NAFTA

The CurrCon Java Applet displays prices on this web page converted with today’s exchange rates into your local international currency, e.g. Euros, US dollars, Canadian dollars, British Pounds, Indian Rupees… CurrCon requires an up-to-date browser and Java version 1.5 or later, preferably 1.7.0_04. If you can’t see the prices in your local currency, Troubleshoot

Introduction

You may have heard terms like NAFTA (North America Free Trade Agreement), FTAA (Free Trade Agreement of the Americas), 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. 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 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 (International Monetary Fund)), the World Bank, and the World Trade Organisation (WTO (World Trade Organisation)) 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 (born: 1950-10-21 age: 61), 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 (America On-Line) 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 Québec. 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: 78), 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 (Public Broadcasting System) journalist documented a number of abuses, which I summarise below. All amounts in the following exposition are in: $0.00 USD

Under Chapter 11, Raymond Loewen, a Canadian funeral company, sued the US Federal Government through the tribunal for $725,000,000.00 USD , 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 $500,000,000.00 USD to Okeefe. Loewen originally settled for $175,000,000.00 USD 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 $970,000,000.00 USD million because the state of California banned MTBE (Methyl Tertiary Butyl Ether) 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 (Methycylcopentodieny Manganese Tricarbonyl) in gasoline, even though the additive is illegal in the USA. Canada could not afford the $250,000,000.00 USD lawsuit and so caved in allowed the additive in Canadian gasoline and paid up $13,000,000.00 USD 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 $16,002,433.00 USD 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

by:

Mel Hurtig

978-0-7710-4166-2

paperback

(born: 1932-06-24 age: 79)

978-0-7710-4165-5

hardcover

publisher:

Douglas Gibson

B004HW6GVY

kindle

published:

2008-04-28

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)

Greyed out stores probably do not have the item in stock

recommend book⇒One Big Party: To Keep Canada Independent

by:

Paul Hellyer

978-0-9733116-0-0

paperback

(born: 1923-08-06 age: 88)

publisher:

Chimo

published:

2003-01

Paul Hellyer was Canada’s former defense minister. He methodically builds a case that George Bush is out for military domination of the whole planet, which includes Canada. He lets the neocon villains condemn themselves in their own words. Bush it turns out is far worse that your worst nightmares, not only for the USA, but for the entire world. He explains why, if NAFTA is extended with the FTAA, it will be the end of Canada.

Greyed out stores probably do not have the item in stock

recommend book⇒The Selling of “Free Trade”: NAFTA, Washington, and the Subversion of American Democracy

by:

John R. MacArthur, Jr.

978-0-520-23178-8

paperback

(born: 1956 age: 55)

978-0-8090-8531-6

hardcover

publisher:

University of California

published:

2001-10-16

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. Part of Harper’s bookshelf.

Greyed out stores probably do not have the item in stock

Learning More

Trailer for Hoodwinked: The Myth of Free Trade .
One World Essay
WTO essay
Free Trade essay
transcript of Bill Moyers’ PBS documentary Trading Democracy. The site also has a few video clips.

	You can get the freshest copy of this page from:	or possibly from your local J: drive (Java virtual drive/mindprod.com website mirror)
	http://mindprod.com/money/nafta.html	J:\mindprod\money\nafta.html
	Please email your feedback for publication, letters to the editor, errors, omissions, typos, formatting errors, ambiguities, unclear wording, broken/redirected link reports, suggestions to improve this page or comments to Roedy Green : . If you want your message, your name or email kept confidential, not considered for public posting, please explicitly specify that. Unless you state otherwise, I will treat your message as a letter to the editor that I may or may not publish in the feedback section. After that, it will be too late to retract it. If you disagree with something I said, please quote it and cite the web page where you found it, tell me why you think it is wrong, and, if possible, provide some supporting evidence. Threatening to kill me or spouting obscenities has yet to persuade me to change my mind.
	Canadian Mind Products
	mindprod.com IP:[65.110.21.43]
view	Your face IP:[38.107.179.213]
Feedback	You are visitor number 21,545.