RM Archive - onsite copies of linked stories

RM Issue #040416

Date: Mon, 12 Apr 2004 18:09:10 -0700
From: World Server
Subject: Meeting Monday night (tonight) to discuss strategy for saving Canada

Meeting Tonight and Call for suggestions for name of new Federal Party to Reclaim Canada

As Mel Hurtig outlined powerfully last Monday night at the Vancouver Public Library
in his lecture titled RUSHING TO ARMAGEDDON: Paul Martin and George W. Bush's Star Wars (which you will soon be able to listen to on www.necessaryvoices.org), the current two major Canadian political parties are hell bent on integrating Canada into the Bush Style Empire of Terror - focused on weaponising space, invading and subjugating countries at will, pre-emptive use of nuclear weapons, driving a new nuclear arms race, and effective control of all governments by the transnational corporate establishment.

We thus need to launch and quickly build up a new federal political party to avert
this disastrous course our country is currently on and effectively, to save our country..


There is nothing Canada needs more than a credible, mainstream political party

that approximately ten million currently disenfranchised middle-of-the-road Canadian electors can vote for in the upcoming election.

Progressive Electors Association Second Meeting
Monday April 12 7 pm - 9 pm

Little Mountain Neighbourhood House
3981 Main Street
Purpose: To Brainstorm and decide on the Name of the Party and to Strategise

the Meteoric Rise of this New, Inclusive, Moderate, Populist, Centrist,
Progressive Federal Political Party. A party that will put people back into
the equation, not just debt repayment, fiscal conservatism, corporate
welfare and other voodoo economics designed to serve elite transnational
corporate and foreign interests at the expense of the Canadian electorate.
Reason: The Conservative and Liberal Parties both intend to take Canada

further down the road of accelerated Americanization, Privatisation,
Neoconservatisation and Corporatisation. The NDP is stuck at 15% in the
polls, with no chance of throwing off the burden of its negative association
with big labor, socialism, etc. The Canadian Action Party intends to
continue promoting its esoteric monetary reform platform, a platform
Canadians cannot relate to. The new Progressive Canadian Party is
essentially an effort to resurrect the old Progressive Conservative Party,
rooted in old fashioned Tory ideology. The Green Party is destined to be a
fringe party in Canada for the foreseeable future. This leaves approximately
ten million Canadian voters with no party to vote for. We need to supply
them with a party to support - a party that can take either first or second
position in the upcoming election. A party to save Canada. This may be the
only opportunity to save our country for the foreseeable future. Let's take
it and win!

In the meantime, send your suggestions for the name of this party to


"We are grateful to The Washington Post, The New York Times, Time

Magazine and other great publications whose directors have attended our meetings and respected their promises of discretion for almost forty years."
"It would have been impossible for us to develop our plan for the world if we had been subject to the bright lights of publicity during those years. But, the world is now more sophisticated and prepared to march towards a world government. The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national autodetermination practiced in past centuries."
David Rockefeller , 1991, as quoted in Operation Vampire Killer 2000, Published by:
Police Against The New World Order, 1992

SOVEREIGNTY: Pressure to have Canada assimilated by the U.S. must be resisted
By Bruce Campbell

Post-September 11 has changed the way the United States views the world and the way the world views the United States. In the Bush administration's new world order, multilateralism is dead. Unilateralism trumps international law except when it serves U.S. interests. Military and economic agendas are indistinguishable. Globalization means enforcing free market rules and investor freedoms for U.S. multinationals, protecting domestic markets for national producers where required, and securing U.S. access to the world's resources.

The American government wages an unending war on an undefined "terrorism," leaving the world in a state of anxiety reminiscent of the Cold War. In its self-appointed new role, it enlists coalitions of the willing, rebukes the uncommitted, threatens the unwilling, and crushes the evildoers.

It is in this climate--where not being in lockstep with the hyperpower raises the spectre of retaliation--that the discussion of deepening Canada-U.S. economic integration is playing out. Business leaders and free trade warriors are beating the drums for another big leap of faith into a new comprehensive arrangement with the United States. It's been called "integration," or "deep integration," but what they are talking about is a process that more often resembles assimilation than integration.

Free trade proponents advocate a range of deep integration measures, such as a customs union; common trade, energy and resource policies; and even the creation of a common currency (in reality adoption of the U.S. dollar).

A prominent deep integration proposal is the so-called Big Idea or strategic bargain. Spurred by September 11, it has been circulating in the public domain for a year now. The luminaries behind it include the C.D. Howe Institute led by Wendy Dobson and former trade negotiators Michael Hart and William Dymond; IRPP president and former Mulroney chief of staff Hugh Segal; free trade commissioner Donald MacDonald; former Canadian ambassador to the U.S. Alan Gotlieb; Tom d'Aquino, CEO of the newly-named Canadian Council of Chief Executives; and Perrin Beatty, head of the Canadian Manufacturers and Exporters Association. These are the same free trade warriors who brought us free trade Round One in the 1980s. Big it may be, but it is neither a new nor a good idea. And it feels like deja vu all over again, coming from the same folks who promised at the time that a big comprehensive deal would put an end to American harassment of our exports.

The essence of the strategic bargain is to trade economic security (Canada's goal) for homeland security (the U.S. goal). For Canada, this means putting the remaining components of our sovereignty on the table in a mother-of-all negotiations--trade policy, culture, energy, other resources including water, agriculture, defense and security, etc.--in return for further enhanced (and this time genuine) security of access for Canadian goods, services and "knowledge workers," and full citizenship for Canadian investors in the U.S.

Proponents stress that there is a window of opportunity to be seized, given America's heightened preoccupation with secure borders and a secure supply of resources. But there are those like myself who argue that further integration at the policy/regulatory level is neither inevitable nor desirable. It should be avoided or reshaped where possible, and reversed where feasible.

The impact of nearly 10 years of NAFTA (and 15 years of the bilateral FTA) has been clearly negative when measured against the only standard that counts ultimately when evaluating public policy: has it bettered the lives of those affected by it? Not only has NAFTA failed to deliver the goods it promised to the Canadian people, but it has also significantly eroded Canada's sovereignty.
Living under NAFTA: The impact

What have been the major NAFTA-related impacts? What problems has it helped to create or exacerbate? In what areas has it not solved the problems it was supposed to solve? The following list is not exhaustive.

First, there has been a long and painful period of economic and social restructuring marked by income loss, employment loss, and the growth of insecure and precarious employment. Although the worst is over, restructuring continues. This is not an unintended consequence. NAFTA and its policy siblings were designed--by enhancing capital mobility and hamstringing government--to transfer power from workers to management and investors, from wages to profits, from the public sector to the market.

Second, a negative social adjustment (most visibly in the cuts to unemployment insurance) has taken place under cover of the war on the deficit; and a cut in taxes, largely for upper-income groups and corporations, has occurred under cover of competitiveness. Though still much less extreme than in the United States, 15 years of "free trade" have seen major increases in both income inequality and wealth inequality in Canada, as well as a deepening of poverty, of homelessness, of hunger and the use of food banks.

Third, labour and environmental side-agreements were negotiated under NAFTA to mitigate social and environmental dumping--the competitive bidding down of labour and environmental standards to attract investment. NAFTA's Labour and Environment Commissions have done some useful research, highlighted some problem areas, and occasionally provided a mechanism for NGO cooperation; but the complaint process does not work and neither accord has been effective in addressing the environmental and labour problems created by NAFTA.

Fourth, NAFTA contains protections for social services such as health care and education. But these exemptions, as the Romanow Commission noted, are seriously flawed and, in tandem with the GATS, constitute a threat to domestic policy flexibility and options around health reform. As yet, foreign penetration in this sector is limited, but this is beginning to change as some provincial governments, after years of financially starving health care, are opening the door to more for-profit delivery and financing.

Fifth, NAFTA gutted the auto pact (a "managed" as opposed to a "free trade" economic integration accord), eliminating its ability to establish a domestic investment floor through minimum content requirements. NAFTA has greatly intensified the competitive race for auto assembly and parts plants among the many jurisdictions of North America. As the government of Ontario has recently learned, if it wants to stay in the game it has to provide huge direct and indirect subsidies and other incentives to attract and maintain these investments. This has a major fiscal impact, reducing resources available for health, education, and other social priorities.

Sixth, contrary to the promise that productivity would soar under free trade and other "free market" policies--from business tax cuts to labour market deregulation--Canada's productivity performance has been less than impressive compared to other industrialized countries. The Canada-U.S. manufacturing productivity gap, which was supposed to narrow, has in fact widened--significantly. There has also been a disconnect between productivity increases and wage increases, reflecting the intensification of low-wage competition, the decline in union bargaining power, the weakening of social and labour market programs and institutions, and the still relatively high unemployment rate.

Seventh, Canada has been losing out to the other NAFTA partners, especially Mexico, as the preferred location of foreign investors who want to produce for the North American market. (It should be pointed out that, when new direct foreign investment is in the form of takeovers of Canadian companies [and most of it is], it often means the loss of high-tech and managerial jobs. How can this be good?)

Eighth, although the U.S. has grown as the destination of 85% of Canadian exports, up from 75%; and although exports now account for 43% of GDP, up from 25%, Canada's share of U.S. imports (18.5%) is about where it was at the outset of free trade. Thus, Canada has become even more vulnerable to U.S. trade sanctions, without having improved its share of the U.S. market.

Ninth, the large increase in north-south trade has, as anticipated, weakened east-west commercial linkages. Only P.E.I. now trades more with other provinces than outside the country. Our national transportation and communications infrastructures have also weakened. When combined with the country's weakening social bonds due to federal cutbacks and decentralization, the question needs to be asked: How much, or to what extent, has North American economic integration, which has clearly produced national economic dis-integration, weakened national social, cultural and political ties?
Alternatives to deep integration

So, how can the current course be altered? In an ideal world the three enlightened North American governments would renegotiate NAFTA, transforming it into a trade and development accord in which citizens' rights prevail over those of corporations, where the mandate of government prevails over the imperatives of the market. A noble aspiration, but unrealistic (except perhaps in the long term, where all things are possible), given the change in the configuration of political power that would be necessary to dislodge the interests embedded in the current agreement.

Another scenario would be for a progressive Canadian government to abrogate NAFTA and conduct the bilateral economic relationship within the WTO framework, as well as through sectoral and functional bilateral mechanisms. The changes (however troublesome) in the multilateral trade architecture--the completion of the Uruguay Round and the creation of the WTO in 1995--mean that Canada, by abrogating NAFTA, would sacrifice little in terms of market access and regain important policy tools. Tariffs have largely disappeared. Anti-dumping and countervail disputes can be dealt with more effectively in the improved WTO dispute resolution system. The NAFTA social services and cultural exemptions, though far from adequate, have been reproduced in different forms in the WTO; and last but not least, the highly problematic investor-state process would be eliminated. The groundwork for invoking the abrogation clause could be laid by a government prepared to both challenge and demand renegotiation of the agreement's most harmful features.

This scenario, though desirable, would be politically costly. It would cause an uproar within the powerful business community, and among neoconservative provincial governments. It would also likely trigger retaliation from the U.S. government. The resulting disruption and instability would be extremely difficult for a national government to withstand, even if it had overwhelming public support.

Nevertheless, the government should undertake a pragmatic analysis of the costs and benefits of NAFTA before deciding whether to go down the road toward deeper integration, including examining the option of abrogation. John Ralston Saul has deplored our unwillingness to honestly evaluate the FTA and NAFTA:

"We seem unable to allow ourselves the dignity of engaging in this sort of straightforward consideration of our actions. . . Questioning is the great strength of democracy: the ability to doubt without losing face. Instead we go on chanting 'free trade = prosperity'. . ."

What should a progressive Canadian government do to manage its economic relationship with the United States in such a way as to slow down, reshape, or reverse the integration process where feasible? I would suggest an approach that might be characterized as the deliberate pursuit of small steps--but with a coherent vision of reclaiming national policy freedom and flexibility--whose cumulative effect may over time be transformative. Specifically, as the government reclaims sovereignty it would gain the confidence to challenge NAFTA, if necessary, in key areas where national interests take precedence-- and be prepared to take the consequences of its actions.

First, I do not suggest reclaiming sovereignty for its own sake, but rather to enable us to flourish as a society on the North American continent with a unique social contract and cultural identity, one that values good government and a balance between individual and community. Sovereignty implies the capacity to take measures democratically that give expression to these values. Otherwise they are hollow.

Second, it cannot be emphasized too much that trade is a means, not an end. Trade is a tool, and equitable, sustainable development is the goal. Free traders always confuse the two. They automatically assume that international trade and investment are unconditionally good, and more is automatically better. This is not necessarily so. Trade may bring benefits, but it may also do great harm. It depends on the nature of the products, on the terms and conditions of the exchange. A progressive government must always keep this distinction in mind as it considers policies to enhance the well-being of its citizens.

Furthermore, it must recognize that the path to a productive and prosperous society does not lie in a vicious international competitive cycle of cutting taxes, wages, standards, and basic public services. Rather, the path lies in a strong public commitment to invest in social, environmental, transportation, communications, research, and cultural infrastructure. It lies in measures that reduce inequality and strengthen social cohesion.

Third, although seemingly unrelated to the issue at hand, a progressive government would be well-advised to do two things: curtail the dominant influence of business over political life, and break up the big corporate- owned media conglomerates. These steps will bring back a measure of democracy to politics, ensuring that business perspectives do not dominate to the same extent as they have in recent decades. What follows are examples of steps that a progressive government could pursue, by itself, or jointly with other nations. The list is not exhaustive.

* Reassert and rebuild the capacity of government as an active manager of the economy, rather than as a bystander to the excesses and failures of the market. Strengthen the national economy and the national demand through a variety of macro-economic, labour market, and industrial policy tools. Though constrained, there is still substantial national policy space remaining under NAFTA. It should identify and maximize that space, and test the limits of that space where appropriate. Specific measures might include:
* Assert forcefully that it will not allow trade agreements to constrain domestic policy in social services. Follow the Romanow Commission recommendation that halting the privatization of health care (and other basic public services) will help to shore up the NAFTA social services exemption and reduce the threat of challenge by foreign investors.
* Rebuild the environmental regulatory capacity gutted over the last 15 years. It was neither mandated by NAFTA nor does NAFTA prevent the reinstatement of effective environmental regulations.
* Use the remaining policy freedom in energy to assert and ensure that security of domestic supply and the needs of domestic consumers take precedence over exports.
* Implement a ban on bulk water exports.
* Reduce monopoly protection provisions for the big pharmaceutical corporations and bring back compulsory licensing (still legal under NAFTA and the WTO) to help reverse the skyrocketing drug prices that have greatly strained our Medicare system.
* Make aggressive use of remaining industrial policy tools to, for example, add value to our natural resources in an environmentally sustainable manner, and make Canada a leader in green technologies.
* Make aggressive use of the public sector investment funds, procurement and Crown corporations to further national economic and environmental objectives, including regional and community economic development.
* Ensure that foreign ownership and other regulations in key sectors such as broadcasting, banking, and basic telecommunications are maintained and strengthened.
* Deal with Canada-U.S. issues and irritants on a case-by-case basis. Remember, U.S. harassments of key exports are, like Canadian winters, a fact of life. The emphasis should be on cooperation to solve problems without compromising policy flexibility. Where possible, disputes should be resolved through existing trilateral or multilateral mechanisms. For example, in the softwood lumber dispute, government should resist, despite business pressure, the temptation to resolve it outside these frameworks by restructuring the management of our publicly-owned forests along U.S. lines. And finally, work with like- minded individuals and groups in the U.S. Congress and civil society, nationally and at the state level, to further common interests. (This applies as well to working in international arenas.)
* Seek ways to prune back the most egregious aspects of NAFTA. Work with NAFTA partners to strengthen social services and cultural exemptions, and eliminate the investor-state dispute mechanism. Ensure that the work of the myriad NAFTA committees is open and publicly accountable. Where harmonization of standards and regulations is being negotiated, ensure that harmonization moves upward to the highest standard, and that it serves as a floor allowing jurisdictions to adopt higher standards. Where mutual recognition of standards is being considered, make sure that this is not a back-door way of exerting pressure to lower standards. Strengthen the ability of existing institutions to more effectively counter market pressure to weaken standards and protections.
* Favour multilateral forums, where powerful counterweights to American domination can be created, and where Canada, working with like-minded governments, has a better chance of achieving its objectives and containing U.S. unilateralism. For example, the WTO dispute mechanism, with its separate body of law and common rules (and definitions) on subsidies, is an improvement on what was achieved trilaterally in NAFTA.
* Work in multilateral forums to forge agreements in the area of human rights, environment, health, culture, and taxation that are enforceable and supersede the rules in agreements like the WTO and NAFTA. Examples of treaties that attempt to reach these goals are the Montreal Bio-safety Protocol, the Stockholm Convention on Persistent Organic Pollutants, the Framework on Tobacco Control, and the Cultural Diversity Instrument initiative where the Canadian government is taking the lead. Canada should also seek international accords to regulate corporate activity in areas such as transfer pricing and tax havens in order to relieve the pressure on countries to lower business and income tax regimes.
* Work in the FTAA negotiations with other progressive governments to reshape or even scuttle its worst NAFTA-based aspects, such as the investor-state process. Use the negotiations to broaden relations with the other countries of the hemisphere. Resist U.S. efforts to forge hub- and-spoke relationships (through, for example, a proliferation of bilateral deals) and work with them to challenge the hyperpower's imperial excesses.
* Revisit the 1972 Trudeau "third option" to diversify trade, economic and cultural relationships with other nations--India, Japan, Korea, Europe, Brazil, etc. It failed because there was no real follow-up effort to make it work and because of resistance from a continentalist bureaucracy. The FTA was supposed to be a testing ground, a springboard to the world market for Canadian entrepreneurs. It hasn't turned out that way. Revisit the third option and try harder this time to make Canada a real global player. Diversification can be pursued without more "free trade" agreements.


The politicians, bureaucrats, business lobbyists, think-tanks and media pundits who brought us NAFTA dismiss NAFTA's negative effects and deny its failed promises as they push ahead with their deep integration agenda. They claim that we can go down this road without compromising our sovereignty, but warn of the dire consequences of being offside with U.S. policy. This path promises ever deeper integration (read: assimilation), but with no articulation of what kind of Canada would exist at the end of it all.

I have argued that further integration at the policy or regulatory level should be avoided, or reshaped where possible and reversed where feasible. Where necessary, integration should be negotiated under equitable terms that are clearly in the national interest. This would rule out customs union-type steps, which further compress policy space and beget further integration.

Canada should conduct its economic relations with the United States in a spirit of cooperation and mutual respect, as befits friendly neighbours with deep interlocking interests. The key word is cooperation, not capitulation. Canada should act like a proud sovereign nation, not like a colonial supplicant.

We should not allow ourselves to be duped once again by the self- interested voices of the influential minority that wants to take another "leap of faith" that will lock Canada ever more tightly into the American orbit. The record of the last 15 years should be reason enough for us not to continue down this path.
(Bruce Campbell is the CCPA's executive director. This article is an abridged version of his paper "From Deep Integration to Reclaiming Sovereignty: Managing Canada-U.S. Economic Relations under NAFTA," the full text of which [with sources and references] can be accessed on our website.)

Taken from The CCPA Monitor, June 2003
Canadian Centre for Policy Alternatives


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