New "NAFTA" deal is still a big bargain for huge corporations

The new NAFTA deal is called the USMCA, the United States Mexico Canada free trade agreement. The deal contains several changes to the original NAFTA, of varying importance for the countries involved.

Plus factors in the new agreement

There are two major advantages to the new agreement according to Maude Barlow, chair of the Council of Canadians: the Chapter 11 state dispute mechanism, which allows corporations to sue states, and the energy proportionality provision which guarantees a certain amount of energy exports to the US are both absent from the new agreement.

Marlow said: "This is a major victory for the many groups and individuals who sounded the alarm on how these dangerous provisions affect our ability to protect the public interest and the environment. Our movement should be very proud. But as always, we should be vigilant about the rest of the agreement, which was hatched in order to erase rules, and help out big business."

Canadian objectives in negotiations were discussed in a pervious Digital Journal article. It was not listed as an objective to remove the proportionality provisions. It may be that since Mexico was exempted from the provisions and they are not in the new agreement with Mexico that they should not be in the Canada agreement.

The U.S. is now much more energy self-sufficient and also the demand for fossil fuels may soon decrease so perhaps it was not thought necessary even though it could be of great benefit to the U.S.

Dairy Provisions break promises made by the Liberals

One of the priorities that was in the original list of Canadian objectives was to protect the supply management system used to produce dairy and some other products in Canada. The changes will have a considerable effect in the province of Quebec and may hurt Liberals both in provincial and federal elections.

But even Mike Southwood, general manager of Alberta Milk in the west, complained of the new provisions. He noted that dairy producers had already given up ground in the Progressive Agreement for Trans-Pacific Partnership (CPTTP) and the Comprehensive Economic and Trade Agreement (CETA). Having already sold out the farmers twice it was not surprising that the U.S. demanded the Canadian government do so again.

Southwood pointed out that with more access to Canadian markets for U.S. companies, processing jobs will be lost and quota on dairy farms across Canada will be reduced. Barlow claimed that under the deal Canadians would not be getting local, fresh, hormone-free milk.

Other negative features of the deal

A recent Rabble article notes: "In Article 32.10 Canada agreed not to negotiate commercial agreements with non-market countries. That would be China. Should Canada decide to sign a trade agreement with China, the non-market country, it would be booted out of USMCA. For trade expert Peter Clark this amounts to Canada being treated as a vassal state by the U.S."

Chapter 33 is entitled "Macroeconomic Policies and Exchange Rate Matters". Canada will now sit down with the US whenever they think that our dollar is too low and we will be accused of currency manipulation. There goes the independence of our Central Bank. According to Rabble, Canada's macroeconomic policy, government spending and taxation would need to be coordinated with the U.S.

Federal Crown corporations which have often been a key to Canadian economic development in some areas under Chapter 22 of the new deal become State-Owned Enterprises. Their activities are to be restricted to non-competition with private sector companies. Forget any new policies such as public auto insurance except in areas where private companies can find no profit so do not compete. Forget launching a public company to build public transit vehicles. There are even penalties spelled out for non-compliance. The neo-conservative free enterprise ideology is being enforced as a gain to global corporate domination of the economy.

The new deal also gives a two year extension on biologic drugs and this will prevent lower cost generic drugs from entering the market. This will make it difficult for Liberals to keep their promise of a national pharmacare program.

Previously published in Digital Journal

US pressing for quick NAFTA in principle deal

(April 26)Regular negotiations for NAFTA stopped some time ago to be replaced by negotiations between ministers from the US, Mexico and Canada. A handful of high placed politicians are working out a deal behind closed doors.

The process is quite opaque and only a few people are involved. There has been no public input into the process and few if any details are available as to what is happening.

President Trump speaks of the talks as going nicely. In the past Trump has complained about how bad the deal was but as often happens has changed his tune. He has also in the past talked of walking away from the deal if it is not improved to his liking.

Frantic negotiations taking place in Washington

Significantly there is no hint now of spreading the negotiations among the three countries. The recent talks have all been in the United States capital Washington D.C.

Mexican Economy Minister Ildefenso Guajardo and Chrystia Freeland the Canadian Foreign Affairs Minister both attended meetings April 24th at the US Trade Representative's office in Washington. These high level meetings are expected to continue Wednesday and probably Thursday as well according to an anonymous official familiar with the talks. The negotiations come prior to a US trade mission to China, and as Mexican and US elections come closer.

Goal of faster negotiations not entirely clear

The US has spoken about getting a deal "in principle" and then having the technical details worked out later However, Mexico claims it wants a comprehensive agreement. Trump said as well at his meeting with French President Macron: “I could make a deal very quickly, but I’m not sure that’s in the best interest of the United States. We’ll see what happens, but we’re doing very well.” No doubt he hopes to milk more concessions from Mexico and Canada in exchange for not imposing duties on steel and aluminum.

Deal could come soon.

Moises Kalach, the trade head for the Mexican business chamber CCE said in an interview there was a 70 percent chance of a deal being made soon, within the next ten days under optimistic conditions. If there is no deal in coming days, Kalach said it made sense to put negotiations on hold until after the Mexican election in July and the US elections in November. However, this would complicate matters because the likely winner of the Mexican election is a leftist who is opposed to NATO as it is now. He will likely be a tougher negotiator.

However, Kalach points out that negotiating teams have agreed on nine or ten more topic areas that are ready for ministers' review and approval. Work is reportedly finished on telecommunications issues. Of course there is no hint of what the new regulations are. Yet wide differences remain including the rules of origin for vehicles and their components.

The rules governing vehicle origins and parts

Early on, the US promoted increased US content for cars and parts, policies designed at boosting US manufacturing but would cause problems for existing supply chains. Neither Canada nor Mexico would accept the US proposals and they have been since modified.

Friedlander claims that negotiators have been having constructive talks on the subject, and that the talks were moving ahead due to some creative thinking put forward last month by the US.

Friedlander said that although there were other issues to be resolved "we think a win-win-win agreement is possible". As far as Americans, Canadians, and Mexicans are concerned it will be a lose-lose-lose agreement but it will be a win situation for global corporations as their power over governments increase as the deal will create a more favorable framework of operation for those corporations within the three countries.

US is pushing for agreement by early in May

The Trump administration is pushing for a deal by early May. Guajardo said that he thought that there was an 80 percent possibiliity that there would be an agreement by the first week of May before the Mexican elections on July 1. Polls show leftist candidate Andre Obrador is likely to win posing a new set of problems for negotiations.

The present negotiations have covered the most ground since the last official round of negotiations that was back in early March. As well as the automotive issue, agriculture, and dispute settlement mechanisms have also been discussed according to a preliminary agenda seen by Bloomberg.

Guajardo called what is happening as a permanent round of negotiations. Freeland said that the negotiators were working hard late into the night on some of the issues and would be back at it the next day. There should be updates about the negotiations soon but dont expect to learn much if anything about the details of what is happening.

Key issues need to be settled

Some key issues are not even being discussed such as the proportionality issue, as discussed in a Digital Journal article about NAFTA and Canada's priorities: "The proportionality clause is unique to NAFTA: "Proportionality is "unique in all of the world's treaties," writes Richard Heinberg, a noted California energy expert. Cyndee Todgham Cherniak, a Toronto trade lawyer, says the energy chapter is unique for a trade agreement. There are only three free trade agreements in the world that have energy chapters, and the other two don't have NAFTA-like proportionality clauses." Proportionality requires NAFTA members to make available the current share of energy exports to other NAFTA members even when their are energy shortages in that country."

The Canadian priorities often consist of vague generalities whereas the US list was 14 pages and full of specifics. The Council of Canadians has a list of what it thinks should be Canadian concerns. While a few are on the actual list of Canadian priorities many are not:

"Remove Chapter 11.

Put workers and their rights at the heart of a new agreement.

Promote and protect public services.

Include strong provisions to protect the environment and natural resources.

Maintain the right to regulate in the public interest.

Remove the energy chapter and cancel the proportional energy sharing provision.

Remove all references to water.

Maintain and expand the exemption for culture.

Protect Canada’s supply management system.

Protect and enhance Indigenous rights."

This is a dream list while we await what may be a nightmare result. A favorable results would be for Trump, Canada, or Mexico to simply walk away.

Previously published in Digital Journal

Trump pushing hard for NAFTA agreement in principle as soon as possible

(April 3) The Trump administration is pushing hard for a preliminary NAFTA agreement in order to announce it at a summit in Peru next week.

Bypassing regular negotiations

According to three people familiar with the talks the Trump administration will host talks with cabinet ministers in Washington to attempt a breakthrough on the NAFTA renegotiations.

The White House wants leaders from Canada and Mexico to join in revealing the broad outlines of an updated pact at the Summit of the Americas that starts on April 13. Meanwhile technical talks hammer out the finer details and legal text could continue on. The three people who revealed this asked not to be identified as the talks are private.

The negotiations are already quite opaque with little detail of what is happening being revealed. Although what happens at these meetings is quite important to the welfare of the general public the public has little say in what goes on. It seems that the negotiating groups are not moving fast enough, so the US is having just high level political representatives from the three countries negotiate a deal in principle and will leave the details to the staff of the negotiators.

Major divisions remain among the 3 countries

Divisions remain even on the US proposal for more North American content in automobiles. There was supposed to be a breakthrough on the issue but apparently it is still not settled. There are wide divergences between the US chief negotiator, Robert Lighthizer and that of the chief Canadian negotiator on the progress of the talks with the latter claiming little of importance has been settled and there are wide differences. The US negotiator claims they are near an agreement in principle. Perhaps this is wishful thinking.

The White House has not commented on these rumored plans to announce a NAFTA deal.

Mexican official to meet Lighthizer in Washington

Two of the informants claim that Ildefenso Guajardo, the Mexican Economy Minister will meet with the US Trade Representative Lighthizer this Wednesday. Some meetings could include Jared Kushner and the Mexican Foreign Minister Luis Videgray. Apparently Kushner and Videgray have been handling relationships between Trump and Mexican President Enrique Nieto.

In the upcoming Mexican presidential elections the clear leader is a leftist NAFTA sceptic. No doubt the US would like to see the deal finished before the election.

Further Washington meetings

On Thursday Canadian Foreign Minister Chrystia Freeland will fly to Washington to meet with Lighthizer. Meetings on Friday would include all three countries' representatives.

Originally there were to be an eighth round of NAFTA talks that were to start in Washington next week. Lighthizer is alleged to have fought against this idea and there has as yet been no invitation for people to resume talks. He claims more progress can be made by holding meetings between smaller groups of negotiators. Perhaps the US hopes to better control events in this environment. The new scheme seems to have come from Lighthizer and the US.

In spite of Trump from time to time threatening to abandon NAFTA, the US actually seems anxious to obtain an agreement. It has gone so far as using various bullying tactics to do so.

Adam Austen, a spokesperson for Canadian minister Freeland's office said: “Canada is committed to concluding a modern, mutually beneficial NAFTA as soon as possible." He declined to comment on what her travel plans were.while declining to comment on her schedule. Mexican officials had no comment.

Trump's bullying tactics

Trump has made Canada and Mexico being excluded from steel and aluminum tariffs contingent upon a NAFTA agreement creating leverage to gain concessions favorable to the US.

Lighthizer told reporters: “The president’s view was that it makes sense that if we get a successful agreement, to have them be excluded. It’s an incentive to get a deal." One could consider this a threat as well.

Trump also claimed that Mexico's failure to stop the migrant flow into the US threatened the NAFTA deal.

Important issues for Canada such as the proportionality clause are not even being considered. NAFTA is less a free trade deal than a pact to create international structures that will further the interest of global corporations. Trump wants to make those structures more favorable to the national interests of the US. Global corporations are probably willing to concede a few crumbs to Trump's America First policy as long as their global interests are not much impacted by the concessions.

Published previously in Digital Journal

White House upbeat about NAFTA talks

(March 29) Although the Trump administration sounds upbeat about the progress of NAFTA negotiations and the chances of reaching an agreement the chief Canadian negotiator claimed that the US had yet to make compromises necessary for an agreement to be reached.

US and Canadian negotiators gave quite different assessments of the situation.

Trump's chief negotiator Robert Lighthizer, who has publicly criticized both Mexico and Canada said that he was optimistic that an agreement "in principle" in the next little while is possible with some effort and compromise. In contrast the Canadian chief negotiator Steve Verheul said that significant gaps remain and that Canada is not sure what the US means by an agreement "in principle". He also complained that the US had yet to make the necessary compromises to reach a deal.

Verheul told reporters in Ottawa: “An agreement in principle, to our understanding, means some sense of direction on the big issues, the important issues. We’ve not seen that from the U.S. so far. We’ve not seen any proposals in that regard. If we’re going to achieve that, we would fairly require some considerable flexibility in U.S. positions.”

Canada's large Unifor union also criticized the US assessment

President of Unifor union, Jerry DIas, representing autoworkers was quite blunt in an interview: “I don’t know what Lighthizer is smoking, but he should stop it.” Dias said that at most the three countries could complete negotiations on a number of smaller issues by the end of April. On bigger issues they still remain far apart.

Auto manufacturing issue still not solved

Verneul played down recent reports of a breakthrough on the auto manufacturing issue that had been a source of tension. Lighthizer had said last week that the countries were "starting to converge" on the issue. David MacNaughton the Canadian ambassador to the US said that the talks took a positive turn when the US had placed a compromise proposal to its earlier demands that were rejected by both Canada and Mexico. Nevertheless, Verheul claimed that the auto manufacturing issue was still not close to being resolved saying: “We welcome that signal, but ... we are still quite a distance away from any kind of agreement on the approach to auto rules of origin."

The earlier US demand was that 50 percent of a car had to be made in the US in order to qualify for tariff-free treatment plus there would be an increase from 62.5 percent to 85 percent in the amount of a car that would be required to be made in North America.

Factfile on NAFTA. US President Donald Trump has denounced NAFTA as a "disaster" and the worst agreement ever signed by the United States, blaming it for a $64 billion trade gap with Mexico and loss of countless jobs

John SAEKI, AFP

The new proposal

The publication Inside US Trade reported on Tuesday that the US would drop its US content proposal if Canada and Mexico agree to count autoworker's wages toward the North American content requirement. Mexico could avoid tariffs by paying their auto workers higher wages. However, the qualifying wage for this is thought to be around 15 dollars per hour. This is more than three times higher than the average current Mexican wage.

This could be a boon for Mexican workers but big automakers no doubt would reject it, as one of the main reasons for moving production to Mexico is the lower wages. The Mexican government might reject it as well since there would be no motive for automakers to increase production in Mexico and some production might even move back to the US. No doubt this is part of the aim of the proposal.

Horacio Lopez-Portillo, a trade lawyer with Vazquez Tercero and Zepeda in Mexico said that fifteen dollars as a cutoff was not workable. Lopez-Portillo claimed: “There is no way it’s going to happen. Can the Mexican government be pressured to increase wages in the auto industry higher than they currently are? Maybe. But it won’t be much higher than where they actually stand.”

In contrast to this rejection of the new proposal Canadian PM Justin Trudeau said on March 21st that there was a certain momentum in negotiation. The US confirmed that there had been a breakthrough in negotiations over the auto sector. In Mexico Trudeau said: “There is very strong resistance to including this. Having said that, will it happen? Maybe. And I say maybe because we’re trying to reach common ground ... so Mexico might actually cede a little bit here. How much, I don’t know.”

US wants a deal soon

From time to time Trump threatens to simply terminate NAFTA but in March his administration has struck a more positive tone, indeed more positive than that of Canada or Mexico. The Inside US Trade reports that US trade representative Lighthizer wants a deal by May 1. However, the three countries have yet to even agree to a calendar for the next round of negotiations that are expected to take place in Washington DC in April.

The Mexican presidential election is on July 1 and Andres Obrador the front runner is left-leaning NAFTA skeptic. Obrador is sure to drive a harder bargain that Enrique Nieto the present president.

The last talks were in Mexico in early March. At that time Trump announced that exemption of Mexico and Canada from steel and aluminum tariffs would depend on the completion of successful NAFTA renegotiations. In effect he is using the tariff threats to drive a harder bargain.

Conclusion

NAFTA is basically a trade agreement meant to increase the power of global corporations in North America and foster their interests. Trump wants to change the agreement so that more jobs are created in the US and have the terms align more closely with US national interests and national corporations in line with his America First policy.

Canada continues to take the perspective of global corporate interests. Basic imperfections in NAFTA such as the proportionality clause are not even opened and the press for the most part does not even talk about it. The issue is discussed in a http://www.digitaljournal.com/news/politics/op-ed-canada-s-nafta-priorities-excludes-key-proportionality-clause/article/500171 in August of last year.

Previously published in Digital Journal

Mexico could withdraw from NAFTA if Trump fails to offer a good deal

rump is forging ahead with plans to renegotiate the North American Free Trade (NAFTA) agreement after signing an order for the U.S. to withdraw from the Trans-Pacific Partnership trade deal.

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Trump has threatened to withdraw from NAFTA that came into effect in 1994 if he cannot renegotiate it to benefit American interests. However, Mexico and Canada will also be looking to make changes to NAFTA once it is opened again to negotiation. Trump may not be able to convince Mexico and Canada that changes he wants are in their interests. Either country could decide it would rather withdraw from the pact than accept Trump's changes. Trump has complained in particular about Mexico and it may turn out to be the target of Trump changes.

Mexican Economy Minister Ildefonso Guajard warned that his country could pull out of NAFTA if the new terms do not benefit it. Guajard said:"There could be no other option. Go for something that is less than what we already have? It would not make sense to stay. The strategy for this treaty needs to be one in which everyone wins. It's impossible to sell it here at home if there aren't clear benefits for Mexico."

Guajardo and Foreign Minister Luis Videgaray are to hold talks with senior Trump advisers this week about trade, security, and immigration. The Mexican president Enrique Nieto is supposed to meet with Trump at the end of January. Nieto said Monday that he wants to preserve the tariff-free commerce as now exists under NAFTA and called for the competitiveness of North America to be strengthened. Many Americans in areas that were hurt by NAFTA voted for Trump during the November 8 election.

As a Bloomberg article puts it the renegotiating could be a long and potentially messy process. Trump has called NAFTA "the worst trade deal in the history of this country". Canadian Prime Minister Trudeau has expressed his willingness to talk to the Trump administration about NAFTA and many Canadian critics of the deal are suggesting changes that should be made.

White House spokesperson Sean Spicer said that Trump was planning further talks on changing NAFTA in meetings with the Canadian PM and Mexican president within the next 30 days. How these talks unfold will determine whether piecemeal changes will be made or the entire treaty be renegotiated and the process started over. Spicer said if Trudeau and Nieto agreed to negotiate it through the existing structure this could happen but otherwise Trump could pull out and the entire deal would need to be negotiated anew.

Stephen Schwarzman, CEO of the Blackstone Group LP, and a Trump adviser told reporters after speaking to the federal cabinet at a retreat in Calgary that Canada should not be "enormously worried" because it is held in high esteem and two-way trade is balanced.

Mexican president Pena Nieto has already set out ten of his own goals in the upcoming negotiations. These include the free flow of remittances and assurances that any return of Mexican migrants be orderly. He demanded that NAFTA remain free of all tariffs. Chad Brown, a former adviser to President Obama said that there is no formal provision in NAFTA for renegotiation but there is a section that allows one party to withdraw after a six month notice to the other two countries. It could take months or even years to agree on new terms even after all three leaders give their go ahead and negotiating teams are assembled.

Wilbur Ross, nominated as Commerce secretary, said at his confirmation hearing that retooling NAFTA would be an early priority and everything would be on the table. Carlos Vejar, a Mexico city lawyer who had previously worked on NAFTA issue said that updating a trade agreement typically began with an exchange of letters. An agenda of topics was then agreed to and a schedule of negotiating rounds that rotated among the countries involved was set out.

Trump has not said explicitly what changes he wants but given his rhetoric during the campaign it seems that he will want the US to have a bigger share of auto manufacturing. The deal might specify more American content in autos or have rules that require more American content or at the least limit content outside of North America. The big auto makers are multinational who want the freedom to produce parts for autos in places which are best for them. They might react negatively to such changes and lobby against them.

At present NAFTA allows U.S. and Mexican firms to bid on U.S. government contracts. Trump might want to end this to keep more jobs in the U.S. Trump might also want to limit the ability of Mexican or Canadian firms to sue the U.S. government under the investor dispute settlement. This tactic provides an opportunity of critics to argue that the mechanism should be removed altogether. Ross in a written response to questions at his confirmation by Senator Bill Nelson of Florida said that issues of concern about NAFTA included country of origin rules and dispute resolution mechanisms.

Trump withdraws US from Trans-Pacific Partnership trade deal

(January 22) The Trump administration announced it will withdraw from the 12-nation Trans-Pacific Partnership (TPP) trade deal and is committed to renegotiating the North American Free Trade Agreement (NAFTA).

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The announcement is in keeping with promises Trump made during his campaign for presidency. The announcement said that the withdrawal was meant to protect American jobs and that the U.S. would "crack down on those nations that violate trade agreements and harm American workers in the process". The statement said:

"For too long, Americans have been forced to accept trade deals that put the interests of insiders and the Washington elite over the hard-working men and women of this country. As a result, blue-collar towns and cities have watched their factories close and good-paying jobs move overseas, while Americans face a mounting trade deficit and a devastated manufacturing base..This strategy starts by withdrawing from the Trans-Pacific Partnership and making certain that any new trade deals are in the interests of American workers."The TPP was signed in Auckland, New Zealand on February 4 2016 but only Japan has ratified it. Obama supported the TPP but was unable to get it ratified. Hillary Clinton at first praised it but then during the election campaign also opposed it along with Trump.

NAFTA was signed by the United States, Mexico, and Canada in 1994. The statement said that the U.S. would withdraw from NAFTA if the U.S. were not able to renegotiate it so as to give US workers a fair deal. U.S. stock markets have risen considerably since Trump was elected. No doubt corporations are looking for tax cuts, a stimulus program and less regulation. But not following through on the TPP and renegotiating NAFTA may send negative signals to markets.

China, notably absent from the TPP may begin to extend trade agreements with other countries in response and take a leadership role in expanding trading relationships. The TPP had been part of the Obama administration's "pivot" to Asia and meant to counter the influence of China. Damon Hunt, spokesperson for the Australian PM said that Trump could have a change of heart and the trade deal could proceed. Trump has been critical of Chinese trade policy and threatened to impose tariffs on Chinese imports. The Chinese have warned that China would retaliate if Trump begins a trade war.

Opening up NAFTA will result not only in demands for changes by Trump but no doubt by Canada and Mexico as well. According to the Council of Canadians only one in four Canadians even support NAFTA. The Council notes some of the negative features:For example, income inequality has worsened considerably in Canada, Mexico and the United States in the past 20 years. Manufacturing jobs have disappeared across the region, leading to a greater economic dependence in Canada on raw resource exports (and in Mexico on punishingly low wages).NAFTA is forged in the interests of global corporations many headquartered in the U.S. The last thing they want is opening up an agreement that was designed in their interests. It is too risky.

Leaked TTIP text confirms critics worst fears about the deal.

A 248-page leak of negotiating documents for the Transatlantic Trade and Investment Partnership (TTIP) confirms many of the fears of critics about the proposed trade deal.

The TTIP is a proposed trade agreement between the European Union and the United States. It aims to promote trade and multilateral economic growth between the U.S. and the EU.The U.S. considers the TTIP a companion agreement to the Trans-Pacific Partnership (TPP). The material was leaked by Greenpeace, Netherlands.

Texts of negotiation documents have been kept under wraps until now. The leaked documents make up 13 of the 17 chapters of the agreement. They show that the TTIP will open the EU to US producers of genetically modified food and other products, that up to now are banned in the EU. This confirms fears that EU regulatory standards will be sabotaged by the deal.

The documents also show that the US is refusing to accept any reforms suggested by the EU to the investor-state dispute settlement (ISDS) provisions in the agreement which would allow corporations to sue governments for lost profits. ISDS provisions are also found in the North American Free Trade Agreement (NAFTA) and the Trans-Pacific Partnership (TPP). Treaties involving these provisions tend to have long minimum life spans, ranging up to 30 years.

John Hilary, Executive Director of War on Want, said of the information in the documents:"We have long warned that TTIP is a danger to democracy, food safety, jobs and public services. Now we see it is even worse than we feared. Today's leak shows the European Commission preparing to sell us down the river, doing deals behind closed doors that will change the face of European society for ever. It is simply unacceptable that a group of unelected officials should be allowed to contemplate such a thing without any public scrutiny."

He said that secrecy was the only way that the European Commission was able to hide the truth from the people of the EU. He called on EU governments to halt the talks immediately and disband the EU negotiating team. He also demanded a public inquiry to determine how such a damaging round of negotiations ever got as far as it did. A petition calling for an end to the TTIP negotiations attracted 3.4 million signatures.

A Sputnik article notes that "climate change" is not mentioned in the 248 leaked pages. Nevertheless, there are rules that would restrict what tools the EU and U.S. could use to deal with climate change according to the Sierra Club. The Sierra Club has more than 2.4 million members and supporters according to its website. Sierra Club's Responsible Trade Director Ilana Solomon said that the material showed that the U.S. position was to undermine environmental and climate protections and would grant broad rights to corporations to undermine climate policies. The text also includes rules that have been used to prohibit "buy local" policies that could create local clean energy jobs and support clean energy entrepreneurs. The Sierra Club pointed out there are at least 23 different U.S. states which have this type of policy.

France has already given notice that it would not sign the deal if it threatened French agriculture. Greenpeace said it released the documents to provide transparency and so that debate on the TTIP could be informed. The documents cover environmental issues, animal welfare, labor rights, and Internet privacy. Greenpeace claims that the TTIP involves a huge transfer of power from people to large corporations. A summary of what the TTIP is all about, reviews of different areas, with the ability to download the texts for that area can be found here.

TPP will lessen competition and reduce democracy as well

The announcement that an agreement was reached by the 12 nations negotiating the Trans-Pacific Partnership(TPP) has resulted in considerable discussion and debate on the pact.

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The text of the agreement has never been made public and it is not clear when the text will be released. The details released are probably released by parties whose interests are involved. Many critics of the TPP complain about the secrecy and lack of transparency in the process. There is much discussion of the impact of the deal on agriculture sectors such as dairy farmers who have a supply-managed system. While the agreement does open the system somewhat to allow more imported products into Canada, the basic supply management system remains. The negative impact of the changes will be muted through compensation paid to the industry courtesy of the Canadian taxpayer. The auto parts industry will also be hurt with many jobs lost. Again Harper promises billions of taxpayer money to mute the negative impact.

There is less discussion of other significant aspects of the agreement. The TPP, as with other trade agreements such as NAFTA, is less about free trade and more about placing the power of global corporations beyond the reach of democratic governments. Ironically, our government quite consciously bargains away our right to pass laws and regulations as we see fit. If we pass laws or regulations which are considered inconsistent with the TPP, a foreign corporation can sue Canada.

A leaked text of part of the TPP includes an investor-state dispute settlement(ISDS) very much like the already existing mechanism in Chapter 11 of the North American Free Trade Agreement. Wikipedia describes an ISDS as follows: Investor-state dispute settlement (ISDS) is an instrument of public international law, that grants an investor the right to use dispute settlement proceedings against a foreign government. Provisions for ISDS are contained in a number of bilateral investment treaties, in certain international trade treaties, such as the North American Free Trade Agreement (Chapter 11)...If an investor from one country (the "Home State") invests in another country (the "Host State"), both of which have agreed to ISDS, and the Host State violates the rights granted to the investor under public international law, then that investor may bring the matter before an arbitral tribunal.As mentioned, NAFTA contains such a provision.

There have been many cases in which Canada has been sued by foreign corporations. In August 2008 Dow Chemicals submitted a claim for losses caused by a Quebec ban on the sale and certain uses of pesticides containing 2-4 D. In this case, the two sides reached a settlement accepted by the tribunal. States cannot sue corporations under the ISDS nor can they receive any compensation should a corporation lose except for their legal costs in some cases.

Canada has already lost seven cases under the ISDS process and paid out damages of $190 million and who knows how much in legal fees. One case filed against Canada challenges a Quebec ban on oil and gas fracking in the province. An analysis of cases under the NAFTA provisions can be found here:This study documents the 77 known NAFTA investor-state dispute settlement (ISDS) claims up to January 1 2015. These include 35 against Canada, 20 against the U.S., and 22 against Mexico. Canada has paid out NAFTA damages totaling over $CAD172 million, while Mexico has paid damages of $US204 million. The U.S. has yet to lose a NAFTA chapter 11 case. All three governments have incurred tens of millions of dollars in legal costs to defend themselves against investor claims.

In Europe, the issue of ISDS mechanisms has been hotly debated The EU parliament has passed a resolution that will require replacing an ISDS system in the Transatlantic Trade and Investment Partnersip(TTIP) ".. by a new public and transparent system of investment protection, in which private interests cannot undermine public policy and which is subject to public law." Brazil refuses to sign any treaty with ISDS clauses. South Africa intends to withdraw from any treaties that have ISDS clauses. In Canada the politicians of the major parties appear to think the issue is not worth bringing into public debate. What is significant are issues that impact specific interests such as the dairy industry or auto industry, where the parties might win or lose votes if they take the wrong position. That the democratic system itself is endangered and more power given to global corporations does not seem important.

If provisions in the TPP allow more penetration of global corporations into new markets such as the Canadian dairy and auto industry then competition will be fostered but in general the exact opposite is the case. In any free trade deal there are always clauses extending copyright and patent lengths, giving corporations monopoly rights over their products. We can expect the costs of drugs to our health care system to increase dramatically as a result of the TPP. It will become more difficult for producers of less expensive generic drugs to be able to replace drugs protected by patents. Protection of copyright terms in the TPP will prevent free or less expensive copied version of items:In the area of copyright, the TPP would require far longer terms of protection than what Canadians agreed to in a parliamentary copyright law review that only wrapped up recently. To smooth the way for the TPP, the federal government has already agreed, in the latest omnibus budget bill, to extend copyright terms for audio recordings from 50 to 70 years. The TPP could also require protection for controversial “digital locks,” which allow copyright holders to encrypt software in computerized devices and criminalize its circumvention.We do not know exactly what will be in the final text. With provisions such as these in the leaked text, it is not surprising that the final text will probably not be released until after the election.

Free Trade agreements grant new rights to corporations

Free Trade agreements are in many respects less about free trade than providing rights for corporations that transcend national laws. The TTIP provides a case in point but NAFTA and CETA have similar purposes.

The Transatlantic Trade and Investment Partnership(TTIP) allows corporations to sue governments technology writer, Glyn Moody claims. This could happen when corporations think that there had been an "indirect expropriation" of future profits through government action.  

]A case in point could be the British National Health Service(NHS) if it should be privatized. Supporters of the TTIP point out that as it is now, the Health Service will not be directly affected by the TTIP agreement. One chapter of the TTIP is about the "investor dispute settlement" a feature common to a number of free trade agreements. The section as with many parts of free trade agreements is more about giving corporations rights to override national laws than anything to do with free trade. If a company thinks that it has lost future profits through government action such as taking what is now private into the public sector it can sue the government to recover those expected future profits. 

Already there has been some privatization within the NHS. Should a future government try to reverse the privatization it could be immediately sued by the private companies that would lose future profits through this action. What the section does is basically lock in privatization unless the government is willing to pay billions of euros to settle any resulting lawsuits filed by companies that would lose future profits in the process. From the corporate point of view the provision protects them from any government that might want to reverse privatization. However it also prevents governments from taking any new sectors into the private sector, since any businesses who could claim to lose future profits from taking services into the public sector could use the provisions of TTIP to bring suit against the government.

 The UK trade minister claims that those against TTIP are motivated by dislike of America. However, there is the same concern about the Comprehensive Economic Trade Agreement (CETA) an agreement between Canada and Europe. There have also been concerns expressed about similar provisions in the existing North American Free Trade Agreement {NAFTA) between the US, Canada, and Mexico. The opposition to these types of agreement has nothing to do with antipathy towards a particular country but antipathy towards provisions that allow corporations to sue countries when they democratically pass certain laws.

 Even environmental regulations could be challenged as creating barriers to trade. This has already happened with NAFTA: The “investor-state” provision of NAFTA’s Chapter 11 was innovative, allowing companies to bypass governments and court systems and sue for injury due to ‘indirect’ expropriation — harm to the present or expected interests — due to government regulation. As University of Victoria Law professor Chris Tollefson has pointed out, NAFTA vests “in essentially unaccountable tribunals the authority to constitute themselves as courts of appeal with powers to adjudicate key domestic legal issues.” In the recent suit of the Metalclad Corp against a Mexican municipality, “the Tribunal decided … that municipal governments have no right to insist that foreign investors address local environmental and public health concerns, even though this conclusion was strenuously disputed by the Mexican government.” (Choices, IRPP, March, 2003) 

 Both Ontario when Bob Rae was the NDP premier and more recently New Brunswick campaigned for public auto insurance but neither went ahead to carry out their promises even though four provinces already had variations on this type of insurance before NAFTA came into force. Now any attempt to implement such plans could result in lawsuits under NAFTA. The suits might not be successful but just the threat of them has been enough to prevent any move to extend the popular insurance systems to other provinces.  

This article sums up the issue, noting that these free trade agreements give corporations power to claim damages against countries that pass laws that may harm their profits: ".. if you are a multinational corporation covered by NAFTA, or CETA if it gets put into place, then corporations have the right to go over the heads of government and courts, to an all powerful tribunal of trade lawyers and experts, three people who can ignore the decisions of Parliaments, courts, the Supreme Court, and give the company money for being so wronged by valid laws and strong systems of justice." The appended video below shows some of the other possible negative effects of CETA. A second video discusses the similar trade agreement for the Pacific Area the Trans Pacific Partnership (TPP).

Venezuela and Canada: Two models of oil development

Ralph Klein is not the premier of Alberta. He hasn't been since early last December. The premier is Ed Stelmach.
This is an interesting article. The new Alberta premier is following the same policy path as Ralph Klein for the most part. There are some alternative energy projects in Alberta. There is quite a bit of wind generated power in the foothills of the Rockies where wind conditions are good for generation.
The situation in Canada is somewhat constrained by the fact that resources are under provincial control. Alberta has always been sort of a Texas north and US oil has always been a big player in Alberta politics.
Trudeau infuriated Alberta with his National Energy Policy. I don't think that it is true that the west as a whole was alienated by the policy. It was mainly Alberta.
Anyway as mentioned NAFTA has also constrained the development of a national energy policy. NAFTA gave the US the same right to our resources as Canadians and makes it virtually impossible to nationalise oil companies. We would be required under NAFTA to compensate all the companies involved for lost profits.
I don't know why the author does not mention that.
He could also have noted that prime minister Stephen Harper is an Albertan and great admirer of the US. He is against increased power for the federal govt. except to buy military toys to be used to help the US in its empire building. In fact the direction of Canadian politics is towards dismantling national programs. A national child care program painfully worked out by the provinces was sabotaged by Harper. He is now cosy with Quebec autonomists(ADQ) and is buying them off through transferring federal funds to Quebec. Although the separatist PQ lost seats in the Quebec federal election the minority Liberal govt. of Charest represents a very weak federalist option. Harper is happy with both---Charest is himself a former Conservative and the ADQ is right wing on social issues just as Harper.
---
>
>
> To Sow the Oil, or Give it Away?
>
> Canada and Venezuela are pursuing very different oil
> policies. In the
> war of the wells, whose investment will bring the
> biggest return?
>
> by Jonah Gindin; Alberta Views; December 04, 2006
>
> With the recent surge in oil prices, long-standing
> debates about
> Canadian and Albertan oil policy have been infused
> with new vigour. Is
> Canada getting the most out of this precious natural
> resource? What
> are we doing with our wealth?
>
> Canada and Venezuela represent the most important
> sources of oil
> outside the Middle East -- and as heavy oil
> extraction methods
> improve, they may surpass even that black-gold mine.
> But their
> approaches to oil revenue could not be more
> different.
>
> Venezuela's oil industry was very similar to
> Alberta's in the early-
> to mid-1990s, when US-promoted neo-liberalism --
> "free trade" and the
> privatization and deregulation of the oil industry
> -- was implemented.
> But when the controversial yet popular Hugo Chávez
> was elected in
> 1998, Venezuela embarked on a transformative
> experiment,
> "re-nationalizing" the state oil company. With the
> country's oil-based
> income increasing exponentially, Venezuela has
> invested heavily in
> social programs. According to the Venezuelan
> National Statistics
> Institute, poverty rates have declined from 49 to 37
> per cent since
> Chávez assumed office. The Chávez administration has
> presented a
> serious challenge to neo-liberalism in Latin America
> by developing a
> social-democratic model with a sharp revolutionary
> edge. This process
> was made possible by Chávez's successful
> mobilization of poor
> Venezuelans into a mass movement.
>
> Canada's oil sector is highly regionalized, with
> royalty rates and the
> bulk of corporate taxes set and collected at the
> provincial level.
> Alberta Premier Ralph Klein has pursued
> diametrically different
> policies than Chávez. Despite its business-friendly
> approach, the
> Klein government has presided over huge surpluses
> over the past few
> years. Nevertheless, though social spending has
> increased marginally
> over this period, it remains below the level it
> reached in 1993 before
> being slashed by Klein.
>
> Were Alberta to begin demanding a bigger piece of
> the oil-revenue pie,
> would it end up being invested in the public good?
> Would it inspire
> (or require) popular mobilization along the lines of
> the Venezuelan
> experience?
>
> Two Models
>
> From the birth of the Canadian and Venezuelan oil
> industries in the
> early 20th century to the late 1990s, the policies
> in both countries
> followed similar trajectories. Up until the 1973
> OPEC oil shock, both
> oil industries were increasingly dominated by
> foreign corporations,
> most of them American.
>
> As happened in many other OPEC countries as a result
> of the crisis,
> then-President of Venezuela Carlos Andrés Peréz
> nationalized the oil
> industry in 1975, creating state-run oil company
> Petroleos de
> Venezuela S. A. (PDVSA). Venezuela pursued a series
> of nationalist
> policies during the late seventies and early
> eighties, investing oil
> revenues in a a slew of ill-conceived development
> projects.
> Ultimately, these were doomed by poor planning,
> arrogance and the
> misconception that everlasting high oil rents would
> provide permanent
> subsidies.
>
> Venezuela experienced a country-wide depression for
> much of the 1980s,
> as oil wealth was replaced by foreign debt. By 1989,
> at the behest of
> the International Monetary Fund (IMF) and the US
> Treasury Department,
> the government implemented the Apertura
> Petrolera—the "oil opening."
> While PDVSA technically remained state-run, the
> industry was opened up
> to external investment under extremely generous
> conditions, quickly
> becoming dominated (once again) by foreign
> multinationals. PDVSA
> itself came under the control of a technocratic
> elite, eventually
> becoming known as a "state within a state" for its
> viciously defended
> autonomy from the Venezuelan government. It resisted
> government
> oversight through "internationalization" --
> investing oil rents in
> overseas ventures to avoid transferring the money to
> the government.
>
> Though not an OPEC member, Canada also founded a
> state-run oil
> company, Petro-Canada, in 1975, during the first
> Trudeau government.
> In 1980 the federal government implemented the
> National Energy Program
> (NEP), despite fervent opposition from Western
> Canada. The NEP
> expanded the role of Petro-Canada, gave preferential
> treatment to
> Canadian oil producers, and by fixing domestic
> prices sought to brace
> Canada's industrial east from the terrifying jumps
> in the
> international price of oil.
>
> In 1984, however, Brian Mulroney won the federal
> election campaigning
> against the NEP, heralding the rise of an emboldened
> regionalism and
> the end of nationalist oil politics in Canada. The
> signing of the
> North American Free Trade Agreement (NAFTA)
> effectively enshrined
> Canada as an energy satellite of the US, making it
> exceedingly
> difficult for Albertan or Canadian governments to
> serve the province
> or the country's energy needs until the US had been
> served first. In
> 1990, the Mulroney government declared its intention
> to privatize
> Petro-Canada, a process completed under Chrétien in
> 2004.
>
> Bolivarian Venezuela: Renationalization and Rebirth
>
> A former colonel who led a failed coup against a
> corrupt and
> repressive government in 1992, Hugo Chávez was
> democratically elected
> in 1998 with a mandate to overhaul Venezuelan
> society. Realizing his
> most important campaign promise, he called a
> Constituent Assembly to
> rewrite the Venezuelan Constitution. Over the past
> seven years,
> Venezuela has seen a truly impressive number of
> elections, plebiscites
> and referendums. All told, Venezuelans have voted 11
> times since
> electing Chávez in 1998. Once key political reforms
> were passed
> through the ratification of the new Bolivarian
> Constitution (named
> after of Simón Bolívar, the 19th-century
> independence leader), the
> Chávez government proceeded with a series of more
> profound changes
> aimed at addressing the country's most glaring
> contradiction: oil
> wealth has made Venezuela one of the region's
> wealthiest countries,
> but poverty rates have been brought below 50 per
> cent only in the last
> two years.
>

Venezuela and Canada: Two models of oil development

Ralph Klein is not the premier of Alberta. He hasn't been since early last December. The premier is Ed Stelmach.
This is an interesting article. The new Alberta premier is following the same policy path as Ralph Klein for the most part. There are some alternative energy projects in Alberta. There is quite a bit of wind generated power in the foothills of the Rockies where wind conditions are good for generation.
The situation in Canada is somewhat constrained by the fact that resources are under provincial control. Alberta has always been sort of a Texas north and US oil has always been a big player in Alberta politics.
Trudeau infuriated Alberta with his National Energy Policy. I don't think that it is true that the west as a whole was alienated by the policy. It was mainly Alberta.
Anyway as mentioned NAFTA has also constrained the development of a national energy policy. NAFTA gave the US the same right to our resources as Canadians and makes it virtually impossible to nationalise oil companies. We would be required under NAFTA to compensate all the companies involved for lost profits.
I don't know why the author does not mention that.
He could also have noted that prime minister Stephen Harper is an Albertan and great admirer of the US. He is against increased power for the federal govt. except to buy military toys to be used to help the US in its empire building. In fact the direction of Canadian politics is towards dismantling national programs. A national child care program painfully worked out by the provinces was sabotaged by Harper. He is now cosy with Quebec autonomists(ADQ) and is buying them off through transferring federal funds to Quebec. Although the separatist PQ lost seats in the Quebec federal election the minority Liberal govt. of Charest represents a very weak federalist option. Harper is happy with both---Charest is himself a former Conservative and the ADQ is right wing on social issues just as Harper.
---
>
>
> To Sow the Oil, or Give it Away?
>
> Canada and Venezuela are pursuing very different oil
> policies. In the
> war of the wells, whose investment will bring the
> biggest return?
>
> by Jonah Gindin; Alberta Views; December 04, 2006
>
> With the recent surge in oil prices, long-standing
> debates about
> Canadian and Albertan oil policy have been infused
> with new vigour. Is
> Canada getting the most out of this precious natural
> resource? What
> are we doing with our wealth?
>
> Canada and Venezuela represent the most important
> sources of oil
> outside the Middle East -- and as heavy oil
> extraction methods
> improve, they may surpass even that black-gold mine.
> But their
> approaches to oil revenue could not be more
> different.
>
> Venezuela's oil industry was very similar to
> Alberta's in the early-
> to mid-1990s, when US-promoted neo-liberalism --
> "free trade" and the
> privatization and deregulation of the oil industry
> -- was implemented.
> But when the controversial yet popular Hugo Chávez
> was elected in
> 1998, Venezuela embarked on a transformative
> experiment,
> "re-nationalizing" the state oil company. With the
> country's oil-based
> income increasing exponentially, Venezuela has
> invested heavily in
> social programs. According to the Venezuelan
> National Statistics
> Institute, poverty rates have declined from 49 to 37
> per cent since
> Chávez assumed office. The Chávez administration has
> presented a
> serious challenge to neo-liberalism in Latin America
> by developing a
> social-democratic model with a sharp revolutionary
> edge. This process
> was made possible by Chávez's successful
> mobilization of poor
> Venezuelans into a mass movement.
>
> Canada's oil sector is highly regionalized, with
> royalty rates and the
> bulk of corporate taxes set and collected at the
> provincial level.
> Alberta Premier Ralph Klein has pursued
> diametrically different
> policies than Chávez. Despite its business-friendly
> approach, the
> Klein government has presided over huge surpluses
> over the past few
> years. Nevertheless, though social spending has
> increased marginally
> over this period, it remains below the level it
> reached in 1993 before
> being slashed by Klein.
>
> Were Alberta to begin demanding a bigger piece of
> the oil-revenue pie,
> would it end up being invested in the public good?
> Would it inspire
> (or require) popular mobilization along the lines of
> the Venezuelan
> experience?
>
> Two Models
>
> From the birth of the Canadian and Venezuelan oil
> industries in the
> early 20th century to the late 1990s, the policies
> in both countries
> followed similar trajectories. Up until the 1973
> OPEC oil shock, both
> oil industries were increasingly dominated by
> foreign corporations,
> most of them American.
>
> As happened in many other OPEC countries as a result
> of the crisis,
> then-President of Venezuela Carlos Andrés Peréz
> nationalized the oil
> industry in 1975, creating state-run oil company
> Petroleos de
> Venezuela S. A. (PDVSA). Venezuela pursued a series
> of nationalist
> policies during the late seventies and early
> eighties, investing oil
> revenues in a a slew of ill-conceived development
> projects.
> Ultimately, these were doomed by poor planning,
> arrogance and the
> misconception that everlasting high oil rents would
> provide permanent
> subsidies.
>
> Venezuela experienced a country-wide depression for
> much of the 1980s,
> as oil wealth was replaced by foreign debt. By 1989,
> at the behest of
> the International Monetary Fund (IMF) and the US
> Treasury Department,
> the government implemented the Apertura
> Petrolera—the "oil opening."
> While PDVSA technically remained state-run, the
> industry was opened up
> to external investment under extremely generous
> conditions, quickly
> becoming dominated (once again) by foreign
> multinationals. PDVSA
> itself came under the control of a technocratic
> elite, eventually
> becoming known as a "state within a state" for its
> viciously defended
> autonomy from the Venezuelan government. It resisted
> government
> oversight through "internationalization" --
> investing oil rents in
> overseas ventures to avoid transferring the money to
> the government.
>
> Though not an OPEC member, Canada also founded a
> state-run oil
> company, Petro-Canada, in 1975, during the first
> Trudeau government.
> In 1980 the federal government implemented the
> National Energy Program
> (NEP), despite fervent opposition from Western
> Canada. The NEP
> expanded the role of Petro-Canada, gave preferential
> treatment to
> Canadian oil producers, and by fixing domestic
> prices sought to brace
> Canada's industrial east from the terrifying jumps
> in the
> international price of oil.
>
> In 1984, however, Brian Mulroney won the federal
> election campaigning
> against the NEP, heralding the rise of an emboldened
> regionalism and
> the end of nationalist oil politics in Canada. The
> signing of the
> North American Free Trade Agreement (NAFTA)
> effectively enshrined
> Canada as an energy satellite of the US, making it
> exceedingly
> difficult for Albertan or Canadian governments to
> serve the province
> or the country's energy needs until the US had been
> served first. In
> 1990, the Mulroney government declared its intention
> to privatize
> Petro-Canada, a process completed under Chrétien in
> 2004.
>
> Bolivarian Venezuela: Renationalization and Rebirth
>
> A former colonel who led a failed coup against a
> corrupt and
> repressive government in 1992, Hugo Chávez was
> democratically elected
> in 1998 with a mandate to overhaul Venezuelan
> society. Realizing his
> most important campaign promise, he called a
> Constituent Assembly to
> rewrite the Venezuelan Constitution. Over the past
> seven years,
> Venezuela has seen a truly impressive number of
> elections, plebiscites
> and referendums. All told, Venezuelans have voted 11
> times since
> electing Chávez in 1998. Once key political reforms
> were passed
> through the ratification of the new Bolivarian
> Constitution (named
> after of Simón Bolívar, the 19th-century
> independence leader), the
> Chávez government proceeded with a series of more
> profound changes
> aimed at addressing the country's most glaring
> contradiction: oil
> wealth has made Venezuela one of the region's
> wealthiest countries,
> but poverty rates have been brought below 50 per
> cent only in the last
> two years.
>