. Kennedy School of Government; former Special Advisor to the Secretary of Defense and former Assistant Secretary of Defense
    Rona Ambrose, former MP, former Interim Leader, Conservative Party; former Minister on the Status of Women, Environment, Health and Public Works, Ottawa
    Dominic Barton, Worldwide Managing Director, McKinsey & Company, London
    *Catherine Bertini, Professor, Public Administration and International Affairs, Maxwell School of Citizenship and Public Affairs, Syracuse University; Distinguished Fellow, The Chicago Council on Global Affairs
    Herminio Blanco Mendoza, Chairman, IQOM, Mexico City; former Mexican Secretary of Commerce and Industrial Development; former Chief NAFTA Negotiator
    Michael Bloomberg, Founder and CEO, Bloomberg LP, NewYork; fomer Mayor of New York City
    Esther Brimmer, Executive Director and CEO, NAFSA, Association for International Educators, Washington R.
    Nicholas Burns, Professor of the Practice of Diplomacy and International Politics and Member of the Board, Belfer Center for Science and International Affairs, John F. Kennedy School of Government, Harvard University, Cambridge; former U.S. Under Secretary of State for Political Affairs
    Jean Charest, Former Premier of Québec; former Deputy Prime Minister of Canada, Montréal
    *Michael Chertoff, Chairman and Co-Founder, The Chertoff Group; former Secretary of Homeland Security; Former Judge, U.S. Circuit Court of Appeals for the Third Circuit; Former Assistant Attorney General, Criminal Division, Department of Justice, Washington
    Raymond Chrétien, Partner and Strategic Advisor, Fasken Martineau DuMoulin LLP, Montreal, QC; Chairman of the Board of Directors of the Montréal Council on Foreign Relations (MCFR); former Associate Under Secretary of State of External Affairs; former Ambassador to the Congo, Belgium, Mexico, the United States, and France
    Timothy Collins, CEO and Senior Managing Director, Ripplewood Holdings, Inc., New York
    Richard N. Cooper, Maurits C. Boas Professor of International Economics, Harvard University, Cambridge; former Chairman, National Intelligence Council; former U.S. Under Secretary of State for Economic Affairs
    Heidi Crebo-Rediker, CEO, International Capital Strategies, Washington; former Chief Economist, State Department
    Lee Cullum, Contributing Columnist, Dallas Morning News; Radio and Television Commentator, Dallas Luis de la Calle, Managing Director and Founding Partner, De la Calle, Madrazo, Mancera, S.C. (CMM), Mexico City; former Undersecretary for International Trade Negotiations
    Arthur A. DeFehr, CEO, Palliser Furniture Holdings Ltd., Winnipeg
    André Desmarais, President and Co-Chief Executive Officer, Power Corporation of Canada, Montréal; Deputy Chairman, Power Financial Corporation
    John M. Deutch, Institute Professor emeritus, Massachusetts Institute of Technology, Cambridge; former Director of Central Intelligence; former U.S. Deputy Secretary of Defense and Undersecretary of Energy
    Paula J. Dobriansky, Senior Fellow, Belfer Center for Science and International Affairs, John F. Kennedy School of Government, Harvard University, Cambridge; Vice Chair, National Executive Committee, U.S. Water Partnership; former U.S. Under Secretary of State for Global Affairs
    Wendy Dobson, Professor and Co-Director, Institute for International Business, Rotman School of Management, University of Toronto, Toronto; former Canadian Associate Deputy Minister of Finance
    Gary Doer, former Canadian Ambassador to the United States, Winnipeg Thomas Donilon, Partner and Vice Chair, O’Melveny & Myers LLP, Washington; Non-resident Senior Fellow, Belfer Center for Science and International Affairs, Harvard University; former U.S. National Security Advisor
    *Kenneth M. Duberstein, Chairman and Chief Executive Officer, The Duberstein Group, Washington; former Chief of Staff to President Ronald Reagan
    Michael Duffy, former Executive Editor, TIME Magazine, Washington Douglas Elmendorf, Dean, John F. Kennedy School of Government, Harvard University, Cambridge Richard Falkenrath, Chief Security Officer, Bridgewater Associates, Westport Dawn Farrell, President and CEO, TransAlta Corporation, Calgary
    Diana Farrell, Chief Executive Officer and President, JPMorgan Chase Institute, Washington; former Deputy Director, National Economic Council, and Deputy Assistant to the President for Economic Policy
    Martin S. Feldstein, George F. Baker Professor of Economics, Harvard University, Cambridge; President Emeritus, National Bureau of Economic Research; former Chairman, Council of Economic Advisors
    Linda Frum, Member, Senate of Canada, Ottawa Juan Gallardo, Chairman of the Board, Grupo Embotelladoras Unidas, SA de CV, Mexico City
    *David R. Gergen, Professor of Public Service and Director of the Center for Public Leadership, John F. Kennedy School of Government, Harvard University, Cambridge; CNN Senior Political Analyst
    Gordon Giffin, Partner, Dentons US LLP, Atlanta; former U.S. Ambassador to Canada
    Donald Gogel, President and Chief Executive Officer, Clayton Dubilier and Rice, Inc., New York
    Jamie S. Gorelick, Partner, WilmerHale, Washington; former Deputy Attorney General; former General Counsel, Department of Defense
    Bill Graham Chancellor, Trinity College, University of Toronto; former Member, House of Commons; former Minister of Foreign Affairs and former Minister of Defense, Ottawa Donald Graham, Chairman and CEO of Graham Holdings Company, former owner of The Washington Post Company, Washington Peter Harder, Member, Senate of Canada, Ottawa
    *Jane Harman, Director, President, and CEO, Woodrow Wilson International Center for Scholars, Washington; former Member, U.S. House of Representatives
    Linda Hasenfratz, President and CEO, Linamar Corporation, Ontario
    Carlos Heredia, Associate Professor, Department of International Studies, Center for Research and Teaching in Economics (CIDE), Mexico City; Coordinator, Program for the Study of the United States, CIDE
    John B. Hess, Chairman of the Board and CEO, Hess Corporation, New York
    *Carla A. Hills, Chairman and Chief Executive Officer, Hills & Company, Washington; former U.S. Trade Representative; former U.S. Secretary of Housing and Urban Development
    *Karen Elliott House, writer, Princeton, NJ; Senior Fellow, Belfer Center for Science and International Affairs, John F. Kennedy School of Government, Harvard University; former Senior Vice President, Dow Jones & Company, and Publisher, The Wall Street Journal
    Joseph K. Hurd, III, former Director, Emerging Business, Facebook, Menlo Park
    David Ignatius, Columnist, The Washington Post, Washington Merit E. Janow, Dean of the Faculty and Professor of Practice, International Economic Law and International Affairs, Columbia University’s School of International and Public Affairs (SIPA), New York; former Member, Appellate Body from North America, World Trade Organization
    P. Thomas Jenkins, Chair, Open Text, Waterloo; Chair, National Research Council of Canada
    Lewis Kaden, Chairman, Markle Foundation Board of Directors; Former Vice Chairman, Citigroup, New York
    Andy Karsner, Managing Partner of the Emerson Collective; Senior Strategist at X; former Assistant Secretary of Energy for Energy Efficiency and Renewable Energy
    Juliette Kayyem, Lecturer in Public Policy, John F. Kennedy School of Government, Harvard University, Cambridge; Former Columnist, Boston Globe
    Timothy Keating, Senior Vice President, Government Operations, The Boeing Company, Arlington
    Colin Kenny, Member, Senate of Canada, Ottawa; former Special Assistant, Director of Operations, and Assistant Principal Secretary, to the Rt. Hon. P. E. Trudeau; Member, Special Senate Committee on Terrorism and Security, Special Joint Committee on Canadian Defence Policy; former Chair of Senate Standing Committee on National Security and Defence
    Robert M. Kimmitt, Senior International Counsel, WilmerHale, Washington; former U.S. Deputy Secretary of the Treasury; former U.S. Under Secretary of State for Political Affairs; former U.S. Ambassador to Germany
    Henry A. Kissinger, Chairman, Kissinger Associates, Inc., New York; former U.S. Secretary of State; former Assistant to the President for National Security Affairs; Lifetime Trustee, Trilateral Commission Nicholas Kristof, Columnist, The New York Times, Scarsdale Stephanie Kusie, Member of Parliament, House of Commons, Ottawa Fred Langhammer, Chairman, Global Affairs, The Estée Lauder Companies, Inc., New York
    Hélène Laverdière, Member of Parliament, House of Commons, Ottawa *Monique Leroux, Chair of the Board of Investissement, Québec
    Andrew Leslie, Member of Parliament, House of Commons, Ottawa
    Marne Levine, former Chief Operating Officer, Instagram, Menlo Park Santiago Levy, Vice President for Sectors and Knowledge, Inter-American Development Bank, Washington David Lipton, First Deputy Managing Director, International Monetary Fund, Washington
    Linda Koch Lorimer, CEO, Abundantior; former Vice President for Global & Strategic Initiatives, Yale University
    *John Manley, Chair CIBC, CIBC Bank USA, and Chair CAE Inc.
    Judith A. McHale, President and Chief Executive Officer, Cane Investments, LLC, Hastings on Hudson; former U.S. Under Secretary of State for Public Diplomacy and Public Affairs; former President and Chief Executive Officer, Discovery Communications
    Thomas F. McLarty, III, President, McLarty Asssociates, Washington; former Chief of Staff to President Clinton
    Lourdes Melgar, Energy Scholar, MIT Center for International Studies, Mexico City
    Jami Miscik, President and Vice Chairman, Kissinger Associates, Inc., New York; former Deputy Director for Intelligence, Central Intelligence Agency Andrea Mitchell, Chief Foreign Affairs Correspondent, NBC News, Washington
    Adm. Michael Mullen (Ret.), CEO, MGM Consulting, Annapolis; former Chairman of the Joint Chiefs of Staff Heather Munroe-Blum, Chair of the Board, Canada Pension Investment Fund; Principal Emerita and Professor, Faculty of Medicine, McGill University, Toronto
    Lori Esposito Murray, Distinguished Chair for National Security, U.S. Naval Academy; former President & Chief Executive Officer, World Affairs Councils of America; former Special Advisor to the President on the Chemical Weapons Convention; former Assistant Director, U.S. Arms Control & Disarmament Agency
    John D. Negroponte, Vice Chairman, McLarty Associates, Washington; former Deputy Secretary of State; former Director of National Intelligence; former Ambassador to the United Nations, Honduras, Mexico, the Philippines and Iraq
    *Joseph S. Nye, Jr., University Distinguished Service Professor and former Dean, John F. Kennedy School of Government, Harvard University, Cambridge; former Chair, National Intelligence Council; former U.S. Assistant Secretary of Defense for International Security Affairs; former North American Chairman, Trilateral Commission
    *Meghan L. O’Sullivan, Evron and Jeane Kirkpatrick Professor of the Practice of International Affairs, John F. Kennedy School of Government, Harvard University, Cambridge; former Special Assistant to President and Deputy National Security Advisor for Iraq and Afghanistan; North American Chairman, Trilateral Commission Thomas R. Pickering, Vice Chair, Hills & Company, Washington; former Under Secretary of State for Political Affairs; former U.S. Ambassador to the Russian Federation, India, Israel, El Salvador, Nigeria, Jordan, and the United Nations; former Senior Vice President, International Relations, Boeing Company
    John A. Quelch, Vice Provost for Education and Dean, School of Business Administration, University of Miami, Miami
    John Risley, Chairman and President, Clearwater, Bedford
    Andrés Rozental, former Mexican Deputy Foreign Minister; Nonresident Senior Fellow, Foreign Policy, Latin America Initiative, Brookings Institution, Mexico City
    David M. Rubenstein, Co-founder and Managing Director, The Carlyle Group, Washington
    *Luis Rubio, President, Mexican Council on Foreign Relations; Chairman, Center for Research Development (CIDAC), Mexico City Indira Samarasekera, Senior Advisor, Bennett Jones LLP, Vancouver
    David Sanger, Chief Washington Correspondent, The New York Times, Adjunct Lecturer in Public Policy, Harvard University, Cambridge Eric Schmidt, Technical Advisor and Board Member, Alphabet Inc., Mountain View
    Susan Schwab, Professor, Maryland School of Public Policy, University of Maryland, College Park; former U.S. Trade Representative Gerald Seib, Executive Washington Editor, The Wall Street Journal, Washington Jaime Serra, Chairman, SAI Law and Economics; Founder, Aklara, the Arbitration Center of Mexico, and the NAFTA Fund of Mexico, Mexico City; Deputy Chairman, North American Trilateral Commission
    Rajiv Shah, President, Rockefeller Foundation; Distinguished Fellow in Residence, Edward A. Walsh School of Foreign Service, Georgetown University, Washington; former Administrator, U.S. Agency for International Development
    Wendy Sherman, Senior Advisor, Albright Stonebridge Group; Resident Fellow, Harvard Kennedy School Institute of Politics; former Under Secretary of State for Political Affairs Jeffrey Simpson, Senior Fellow, Graduate School of Public and International Affairs, University of Ottawa; former National Affairs Columnist, The Globe and Mail, Senior Fellow, University of Ottawa, Ottawa
    Olympia Snowe, Former U.S. Senator; Senior Fellow, Bipartisan Policy Center, Portland
    Cecilia Soto Gonzalez, Federal Congresswoman, Mexico City Nancy Southern, President and Chief Executive Officer, ATCO Ltd. and Canadian Utilities Limited, Calgary
    *James B. Steinberg, former Dean, Maxwell School, and University Professor of Social Science, International Affairs and Law, Syracuse University, Syracuse; former Deputy Secretary of State, former Deputy National Security Advisor *Carole Taylor, Chancellor Emeritus, Simon Fraser University, Vancouver; former Minister of Finance, British Columbia; former Chair, CBC/Radio-Canada; former Chair, Canada Ports; public affairs broadcaster
    Luis Téllez Kuenzler, Special Advisor, KKR, President, NTT Everis; former Chairman of the Board, Mexican Stock Exchange, Mexico City; former Secretary of Communications and Transportation of Mexico
    G. Richard Thoman, Managing Partner, Corporate Perspectives, New York; Adjunct Professor of International Business, Columbia University; Professor of Practice in International Business, the Fletcher School, Tufts University; former President and Chief Executive Officer, Xerox Corporation; former Senior Vice President and Chief Financial Officer, IBM Corporation
    *Frances Townsend, Senior Vice President, Worldwide Government, Legal and Business Affairs, MacAndrews & Forbes Inc., New York; former Assistant to the President for Homeland Security
    Melanne Verveer, Executive Director, Georgetown Institute for Women, Peace and Security, Georgetown University, Washington Guillermo F. Vogel, Director and Vice President of the Board, Tenaris, Mexico City
    *Paul A. Volcker, former Chairman, President’s Economic Recovery Advisory Board; former Chairman, Wolfensohn & Co., Inc., New York;
    Frederick H. Schultz Professor Emeritus, International Economic Policy, Princeton University; former Chairman, Board of Governors, U.S. Federal Reserve System; Honorary North American Chairman and former North American Chairman, Trilateral Commission
    Yuen Pau Woo, Member of Parliament, House of Commons, Ottawa
    Robert Zoellick, Chairman, Alliance Bernstein, New York; former President, The World Bank Daniel Yergin, Vice Chairman, IHS, Cambridge

    Any more names look familiar?

    9. NAFTA Resulted In Job Losses

    This Economic Policy Institute study estimates job losses from NAFTA. Almost 900,000
    This EPI study estimates job losses from trade with China. Note, it is not even “free” trade, just “liberalized” trade. An estimated 3.4 million jobs.
    And another study on job losses, due to NAFTA.

    And no, job losses are not just an American problem. According to Statistics Canada, there were some very alarming trends across the developed world.

    Shrinking employment in manufacturing is a common trend in almost all OECD countries. From 1998 to 2008, the United States lost close to one-quarter (4.1 million) of its manufacturing jobs. Elsewhere in the OECD, from 1990 to 2003, manufacturing employment fell by 29% in the United Kingdom, 24% in Japan, 20% in Belgium and Sweden and 14% in France.

    Canada’s manufacturing industry lost 278,000 jobs (1 in 6) from 2000 to 2007, which reduced the sector’s share of total employment from 16% to 12%. That share then declined to 10% in 2009 after the 2008–2009 recession when manufacturers faced weaker demand and cuts to industrial capacity, resulting in the loss of 188,000 jobs. Regions where employment is highly concentrated in the manufacturing sector—mainly in Quebec and Ontario—experienced the greatest manufacturing job losses. From 2000 to 2007, Canadian manufacturing workers aged 20 to 29 in these regions were the most affected by the employment decline in this sector, as they were up to twice as likely to experience a loss of income as those holding a comparable job in a region with a low concentration of manufacturing.

    In addition, job security deteriorated in regions of high manufacturing concentration in 2007, leaving workers at greater risk of unemployment and more likely to be receiving Employment Insurance (EI) benefits. Manufacturing workers in these regions were 39% more likely to receive EI benefits than their counterparts in regions with a low concentration of manufacturing.

    Why have all these nations taken huge job losses, especially in manufacturing? Could be because “free trade” allows companies to shop around for cheaper labour costs.

    When 2 nations are very similar in their employment laws and standards, this can theoretically work. But the problem is that these deals create a “race to the bottom”, where cost cutting and the bottom line are the only considerations.

    10. Free Trade Has Real Costs

    A quick primer is this Lou Dobbs video.

    These deals give foreign companies rights to marketplaces and workforces that domestic companies do. This may sound great, but the reality is the undercutting domestic producers can put lots of people out of work.

    As demonstrated by Chapter 11 of NAFTA, there is a lot potential for new litigation for companies not getting the results or the market share they want. Who pays for it? Taxpayers.

    Politicians like Roy Maclaren or Bill Graham can also sit on corporate boards, while still claiming to advocate for the Canadian public. And these conflict-of-interests are hardly limited to Canada. It raises valid questions about who they really work for. Furthermore, for the Liberals to campaign on amending NAFTA (then scrap the promise), makes people wonder if they ever intended to keep the promise.

    The well being of communities doesn’t get emphasized enough. Large employers essentially provide for many families, and help keep things stable. If it suddenly becomes advantageous to pack up and leave, then a lot of people get screwed over.

    Is this a rejection of business or capitalism? No. However, there are other things to consider than simply profits and GDP.

    Posted on

    Thoughts On Potential Canada-China Free Trade Deal

    (Tucker Carlson: Social Costs to Communities Most Important)

    1. Offshoring, Globalization, Free Trade

    The other posts on outsourcing/offshoring are available here. It focuses on the hidden costs and trade offs society as a whole has to make. Contrary to what many politicians and figures in the media claim, there are always costs to these kinds of agreement. These include: (a) job losses; (b) wages being driven down; (c) undercutting of local companies; (d) legal action by foreign entities; (e) industries being outsourced; and (f) losses to communities when major employers leave. Don’t believe the lies that these agreements are overwhelmingly beneficial to all.

    2. Important Links

    (1) https://www.international.gc.ca/trade-agreements-accords-commerciaux/consultations/fta-ale.aspx?lang=eng
    (2) https://www.international.gc.ca/trade-commerce/consultations/china-chine/index.aspx?lang=eng
    (3) https://www.international.gc.ca/trade-commerce/consultations/china-chine/toolkit-outils.aspx?lang=eng
    (4) https://www.epi.org/publication/the-china-toll-deepens-growth-in-the-bilateral-trade-deficit-between-2001-and-2017-cost-3-4-million-u-s-jobs-with-losses-in-every-state-and-congressional-district/
    (5) https://www.forbes.com/sites/charleswallace1/2018/07/21/chinas-currency-manipulation-is-a-response-to-trumps-tariffs/#33295e9a663b
    (6) https://www.thestar.com/news/canada/2012/02/11/harper_in_china_free_trade_agreement_with_china_in_canadas_sights.html
    (7) https://www.theglobeandmail.com/business/article-trudeau-intends-to-work-toward-free-trade-deal-with-china-despite/
    (8) https://www.maximebernier.com/canada_china_free_trade_speech
    (9) https://www.ndp.ca/news/ndp-statement-pms-trade-trip-china
    (10) https://www.cato.org/publications/policy-analysis/disciplining-chinas-trade-practices-wto-how-wto-complaints-can-help
    (11) https://object.cato.org/sites/cato.org/files/pubs/pdf/pa856.pdf

    3. From Archived Pages

    There have been many concerns with dealing with China. To name just some of them:

    1. Human rights abuses
    2. No respect for intellectual property
    3. Preferential treatment
    4. Unsafe products entering Canada

    To put is bluntly, the answers are not reassuring. They are the political-talk we have come to expect that avoids giving concrete answers.

    Canada has robust regulatory requirements and strong enforcement action can be taken on unsafe products entering the country. Regardless of country of origin, if the Canadian government identifies products that do not meet regulatory requirements, enforcement action will be taken. Enforcement action can take a number of forms, including recall.

    Canada’s Foreign Investment Promotion and Protection Agreement (FIPA) with China works to protect Canadian investments in China, and is among the most ambitious investment agreements China has ever ratified.

    A possible FTA could include provisions that would help to mitigate the risk of IP infringements. We would like to hear from you on your experience with IP rights in the context of the Canada-China commercial relationship. Additionally, Canadian firms are encouraged to raise any IP problems they have in China or other overseas market with the Canadian Trade Commissioner Service.

    This all sounds lovely, but to a critical person, this seems more like an attempt to emotionally soothe than to persuade with facts.

    4. Major Job Losses

    Looking at the Economic Policy Institute Study, shown here, from 2001 to 2017, the US lost 3.4 million jobs to China as a result of a growing trade deficit. China can produce much cheaper and in much higher numbers.

    Both increased imports and technical products have done a number on the US job market, who simply cannot compete.

    While this is an American study, it would be wise to use it as a cautionary tale for Canada as well.

    CURRENCY MANIPULATION EXPLAINED


    One unfair way to gain an advantage over a foreign competitor is to manipulate the currency. China has been doing this for a long time, and it leads to an economic advantage that few can match. The Forbes article explains it well.

    First, a bit of background. The Chinese currency, called the renminbi, is what’s known as a policy currency. That means that unlike the U.S. dollar, which rises and falls in value in free market trading, the currency’s value against the dollar is set by the People’s Bank of China, an arm of the Chinese government.

    While the PBOC has gradually tried to make the value of the renminbi more reflective of market forces, setting trading bands in which the renminbi is allowed to fluctuate every day, in the last analysis it is still under government control. Put another way, the value of the renminbi is manipulated by the government and always has been. It’s just that when Beijing was manipulating the value so that the renminbi appreciated against the dollar in the last few years, nobody in Washington complained.

    When the Chinese Government manipulates its currency, it does so in order to artificially cheapen the costs of its products, and to gain an advantage over competitors.

    In a “free market” world, this sort of thing should never be allowed.

    5. CATO Institute Hypocrisy

    Note: CATO calls itself a public policy institute, dedicated to free trade, liberalization and free markets. It is based in the US. But its conflicting observations are disturbing. From their website, they post an article which contains these remarks:

    The Trump administration believes that the international dispute settlement system of the World Trade Organization (WTO) offers no effective remedy for these practices, and prefers an approach that relies mostly on unilateral tariffs. The administration sees the issue as follows. China’s mercantilist state systematically discriminates against foreign products and foreign producers in China while forcing foreign companies to hand over their intellectual property (IP) as the price of access to China’s large and growing market. China engages in widespread cheating in its trade practices, including not only high tariffs, domestic content requirements, and other traditional forms of protectionism, but also rigged regulations that erect trade barriers by favoring Chinese companies and outright theft of foreign IP. And, Trump and his trade cohorts say repeatedly, there is virtually nothing the United States can do under current WTO rules to stop this predatory Chinese behavior.

    Worth noting is that CATO doesn’t dispute the accuracy or factual basis of Donald Trump’s claims. They don’t dispute the one sided advantage that is posed here. However, there is an interesting brochure that CATO released:

    Supporting China’s membership in the WTO in 2001 was not a mistake by the United States. All 163 other members of the WTO, including the United States, are much better off because China is inside the rules-based global trading system and has not been left outside it. China has made great strides since 2001 toward full compliance with the rules of the WTO trading system.

    An organization which promotes liberalized trade is okay when one of its members blatantly acts against the rules and its principles. Okay.

    6. Main Canadian Parties Support This

    Despite all the problems outline above, it is:
    SUPPORTED, by People’s Party.
    SUPPORTED, by the Conservative Party.
    SUPPORTED, by the Liberal Party

    However, NDP acts <a href=”https://www.ndp.ca/news/ndp-statement-pms-trade-trip-china”” rel=”noopener” target=”_blank”>as the voice of reason.

    A potential free trade agreement raises many questions that are yet unanswered. China has no free press, torture is widespread, workers do not have a right to collective bargaining, and hundreds of human rights defenders and dissidents have been detained.

    Environmental protections, labour standards, and human rights must be at the forefront of any trade and investment discussions, and any trade deal must support Canadian jobs, not just focus on selling Canadian resources to be processed abroad.

    The Liberals have failed to take action to address steel dumping by Chinese companies which put Canadian businesses at a dangerous disadvantage. China also has a questionable record on currency manipulation and unfair trade practices, and does not have market economy status, which means it would be very difficult to have a level playing field in a free trade deal.

    There are also concerns about protecting the intellectual property of Canadians and the behaviour of state-owned enterprises in China, including through the takeover of Canadian companies that work on sensitive technologies. Before making a decision on whether to begin formal negotiations, the government needs to clearly address all these concerns, and consult with Canadians before rushing into a deal that is against their interests.”

    What the hell? Why am I agreeing with the NDP on this? Since when did an openly socialist party become the voice of reason?

    The again, a <a href=”https://www.nationalcitizensalliance.ca/NCA-trade-environment-policy-statement/”” rel=”noopener” target=”_blank”>NATIONALIST approach would also conclude free trade with China is a bad idea.

    7. Not Worth It

    Watch the video with Tucker Carlson, at the top of the article. He explains that it is a better way to ensure stability of communities and jobs than to look at a purely profit motive. Well worth a watch. While the talk relates to automating vehicles — and putting truck drivers out of work — the same rationale can be applied here.

    While there may be some benefits to an agreement with China, there are simply too many social costs to Canada that need to be seriously looked at:

    • How many jobs will be lost?
    • What will happen to communities with major job losses?
    • What about environmental protection?
    • Would we be rewarding sweatshop conditions?
    • Can we protect people’s intellectual property?
    • Will we be undercut by currency manipulation?
    • Is getting cheaper products worth the social cost?

    It’s not all about GDP, stock prices, or corporate profits. What will a free trade agreement with China do to Canada?

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