CETA - A Threat We Should All Be Aware Of

A recent post I wrote contrasted the apparent indifference/ignorance of Canadians toward CETA with the furious involvement of the Europeans, most recently the Germans, in open protest against the deal. It is a pact that will see even greater erosion of our ability to enact strong legislation to protect labour, the environment and a host of other realms thanks to the Investor State Dispute Settlement provisions that protect multinationals at the expense of citizens. It will further undermine our increasingly fragile sovereign rights.

And sadly, it is a deal the the Trudeau Liberals are avidly embracing.

Scott Sincleair and Stuart Trew write a trenchant reminder of CETA's dangers:

Much more than a trade deal, CETA is a sweeping constitution-style document that will restrict public policy options in areas as diverse as intellectual property rights, government procurement, food safety and environmental protection, financial regulation, the temporary movement of workers, and public services.

My previous post noted the weak language governing some of the above, including platitudes like commitments to cooperate, provisions encouraging Canada and the EU to continue developing our resources in a way that is environmentally sustainable, establishes shared commitments to promote trade in a way that contributes to the objectives of sustainable development in Canada and the EU, etc.

All part and parcel of what Liberal International Trade Minister Chrystia Freeland calls "a gold-plated trade deal."

As Sincleair and Trew observe,

While CETA’s safeguards for labour and the environment are mainly voluntary and weak, the investor protections are strong and fully enforceable. Such an agreement could only be considered enlightened in an upside-down world.

The devolution of our sovereignty began long before CETA, however.

Canada’s experience with investor-state arbitration under NAFTA is pitiful. We are the most-sued NAFTA party despite our highly developed legal system and strong protections for private property. Many of these challenges involve environmental protection policies that were legally enacted, but which upset an investor’s plans or profits.

Just last year, Canada lost a disturbing NAFTA dispute over an environmental assessment that recommended against a massive quarry in an ecologically sensitive part of Nova Scotia. Canada currently faces a raft of claims as a result of progressive policies, such as banning natural gas fracking in the province of Quebec.

The pending deal promises more of the same, a source of puzzlement to European progressives:

European labour unions, environmentalists and human rights advocates question why Canada and the EU would want to expand this anti-democratic process through CETA. Despite being rebranded as an “investment court system” with pretenses to judicial independence, the substantive protections afforded to foreign investors remain largely intact. This will expose taxpayers in both Canada and the EU to huge financial liabilities and have a chilling effect on future progressive public policy.

European progressives are also asking important questions about the interplay between CETA and public services. CETA contains no clear protections for governments hoping to expand public services into areas where there is currently private sector competition, or to bring previously privatized services back under public control. Doing so can actually trigger foreign investor claims for compensation, effectively locking in privatization.

All the warning signs are there. Whether the vast majority of Canadians can rouse themselves enough to care is an open question.

UPDATED: Thank You, Germans, For Fighting What Should Also Be Our Battle

While Canadians by and large seem content to sleep through the entire CETA negotiations, uttering nary an objection to a deal that will severely compromise our sovereignty, ordinary Germans are turning out en masse to protest its dangers:

Demonstrators took to the streets of Berlin and six other German cities Saturday to voice their displeasure with pending trade deals, one between the European Union and Canada and another with the U.S.

The treaties they’re concerned with are the yet-to-be ratified EU pact with Canada, known as the Comprehensive Economic and Trade Agreement (CETA), and the EU’s Transatlantic Trade and Investment Partnership (TTIP) [the Canadian version is called the Trans Pacific Partnership, but carries essentially the same perils] deal with the U.S. that is still being negotiated.

While the deal between the EU and Canada has escaped the same scale of criticism and widespread outrage among the Canadian public, it continues to be a hot button political issue in Germany and one that protesters are hoping to stop from being ratified sometime in the fall.

In broad terms the critics say that CETA would give multinational corporations too much power within European Union markets and they object to a dispute resolution mechanism that has been proposed in the framework agreement.

This dispute resolution mechanism would allow companies to bypass national courts in both countries, allowing then to argue their cases in front of international arbitration panels instead.

Despite the fact that we have access to the same information about the dangers of these free-trade deals, few seem upset by the unbridled enthusiasm that both Justin Trudeau and his poodle Chrystia Freeland profess for them:





Despite Freeland's rhapsodic recitation of the improvements that have been made in the CETA deal, a quick check of the facts reveals something quite different, unless motherhood statements and feel-good empty rhetoric are your thing. I would encourage you to read about these 'improvements' yourself under the pertinent sections, but here are a few highlights:

Dispute Settlement

CETA includes a more robust voluntary mediation mechanism than has been included in Canada’s previous trade agreements. Mediation is a cost-effective and expeditious way to resolve disputes without the need for a third party to decide the outcome. When parties choose arbitration rather than mediation, CETA improves on the WTO dispute settlement mechanism by streamlining and shortening the process. In addition, CETA includes an accelerated arbitration procedure for cases requiring urgent resolution, such as those involving live animals and perishable or seasonal foods.

So in other words, the great improvements Freeland was extolling have nothing to do with changing what might come under dispute, such as environmental and labour laws, but only offers a faster and potentially cheaper way to resolve conflicts. There is nothing that protects our national sovereignty here, nothing that prevents the signatories from suing governments that enact legislation that may hamper the profits of corporations.

Similarly, the language dealing with labour, environment and sustainable development are peppered with platitudes like commitments to cooperate, provisions encouraging Canada and the EU to continue developing our resources in a way that is environmentally sustainable, establishes shared commitments to promote trade in a way that contributes to the objectives of sustainable development in Canada and the EU, etc.

All in all, empty language that enables the Trudeau government to lie to Canada's citizens. But at least our Prime Minister has a nice smile, perhaps something to dream about as we continue our long, collective snooze.

UPDATE: Be sure you read Owen's excellent post today on Investor State Dispute Settlement Mechanisms.

Trudeau Has Some Explaining To Do

While our 'new' government continues upon the Harper neoliberal path, apparently never having met a free trade agreement it doesn't like, one issue that never seems to be honestly addressed by either Mr. Trudeau or his most ardent acolyte, Chrystia Freeland, is the Investor-State Dispute Settlement provisions.

Thanks to always astute Toronto Star readers, this contentious issue is being kept in the public forum.

It seems if we look behind Prime Minister Justin Trudeau’s ‎”sunny ways” persona, we find he is perpetuating the agenda of the Harper government.

The hearings and meetings being held across the country are a sham, as the PM’s G20 remarks on European trade and the Trans Pacific Partnership ‎show the Liberal government is right in line with the Harper regime, promoting flawed so-called trade deals like the Trans-Pacific Partnership.

Consultation with Canadians on the TPP has consistently raised concerns and objections over the same issue that concerns Europeans – the Investor State Dispute Settlement (ISDS) clauses that give corporations power above that of the federal government and bypass our judicial court system‎.

The PM states that Canadians are largely supportive of international trade, but, like Stephen Harper’s omnibus bills that contained lots of hidden, usually objectionable, legislation, the TPP is only partly concerned with trade.

Justin Trudeau seems intent on ignoring Canadians concerns over increased corporate powers as well as the relatively toothless and unequal protections the TPP offers for workers’ rights and the environment‎.

He misleads Canadians by characterizing those who are opposed to the “hidden” aspects of the TPP (and the Comprehensive Economic and Trade Agreement, or CETA) as being “anti-trade.”

In this respect, he is simply following in Stephen Harper’s shoes, albeit with a sunnier disposition, placing corporate interests above those of the Canadian people.

Terry Kushnier, Scarborough

What is missing in this news report is that most people, in fact most Americans as well as Canadians, are not against the enhancement of international trade. They are against the dispute settlement mechanism (ISDS) that is included in most trade agreements, which requires dispute settlement by non-governmental arbitration panels.

Historically these are loaded toward corporations that sue sovereign governments, which are legislating on behalf of their citizens. Abuse of this system abounds, for example tobacco companies suing Uruguay for loss of income due to anti-smoking campaigns. They lost that one in the end but the inhibition of social (and environmental and labour) programs, and the cost to governments in worrying about and fighting such “disputes” so that corporations can do international business unfettered, is inexcusable. Much of the opposition to recent draft trade agreements such as CETA by social democratic countries in Europe is for this reason.

Roger H. Green, Brighton

Apparently, Justin Trudeau is going to continue the foolish initiative of Stephen Harper and grant investor protection rights to powerful corporations in order to sign CETA, the Canada-Europe trade deal. These rights would allow foreign companies to sue the Canadian taxpayers for billions of dollars if our elected Parliament passes laws regarding, for example, the environment, health or financial regulations, that adversely effect their bottom lines.

What twisted ideology would inspire any thoughtful politician to undermine our democracy in this way? That Justin would even consider this trade-off is proof that corporations already possess too much power. And these are the same corporations that protect billions of dollars through tax avoidance and evasion.

Stop this madness. Mr. Trudeau, please refuse to sign any trade deal that would erode our sovereign rights.

Cliff Lelievre, Burlington

In addition to the above letters, there is a wealth of information readily available demonstrating the folly of embracing deals that elevate corporations over citizens. What happens next is up to all of us.

The Precariously Employed

The other day I made reference in a post to a study showing that half of the workers in the GTA are precariously employed, meaning they have unstable and unreliable employment with no benefits, a reality sharply at odds with the triumphalism of the right over the putative unalloyed good achieved by free trade.

This morning's Star editorial calls for changes in social assistance programs to ease the plight of these workers. Among the ideas being bandied about are more flexible child care, reforms to pensions, and new insurance models “that could create more economic certainty for people in precarious employment.”

While these ideas undoubtedly have merit, I think it would be a profound mistake to exclude corporations from the solution; despite the fact that it has become conventional wisdom that governments cannot consider increasing taxes, direct and indirect, on large businesses, that is one of the many reforms that needs to be included. Otherwise, of course, the rest of us will be alone in picking up the tab.

Canada in general, and Ontario in particular, offers a host of advantages to business ranging from a well-developed infrastructure to an enviable health-care system and a very educated workforce. Being able to shrink its permanent work force while exploiting these advantages has added tremendously to the corporate bottom line. It is time they started paying a larger portion of their lavish profits for those privileges.

Our Race to the Bottom

Rarely have I read a more accurate and succinct chronicle of what the last few decades have done to the people of this country. Enjoy, compliments of The Toronto Star:

Re: Credit cards main cause of high debt, Jan. 27

Growing up in Ontario in the 1960s I remember a good many of my friends’ fathers worked in the local steel mill. It was a typical job an immigrant would occupy — unionized, with a pension plan, health benefits, a decent wage that allowed the family to own a modest home, put food on the table, own a car, and even take a vacation once a year, or have a fishing boat in the driveway.

By the time the kids were grown, the house was paid off, and the parents were able to help the kids go to university or college. That lifestyle no longer exists for most people. Slowly, so that no one really noticed what was happening, over time the take home pay was not quite keeping up with the cost of things. For instance, 10 years after I bought my first car the equivalent car cost $10,000 more. My pay, which would have been considered a good middle-income wage, did not go up $10,000 in that same period.

So, to maintain a standard of life that their parents enjoyed, which they quite reasonably expected, people had to go into debt. People charged purchases to credit cards, big ticket items at first, but gradually it became necessary to use credit to buy essentials like groceries. People took on lines of credit from their bank, putting themselves into a perpetual state of indebtedness. The people lending the money got richer, the shareholders and executives of corporations got richer as the money they saved in wages went into their pockets instead.

The fatal blow to middle income came with globalization, when industry moved en masse to the Third World to exploit cheap labour. Ontario was hit hard as a good part of the economy used to be based on the production of goods. And now, you have a race to see who can offer the lowest wage. Many U.S. states have declared themselves “right to work” states, so that unions can be bypassed, and the desperate unemployed will work for ever lower wages. In Ontario, the governement waged war against unionized teachers. So, hard working Canadians, the ones lucky enough to have a steady job, have to either carry excessive debt, or do without.

And all of the money that was given back to corporations and the rich, as an incentive to invest back into the Canadian economy, turned out to be a nice bonus to the executives and shareholders, and it seems, the only inducement to operating in Canada, is a wage structure competitive to the Third World.

Sylvia Castellani, Bradford