Trans Pacific Partnership and Election

It's sounds like Canada has already caved on dairy (according to the article its Australia that's holding up an agreement over pharmaceuticals) and auto parts (its not even discussed as an impediment, only in terms of loss of jobs). It also warns of a transfer of power to corporations from the goverment and people.

What a deal for Canadians!

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All-night negotiations have led to a day of suspense at major trade talks Saturday, which could be extended for a third day in a row amid persistent irritants.

"Ministers have agreed to stay (until Sunday) if necessary," one source said, casting doubt on earlier expectations that a 12-country Trans-Pacific Partnership might be announced within hours.

The two-day ministerial meeting in an Atlanta convention centre, if it drags into Sunday, will have lasted five days amid widespread desire from proponents to get a deal done now before elections in Canada, the U.S., Peru and Japan. ...

Critics of the deal fear that any gains in trade would be offset by the loss of good-paying jobs at auto plants and dairy farms, with greater foreign competition. They also warn that the deal, which was crafted with heavy input from U.S. businesses but far less from labour and civil-society groups, could transfer power from people and governments to corporations.

The biggest potential impediment to a massive new trade deal across the Pacific rim is believed to be next-generation pharmaceuticals, where competing political pressures in the United States and Australia have those countries locked in a staredown.

Stakeholders at the meeting say the American Congress might not pass the deal if it doesn't offer eight-year exclusivity rights to makers of biologics medicines, which is already down significantly from the U.S.'s current protection of 12 years. The Austalian government, meanwhile, faces political pressure at home to avoid granting anything beyond five.

Canada is somewhat of a bystander in that dispute. It already applies the eight-year standard.

The last big sticking point involving Canada is dairy. As negotiators worked until at least 4 a.m., sources say Canada, the U.S., New Zealand and others were involved in multi-sided talks about providing more access to each other's milk, cheese and butter.

Canada's dairy sector is 90-per-cent closed to foreign competition and the government is under political pressure -- especially in Quebec and Ontario -- to avoid any additional products on Canadian grocery shelves. With an election weeks away, the NDP has made the issue a centrepiece of its campaign.

http://www.ctvnews.ca/business/11th-hour-snags-spell-another-potential-d...

KarlL wrote:

I struggle with this one.  I don't mind paying a bit more for milk or for my car to keep good jobs and viable farms in Canada.  But I am mindful that higher priced dairy products affect more people than just me, including families struggling to make ends meet.

I am also aware that wages in Mexico have increased significantly under NAFTA, so question whether my views should be limited to the betterment only of those who live within our own borders.  This one would also affect Vietnam and Malaysia but I am a whole lot less concerned about who benefits in New Zealand, Australia or Singapore.

When I say, I'd want to read the deal and consider its impact, that's not just a throwaway.

Don't worry. As wages climb in Mexico, that problem will be solved by shifting jobs to Vietnam or Malaysia or even better Bangladesh where textile workers make $30/month and there are virtually no safety standards. There is no bottom too low when it comes to wages or safety standards when it comes to corporations. In the 1980s, secretaries in Thailand suddenly faced high levels of unemployment as firms shifted work to Indonesia to save less than 100 dollars per worker per month. This pattern, whether involving services or goods, has been repeated nearly everywhere.

As we saw just in the last couple of weeks, firms are willing to raise drug prices 5,000% for drugs they did not invent but bought from another firm and then sue the Canadian government when it tries to regulate drug prices. 

Corporations are known to be lobbying for the right to sue governments for any loss of revenue from any form of regulation in this deal, including risk to the health and environment. In other words, they want to be "free" of any costs or consequences of their actions under any circumstances.

While media discussion of the TPP corporate rights deal has focused on the dairy and auto industries in terms of negative impacts, there are many other areas that are problematic for Canada including: investor-state dispute settlement resolution which enable firms to greatly increase their ability to reverse government decisions that run counter to their interests but support the general interest; intellectual property rights provisions that have been used to greatlyt increase the price of goods; provisions for Temporary Foreign Worker entry without a check for whether Canadians are available to do the work; and restrictions on pharmaceuticals that increase their prices. 

These issues have all been hinted at by people who have seen the text of drafts of the TPP document. Unfortunately, we probably won't know the full extent of the damage done to the general interest of Canadians by the 600 corporations involved in negotiating TPP because the final text, with its implications buried in thousands of pages of legalese is unlikely to be released before the election, to the benefit of the Cons. 

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The Trans-Pacific Partnership (TPP) is a 12-country trade and investment treaty ne- gotiation that began in 2008. Canada was only admitted, with strings, to the U.S.- led initiative in 2012. Other members include Australia, Brunei, Chile, Japan, Ma- laysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Supporters call the TPP the “NAFTA of the Pacific” as it is modeled on the 1994 Canada-U.S.-Mexico trade deal. Critics, however, refer to it as “NAFTA on steroids” since it puts far more re- strictions on government policy and regulation.

What Kind of Restrictions?

Like all current free trade agreements, the TPP is only marginally about trade. A far greater part of the text — thousands of pages in more than 30 chapters — has to dowith harmonizing regulations (financial, health and safety standards, etc.), reinfor- cing intellectual property rights (patents, copyrights), opening up new sectors to privatization and foreign investment (health insurance and education), and putting strict limits on how governments choose to protect the environment or create jobs. In almost every case, participant countries will be required to adopt the preferences of powerful U.S. corporate lobbies.

Is It Worth It?

Canada already has free trade deals in place with four of the larger TPP countries (Peru, Chile, U.S. and Mexico) and tariffs on trade with the others are already low. TPP countries with which Canada does not already have an FTA make up only 3% of its total exports and 5% of its imports. Canada has a trade deficit with these coun- tries of $5 to $8 billion annually. Eighty per cent of Canadian exports to these coun- tries are raw or semi-processed goods (e.g. beef, coal, lumber) while 80% of imports are high value-added goods (e.g. autos, machinery, computer and electrical compon- ents). The TPP is therefore likely to exacerbate the erosion of the Canadian manu- facturing sector and jobs that has been taking place since NAFTA.

Canada has not released an economic impact study of the TPP, likely because the effect on GDP and job growth will be so small (and possibly negative, according to one study). A pro-TPP study in the U.S. estimated only a 0.13% increase to U.S. GDP by 2025 from the TPP. Many prominent economists, including Paul Krugman, Jo- seph Stiglitz and Dani Rodrik, feel that the trade impacts of TPP are far less import- ant than the serious concerns it raises about excessive intellectual property rights, regulatory harmonization and investor-state dispute settlement (ISDS).

Issues for Canada

Patents and drug costs — The intellectual property chapter of the TPP could prove a minefield for efforts to control drug costs in Canada, which are already the second highest in the world. For example, Canada is one of only three TPP countries with a patent linkage system for pharmaceuticals (allowing brand-name patent holders to contest regulatory approval for generic drugs). But the TPP will mark the first time that Canada has accepted trade treaty obligations governing patent linkage, which could interfere with cost-saving reforms.

Copyright and trademarks — TPP copyright rules would require far longer terms of copyright protection, based on the U.S. model, and could require protection for con- troversial practices such as “digital locks,” which allow copyright holders to encrypt software in computerized devices. Trademarks have been the central focus of tobac- co plain packaging litigation, and the industry is fighting for stronger trademark pro- tection under the TPP.

Free flow of information — In an e-commerce chapter, the U.S. is insisting on rules to prohibit countries from requiring that personal information be stored on nation- al databases. There are good reasons why a country might require that tax, health care or financial data be stored locally. Treating all information as a kind of private commodity that companies could move when and where they like has considerable implications for privacy.

Increased protection for corporations — Leaked text confirms that the TPP includes an investor-state dispute settlement mechanism similar to NAFTA chapter 11. These clauses exist in thousands of international trade and investment deals and are used by multinational companies from rich countries to sue governments when policy de- cisions interfere with their investments. Canada is already the most sued developed country in the world because of NAFTA’s ISDS process and the TPP will significant- ly increase the number of foreign investors eligible to sue.

A recent Canadian NAFTA ISDS loss shows how unfair and skewed the process is. In that case, a NAFTA tribunal ruled 2-1 that an environmental assessment process, which resulted in a U.S. firm being denied a permit to dig a massive quarry in an ecologically sensitive region of Nova Scotia, violated the firm’s NAFTA investor pro- tections. The dissenting member called this finding “a remarkable step backwards” for environmental protection. Bilcon is now seeking over $300 million in damages from the federal government.

Supply management — One of the most difficult issues for Canada concerns the fate of supply-managed sectors. Although under fierce attack from conservative pundits and big business, supply management systems provide a fair return to farmers and a reasonably priced supply of fresh milk, eggs and poultry to food to consumers. Farmers and consumers in countries and sectors without supply-management sys- tems are subject to wild swings in commodity prices and have little ability to nego- tiate reasonable returns or prices with giant global agri-businesses. The Canadian government is holding back making an offer on market access for dairy until the last possible minute. But U.S. negotiators have made it clear that they expect substan- tial access for all dairy products as well as for poultry. New Zealand and Australia are also insisting on substantial market access for dairy.

Cultural protections — The U.S. and its entertainment industries have always strenu- ously opposed Canadian efforts to exclude cultural industries and policies. The TPP could erode Canadian cultural protections, such as foreign ownership restrictions in broadcasting and publishing.

https://www.policyalternatives.ca/sites/default/files/uploads/publicatio...

What has happened to the Australian automotive industry serves as a warning to Canadians, not just in the automotive sector but in manufacturing in general.

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Toyota will end Australia's run as an automaking nation when it pulls the plug on local assembly in 2017. The move follows similar cut-and-run announcements by Ford and General Motors and triggered an outcry Down Under about the demise of local manufacturing.

But the real question isn't why automakers are closing shop. Rather, it is this: Why were they building there in the first place? Not surprisingly, the answer has a lot to do with tariffs.

The small Australian market hardly warranted local output in an industry where economies of scale matter. So for years, Australia protected local automakers with sky-high import duties. When the tariffs dwindled, so did the appetite to keep making cars there. Australians should have seen it coming.

Warning to others?

The collapse of the local industry post-tariffs might serve as a warning to other markets that still protect local vehicle producers with tariffs. The list includes Malaysia, China and, yes, the United States.

As Washington contemplates the Trans-Pacific Partnership free-trade agreement, might it witness a similar shock if the United States' 25 percent tariffs on pickups are suddenly expunged?

Probably not. Why? Size.

Pickups built in North America compete in a 2 million unit segment.

In contrast, Australia's market is tiny. Last year, domestic sales reached just 1,136,227 units. The country's three remaining manufacturers made just 210,538 cars there.

For comparison, Toyota produced 1,760,792 cars and trucks in North America last year -- more than the entire industry sold in Australia.

'Build where you sell'

For the Japanese especially, "build where you sell" is the mantra of modern manufacturing. But at those paltry volumes, it hardly makes sense.

http://www.autonews.com/article/20140215/OEM01/140219896/why-australias-...

TPP will increasingly drive wages down and shift Canada towards the export of raw resources, along with some agricultural products, such as beef potentially. 

The Cons boast of the 23 "free trade" deals that they have signed in power, however during this period we have lost 400,000 manufacturing jobs and went from an enormous trade surplus to an enormous trade deficit during this period. 

Canada lacks the economic power that the United States used to overcome this blockage of a trade market and has and will face this with other "free trade" partners. 

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Free-trade deals already cover 70 per cent of Canada’s trade – yet the more pacts we’ve inked, the worse our performance has become. I’ve reviewed our five longest-standing trade pacts: with the United States, Mexico, Israel, Chile and Costa Rica. Canada’s exports to them grew more slowly than our exports to non-free-trade partners, while our imports surged much faster than with the rest of the world. If the policy goal (sensibly) is to boost exports and strengthen the trade balance, then signing free-trade deals is exactly the wrong thing to do.

http://www.theglobeandmail.com/globe-debate/the-troubling-truth-about-fr...

Our recent "free trade" deal with Korea how projected increase sales of a product, in this case beef, can disappear as other restrictions are put in place. Very shortly after the deal, Korea banned the import of beef on an ongoing basis because of one BSE (mad cow disease) cow, even though many other countries quickly did so. They have not yet removed this ban, thereby protecting their own industry.

[quote]

Food safety concerns were fenced off quickly after officials reported Canada's 19th case of mad cow disease, or bovine spongiform encephalopathy, three weeks ago. 

No part of the cow reached any food system. The cow came from the same farm — and so might have contracted BSE the same way — as a case found in 2010. And the latest cow was born in 2009, before any changes resulting from the investigation of the 2010 case. ...

But when countries continue to accept American beef, despite the highly integrated North American industry, it raises questions of unjust trade discrimination, Kanargelidis said.