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Corporations get lots, Canadians get little in CETA trade deal

iPolitics | 2 October 2014

Corporations get lots, Canadians get little in CETA trade deal


When is a $16 glass of orange juice just an expensive glass of orange juice, and when is it a toxic, career-ending beverage?

No doubt advisers inside the PMO are contemplating this very question as they ponder whether Stephen Harper’s decision to squander more than $300,000 of taxpayers’ money to fly two European Union officials home last week could become the latest example of a $16 orange juice.

Just as former cabinet minister Bev Oda’s pricey choice of breakfast drinks at taxpayers’ expense ended her career, the PMO is no doubt worried that the $300,000 plane extravaganza could dash any remaining illusions that Harper is a trustworthy steward of public dollars.

The $300,000 junket — staged so that the EU officials could attend a hastily-arranged private reception for an elite business crowd in Toronto — is also a reminder that the beneficiaries of this Canada-EU trade deal were almost all at that reception.

According to Harper government hype, routinely repeated uncritically in the media, the trade deal will be a boon for all Canadians, boosting our economy by $12 billion, generating 80,000 jobs and adding $1,000 a year to the incomes of Canadian families.

But as economist Jim Stanford has pointed out in a concise analysis, these big economic gains were calculated by a computer model — based on a series of assumptions that are "not remotely realistic."

For instance, they assume Canadian companies will sell as many services in Europe as European firms do (despite being thousands of miles away), and that Canadian firms will then invest these profits in new capital here — even though Canadian firms have notoriously hoarded profits in recent years rather than re-invest them. Yet this wildly optimistic assumption about re-investment accounts for more than half of the $12-billion economic boost.

As for job gains, well, the models actually showed productivity gains, not job gains. But knowing the public has little interest in something as esoteric as productivity gains, these somehow morphed into more politically popular job gains, in a sleight-of-hand by government spin-doctors that Stanford dubs "intellectually dishonest."

Most far-fetched is the claim that the deal will boost the incomes of Canadian families by $1,000 each. As Stanford notes, the government simply took the $12-billion economic boost — a specious number at best — and divided it by the number of Canadian families.

This implies an egalitarian distribution of income that is strikingly at odds with the reality in Canada’s economy today.

Over the past 30 years, virtually all the gains of economic growth have gone to the top 10 per cent of Canadian families. If this pattern of the past three decades continues, there will be no gains from the trade deal for ordinary Canadian families. Really only for the corporate sector are the gains significant. Indeed, the trade deal is, above all, a kind of constitution that enshrines corporate rights above the reach of national laws, that is, above the reach of democratically elected governments.

This disdain for democracy permeates the deal and the way it’s been handled. After years of secret negotiations between officials on both sides, a finalized text was only released last week. And now — before any parliamentary debate has taken place — we’re told the text can’t be changed.

This take-it-or-leave-it approach is yet another example of the Harper government’s taste for stifling debate and dissent. Those who dare to criticize any aspect of the deal are dismissed by the government as "anti-trade"— just like former Public Safety Minister Vic Toews insisted that critics who didn’t support his (deeply flawed) online surveillance bill were siding "with child pornographers."

In fact, most critics — like trade researcher Scott Sinclair — strongly support enhanced international trade, but think the Harper government negotiated a lousy deal that primarily protects corporations at the expense of Canadians.

That view is shared by the German Social Democrats (part of Germany’s governing coalition) who strongly object to the clause that allows corporations to sue a government for actions that interfere with their profit-making. Such cases would be decided by international tribunals, beyond the reach of our courts and legislatures.

This could mean, for instance, that if a future Canadian government wanted to create a new public program — such as universal pharmacare or national child care — it could face lawsuits from disgruntled European firms objecting to the way the program limited their opportunities to sell drugs or child care to Canadians.

Imagine the outrage if a Canadian government had negotiated a trade deal that gave such an extensive set of rights to labour unions, allowing disgruntled unions to sue the Canadian government for millions of dollars. And then, to top it off, the government had spent $300,000 so that foreign officials could attend an exclusive soirée with Canada’s "union bosses."

CETA is clearly no simple trade deal about lowering tariffs. Tacked onto it — indeed comprising the heart of it — is an extensive set of provisions that will enshrine the rights of corporations over those of individual human beings.

But the Harper government is hoping the public won’t notice that, and will be excited about the significant benefits the deal offers an ordinary Canadian family. Count on it. That cheque for $1,000 is as good as in the mail.

Winner of a National Newspaper Award, Linda McQuaig has been a reporter for the Globe and Mail, a columnist for the National Post and the Toronto Star. She was the New Democrat candidate in Toronto Centre in 2013. She is the author of seven controversial best-sellers, including Shooting the Hippo: Death by Deficit and other Canadian Myths and It’s the Crude, Dude: War, Big Oil and the Fight for the Planet. Her most recent book (co-written with Neil Brooks) is The Trouble with Billionaires: How the Super-Rich Hijacked the World, and How We Can Take It Back.

 source: iPolitics