CETA: Time to admit it's an underhanded, oversold deal.

Originally published in the Independent, Dec. 15th, 2014

 Surprise! Surprise! Our premier is now suggesting the federal government has deliberately duped our province over the $280 million CETA package we were promised for giving up minimum processing requirements (MPRs).

“He can’t be trusted,” Paul Davis said following his meeting with Stephen Harper in Ottawa last Friday. “They’re moving the goal posts. They’ve moved them so far that the fund is going to be unreachable.”
MPRs are now gone. We can’t go back and renegotiate them out of CETA (Canada and the European Union’s Comprehensive Economic and Trade Agreement). We could, however, stand up and be the first province to say “No” to this trade agreement. Our premier has already hinted at the possibility.

Defying the vindictive Harper Government would clearly be a heroic gesture. But, even more significantly, it could also be the beginning of a domino effect among the provinces, given many are facing opposition to CETA from their own cities and towns. More than 50 municipalities across the country have disliked or distrusted CETA so much that they have asked their provinces to exempt them. Their requests, of course, were denied.

Some provincial governments might also be swayed by the mounting civil opposition to CETA.  Over the past two months more than one million Europeans have signed a petiCtion stating that the European Union should not ratify either CETA or the TTIP (Trans-Atlantic Trade and Investment Partnership, with the United States).

What’s more — the sense that CETA is a very bad treaty for ordinary wage earners and small businesses is starting to trickle into public consciousness on both sides of the Atlantic.

As for Newfoundland and Labrador, anger and a feeling of betrayal about the now iffy nature of the federal fund are not sufficient reasons for our province to reject CETA. Newfoundland and Labrador should have compelling constitutional and economic reasons to take that step. In that pursuit, they might want to consider more seriously what Gus Etchegary, former CEO of Fishery Products International, meant when he said “the $280 million compensation for job loss and negative impact on the industry will be comparable to the size of a flea on the rump of an elephant.”

Etchegary, with decades of experience in the fisheries, remembers how well minimum processing requirements have worked in the past and the perspective to know that they could in the future. As for the present, if they are not working well at this particular moment in time, government has the flexibility to adjust — as it did two years ago when Ocean Choice International was granted a 15 year reprieve from MPRs at its Fortune plant.

CETA’s uncaring, unforgiving nature
That flexibility disappears with CETA, because CETA forbids us to ever use MPRs no matter how our circumstances might change.

And circumstances can change, even dramatically.

Imagine a future scenario where fish stocks are healthy and the shellfish are bountiful. Imagine also a strong demand from Europe for our resource. Then factor in something unexpected like the closure of the Alberta tar sands for economic or environmental reasons. The displacement of workers would cause a huge unemployment problem for our province. There we would be, sitting on a rich resource that is wholly ours, but unable to insist that our own workers do the processing.

Our government is complacent about this scenario because it believes our processing sector will be able to compete with European fish plants. If there was a level playing field this would probably be true, but the EU gives massive subsidies to its fisheries sector. A 2011 study reported that in 13 European countries the value of the subsidies was actually greater than the value of their fish catch.

How do we compete with that?

A benefit for all Newfoundlanders and Labradorians, or just a few?

In return for the abolition of MPRs the Europeans lowered the tariffs on shellfish. Was this as much of a sacrifice for them as losing MPRs was for us? I doubt it. This was not a clear question of our fish competing with their fish. The Europeans actually import 60 per cent of the fish they consume, and because fish stocks are declining around the world their tariffs have been steadily going down.

According to a 2013 report by the Canadian Centre for Policy Alternatives, tariffs would have likely reached zero within a few years. In reality, they weren’t giving up very much at all.

On the other hand, trading away the democratic rights of future governments to act in the interest of local economies, workers and communities was an enormous concession to make. It’s all being justified by the immediate increase in export sales that will come from the elimination of tariffs on shellfish. The economic growth that will come with those increased sales is supposed to benefit Newfoundlanders and Labradorians in all sorts of ways, we’ve been told by both the provincial and federal governments: It will strengthen us.
Canadian farmers have a precautionary story to tell us about that kind of reasoning. In the 10 years following the signing of NAFTA (North American Free Trade Agreement), Canadian farm exports increased by 300 per cent. Those figures sound impressive until you learn that farm debt also increased by 300 per cent. Even more startling, the income of Mexican farmers—many of whom were already living well below the poverty line—declined  by 40 per cent.

 Trading away the democratic rights of future governments to act in the interest of local economies, workers and communities was an enormous concession to make.

NAFTA increased Canadian exports but impoverished family farmers. Meanwhile, the middlemen—the big agribusiness corporations—did extremely well. If this example teaches us anything, it is that we need to be asking where the money will go from increased shellfish exports.

Will it evenly benefit people working in the fisheries of Newfoundland and Labrador? Or is it more likely that a few people will do very well out of increased sales while the great majority will be excluded? I think I know what the farmers would say.

The Newfoundland and Labrador government has finally found out what Citizens against CETA and the Council of  Canadians have been saying in this province for a long time: You can’t trust what the federal government tells us about CETA.

They’ve wildly misrepresented the benefits of this deal from the very start, and when challenged, their strategy is to resort to even greater exaggeration. In his interview on the Fisheries Broadcast last week, federal minister Rob Moore managed to use the word “fantastic” five times to describe what a good deal CETA is for Newfoundland and Labrador.

As for the “middlemen” in our province, it’s time to insist they clarify their vague assertions.
“It is an agreement that will provide benefits and economic growth and jobs—good-paying jobs for Newfoundland and Labrador—for decades to come,” Richard Alexander, executive director with the NL Employers’ Council, said in an interview with The Telegram.

What kind of jobs, Mr. Alexander? How many? Who is going to get them? And who is going to be left out?
It’s time to finally allow a real discussion about CETA. The deal isn’t ratified yet.

Is CETA a Sugar-coated Poison Pill?

Letter Published in the Telegram, October 29th, 2014

After more than five years of secrecy, the final text of the Canada European Comprehensive Economic and Trade Agreement (CETA) has been released. We can at last compare the essence of CETA with government rhetoric, which roughly goes like this. Trade is good for Canada. The European Union will make a good trading partner. Therefore, CETA is good for Canada.

More specifically, the Harper government claims that CETA will boost the Canadian economy by $12 billion annually and equates that with the creation of 80,000 new jobs. Increased European investment in Canada will also create more industries. Finally, CETA will make it much easier for Canadian businesses to expand into the huge European market.

But is this information accurate or realistic?

 Even the corporate sector has publicly doubted government’s predictions of increased GDP and job growth. The (CCPA) Canadian Centre for Policy Alternatives’ projection of GDP contraction and job losses seems more probable. Given that CETA targets government procurement and our public service sector, it’s also doubtful that European investment will create new industries. NAFTA style takeovers and privatizations are more likely.

As for corporate expansion into Europe,  Canadian per capita investment in the EU is already fifteen times that of European investment in Canada, which suggests our big corporations there (mostly finance and insurance) are doing just fine without CETA. Smaller Canadian corporations face significant barriers to penetrating the EU market that have nothing to do with tariffs. These include a fluctuating dollar, high shipping costs, and regulations and languages that differ from country to country.

It is not, however, CETA’s questionable benefits that have pushed groups like the Council of Canadians to oppose the agreement. It’s CETA’s real intent, which is to shift power away from governments and our own court system into transnational corporations and corporate friendly offshore tribunals.

CETA bypasses national courts: In a recent interview with The Globe and Mail, senior German official Uwe Beckmeyer made it clear that Germany finds unacceptable CETA’s Investor-State Dispute Settlement (ISDS) mechanism that allows corporations to sue government in offshore tribunals where national law counts for nothing. By contrast, the Harper government continues to proclaim the benefits of CETA’s ISDS clauses, in spite of the fact that, under NAFTA, Canada has already paid out $170 million in ISDS damages to corporations and is currently facing billions of dollars in current NAFTA lawsuits.

CETA prohibits Buy Local and Hire Local policies:  Even though they seldom exercised this right, provinces, municipalities and crown corporations could in the past favour local businesses that paid local taxes and hired local workers.   On purchases of goods, services or construction projects over certain low thresholds, this right will be gone under CETA. European corporations will have unconditional access to a significant portion of the enormous government procurement market, generally valued at 10 to 15% of GDP or $130-$200 billion annually.

CETA restricts the right to regulate: Loopholes in CETA’s language suggest that governments will have the right to regulate only in so far as their policies are consistent with the obligations in the investment chapter of CETA. This means that governments will increasingly hesitate to regulate to protect the environment or community and worker rights because of the risk of facing ISDS lawsuits.

Expect more privatization of public services under CETA: Nothing in CETA can compel Canadian governments to privatize. However, the federal government is clearly pushing municipalities in this direction through its funding for public private partnerships. Municipalities should realize that once they choose this route for services like wastewater management it will become very difficult (and expensive) to reverse course, given corporate recourse to ISDS lawsuits. Moreover, under the “list it or lose it” approach CETA negotiators have taken to public services, it will also be hard for governments to introduce new public services in the future. All of this undermines the right of citizens to democratically choose which services they want their governments to deliver and to change their opinion on this issue over time.

Young, educated Canadians will face increased competition from temporary foreign workers under CETA: The federal government and some provinces have accepted without reservations a CETA clause that allows European university educated workers (self-employed or working for a European company with Canadian contracts) to fill one year, contractual positions that can be renewed for up to two years.

CETA will increase drug costs: Since 2003, big brand name pharmaceutical manufacturers in Canada have consistently failed to meet previous pledges to invest 10% of their sales revenues in research and development. 2013 was the lowest year on record at 5.4%. Yet, in spite of this, CETA has extended patent protection on pharmaceutical drugs. It’s estimated that this will cost Canadians at least an extra $850 million annually.

CETA will reinforce our competitive trade disadvantage with Europe: Canada runs a $20 billion trade deficit with the EU and it’s been growing. Furthermore, 83% of the EU’s exports to Canada are comprised of highly processed or finished products compared with only 18% of Canada’s to Europe. CETA will remove 99% of import tariffs which we cannot then re-impose. The ability of fu­ture governments to utilize tariffs to support strategic sectors as Can­ada competes with the much larger EU economy is gone. That’s an enormous concession. Canadian industries that will be most negatively affected by cheaper EU imports include processed foods, textiles, clothing, motor vehicles, machinery and equipment.

As for exports, Newfoundland and Labrador may well sell more fish to the EU but the minimum processing jobs that give employment to people will be gone. Canadian farmers probably won’t increase agricultural sales to Europe by much, as the Europeans produce and export beef, pork and food crops.

The really big winner may actually be the oil industry. The Harper government has intensely lobbied the EU over the last five years to get tar sands oil into Europe. Is it possible that the enormous giveaways detailed above were made to achieve that purpose? If so, was this ever necessary? The deteriorating relationship between Europe and Russia, a major exporter of oil to Europe, already means that Europeans are reconsidering their position. In June Spain received its first shipment of tar sands oil.

A report worth reading: In a timely manner, and for this I’m very grateful, The CCPA has just come out with a 127 page analysis of the CETA document. The shift towards expansive corporate rights documented in Making Sense of the CETA is so profound that one has to ask why any elected government would want to do this to us. As to the how, they managed to do it, that’s simple. They held highly secret negotiations to which corporate lobbying groups had access while just about everybody else was excluded. MPs, MLAs and MHAs were told virtually nothing about CETA. Around 50 municipalities across the country, including both small and very large, were so upset by what they learned from CETA leaks that they actually requested to be exempted from the agreement. Their requests were ignored. 

Ratification of CETA may take up to two years but the Harper government has already asserted that they will not entertain any major changes to the agreement.  But heh!  Trade is good for Canada.  The European Union will make a good trading partner. Therefore CETA is good for us. 

#CETA protested in Ottawa, Sept 26, 2014

Photo from Council of Canadians Facebook 
The Council of Canadians, and numerous other groups like the Seafarers International Union (SIU), Campact, CUPE, CUPW, RQIC and numerous others marched in Ottawa Sept 26, 2014, to speak out against the Canada-EU summit taking place in Ottawa today to mark the so-called completion of the negotiations for the CETA 'free trade' agreement. Citizens Against CETA stands in solidarity with the grassroots mobilization against CETA.

Photo from Council of Canadians Facebook 
With around 300 people gathering on Parliament the event showed that there is widespread doubt and misgivings around the so-called benefits of CETA. Yesterday Germany effectively put the CETA trade deal on hold over investor-state lawsuit provisions that would allow corporations to sue countries. 

The European Commission has said if the deal were to be reopened at this point that it would be effectively dead.  
So while Harper may want to trumpet his 'accomplishment' of securing a free trade agreement with Europe, the reality is that governmental and public opposition is only growing and CETA faces an uphill battle to be ratified over the next 2+ years.  
The Council of Canadians has been campaigning to derail CETA since 2009 and remains committed to working with allies both in Canada and Europe to defeat this dangerous deal.
Together in solidarity we can stop CETA!  

Photo from Council of Canadians Facebook 
Watch comedian Scott Vrooman criticize investor protection clauses, which allow corporations to sue governments for lost profits.

#CETA, temporary workers, and the attack on middle class jobs

Originally published The Independent

On Thursday the German media leaked a substantial portion of the Canada-European Economic and Trade Agreement (CETA) text. There were some surprises. In particular, there is a section in the “Cross Border Trading in Services” chapter that makes the federal government’s Temporary Foreign Workers program, which gleaned so much negative publicity a few months back, look like an appetizer.

“This Chapter reflects the preferential trading relationship between the Parties as well as the natural objective to facilitate trade in services and investment by allowing temporary entry and stay to natural persons for business purposes…..” (Article 1.1 Chapter X, CETA leaked document)

Unlike many European countries, the federal government appears to have chosen not to write in reservations or restrictions to this clause. That decision means that, at the federal level, the right to set entry quotas in order to give preference to Canadian workers during times of high employment has been forfeited.

Temporary work permits can be issued to Europeans for a year with the possibility of an extension of two years. Potential workers must hold a university degree or its equivalent. With that qualification, they can enter the country, either as employees of a European corporation doing contract work in Canada, or as independent, self-employed professionals that have secured contract work here. Sectors of the economy that will be open to them include: legal, architectural, engineering, computing, research and development, market research, management consulting, mining, higher education, and much more

Read more on TheIndependent.ca: http://theindependent.ca/2014/08/19/ceta-temporary-workers-and-the-attack-on-middle-class-jobs/

#CETA text leaked by German TV

Via the Council of Canadians

The Council of Canadians is pleased that the Canada-EU trade deal, the Comprehensive Economic and Trade Agreement (CETA), has seen the light of day after German television show Tagesschau provided the full text online this afternoon.
  • This text (and earlier versions of it) should have been made public to give the public the appropriate amount of time to read it, discern its contents and comment on it fully. The whole CETA negotiation process has been undemocratic, and has failed in terms of transparency.
  • The 25-page investor-state section appears to be a standard investor-state dispute settlement: a three-person panel that would make decisions rather than the mature court systems. This probably will not placate Germany.
  • The 30-page procurement section appears to give no consideration to the numerous Canadian municipalities that requested to be exempted from its provisions.
  • The EU language was adopted on resolution of pharmaceutical patent disputes. This will open the flood gates to pharmaceutical companies’ law suits. This will lengthen patent lengths and delay generics coming to market. In the end, this could severely increase public health care costs by $900 million to $1.7 billion.

“Throughout the process, this agreement and its devastating impacts have been kept locked away from legislators and the public, shielded from a democratic process. Finally, it comes to light, probably because people in Germany are fed up with the secrecy and fed up with being taken hostage by companies,” says Maude Barlow, Council of Canadians national chairperson.

Read the leaked text here: 

Coverage in the Huffington Post: 

Germany rejects CETA and TTIP

via the Council of Canadians

The Council of Canadians applauds Germany's rejection of the Canada-EU and EU-US trade deals reported in Reuters today. The German government decided to reject these trade deals because of provisions that allow companies to sue governments for infringing on their profits.
"This is a victory for democracy. We are pleased that the German government has listened to critics of the investor-state dispute settlement provisions of the deal that give foreign corporations the right to dictate domestic policy," said Maude Barlow, national chairperson of the Council of Canadians.
"We've worked to educate European politicians on just how harmful allowing companies to sue you can be," said Scott Harris, trade campaigner with the Council of Canadians. "We've told them about all the lawsuits Canada has faced under NAFTA for legitimate regulations that protect our health and environment."

[webinar] CETA's investment chapter: Where do the negotiations stand?

One of the most contentious issues in the Canada-EU Comprehensive Economic & Trade Agreement (CETA) negotiations is the inclusion in these deals of broad investor rights backed up by an investor-state dispute settlement (ISDS) process.

Like NAFTA’s Chapter 11, ISDS clauses would allow foreign corporations to directly sue governments over regulations and policies put in place that supposedly violate “fair and equitable treatment” or are seen by corporations as “indirect expropriation.” Inclusion of ISDS in the US-EU TTIP agreement has been met with such widespread opposition in Europe that the European Commission has halted negotiations on ISDS in the agreement while a three-month EU-wide consultation takes place.

This Council of Canadians webinar (click here for the link) featuring the International Institute for Sustainable Development’s Senior Law Advisor Howard Mann, presents an analysis based on the latest leaks of the CETA Investment Chapter and Investor-State Dispute Settlement Chapter, and the implications CETA’s investment and ISDS chapters might have on public interest regulations and policy in Canada if CETA is finalized and ratified.

There are good reasons to oppose Trade Deals

Wednesday’s editorial (“Whew! That’s over”) included two quotes from the recent NDP convention: “Nothing good happens when big business takes over things …,” and “CETA and evil have both got four letters, and to me they’re both the same thing.”

Not having attended the convention, I don’t know where the quotes came from, nor what the supporting arguments were. However, I take issue with two of The Telegram’s conclusions.
“Politics is about forging a middle ground, one that isn’t going to scare off either end of the spectrum.” Unfortunately, the middle ground in politics today bears little resemblance to how we governed ourselves 50 years ago. Green Party leader Elizabeth May perhaps summed it up best in an interview with the McGill Reporter.
“It’s arguable that we now live in a dictatorship, punctuated by manipulated elections. The symptoms of the problem are easy to spot — low voter turnout, with worryingly low levels among young people with no sign they will start voting once they are over 30, a less than vital Fourth Estate, undermined by an alarming level of concentration of media ownership in very few hands, public apathy, indifference bordering on antipathy toward the whole process, excessive power in the hands of the few (or the one, since I refer to PMO), a loss of respect for the fundamental principle of the supremacy of Parliament, misuse of the talents of members of Parliament of the large parties, as MPs are expected to toe the party line on every issue, big and small, and its flip-side, excessive control by the unelected top party brass in all three main parties.”
May’s conclusions are very much in line with what is happening elsewhere. A recent study by Gillens and Page of Princeton and Northwestern Universities concluded that “economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence.”
Nowhere is this erosion of democracy more evident than in the way we negotiate trade agreements. It’s not just that concerned civil society groups are denied any kind of access to what is being negotiated. So, too, are our elected MPs and MHAs.
Meanwhile, transnational corporations are working hand in hand with our negotiators to ensure that their interests are taken care of. That’s been true with CETA, the Trans Pacific Partnership Agreement (TPP) which we’re negotiating with 11 countries and probably to the little known but alarming Trade and Services Agreement (TISA) which includes 23 countries representing 50 countries.
Trade agreements tend to build on the ones before them, so that any protections for public services or regulatory capacity achieved in a specific agreement become targets for elimination in the next one. The common thread throughout is an agenda skewed towards global corporate interests and the super-rich elites behind them.
The solution is not, as The Telegram’s editorial suggests, “a little more scrutiny and oversight” of trade deals. We need a full discussion of how this generation’s treaties have evolved into constitutional-style documents that constrain governments, and in ways that are only loosely related to trade. We need to talk about how government and the mainstream media stifle debate by typecasting those of us who oppose the agenda of these new trade agreements as being anti-trade in general.
The latter was subtly evident in your editorial reference to the “Business-is-evil old guard” of the NDP. Those of us who oppose CETA, the TPP and TISA are not against trade agreements or business. But we are against trade agreements that erode democratic rights and hand over power to huge transnational corporations that concentrate wealth in the hands of offshore elites. We believe that a healthy democracy must include strong, vibrant, small- and medium-size businesses. They are a disappearing breed, and trade agreements — contrary to the rhetoric — rarely benefit them.
Perhaps that’s what the discussion was about at the NDP convention.