House Call with Carol Hughes

Trade deals don’t always protect like they should

With the government launching a charm offensive on the Canada Europe Trade Agreement (CETA), another Donald Trump landmine is threatening the few months of peace we experienced on the trade front with the United States. For the government, this development is over-shadowing their goal of selling the CETA as beneficial, but a deeper analysis of that deal shows it is riddled with concessions that will cost Canadians jobs and money. The American development highlights how deals aren’t protection enough when up against unpredictable leadership.

The CETA trade deal is a classic example of the government prioritizing wealthy and powerful corporations while watering down their commitments to every day Canadians. Since coming into force, it created a $3.5 billion trade deficit in favour of European agri-food producers, who are exporting their products to Canada at a much higher rate than Canadians are exporting to Europe. The deal cuts deeply into Canada’s supply managed sectors, resulting in significant costs for Canadian dairy farmers, who are bearing the brunt of the government’s reckless trade policies without adequate compensation.

Instead of providing relief for runaway drug pricing, the CETA only strengthened patent protections for Big Pharma, while increasing the cost of medication for Canadians. That is something the Parliamentary Budget Officer tells us will cost Canadians hundreds of millions of dollars a year while another study has pegged the increase as high as $850 million annually. These costs will fall on households and employers who provide insurance coverage and only make the case for a comprehensive Pharmacare program stronger.

The deal also threatens Canadian sovereignty by imposing investor-states provisions that hand more powers to giant multinationals at the expense of our public interest. That was a problem under NAFTA as well which cost Canada time and again as losses mounted under the Chapter 11 tribunal system the deal implemented.

Trade with the US is a concern again because, despite having a freshly minted deal in place, the Trump administration decided to update “Buy American” provisions which will hurt Canada’s manufacturing sector and workers by restricting the access to the US procurement market. This is a blow for the Canadian steel industry and the whole Canadian economy.

New Democrats know this could have been avoided if the government had stood up to Trump in the NAFTA renegotiation process. Instead of putting the interests of Canadian workers first, they withdrew their demand for access to the US procurement market and pushed ahead with the new deal while devastating tariffs on our steel and aluminum were still in place. Now, the latest “Buy American” procurement provisions with a 95 percent domestic steel and iron threshold will restrict Canadians from bidding on many new contracts, jeopardizing our jobs and our highly integrated economies, particularly in the manufacturing sector. In many ways, it’s a return to the punitive tariffs that had just been lifted.

It’s easy to see why Canadians are worried that the government doesn’t seem to be standing up for workers-especially those in our steel sector. That failure will only result in losses that could have been avoided. Critics pointed out these problems going all the way back to the original Free Trade debate and we are now dealing with discontent that was sown due to the surrender of North America’s manufacturing sectors in Canada and the US. That is the legacy that Donald Trump is tapping with his latest measures and the irony shouldn’t be lost on anyone.