THE DUEL: NAFTA, the capitalist manifesto
Trade agreements like NAFTA have been exceptionally good for North America’s corporate class but less so for workers and the environment. Incredible wealth has been concentrated at the top. Meanwhile, good-paying union jobs have been destroyed, wages have stagnated and social programs have been slashed. These agreements represent a rulebook for global capitalism written by the 1%.
NAFTA, CETA, FTAA, WTO, GATT, FIPAs and many more have liberated capital from the constraints of local regulation, so that it can flash around the world, seeking out the most profitable investment opportunities. Countries are forced to compete — to drive down wages, loosen environmental standards and cut corporate taxes. It’s a race to the bottom.
NAFTA’s Chapter 11 — there’s something like it in most trade agreements — enables corporations to sue governments for lost profits. Ethyl Corp used this clause to sue Canada in 1997 when the federal government banned a potentially dangerous gasoline additive manufactured by the company.
When Ontario was getting off coal, the WTO quashed a policy that incentivized hiring local workers and using local materials to build a renewable power grid.
There are examples like this around the world. Tobacco companies use these clauses to frustrate public health regulation in developing countries.
NAFTA's proportional energy-sharing clause locks in large oil and gas shipments to the U.S. NAFTA could stop Canada from ending oil exports, and winding down tar sands production for a transition to renewable energy — should we ever decide to do that.
There’s nothing wrong with trade per se. But health, labour, human rights and the environment always come second. Agreements in those areas don’t have the teeth that trade deals do. So corporations usually win.
Canadian officials are heading to Washington this week for NAFTA talks. Trump blames other countries for stealing American jobs — an appealing argument for those who’ve lost out to trade. But it’s Trump and his class who’ve destroyed the good jobs — downsizing and outsourcing; pushing for deregulation, privatization and austerity to bolster their bottom line.
In the 1980s, Canada’s father of “free trade,” former Conservative Prime Minister Brian Mulroney vowed trade deals would usher in a future of prosperity, good jobs and fully-funded social programs. But these agreements have helped hollow out the Canadian economy, rewiring it to focus on exporting raw natural resources and stripping out value-added manufacturing.
It’s time to quit this race to the bottom and re-write the rulebook.