NAFTA
by Roedy Green ©1996-2009 Canadian Mind Products
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Introduction
You may have heard terms like NAFTA, FTAA, free trade and globalisation. You may be aware that some people are violently
opposed, willing to risk their lives to protest. Never do the news commentators explain why. I am going to do that for
you. It turns out the protesters in general are in favour of free trade, just opposed to the way it has been implemented.
It also turns out the politicians have pulled a boondoggle so outrageous it is hard to believe they are getting away
with it.
Background
In 1992 Canadian Prime Minister Brian Mulroney, the American President George Bush Senior and
Mexican President Salinas signed a free trade agreement called NAFTA (North American
Free Trade Agreement).
It took effect 1994. It dropped duties on trade between the countries and made it easier for
companies in one country to invest in the other two. So far so good.
The negotiations were arduous. To push negotiations along, at the last minute, the Americans tried a bluff, a bargaining
chip they intended to push then withdraw. This was the famous chapter 11 you will hear so much about. Chapter 11 has
nothing to do with bankruptcy; it is a section of the agreement that gave outrageous powers to foreign corporations. To
the American negotiator’s surprise, the Canadians accepted it.
In 2002, negotiations are underway to extend NAFTA to include 31 new North and South American
countries. This new agreement called FTAA (Free Trade Agreement
of the Americas) has an even stronger version of chapter 11.
Protests are heating up. The Canadian government announced it would shoot free trade protestors. The right wing Bush
administration in the USA and the right wing Harper government in Canada have funded a propaganda blitz to persuade the
public that anyone who has any reservations about NAFTA is a raving lunatic.
“Soon after the US petroleum production had peaked, official policy began emphasising ‘free trade’ as
a global panacea for unemployment, underdevelopment, and virtually every other economic and political ill. Through the
manipulation of the rules of global trade, the US sought to maintain and increase its access to natural resources
worldwide. Those rules — written primarily by US-based corporations and encoding in policies of the International
Monetary Fund (IMF), the World Bank, and the World Trade Organisation (WTO) as well as treaties like the North American
Free Trade Agreement (NAFTA) — essentially said that wherever resources lie, they must be available for sale to
the highest bidder. In other words, whoever has the money to buy those resources has a legally defensible right to them.
According to those rules, the oil of Venezuela belongs to the US every bit as much as if they lay under the soil of
Texas or Missouri. Meanwhile technology, or ‘intellectual property’, was regarded as proprietary; thus
nations with prior investments in this stragetgy were at an advantage while ‘underdeveloped’ nations were
sysetatically discouraged from adopting it.”
~ Richard Heinberg, The Party’s Over
In other words free trade and globalisation are a heads-I-win, tails-you-lose game rigged in favour of the USA. That is
partly how the USA, with only 1/20 of the world’s population, manages to hog most of the planet’s resources.
The Case Against NAFTA in a Nutshell
- Even Liberal Minister of the environment Caccia admitted, "NAFTA has been an environmental disaster."
- NAFTA prospers the richest 3% of Canadians, but is a disaster for the rest of us. The
wealthy bamboozle the public and bribe politicians to keep NAFTA.
- Under NAFTA, Canadian farmers are exporting seven times as much to the Americans, but are making 24%
less income. There are similar stories in other sectors.
- NAFTA put Canada up for sale at bargain prices. Even Tim Horton’s is now American.
- Under NAFTA, Americans have the right to buy as much of our electricity, oil, gas and water as they please and we
are stuck paying American prices for our own resources.
What is the Matter with the Free Trade Agreement?
There are many complaints, most centering around chapter 11. The agreement gives foreign corporations the right to sue
the government for any lost profit and any lost future profit as a result of any government action,
even when the corporation was selling a harmful or dangerous product.
You may be coughing just now, saying preposterous, no government in their right mind would hand over such a blank
cheque to foreign corporations. That was my reaction when I heard about it Bill Moyer’s documentary Trading
Democracy. Keep in mind who made the agreement — Mulroney and Bush senior, men known for promoting the
interests of the corporations over citizens. Because Chapter 11 gives the corporations the right to sue for billions in
lost profit, it gives foreign corporations immense political power as well.
- The agreement gives foreign corporations the effective power to overturn anti-pollution legislation.
- The agreement gives foreign corporations the effective ability to overturn court decisions, even those of the supreme
court.
- The agreement gives foreign corporations the effective right to overturn the rules for organic food labelling. If a
foreign corporation loses sales because their products don’t quality, either the government has to relax the rules
to allow them to comply or else compensate them for all current and future lost profits.
- These lawsuits are not decided in courts, but by secret tribunals, made up of guess who, industry members! Guess who
always wins these lawsuits: the corporations or the federal governments? These decisions override even the supreme court.
The new version of chapter 11 wants to keep not only the proceedings secret, but also the rulings. The public will never
find out about the billions their government is handing out to foreign corporations in Chapter 11 lawsuits.
- Canadians are alarmed that Chapter 11 will be used to challenge water safety regulations. Canadas stringent regulations
are according to Chapter 11 a restraint of trade.
- Canadians are alarmed Chapter 11 lawsuits will destroy the public health care system. American health providers can sue,
since they are losing profits because the government competes with them in providing health care.
- Canadians are alarmed the AOL Time Warner will use chapter 11 to dismantle the subsidies to help the fledgling Canadian
publishing industry. Americans should be alarmed that Mexican agribusinesses could similarly use it to dismantle the
extensive American farm subsidies.
- Literally, foreign corporations should not even have to pay any taxes at all since that interferes with their
profitability. Whether they take chapter 11 that far, foreign corporations still have a huge unfair advantage over
domestic ones.
There are two other major problems with free trade:
- Trade is not always free. George W. Bush slapped a 33% duty (illegal under the NAFTA
treaty) on Canadian softwood exports to the USA, which crippled her lumber industry, the number one industry in the
provinces of British Columbia (where I live) and Quebec. Most Canadians suspect, but cannot prove, that George W. Bush
was arm twisting Canada to get Prime Minister Chrétien to support Bush’s illegal war on Iraq. When that did
not work, Bush raised the duty to 47%. Prime Minister Chrétien diplomatically told him to shove it up his
nostrils.
“The price of being the world’s only superpower is that its motives are sometimes questioned by others.
Great strength is not always perceived by others as benign. Not everyone around the world is prepared to take the word
of the United States on faith.”
~ Jean Chrétien (born: 1934-01-11 age: 75), Prime Minister
of Canada
The USA is a big country and makes up the rules as she goes in her favour.
- It weakens the power of the workers. Multinational corporations take jobs wherever labour is cheapest. Jobs moved from
Canada to the US to Mexico and from there to China. National unions have no power to compete with slave wages in the
third world.
The Actuality
You may say, "Yes, such ripoffs may be possible in theory, but in practice, nothing that outrageous would be
allowed to happen." Bill Moyers, a respected PBS journalist documented a number of abuses, which I summarise below.
All amounts in the following exposition are in:
- Under Chapter 11, Raymond Loewen, a Canadian funeral company, sued the US Federal Government through the tribunal for
, because it lost a jury trial in a legal dispute with a small Louisiana funeral chain owned by Jerry O’Keefe, the
mayor of Biloxi, claiming the jury was biased against Canadians. In the original trial, the jury awarded
to Okeefe. Loewen originally settled for
then struck back some years later with Chapter 11. Here we have a jury trial was overturned by a secret tribunal, not by
a superior court. That should ring alarm bells for civil libertarians.
- Under Chapter 11, Methenex, a Canadian gasoline additive company, sued the US Federal government for
million because the state of California banned MTBE a gasoline additive that causes cancer in animals.
- Under Chapter 11, the Ethyl Corporation, an American gasoline additive company, successfully sued the Canadian federal
government when it banned MMT in gasoline, even though the additive is illegal in the USA. Canada could not afford the
lawsuit and so caved in allowed the additive in Canadian gasoline and paid up
for the short time the ban was in effect. To add insult to injury, the settlement required two cabinet ministers to go
on TV and lie to the Canadian people that MMT was considered completely safe.
- Under Chapter 11, Metalclad, an American company successfully sued the federal government of Mexico for
when local Mexican governments refused them a permit to expand a toxic waste dump until they had cleaned it up. They
took the money then went ahead with the toxic dump without any cleanup.
- One of the Canadian negotiators of the free trade agreement said that even if a company were putting plutonium in
children’s food, the company could still sue for lost profit if they were required to stop. Foreign corporations
are insured from economic risk, unlike domestic corporations, no matter how irresponsibly they behave. Not only are
governments required to compensate them for lost profits, but also for all lost profits indefinitely into the future.
Ironically, the worse the foreign corporations behave the more they can extort from governments under Chapter 11.
Why?
Why would any government in its right mind sign such an agreement that so seriously undermines its own authority?
- Politicians get the bulk of their campaign contributions from corporations, and so they do what the corporations want.
The large corporations are quite understandably wildly in favour of Chapter 11.
- The negotiators of the treaty were lawyers who are now in private boutique practice teaching corporations how to
milk the Chapter 11 cow. They put the language in there on purpose so they could exploit it later. The politicians may
not have realised how foolish they were being when they signed.
- Note that the major news media TV and newspapers have a conspiracy of silence of Chapter 11. Not a one has reported it.
Not a one has explained what the free trade controversy is about. All they show are pictures of protestors and fire
hoses as if the protests were a form of mindless violence.
Books
 |
recommend book⇒The Truth about Canada: Some Important, Some Astonishing, and Some Truly Appalling Things All Canadians Should Know About Our Country |
| | hardcover |
|---|
| ISBN13: | 978-0-7710-4165-5 |
|---|
| ISBN10: | 0-7710-4165-9 |
|---|
| publisher: | Douglas Gibson |
|---|
| published: | 2008-04-28 |
|---|
| by: | Mel Hurtig |
|---|
Hurtig points out that if you compare Canada economically before and after NAFTA, all 30 indicators he looked at show Canada was better off before. NAFTA’s purpose is to transfer Canadian sovreignty to corporations. International corporations get rich off NAFTA, but ordinary citizens have just gotten screwed. I talked with Mr. Hurtig at a book signing. He has thousands of facts at his fingertips. How well do you know Canada? | Statistics about Canada |
|---|
| % | statistic |
|---|
| 0 | percent improvement in child poverty since 1989. | | 0 | percent increase in middle class income, inflation-adjusted income since 1980. | | 0.75 | percent of Canadians who donated to any political party in 2006. | | 2.4 | percent of direct foreign investment that created new jobs, 97.6% was for takeover of existing companies which diverted the profits to offshore tax havens. | | 21 | percent of jobs that are paid too low to provide food, shelter and heat. 8-12% is typical in Europe. | | 55 | percent foreign takeovers financed by Canadian banks. | | 56 | percent drop in foreign aid since 1975. | | 76 | percentage of print and TV media in Vancouver BC owned by one company. | | 80 | percent of Canadians who have never belonged to any political party. | | 100 | percent increase in GDP since 1989. | | 400 | percent increase in share of the economic pie by taken by investors at the expense of workers since 1992. | ~ Mel Hurtig (born: 1932-06-24) |
|
 |
recommend book⇒One Big Party: To Keep Canada Independent |
| | paperback |
|---|
| ISBN13: | 978-0-9733116-0-0 |
|---|
| ISBN10: | 0-9733116-0-6 |
|---|
| publisher: | Chimo Media |
|---|
| published: | 2003-01 |
|---|
| by: | Paul Hellyer |
|---|
| Paul Hellyer was Canada’s former defense minister. He methodically builds a case that Mulroney sold out Canada to the USA with NAFTA. He explains why, if NAFTA is extended with the FTAA, it will be the end of Canada. |
|
 |
recommend book⇒The Selling of "Free Trade": NAFTA, Washington, and the Subversion of American Democracy |
| | paperback | hardcover |
|---|
| ISBN13: | 978-0-520-23178-8 | 978-0-8090-8531-6 |
|---|
| ISBN10: | 0-520-23178-3 | 0-8090-8531-3 |
|---|
| publisher: | University of California Press |
|---|
| published: | 2001-10-16 |
|---|
| by: | John R. MacArthur, Jr. |
|---|
| MacArthur is editor of Harper’s Magazine. People have accepted NAFTA because few people bothered to read the agreement and discover it had nothing at all to do with free trade. It is about giving Americans the same rights as Canadians when it comes to buying up Canadian resources and companies. |
|
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