The Bosses’ Trade Deals Hurt Workers

by Barry Weisleder

On October 2 negotiators reached a new continental trade deal.  It’s called the USMCA.  Despite a familiar cadence, it’s not a cover version of the song by the Village People.  It’s NAFTA 2.0.  Should we be grateful that it’s not worse than it is?

First, the good news. Chapter 11 between Canada and the U.S.A. is gone. The investor-state dispute settlement provisions that were in the North America Free Trade Agreement allowed U.S. corporations to sue Canada for billions over policies and laws that infringed on corporate profits.

Energy proportionality is also gone. It required Canada to send a set percentage of its energy resources to the U.S., even in times of shortages.

In addition to the elimination of these two harmful provisions, the cultural exemption clause from NAFTA 1.0 is retained, which allows for promotion of local (Canadian) artists in the mass media. And there are signs of improved labour standards too, including increased wages and collective bargaining freedoms for Mexican workers.  40% of autos and auto parts must be made in factories where workers earn at least $16 US/hour.  But don’t think for a moment that Washington is trying to help Mexican workers.  It is merely making it more expensive for the auto giants to produce south of the Rio Grande.

Now, here is the bad news.  Farmers will pay a heavy price as NAFTA 2 opens Canada’s market to more U.S. dairy products, including products that contain bovine growth hormone (BGH), a genetically modified hormone that is injected in cows to make them produce more milk. BGH has been banned in Canada due to its link to serious health concerns.

If the deal is ratified, there will be increased deregulation and harmonization of rules to accelerate approvals for massive pipelines to be built.

Patents on pharmaceuticals, like biologic drugs, have also been extended to ten years.  That means it will take longer for generic drugs to get to the market. This will keep drug prices higher – and often unaffordable – for longer, and could have an impact on any attempt to implement a national pharma care plan in Canada.

What is also clear is that the United States-Mexico-Canada Agreement (USMCA) – is still based on a trade model that puts corporate interests over people and the environment.

This new NAFTA deal doesn’t address climate change. It still leaves fresh water vulnerable to corporate interests that want to buy and sell it. It does not, despite promises by Foreign Affairs Minister Chrystia Freeland and Prime Minister Justin Trudeau, include provisions on gender equality or Indigenous rights.

In many ways, NAFTA 2 is cut from the same cloth as the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Ottawa also agreed to let Washington and Mexico vet any future trade deal with a “non-market economy”.  That means Canada could get kicked out for trading with China.

Toronto Star columnist Tom Walkom calls the USMCA “a fraud” because it doesn’t guarantee the key benefit it promises:  free trade access to the huge U.S. market.  It’s not free trade.

If there’s one positive takeaway, it’s that activists have shown it’s possible to change things that were once thought unchangeable in trade agreements.  But have no illusions.  When bosses negotiate across borders, the losers every time, to one degree or another, are workers on all sides.

The high tariffs on steel and aluminum imposed by Donald Trump remain in place.  Trump cited “national security” as the reason.  This can be the excuse for imposing high tariffs on anything in the future.

If there were revolutionary socialists in Parliament or Congress, they would vote against this deal, like its rotten predecessors, and fight for a Workers’ Agenda.

We demand:

  • No barriers against the free movement of workers.
  • Nationalize the energy giants, the big banks, the telecoms, all the major means of production, distribution and exchange, under workers’ and community control.
  • Make the polluters clean up their mess.  Money for good jobs, not for war and plunder of the environment.