New Generation Trade blog

A call for trade that protects the new generations coming to this beautiful planet.


Canada’s Trade Deficit is a Lack of Vision

If you were devising a legal plan for the management of your country’s assets, which principles would guide you?

Trade’s Influence – More powerful than national law, trade sets the course for all our futures.  Sounds quite over-puffed, I know. But stay with me for a sec. In the last few decades, trade deals have become legal frameworks for the management of a nation’s assets by the corporations of a partner country. They basically guarantee profit for transnationals in specified sectors. The rules apply far beyond goods. Treaties commonly include assets under local domain like energy, water, transit, and essential national jurisdiction like financials, crown corporations and communications. It doesn’t help that we seldom hear about ISDS lawsuits – one-sided legal courts where corporations sue nations for their policy that prevents profit. And when we do, the words are so abstract that we don’t feel their gravity. Because trade deals are written in private from so high above the grassroots, it’s hard at first to see their impact on the local community.

Canada’s High Trade Deficit — It was reported last week on Yahoo news that Canada has reached its second largest trade deficit. Not surprising I suppose as Canada is becoming a resource-based trading economy. We are creating a nation that trades away millennia-aged resources, while other countries establish value-added markets, based on exports like technology that fetch higher prices and promote longer term employment. Besides the short-sightedness of focusing prosperity on things that can be extracted once, never to be replaced to the earth, Canada in general, takes a tiny lens to trade.

Short-term Goals at the Grand Children’s Expense — Our priority has been securing short-term business investment from corporations by removing rules of conduct. In the form of national or local policy to protect public health, environment, regional economic development, rules for corporations are called performance requirements, and they are illegal in trade. Under the enforcement of Investor State or ISDS, corporations have legal grounds to sue countries for public policy that could diminish anticipated profits. Citizens cannot sue back. Canada has signed many bilateral trade and investment deals in the last decade with Columbia, South Korea, China and more. These plans are focused on the profit-making capacity of the few of this generation. For the next, what will be left?

Trade for the Generations — If the goal were the security of the generations, a trade deal would measure success differently. Imagine an ecos — Latin root of economy & ecology which means home — measure  that was scaled on how well it provided multi-generational protection of significant ecosystems while creating sustainable, value-added jobs. We would use 3-D measures, not the simplified surplus-deficit or the GDP as the basis of our multi-decade plans.  Bhutan uses the Well-Being Index as a guide for policy decisions. Trade could support the call for ethical business, if it were to bring other parties to the table. Public organizations and elders of the First Nations could provide insight. Trade would become more robust if it were to hear the voices of its greatest stakeholders — the citizens of this planet.

Understanding the generational impacts of trade treaties will help secure a global future. Only with comprehending the potency of trade law, will we be able to course correct.

 

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How Could You? An Investor’s State of Canada and the European Union

What do you predict the great-grandchildren of this planet will say after a few decades of ISDS as the global norm?

Nuclear energy, financial crisis debt, carcinogenic substances, research and development funds, drug prices, toxic substance transport. Transnational corporations have been given special legal authority on these and other issues in Canada and the European Union through trade pacts. Meanwhile, countries have lost millions in trade tribunals defending protective laws, paying legal fees and lawsuit fines to corporations.

Years from now, there is no doubt that the great (and ever greater) grandchildren of this planet will ask why we allowed transnationals to overturn our highest courts. If you imagine the possibilities even a little you can almost hear their astonishment: You seriously allowed corporations to cancel laws that interrupted their profits? Did you not see how a special legal power for corporations inside a government framework would impact this generation’s ability to have any hope of electing responsible representation?

Many bilateral investment treaties have included ISDS since the North American Free Trade Agreement, NAFTA. It is a legacy of which many in-the-know North Americans feel ashamed. However, an opportunity for other choices may be arising on the global scene. Last week, Germany and France, in response to 132 000 people stating opposition to ISDS, are requesting to change it in the CETA. CETA is a backdoor deal with the US because much of Canada’s economy has been filled with American firms. The majority of US-based transnationals have subsidiaries in Canada and post-ratification, they could launch lawsuits at the EU. This deal also includes a wider variety of sectors for ISDS-suits to emerge like municipal procurement and banking. With European – North American trade regimes that include ISDS we are normalizing the practice of corporations suing citizens for laws that interfere with profit. GDP? New job markets? Is there any possible way to justify this to future generations?

Trade deals set the character of nation to nation relationship. Sadly, trade is now heavily mediated by private interests and few of its sections relate to goods. Wise trade requires a long lens. If a deal is forty years, then potential impacts should be explored for that long. ISDS will be a marker of historic proportion. When people look back at this time, they will want to know about each nation’s role. Maybe the best marker for the quality of a deal will be how often our descendants have cause to say, How could you?

 


Pulling a Canada

What’s the big idea behind corporations suing Canadians?

In the last couple years I came across a phrase in trade talk being whispered behind our backs. “Pulling a Canada.” Peculiar. Nothing like the Canadian self-image of champion – in hockey, coffee and geographic beauty. Reading the Canadian Centre for Policy Alternatives (CCPA) January 2015 report, I think I understand what the chiding is about.

The lawsuits. Did you know that through trade agreements countries are being sued for having policies that diminish the profits of corporations? Investor State Dispute Settlement (ISDS) is what this beast is called. In secret trade courts a corporation sues to have a policy removed. Corporations are given special rights beyond citizens to use trade constructs such as Most Favoured Nation or National Treatment (see Trade Justice Dictionary) any time they feel anticipated profits may be shrunk by health, labour, environmental or local laws. There is no mechanism for countries to sue back. Trade-legal outcomes supersede national laws and force changes in policy or risk further payment of hefty fines. Taxpayer money pays them out. ISDS – with its easily forgettable acronym sounds irrelevant. Of course, it isn’t. It’s as intimate a thing as the rules you set in your household and the budget you draft in your bank. Its influence enormous from the wide lens though subtle to see at first. The impact felt not only by your family. Multiply it by the wallets of all the families in your country. That’s the power of a trade deal.

From environmental protections to health care costs, Canadians have been charged with more lawsuits than any other developed nation. The CCPA report summarizes so far under NAFTA, Canada has been the target of 45% of NAFTA’s investor state lawsuits within the three signatory nations. Here is the score: Canada — 35, Mexico — 22, and the US — 20. In terms of payment, the US has not yet lost a case. Canada has lost six paying out 170 million so far. Mexico has paid for five at a cost of 210 million.

Canada has paid Investor State fines to gasoline, paper, and oil companies but we have never had so many transnational companies suing us as we do right now. If all the present cases were to pass in trade courts, Canadian taxpayers would have to pay out over six billion dollars according to the CCPA report.

We could become the biggest loser on the globe.

 

The rules of the game are clearly wrong. It’s absurd to defend hard-earned laws against the risk they pose to profits of large corporations hosted in the lands of our trading partners. (The people who work diligently day to day in the ground offices of these corporations are neither told nor consulted.) With this emerging international system that behaves like its the law, we are changing the very standards of our lives far into the future.

Is it fair to talk about trade as a game? If we do, it might be appropriate to call it Russian Roulette with our children’s futures. Those with the biggest guns, tend to win. With serious issues facing Canadians and our brothers and sisters across this globe, it’s time to look deeply at what our country is doing with the collective budgets of all our houses. It’s time to ask — who is the winner under this set of rules?

https://www.policyalternatives.ca/newsroom/news-releases/nafta-investor-state-claims-against-canada-are-out-control-study

 


From Victoria to Halifax, Canada is about to Get Grinched!

With all the merry-making, we might miss the biggest scrooge sneak since the Grinch flew down to Whoville on his one dog sleigh. Named the most important under-reported story facing Canadians (NewsWatch Canada 2011), the CETA, or Comprehensive Economic and Trade Agreement, is on the road to becoming binding international law that will limit buy-local of all flavours. By January 2016, Canada Post could become EuroPost and city water from Halifax to Victoria could be run Monopoly-style by Veolia from France. And we thought the ghost of Christmas past was bad.

How does this transfer of power from city councils to foreign corporations work? Enter globalization and a federal Conservative government that prefers global over local, private over public. Eager to participate in the free trade market model, and particularly investment treaties like the CAN-CHINA FIPA, they are handing over the key to our cities not to a quirky little green dude with retro style but to multinational corporations with home offices in the European Union. City transit, education, pharmaceuticals, and more will be pushed towards private foreign management. City councils will be encouraged to abide or suffer the chill.

CETA will be enforced in the controversial “legal” style born from NAFTA — Investor State Dispute Settlement (ISDS). From environmental protection to public health efforts, under NAFTA-invented Investor State, Canada has infamously become the most sued country. Canada has paid out many settlements to multinational corporations or changed policy directions to avoid the mega-fines. Newfoundland and Labrador suffered a multi-million dollar attack for asking Exxon Mobil and Murphy Oil to follow provincial legislation that requires a percentage of profits to be re-invested in local research and development. Lone Pine corporation is Investor State suing Canada for 250 million dollars in response to Quebec’s fracking moratorium under the St. Lawrence River. Eli Lilly pharmaceutical corporation is suing for 500 million for loss of expected exclusive patent rights for their ADHD drug Strattera using trade legalese. Under CETA, Canadian cities will be facing similar struggles and the post-NAFTA risk of policy improvements that goes along with it.

With CETA so hush (even federal MP’s outside of the Conservative trade committee have not seen the full text), it’s like somebody going into our house and stealing what we own while we sleep. Not with red suit and sleigh but through the signing of what Minister Fast calls the boldest economic plan Canada has ever attempted. Canada is the only country in the negotiations that has offered a bulk of city assets to permanent bidding by foreign corporations. According to the EU government trade website, the Conservative government has also committed to providing an online portal for EU corporations of ongoing procurement possibilities throughout Canadian municipalities.

What if our cities don’t oblige? Toronto City Council, as part of its request for total exemption from CETA, asked “the Federal Government to protect the powers of the City to create local jobs, protect the environment, and provide services and programs as it sees fit – from any restrictions to those powers in the CETA.” Approximately, thirty-nine other city councils and school boards have asked for the same thing – to be taken out of the plan. No city wish has been granted.

This season is a time to take pause. What is it we truly desire? What about security on a vulnerable planet? It’s time to grow our hearts a little bigger and look ahead to the future for all the littles who need strong local infrastructure and healthy grassroots. Join Canadian city councillors and thousands of people in Toronto, Hamilton, Thunder Bay, London, Victoria and beyond demanding Canadian cities be taken out of CETA. This holiday season — an exemption for all Canadian cities from CETA — is the ultimate gift.

 


I’ve been thinking about how corporations are suing countries.

I’ve been thinking a lot lately about transnational corporations suing countries. The fancy name for this is Investor State Dispute Settlement (ISDS) and it happens in free trade. ISDS is on my mind a whole bunch as Germany speaks out about the inclusion of ISDS in the soon to be announced CAN-EU CETA deal.  https://www.flickr.com/photos/campact/sets/72157647398779707/

ISDS was first employed in NAFTA , the North American Free Trade Agreement. Some say this deal, circa 1994, was the first New Generation deal because of its use of Investor State.  ISDS is a trade mechanism with binding international law power. It affords corporations the opportunity to sue nation states if the profits they expected from the opening of specific sectors in a free trade deal are diminished because the country has laws or policies that prevent earnings. It is not confusing really but expresses exactly as its name says — a State for Investors. Ethyl Corporation was the first to successfully sue Canada in the mid nineties, for approximately 16 million, when Canada attempted to bar its gasoline additive. Researchers in Canada believed it was carcinogenic. Ethyl won on the grounds that profits expected as a result of NAFTA were lost. There have been hundreds of cases administered through trade tribunals since and the number of cases launched is on a steep incline every year. Through leaked texts in German news and other places, critics of CETA have said that corporations will be able to sue countries when municipalities use public money for various buy-local initiatives, municipal procurement, and protection of local public management, but no ones knows for certain as the text has not been shared publicly.

Let’s talk trade that works. Opening borders to gastronomic delights! to expertise in regions that most benefit! How about encouraging the growth of sale in specialty items (like fair trade bananas) that could give economic stability to a struggling country? But when you get into lawsuits waged in a one way direction from corporations to countries, it feels like we are no longer talking about trade.  The conversations turns a whole lotta dark. People don’t like it. Investor State creates an Investor’s State superimposed on a Nation State. This is the kind of trade that makes people uncomfortable. It’s the kind of design that will sink itself.

People from Canada, Germany, France, and many other locales in between are bidding Investor State Adieu. Adios. Au Revoir.

We are entering a new era — one of critical trade justice understanding that will not tolerate excessive corporate rights at the expense of family and community well being — whether or not we call them new generation free trade, CETA, or we@#$@#lkflskdjfls investor state ding-a-ling.


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Trade with the New Generations in Mind

I am fascinated by new generation trade pacts, described as the transfer of power from people to transnational corporations.* I find the topic compelling in a repelling kind of way. Despite the discomfort, studying trade offers essential understanding for all of us interested in preserving what is left of natural life and community infrastructure across the globe.

In the late nineties, my professors startled me with the news that “new generation” trade deals give large corporations the opportunity to manage the public’s assets, and sue countries when public laws decrease corporate profits. Should we not ask for more in our global policy?

What if the best in us was put forward for their composition. What if the wisest elder, with a great sense of humour, soft heart, and economic knowledge sat at the table to negotiate? Why not seek robust economy based in real jobs and environmental security? Such global-impact regulations should be approached with loving-kindness and not use as their foundational indicator of success in a relationship between two nations the gross domestic product (GDP). In trade, there is so much more at stake than that. For no child in the Global North will be secure in an insecure world and no child in the Global South, with all its restriction of access to clean water and basic human rights, will be fully nourished. We could take less in the North in exchange for greater security.

We can do better than the new international law creating an Investor state — a trade legal mechanism that permits corporations to sue nations if their profits decrease over the use of public laws. As a North American, the place of birth of the “New Generation” deal, I feel a responsibility to be part of the dialogue to create authentic and fair trade. I am curious about global law after the new generation pact and what else is possible!

People are awakening to speak what is truly valuable. When I think of the people in my city I see so many whose primary desire is security for families, friends and community. This is a reason to learn about trade pacts. This blog is a space for exploring New Generation trade from a different perspective, one that takes a generational lens and is focused on what we are offering children and their children to come.

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*trade pact description from Maude Barlow, Chair of the Council of Canadians