Québec fights back against austerity

We are supposed to accept austerity as being as natural as ocean tides. Or be demoralized by the power of the forces that continually press down on working people around the world. But there is an ongoing, organized fightback going on — in Québec.

A series of rolling strikes by public-sector employees and students throughout 2015 appear to be headed toward a provincial general strike in December. Haven’t heard of this? That is not because it is francophone workers and students are who are driving these actions but because there has been a near total blackout of this news in the North American corporate media.

It would be all too easy to assume that that the owners and managers of corporate-media outlets don’t wish you to know that such fightbacks are possible. That may be so in some cases; it is more likely that the activity of working people, as opposed to the proclamations of business elites, simply aren’t seen as “news.” Read through the business section of your local newspaper — you will find it chock full of hand-wringing on behalf of corporate interests, with neoliberal ideology presented as the only possible orientation.

Downtown Montréal from Mont-Royal (photo by Anna Kucsma)

Downtown Montréal from Mont-Royal (photo by Anna Kucsma)

There are other possibilities, and such alternatives are being loudly put forth in Québec. Although the outcome of the current struggles for a fair contract for public-sector workers and increased support for education are far from being settled — much less the larger social issues thrown up by the neoliberal project — victories have been won, going back to the Maple Spring of 2012.

The 2012 student strike was so successful that it caused the provincial government to fall. The Québec government, then controlled by the Liberal Party, intended to raise tuition by 75 percent over three years. Protests and strikes quickly blossomed, shutting down universities and leading to street battles as police repeatedly attacked near daily demonstrations that sometimes numbered more than 100,000 as students were joined in large numbers by older people. The Liberal government dug in its heels, not only refusing to negotiate seriously but passing a law making the demonstrations illegal.

After months of struggle, the government called an early election, which it lost, ushering in a Parti Québecois government that promptly rescinded the tuition increases, canceled the anti-demonstration laws and, in an environmental gesture, reversed the Liberal support for fracking. Unfortunately, this victory is also an exemplary lesson of how capitalist reforms are ephemeral: The Parti Québecois ultimately failed to live up to its promises, itself called an early election, and was handed a stinging defeat, bringing the Liberal Party back to power.

Back in office, back to attacking

Québec’s new Liberal Party government, now headed by Premier Philippe Couillard, resumed its neoliberal assault. (A lesson that ought be borne in mind by those celebrating last month’s national election of Justin Trudeau.) The Québec government seeks to impose a de facto wage cut (offering a three percent increase over five years, well below the rate of inflation), institute a two-tier wage scale, raise the retirement age and cut pensions. In education, Premier Couillard wants to add eight hours to the workweek, cut teacher staffing for special-education students by two-thirds and impose drastic cuts in funding. For health care, he wants to impose funding cuts, more forced overtime and greater number of patients per nurse.

The Québec government claims a lack of money is behind its austerity measures, yet it had no hesitation in handing Bombardier Inc., one of the province’s biggest corporations, a $1 billion subsidy this year. Bombardier did report a loss in 2014 and is in the red for this year, but only due to accounting tricks; it reported $2.8 billion in net income for the previous four years.

As always, there is plenty of money for corporate handouts. Ideology, then, is the real reason behind these attacks. This has not gone unnoticed, by either the students or the working people who are uniting to fight back. Camille Godbout, spokesperson for the student group Association pour une solidarité syndicale étudiante (ASSÉ), said:

“Often, we are asked why we, the students, are mobilizing ourselves against austerity measures. For us, the answer seems clear: the government is trying, through its repeated compressions, to place the entirety of our public services in permanent crisis. The final objective of this government is that we turn more towards the private sector and establish a ‘user-payer’ model in Québec. In rendering our services non-functional due to inadequate financing, the solution of Mr. Couillard and his minsters will be to raise individual fees.

We refuse this logic which reduces us simply to consumers who will need to pay for each use of our health, education, daycare and all other services necessary for the good functioning of a rich society.

As soon as we note that the six biggest banks in Canada had profits of over 34 billion in 2014 and that, despite everything, they are taxed less and less, we know that we have the means to do things differently. It would suffice to go find the money there where it can really be found rather than systematically making the population poorer. For example, the return of a 1% tax on capital gains for financial institutions would bring in more than 600 million for the state.”

Calls for unity

A November 8 communiqué issued by the Front Commun, an umbrella organization of 400,000 workers from three unions across Québec, also made clear its belief in unity:

“Our members will not agree to become impoverished to finance tax cuts for business and the rich. [The government] ignores the conditions that we asked, that no one should get poorer at the end of this restructuring and that the wage freeze was not acceptable. … 18,000 people would see their salary reduced overnight … and many young people would start their careers with lower salaries. We can not accept such parameters.”

More than 60,000 Québec students went on strike in March; dozens of May Day demonstrations were held; parents have formed human chains in front of their children’s schools to symbolize their intent to defend them against cuts on three separate autumn days; schools were shut down across Québec by teacher strikes on October 7; 150,000 demonstrated in Montréal on October 10; and a series of rolling two-day strikes in cities and regions across the province have taken place throughout November by health care workers, teachers, administrative officials and others.

This was to culminate in a three-day provincial general strike beginning December 1. But, for now, that general strike has been called off. The Front Commun announced on November 18 that because the government has finally made a counter-offer, although inadequate, it will continue to negotiate. It said that it “has no plans to cancel the strike days, or to suspend the movement” and said its postponement of the December strike will be “short-lived” in the absence of significant movement at the negotiating table.

Several organizations have been in the forefront of Québec’s fightback against austerity. In addition to the student union ASSÉ, which played a leading role in the 2012 Maple Spring, and the union federation Front Commun, parents have organized the Je protège mon école publique, more militant rank-and-file union members are organizing through Lutte Commune to maintain pressure on union leaderships, and the Red Hand Coalition brings together unions, community organizations and students.

Lutte Commune’s open letter urges union locals to reach out to the broader working class through convening local strike committees that would make the case that the unions are fighting for the services and living standards of everybody. The group also has vowed to campaign for a rejection if union leaders accept a concessionary deal.

Solidarity as the key to struggle

The Red Hand Coalition has called a November 28 demonstration in Montréal, demanding the provincial government obtain the money to meet worker and student demands by reinstating the tax on capital gains for banks; increasing the number of levels of taxation to ensure genuine progressive taxation and a greater contribution of the richest; and increasing taxes for large companies rather than decrease them again. The coalition, which is organizing a series of conferences in anticipation of united mobilizations, says:

“While millions of dollars in further cuts await us, how can we together stop the destruction of public services and social programs by the Couillard government? By solidarity!”

That is a lesson for all places. That there is a robust public sector to defend is a product of a united front in 1972 and a bitter strike that held because of solidarity. During the strike, the government passed draconian laws mandating workers return to work. Union leaders were slapped with year-long jail terms for not calling off the strike, but a province-wide general strike was victorious.

Three years ago, when the previous Liberal Party assault was pushed back by the Maple Spring, ideology and not finance were really what counted for the government. Students estimated that the provincial government spent C$200 million, citing police and related costs, the value of canceled classes, the costs of personnel maintaining empty buildings and the cost of making up a lost semester. Martine Desjardins, president of the Fédération étudiante universitaire du Québec, a student association with 125,000 members, said to The Montreal Gazette that those costs exceeded what would have been collected from the tuition increases:

“The tuition for seven years was supposed to bring in about $170 million. So you can see it’s not about economics, but about ideology. It just doesn’t make sense.”

In terms of common sense, it doesn’t. In terms of class warfare waged from above, alas, it makes much sense. Class warfare has been a one-sided affair since the dawn of capitalism. It is long past time we fought back.

Now that we can see the TPP text, we know why it’s been secret

The text of the Trans-Pacific Partnership can now be viewed by the public, thanks to the New Zealand government, and it is every bit as bad as activists have been warning.

The TPP, if enacted, promises a race to the bottom: An acceleration of jobs to the countries with the lowest wages, the right of multi-national corporations to veto any law or regulation their executives do not like, the end of your right to know what is in your food, higher prices for medicines, and the subordination of Internet privacy to corporate interests. There is a reason it has been negotiated in secret, with only corporate executives and industry lobbyists consulted and allowed to see the text as it took shape.

The threat from the TPP extends beyond the 12 negotiating countries, however — the TPP is intended to be a “docking” agreement whereby other countries can join at any time, provided they accept the text as it has been previously negotiated. Moreover, the TPP is a model for two other deals: the Transatlantic Trade and Investment Partnership (TTIP) between the United States and the European Union, and the Trade In Services Agreement (TISA), an even more secret “free trade” deal being negotiated among 50 countries that would eliminate any controls on the financial industry.

Activists celebrate after the New York City Council declares the city a "TPP-free zone."

Activists celebrate after the New York City Council declares the city a “TPP-free zone.”

The elimination of protections is precisely what U.S. multi-national corporations intend for Europe by replicating the terms of the TPP in the TTIP, a process made easier by the anti-democratic nature of the European Commission, which is negotiating for European governments. Already, higher Canadian standards in health, the environment and consumer protections are under sustained assault under the North American Free Trade Agreement. The TPP is an unprecedented corporate giveaway, going well beyond even NAFTA, which has hurt working people and farmers in Canada, the U.S. and Mexico.

More than 300,000 jobs in the U.S. alone may be eliminated by the passage of the TPP. The Wall Street Journal, in an article celebrating victory for multi-national capital, nonetheless reported that 330,000 manufacturing jobs would be lost, basing this estimate on an estimated US$56 billion increase in the national trade deficit. That forecast is based on a U.S. Department of Commerce estimate that 6,000 jobs are lost for every $1 billion of added trade deficit.

Bad news on both sides of the Pacific

The Canadian union Unifor estimates that 20,000 Canadian jobs in auto manufacturing alone are at risk from TPP. Canada will also be forced to open its dairy and poultry industries. There is fear that Canadian dairy farming may collapse and the outgoing Harper régime promised $4.3 billion to compensate farmers from expected losses.

The Australian Fair Trade and Investment Network, while acknowledging that community pressure forced governments to resist some of the most extreme measures, worries that the U.S. concession to Australia that the extension of monopolies on biological medications will be five years rather than eight will prove ephemeral. The group reports that the text “refers to eight years and to ‘other measures’ which would ‘deliver a comparable market outcome,’ and to a future review. It is not clear how this will be applied in Australia.” The U.S. will retain its 12-year exclusivity period, while other countries can choose five or eight years, so there will likely be continued pressure from pharmaceutical companies for all to adopt a longer period.

A product would not have to be produced locally to qualify as a locally made product. As much as two-thirds of an automobile’s components could be manufactured in China, for example, and it would still qualify for preferential treatment if one-third is made in any TPP signatory country. But “buy local” rules would become illegal, including for government procurement.

There are no enforceable provisions for environmental, health, safety or labor protection. Public Citizen, in its analysis of the TPP text, reports:

“The language touted as an ‘exception’ to defend countries’ health, environmental and other public-interest safeguards from TPP challenges is nothing more than a carbon copy of past U.S. free trade language that ‘reads in’ to the TPP several World Trade Organization (WTO) provisions that have already been proven ineffective in more than 97 percent of its attempted uses in the past 20 years to defend policies challenged at the WTO. In two decades of WTO rulings, [the articles purporting to protect laws necessary to protect human, animal or plant life or health] have only been successfully employed to actually defend a challenged measure in one of 44 attempts.”

The ratio under TPP is likely to be even lower as the TPP promises the most extreme rules in favor of corporations of any “free trade” deal. Even the extremely weak “exception” does not apply to the entire investment chapter of the TPP. Precedent here is bad — as the secret tribunals that decide cases brought by corporations against governments hand down their one-sided agreements, these decisions become a floor for the next decision, pushing the interpretation further in favor of corporate domination.

Democracy canceled by corporate power

Under the TPP, corporations are elevated to the level of national governments and, in practice, could be said to be elevated above governments. The TPP text mandates that “customary international law” be applied for the benefit of an “investor” — that law is not found in any statutes, but rather has been established by previous decisions of secret tribunals interpreting NAFTA and other “free trade” deals. Worse, the TPP places essentially no limits on who qualifies as an “investor” eligible to be compensated for potential profits that may not materialize due to a regulation or safety rule.

Although the rules codifying benefits for multi-national capital are written in firm language, there is no such language for protections. The Sierra Club reports that the TPP mandates that only one of the seven environmental agreements found in previous “free trade” deals be fulfilled, an alarming development as previous environmental requirements have been routinely ignored. Among the many deficiencies in the TPP, the Sierra Club said:

“Rather than prohibiting trade in illegally taken timber and wildlife — major issues in TPP countries like Peru and Vietnam — the TPP only asks countries ‘to combat’ such trade. To comply, the text only requires weak measures, such as ‘exchanging information and experiences,’ while stronger measures like sanctions are listed as options. … Rather than obligating countries to abide by [rules to] prevent illegally caught fish from entering international trade, the TPP merely calls on countries to ‘endeavor not to undermine’ [fisheries-management protocols] — a non-binding provision.”

The TPP fails to even mention the words “climate change”! More than 9,000 corporations would be newly empowered to sue governments because a law or regulation hurt their profits. Worse, the TPP would mandate that the U.S. Department of Energy automatically approve all exports of liquified natural gas to all TPP countries. This would guarantee more fracking; already under NAFTA the province of Québec has been sued in an effort to overturn its fracking moratorium. That may only be the beginning, according to 350.org:

“The agreement would give fossil fuel companies the extraordinary ability to sue local governments that try and keep fossil fuels in the ground. If a province puts a moratorium on fracking, corporations can sue; if a community tries to stop a coal mine, corporations can overrule them. In short, these rules undermine countries’ ability to do what scientists say is the single most important thing we can do to combat the climate crisis: keep fossil fuels in the ground.”

You’ll have no right know what you eat

Food safety would fare no better. The TPP’s race to the bottom would require that the lowest inspection standards of any country be applied, forcing a lowering of other countries’ standards, and end protections against untested genetically modified organisms (GMOs) in your food. Food & Water Watch reports:

“The TPP includes a new provision designed to second-guess the government inspectors who monitor food imports. … The food and agribusiness industry demanded — and received — stronger [rules] that make it harder to defend domestic food safety standards from international trade disputes. … Agribusiness and biotech seed companies can now more easily use trade rules to challenge countries that ban GMO imports, test for GMO contamination, do not promptly approve new GMO crops or even require GMO labeling. The TPP gives the food industry a powerful new weapon to wield against the nationwide movement to label GMO foods. The language in the TPP is more powerful and expansive than other trade deals that have already been used to weaken or eliminate dolphin safe tuna and country of origin labels.”

Health care will also come under direct assault, forcing other countries more toward the U.S. system, under which health care is a privilege for those who can afford it rather than a human right. Government programs to hold down the cost of medications are targeted for elimination in the TPP. Doctors Without Borders/Médecins Sans Frontières, which has been sounding the alarm for years, said:

“TPP countries have agreed to United States government and multinational drug company demands that will raise the price of medicines for millions by unnecessarily extending monopolies and further delaying price-lowering generic competition. … [T]he TPP will still go down in history as the worst trade agreement for access to medicines in developing countries, which will be forced to change their laws to incorporate abusive intellectual property protections for pharmaceutical companies. For example, the additional monopoly protection provided for biologic drugs will be a new regime for all TPP developing countries. These countries will pay a heavy price in the decades to come that will be measured in the impact it has on patients.”

The text of the TPP is subject to approval by legislative bodies in various countries, and while time is limited and the approval process is streamlined to facilitate approval in several of them, the Trans-Pacific Partnership can be defeated. This is not a national issue. Working people will be hurt everywhere, with jobs disappearing in developed countries and sweatshop misery for other countries — this is why multi-national capital, where ever it is based, is pushing for the TPP. If it is to be stopped, it will be through the combined activity of activists on both sides of the Pacific. We have no time to lose.

There is still time to defeat the Trans-Pacific Partnership

The task may be difficult but it is not impossible — there is still time to defeat the Trans-Pacific Partnership. Activists on both sides of the Pacific Ocean forced a couple of concessions in the final TPP text, agreed to earlier this week after years of negotiation, so we are not without hope.

More hard work by activists is the only power that can stop the TPP from becoming law in 12 countries. If we fail to stop it, the TPP promises to tighten further the dominance of the world’s biggest multi-national corporations with the implementation of nearly unlimited rights of corporations to overturn health, safety, labor and environmental laws through secret tribunals that bypass and override national legal systems.

Although the Obama administration, which had consistently pushed for the most draconian rules, yielded some ground on pharmaceutical-industry profiteering, the TPP is a thoroughly anti-democratic deal. Just how awful won’t be fully known until the text is published on the Internet in coming weeks. In the United States, there is a 60-day period after the text is published before President Barack Obama can send it to Congress for approval. Congress must act within 90 days, voting either yes or no with no amendments allowed (not even a comma can be changed) and limited debate. And even this “fast-track” process, voted into being by Congress earlier this year, represents concessions to persistent public opposition to the TPP — the text has been held as a state secret, hidden for years from members of Congress until public outcries embarrassed the Obama administration into letting elected representatives have a peak.

TPP cartoonParliamentarians in Canada, Australia, New Zealand and elsewhere have also not been allowed to see the text. The Canadian Parliament can’t take up the TPP until after the October 19 elections. The Harper régime is intent on passing the TPP, but if the Liberals or New Democrats unseat the Conservatives, there would be uncertainty. Neither opposition party, however, has openly opposed it, instead reserving judgment before seeing the final text.

In Australia, the Parliament doesn’t get to vote on the TPP, only on legislation necessary to implement its provisions once agreed to by the cabinet ministers. A committee of senators from parties in government and in opposition issued a report in June strongly condemning the TPP and the secrecy of it, but it remains to be seen what, if anything, opponents can do to block it. One glimmer of hope is that two small parties, Palmer United and the Greens, hold the balance of power in the Australian Senate, and the Greens are opposed to the TPP.

New Zealand parliamentary debate will be limited and no text may be changed; the Parliament would have to change national laws to conform with the TPP if passed.

The biggest compromise concerned biologic medications. This had been one of the main areas of contention, with the U.S. wanting to impose a 12-year period of exclusivity to pharmaceutical companies that originate biologics before other manufacturers could introduce generic versions (“biosimilars”) of the drugs. Other countries, including Australia, wanted that period cut to five years.

It is still not clear what agreement was reached, but reports indicate that the period will remain 12 years for the U.S., and either five or eight years for other countries. The longer period is seen as a means to guarantee pharmaceutical companies, especially those in the U.S., super-profits for a longer period of time and thus driving up the costs of medicines for public health systems in other counties, including Australia and New Zealand.

Activist work forces concessions but still a bad deal

Sustained public opposition to the longer period pushed the Australian and New Zealand governments to hold out against intense U.S. pressure on this issue, so activists can take credit for whatever better terms were attained. But that does not mean the TPP is a good deal for health care. Far from it.

Peter Maybarduk, the director of Public Citizen’s Access to Medicines Program, had this to say:

“The deal … fell short of Big Pharma’s most extreme demands but will contribute to preventable suffering and death. … [T]he deal includes mechanisms that would help the [U.S. trade representative] browbeat countries, now and in the future, to get what Big Pharma wants, and pull countries toward longer monopoly periods.”

Doctors Without Borders/Médecins Sans Frontières is no more optimistic:

“TPP countries have agreed to United States government and multinational drug company demands that will raise the price of medicines for millions by unnecessarily extending monopolies and further delaying price-lowering generic competition. The big losers in the TPP are patients and treatment providers in developing countries. Although the text has improved over the initial demands, the TPP will still go down in history as the worst trade agreement for access to medicines in developing countries, which will be forced to change their laws to incorporate abusive intellectual property protections for pharmaceutical companies.”

New Zealand’s Pharmaceutical Management Agency, which provides thousands of medicines, medical devices and related products available at subsidized costs, is a particular target of the U.S. pharmaceutical industry because it is an example that drug companies do not wish to be emulated elsewhere. The agency says it has saved about NZ$5 billion in the past 10 years.

Don’t buy the snake oil proponents are selling

Although the U.S. trade representative is trumpeting the TPP as the “most progressive trade deal ever,” don’t buy that snake oil. To provide one example, the U.S. trade representative claims that “A Party may elect to deny the benefits of Investor-State dispute settlement with respect to a claim challenging a tobacco control measure of the Party.” This is a claim that corporations can no longer challenge government regulations on tobacco, as has happened to Australia, Uruguay and other countries. (“Party” means a government in the TPP text.)

Another snake oil salesperson, U.S. Senator Ron Wyden, who has been perhaps the senator most responsible for the advancement of the TPP in the Senate and a consistent liar on “free trade” agreements, packed quite a lot of misinformation into one paragraph this week:

“I’m pleased to hear reports that the deal reached today includes, for the first time, an agreement to curb currency manipulation and new and enforceable obligations on countries like Vietnam and Malaysia to uphold labor rights, including in the case of Malaysia enforceable commitments to address human trafficking. I also understand that the agreement will include commitments to stop trade in illegal wildlife and first-ever commitments on conservation. Importantly, I understand that this deal will ensure that countries that are part of it can regulate tobacco without fearing intimidation and litigation by Big Tobacco.”

Don’t be fooled. The Center for Policy Analysis on Trade and Health issued this correction:

“The precise effects of this ambiguously worded compromise are unclear. … Tobacco companies could still file charges [in secret tribunals] if they assert the regulation is ‘discriminatory’ to the trade interests of a particular country. For example, when the U.S. banned clove cigarettes, which are important in hooking kids, Indonesia filed a successful trade charge, as the main producer of clove cigarettes.”

Stop TPPSenator Wyden’s words are hollow, coming after the Obama administration cynically removed Malaysia from the State Department’s list of worst countries for human trafficking to keep the developing country eligible. People without hope of work at home or who are refugees are recruited to work in Malaysia, where they are subject to forced labor and sex trafficking. Jamie Kemmerer, regional organizer for MoveOn NYC, said:

“The TPP is a terrible deal for workers, but is even worse for those who are subject to forced labor and human trafficking. Granting favorable trade access to nations engaging in these barbaric practices would be a huge step back for humanity in the name of commerce.”

Language in the TPP that purports to provide protection for environmental and health laws are meaningless boilerplate without effect, just as such language has been in existing “free trade” deals. The real-world effect is that any corporate entity can move to overturn any government action, simply on the basis that its “right” to the maximum possible profit, regardless of cost to a community, has been “breached.” The TPP places no limits on who or what corporate entity or individual is eligible to sue for the “loss” of “expected profits,” and only corporations can sue, not governments.

In effect, corporations are raised to the level of national governments, and it might be more properly argued that corporations are raised above national governments. This is the future that awaits all of us, and only the united actions of activists in countries on both sides of the Pacific can stop it. And, once we do, we need to go on the offensive and begin to roll back existing deals. Democracy or corporate dictatorship: The choice we now face is that stark.

G7 leaders fiddle while Earth burns

The G7 governments saying they will phase out fossil fuels by 2100 isn’t closing the barn door after the horse has left. It is declaring an intention to consider closing the barn door after waiting for the horse to disappear over the horizon. It is okay to be feel underwhelmed by this.

The Group of 7 summit held earlier this month in Germany, representing seven of the world’s largest economies, ended with a declaration that these governments would commit themselves to a 40 to 70 percent reduction in greenhouse-gas emissions and a complete phaseout in 2100, and an invitation for “all countries to join us in this endeavor.” A communiqué issued after the summit declared:

“We commit to doing our part to achieve a low-carbon global economy in the long-term including developing and deploying innovative technologies striving for a transformation of the energy sectors by 2050. … To this end we also commit to develop long-term national low-carbon strategies.” [page 17]

The G7 governments say they are acting under the impetus of last year’s Intergovernmental Panel on Climate Change report and in anticipation of next December’s Climate Change Conference in Paris. In the conception of the IPCC report, greenhouse-gas emissions should be 40 to 70 percent lower globally in 2050 than in 2010 and “near zero” in 2100 to achieve a goal of holding greenhouse-gas concentrations in the atmosphere to 450 parts per million in 2100. Even that level is a substantial increase above the current level of 404 parts per million, at which the Earth’s climate is already undergoing dramatic changes.

Retreating glacier in Greenland (photo by Bastique)

Retreating glacier in Greenland (photo by Bastique)

The IPCC report, prepared by scientists from around the world but apparently watered down by the world’s governments, promises that mitigating global warming will be virtually cost-free and require no fundamental change to the world’s economic structure. Alas, there are no free lunches — the IPCC report’s insistence that techno-fixes will magically take care of carbon buildup, allowing humanity to continue the path it has been on since the dawn of the Industrial Revolution, is dangerously unrealistic.

So what do the G7 governments have in mind? Their communiqué says they will increase the number of people in developing countries who have access to insurance, increase developing countries’ access to renewable energy and raise funds “from private investors, development finance institutions and multilateral development banks.” [pages 15-16] Try to contain your excitement when you read the G7 prescription for combating global warming:

“We will continue our efforts to provide and mobilize increased finance, from public and private sources. … We recognize the potential of multilateral development banks in delivering climate finance and helping countries transition to low carbon economies.” [page 15]

It may already be too late

Before we delve into the idea that the World Bank, funder of gigantic greenhouse-gas belching, polluting projects around the world, is the cure for global warming, and before we contemplate the idea that we can bind the policies of governments eight decades in the future, let us ask what actually needs to be done to prevent the climate from spiraling into a feedback loop that will accelerate species die-offs and dangerously disrupt agriculture and water supplies. The U.S. government’s climate agency, the National Oceanic and Atmospheric Administration, issued a study in 2009 that flatly concluded “there’s no going back.” The study, led by NOAA senior scientist Susan Solomon, found:

“[C]hanges in surface temperature, rainfall, and sea level are largely irreversible for more than 1,000 years after carbon dioxide (CO2) emissions are completely stopped. … ‘It has long been known that some of the carbon dioxide emitted by human activities stays in the atmosphere for thousands of years,” Solomon said. “But the new study advances the understanding of how this affects the climate system.’ ”

Carbon dioxide thrown into the air stays in the atmosphere for a long time, warming oceans will retain added heat and transfer that back to the atmosphere, and we have yet to experience the full effect of greenhouse gases that have already been emitted. Global sea-level rises and major disruption to rain patterns will effect billions of people. The NOAA study said:

“If CO2 is allowed to peak at 450-600 parts per million, the results would include persistent decreases in dry-season rainfall that are comparable to the 1930s North American Dust Bowl in zones including southern Europe, northern Africa, southwestern North America, southern Africa and western Australia.

The study notes that decreases in rainfall that last not just for a few decades but over centuries are expected to have a range of impacts that differ by region. Such regional impacts include decreasing human water supplies, increased fire frequency, ecosystem change and expanded deserts. Dry-season wheat and maize agriculture in regions of rain-fed farming, such as Africa, would also be affected.”

A Massachusetts Institute of Technology paper, lamenting the widespread conviction that global warming can be reversed quickly when and if it is decided to do so, notes such beliefs are in violation of basic physics. The paper’s abstract says:

“[W]ait-and-see policies erroneously presume climate change can be reversed quickly should harm become evident, underestimating substantial delays in the climate’s response to anthropogenic forcing. … [Greenhouse-gas] emissions are now about twice the rate of GHG removal from the atmosphere. GHG concentrations will therefore continue to rise even if emissions fall, stabilizing only when emissions equal removal. In contrast, results show most subjects [of an MIT study] believe atmospheric GHG concentrations can be stabilized while emissions into the atmosphere continuously exceed the removal of GHGs from it. These beliefs—analogous to arguing a bathtub filled faster than it drains will never overflow—support wait-and-see policies but violate conservation of matter.”

More heating even if we stopped today

A commentary published on RealClimate, a Web site published by working climate scientists, calculates that if greenhouse-gas concentrations were kept constant at today’s level, there would still be an increase in global temperatures of as much as 0.8 degrees Celsius — combined with the global warming already experienced, that is close to the 2-degree overall rise widely believed to be the outer limit to avoid catastrophic damage to Earth’s ecosystem. But to achieve even that equilibrium requires immediate, significant cuts to greenhouse-gas emissions. The commentary says:

“[C]onstant concentrations of CO2 imply a change in emissions — specifically an immediate cut of around 60 to 70% globally and continued further cuts over time.”

“Immediate” as in now, not decades in the future. The actual proposed cuts, in the near term, are far less than that range, and less than initially meets the eye. The baseline of measurement is being shifted, for example, so that the benchmark against which the reductions are measured are higher than previously set. Environmental Defence Canada calculates that the Harper government’s switch to using 2005 rather than 1990 as the baseline reduces the goal by more than half. In a report, the group writes:

“The U.N. Framework Convention on Climate Change (1992) and the Kyoto Protocol (1997) both used 1990 as the reference or base year. Most countries still use 1990 as the base year but some have started using more recent base years. Since the Copenhagen summit in 2009, Canada has been using 2005 as a base year. This makes comparison between targets more difficult. It also makes targets look stronger than they are since Canada’s carbon pollution increased significantly between 1990 and 2005. For example, the Canadian government’s pledge to reduce emissions by 30 per cent below 2005 by 2030 is actually less than half as strong … when expressed using 1990 as the base year.” [page 3]

Emissions from the Alberta tar sands have increased almost 80 percent since 2005 and the Harper government has every intention of boosting tar sands production as much as possible, including plans for multiple pipelines, while equating environmentalists with terrorists. Environmental Defence Canada notes that the Harper government has no intention of regulating tar sands oil and flatly declares Canada’s post-2020 target “the weakest in the G7 to date.”

The potential global warming just from the Alberta tar sands is so large that the U.S. environmental scientist James Hansen believes it will be impossible to stop runaway global warming should that oil be burned.

Assigning contributions isn’t straightforward

The point here isn’t to single out Canada. But its cumulative greenhouse-gas emissions since the dawn of the Industrial Revolution is the ninth highest in the world, a ranking likely to rise if plans of current oil and gas companies come to fruition. So the argument sometimes made that Canada isn’t a significant contributor to global warming because of its small population isn’t true. The United States, not surprisingly, is easily the biggest culprit, having emitted 29 percent of the world’s cumulative greenhouse gases, according to calculations by the World Resources Institute.

China ranks second, with nine percent of the world’s cumulative greenhouse-gas emissions, and the top 10 countries account for 72 percent. (Italy is the only G7 country not among the top 10.) But even here, it could be argued that China’s ranking deserves an asterisk. Western multi-national corporations have eagerly transferred production to China, particularly U.S. companies such as Wal-Mart and Apple. So much of those Chinese greenhouses gases are the responsibility of U.S. corporations. A paper led by Glen Peters of the Center for International Climate and Environmental Research in Oslo estimates that, in 2008 alone, the U.S. imported as much as 400 million tons of carbon dioxide in Chinese goods.

Regardless of source, global warming does not come without costs. The nonprofit organization DARA claims that global warming already causes 400,000 deaths per year, and that “the present carbon-intensive economy moreover is linked to 4.5 million deaths worldwide each year.”

Can the World Bank and International Monetary Fund realistically be part of the solution to global warming, as the G7 communiqué would have it? No! The World Bank has poured billions of dollars into dams, power plants and other projects that worsen global warming, and shows no sign of altering its indifference to environmental costs. The World Bank and IMF also promote neoliberalism and austerity programs around the world; immiserating people makes them more vulnerable, not less, to the stresses of global warming and pollution.

The amount of industrial carbon dioxide emissions thrown into the atmosphere from 1988 to 2014 is equal to all the emissions from 1751 to 1988, according to the Climate Accountability Institute. That continually rising rate of emissions is reflective of the ever more intensive pressures for growth capitalism imposes, and the continual movement of production to the places with the lowest wages and weakest environmental laws imposed by capitalist competition, stretching supply chains ever longer, is itself a contributor to global warming.

The G7 communiqué is nothing more than wishful thinking that no real change is necessary. There are no free lunches: The world has to drastically reduce its consumption. As this is an impossibility under capitalism, another world is not only possible, it is necessary in the long run for our descendants to even have a livable world.

Canada targets tar sands critics in new criminalization of dissent

Canada’s Harper régime has invented the new crime of being a member of an “anti-Canadian petroleum movement,” and equating such a stance with terrorism. Evidently believing it is in danger of losing the fight against pipeline projects intended to speed up Alberta tar sands production, its response is to place environmentalists under surveillance.

A secret report prepared by the Royal Canadian Mounted Police, the country’s national police agency, claims that public activism against the problems caused by oil and gas extraction is a growing and violent threat to Canada’s national security. The report goes so far as to challenge the very idea that human activity is causing global warming or that global warming is even a problem. At least 97 percent of environmental scientists agree that human activity is causing global warming. The basis on which a police force can declare otherwise is surely not clear.

The Alberta tar sands (photo by Howl Arts Collective, Montréal)

The Alberta tar sands (photo by Howl Arts Collective, Montréal)

Whether police officials truly believe they understand the global climate better than scientists who are expert in the field or are merely providing “intelligence” [sic] that the government of Prime Minister Stephen Harper wants to hear, I will leave to others more familiar than I with the Royal Canadian Mounted Police. Regardless, the RCMP report, leaked to Greenpeace, makes for amusing reading. For example:

“[T]here is an apparent growing international anti-Canadian petroleum movement. In their literature, representatives of the movement claim climate change is now the most serious global environmental threat, and that climate change is a direct consequence of elevated anthropogenic greenhouse gases which, reportedly, are directly linked to the continued use of fossil fuels.” [page 5]

And whom might the police rely on for that statement? No, not those pesky scientists who refuse to say what is demanded of them by oil and gas companies and the right-wing governments who love them. Instead, the RCMP quotes the Canadian Association of Petroleum Producers, cites a poll commissioned by a foundation connected to the oil industry, and a columnist at the Toronto Sun, a hard-right tabloid in the Murdoch mold. The Sun columnist, as quoted in the police report, said “environmental radicals” seek “to undermine the development of Canada’s oilsands — an insignificant contributor to global greenhouse gas emissions.”

Actual experts in the field would disagree. A Scientific America analysis that quotes several climate scientists reports that if all the bitumen in the Alberta tar sands were burned, 240 billion metric tons of carbon would be added to the atmosphere. The total amount of carbon that has been thrown into atmosphere by humanity in all of history is estimated at 588 billion tons.

Are going to believe the police or your lying eyes?

The Globe and Mail of Toronto quoted a Royal Canadian Mounted Police spokesman denying any intention of spying on peaceful protestors:

“There is no focus on environmental groups, but rather on the broader criminal threats to Canada’s critical infrastructure. The RCMP does not monitor any environmental protest group. Its mandate is to investigate individuals involved in criminality.”

But the newspaper’s report noted that the spokesman “would not comment on the tone” of the report, which even The Globe and Mail, a leading establishment publication, found difficult to accept as it earlier in the article noted the RCMP report’s “highly charged language.” Moreover, Canadian human rights organizations filed complaints earlier in February over spying on opponents of the proposed Northern Gateway pipeline, a project intended to move tar sands oil from Alberta to a port in northern British Columbia, passing through hundreds of miles of environmentally sensitive lands.

Environmentalists and Indigenous peoples have been subjected to spying by the RCMP and the Canadian Security Intelligence Service, according to a complaint filed by the British Columbia Civil Liberties Association. The association is also opposing a new measure, the Anti-terrorism Act 2015, or Bill C-51, intended to “dramatically expand the powers of Canada’s national security agencies.” The association reports:

“Bill C-51 makes massive changes to many aspects of Canada’s spying and security system. Any one of the changes – making it easier to lock people up without charge; criminalizing expression; vastly expanding the powers of Canada’s spies; gutting privacy protections – is significant, raises constitutional questions, and must be the subject of serious debate. Lumping them all together into one bill, and proposing to speed that bill through Parliament, virtually guarantees that democratic debate on these proposed measures will be insufficient.”

Such speed is consistent with the Harper government’s attitude toward activists. A previous environment minister, Peter Kent, called parliamentary opponents of tar sands “treacherous” and had a long history of dismantling every regulation he could. The current environment minister, Leona Aglukkaq, while less inclined to frontal attacks, nonetheless also doubts climate change.

From smoking is good for you to the weather is just fine

Global-warming denialism is well-funded, with oil and gas companies often the heaviest contributors to “think tanks” that specialize in doubting scientific evidence on behalf of their corporate benefactors. An excellent roundup of these deniers, written by physics professor John W. Farley for the May 2012 edition of Monthly Review, noted that Exxon Mobil Corporation, the Koch brothers and other special interests have spent tens of millions of dollars.

One of these corporate-funded “think tanks” is the Heartland Institute, which began life as a Big Tobacco outfit issuing reports denying links between smoking and cancer. Another global-warming denial outfit, The George C. Marshall Institute, originated as lobby group for Ronald Reagan’s crackpot Strategic Defense Initiative, more commonly known as the “Star Wars” program. Another was the now-defunct Global Climate Coalition, which included major oil companies, the U.S. Chamber of Commerce and automobile manufacturers; it actually operated from the offices of the National Association of Manufacturing.

A scientist who is often trotted out by global-warming deniers is Wei-Hock (“Willie”) Soon, who was recently revealed to have taken more than $1.2 million from the fossil-fuel industry. The New York Times reports that at least 11 papers Dr. Soon has published since 2008 omitted disclosures of this funding and at least eight violate the ethical guidelines of the journals that published him. The Times reports:

“[D]ocuments show that Dr. Soon, in correspondence with his corporate funders, described many of his scientific papers as “deliverables” that he completed in exchange for their money. He used the same term to describe testimony he prepared for Congress.”

The world is facing an environmental catastrophe as it is; increasing production from the Alberta tar sands will only hasten it. The capacity of railroads to ship oil is reaching its limit (and in itself is dangerous as a recent flurry of crashes demonstrate). Thus pipelines are critical for tar sands expansion. Not only the Keystone XL pipeline across the United States, but the Northern Gateway and other proposed pipelines that would cross Canada to eastern ports. U.S. President Barack Obama’s February 24 veto of a congressional bill designed to force Keystone construction by no means puts that issue to rest; the State Department’s inaccurate claim that the pipeline would not add to global warming and falsehoods that tens of thousands of jobs would result remain an official document.

Opposition to the Keystone XL pipelines has not slackened and strong resistance continues against the Northern Gateway, which would not only send oil through sensitive mountains and forests, but would require ocean tankers to travel more than 100 kilometers just to reach the Pacific Ocean from the pipeline terminus in northern British Columbia. From there, the oil would be shipped to Asia. First Nations peoples, who have the right to block projects from crossing their lands, are leading that fight, and vow physical resistance.

TransCanada Corporation, the same company that wants to build Keystone XL to the Gulf of Mexico, is also proposing an Energy East pipeline that would carry tar sands oil to terminals in Québec City and St. John, New Brunswick. This project, if it comes to fruition, would alone produce the same amount of carbon each year as seven million new cars on Canada’s roads, according to 350.org. Some of this project would use existing natural gas lines; these are not designed for oil, a heavier substance, elevating the risk of ruptures.

The RCMP reports asserts that “extremists pose a realistic criminal threat to Canada’s petroleum industry.” Advocating for clean air and water is a crime? The fight against one of these pipelines must be a fight against them all; increased oil profits surely won’t be compensation for drowned cities and farmlands turned to dust bowls.

Please make your comment after we make our decision

Taking a page from their United States counterparts, European Union trade negotiators apparently interpret the word “consultation” as a synonym for “ignore.” Fresh evidence for this attitude toward the public was provided thanks to a leak of the final text of the proposed “free trade” agreement between Canada and the EU.

Although the E.U. trade office, the European Commission Directorate General for Trade, promotes a process of public consultation on its web site, it isn’t the public who gets listened to. The final text of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) includes language mirroring corporate wish lists unchanged from previous drafts despite the fact that the E.U. trade office has not had time to analyze comments submitted by the public.

This farce of a “consultation” process mirrors the secretive negotiations in the better known Trans-Pacific and Transatlantic trade agreements. Corporate lobbyists are well represented in these talks, but the public, watchdog groups and even parliamentarians and legislators are barred from seeing the text. The CETA text is also secret, but was leaked by the German television news program Tagesschau, which published the entire 521-page document on its web site. Yep, 521 pages.

The Rideau Canal in Ottawa (photo by John Talbot)

The Rideau Canal in Ottawa (photo by John Talbot)

Critical to understanding the CETA text is Section 33, the portion simply labeled “dispute settlement.” Under that bland heading a reader finds the muscle — what is known as an “investor-state dispute mechanism.” These “mechanisms,” found in many bilateral and multilateral trade deals, are corporate-dominated secret tribunals that hand down one-sided decisions with no oversight, no public notice and no appeals. Governments that agree to these mechanisms legally bind themselves to mandatory arbitration with “investors” in these secret tribunals on which most of the judges are corporate lawyers who represent the “investors” in other legal proceedings.

Kenneth Haar, a spokesman for the watchdog group Corporate Europe Observatory, in an interview with the EurActiv news site, called the dispute mechanism “an outright danger to democracy,” and said:

“The Commission is not really serious about its own consultation. It’s more about image than substance. … I think those who chose to respond to the Commission’s consultation are being ridiculed.”

Decisions will be final and unaccountable

Employing the standard sweeping language, CETA’s Article 14.2 (the articles here are numbered “14” even though they are found in Section 33) states: “[T]his Chapter applies to any dispute concerning the interpretation or application of the provisions of this Agreement” [page 472]. Article 14.10 goes on to declare, “The ruling of the arbitration panel shall be binding on the Parties. … The panel shall interpret the provisions referred to in Article 14.2 in accordance with customary rules of interpretation of public international law” [page 476].

“Customary” international law is whatever one of these secret tribunals says it is. Environmental regulations, “buy local” laws or any other government action that a corporation claims will hurt its profits can be, and frequently are, ruled illegal by these tribunals when adjudicating disputes under existing trade agreements. Such rulings set precedents that become “customary” international law.

In case these “customary” laws are not clear, on page 480 of the CETA text is Article 14.16, which would supersede national law:

“No Party may provide for a right of action under its domestic law against the other Party on the ground that a measure of the other Party is inconsistent with this Agreement.”

Your law was passed in a democratic process? Too bad — it will be overruled if an “investor” doesn’t like it.

CETA’s proposed rules are consistent with what is being secretly negotiated in the Transatlantic Trade and Investment Partnership between the U.S. and E.U., and in the Trans-Pacific Partnership being negotiated among 12 Pacific Rim countries. A majority of the world’s economy would be removed from any possibility of democratic control should these three trade deals come into effect.

The watchdog group Council of Canadians warns:

“The Harper government has thrown Canadian municipalities under the bus, forever banning ‘buy local’ and other sustainable purchasing policies that help create jobs, protect the environment and support local farmers and businesses. The Harper government has also agreed to lengthen patents and give new monopoly protections to already profitable brand name drug companies, which will needlessly add hundreds of millions to the cost of prescription drugs in Canada.”

Not even water would be exempt. If a water system is privatized and a local government chooses to re-municipalize it because rates have risen while service declines (as has routinely occurred on both sides of the Atlantic), the investor would be able to hold out for an extra windfall under the terms of the trade deal.

Only corporate lobbyists need apply

Although the public, and public-interest groups, are not heard, corporate lobbyists are. For example, there are 605 “advisers” with access to the text of the Trans-Pacific Partnership and who shape U.S. negotiating positions. Virtually every one is an executive of a multi-national corporation or a corporate lobbyist working for an industry association.

It is little different in Europe. Corporate Europe Observatory reports that 92 percent of the closed-doors meetings of the E.U. trade office have been with corporate lobbyists, while only four percent have been with public-interest groups. The trade office has gone so far as to actively solicit the involvement of corporate lobbyists. That perspectives other than those of multi-national capital are not considered can be inferred from the very way public input is solicited, the Observatory said:

“How would the average citizen respond to questions such as: ‘If you are concerned by barriers to investment, what are the estimated additional costs for your business (in percentage of the investment) resulting from the barriers?’ So, clearly, the close involvement of business lobbyists in drawing up the EU’s position for the [Transatlantic Trade and Investment Partnership] talks is a result of the privileged access granted to them.”

It’s no different for CETA, and the same dynamic exists across the Atlantic. Former U.S. Trade Representative Ron Kirk once admitted that if people knew what was in the Trans-Pacific Partnership, it would never pass. It is important to remember that these massive “free trade” deals are not simply business as usual — they go well beyond even the draconian rules of the North American Free Trade Agreement.

So although the competitive pressures of each country attempting to give an advantage to its multi-national corporations does mean that maneuvering through differing interests requires lengthy negotiations — not to mention the sometimes conflicting interests of various industries — at bottom there is a unifying class interest in the overall project. It is true that the U.S. adopts the hardest line in the trade negotiations it participates in (before we even get to the military muscle it applies to force open Southern countries), yet the absence of the U.S. from a Canada-European Union trade deal has made no practical difference to its outcome.

That different countries, different administrations, reach similar one-sided “free trade” agreements in which “investors” are allowed to overrule national laws, and labor, safety and environmental regulations are “harmonized” at the lowest level, is a product of capitalist competition. The rigors of that structural competition mandate expansion and growth — as local markets mature, capital has no choice, if it is to survive relentless pressure from competitors, other than opening new markets and relentlessly cutting costs to maintain profit levels. “Free trade” agreements represent one of the most effective ways to accomplish that.

Popular revolts against these agreements must be continued, and strengthened, but there will be no end to them as long as economic and social decisions are allowed to be made by “markets,” which are not disembodied entities sitting dispassionately on an Olympian throne but rather are the aggregate interests of the most powerful industrialists and financiers.

The scorecard of NAFTA: Losses for all three countries

The North American Free Trade Agreement has been a lose-lose-lose proposition for working people in Canada, the United States and Mexico.

Let us count the ways: Lost jobs, reduced wages, more unemployment, higher food prices and reversals of environmental laws. NAFTA, a 20-year laboratory for mainstream economics, has been a bonanza for the executives of multi-national corporations, and that is all you need to know why the so-called “free trade” model continues to be promoted despite the immiseration and dislocation it spawns. Agreements like NAFTA, and proposed deals that would go further in handing power to corporate executives and financiers such as the Trans-Pacific Partnership, have little to do with trade and much with ensuring corporate wish lists are brought to life.

Not dissimilar to medieval doctors who insisted that having leeches bleed the patient was the only course of action, neoclassical economists, who dominate the field, won’t budge from their prescriptions of neoliberal austerity. But although the medical field has made enormous strides in recent centuries, there is no such progress among neoclassical economists. That is because said economists — most often under the banner of “Chicago School” but sometimes using other names — promote ideology on behalf of the powerful, not science for all humanity.

"Canada in fog" photo by Kat Spence

“Canada in fog” photo by Kat Spence

Thus the spectacularly wrong predictions made for NAFTA before it was went into force on January 1, 1994, have no effect on their predictions for new deals. To provide one example, in 1993 the Peterson Institute for International Economics predicted 170,000 jobs would be created in the U.S. alone by 1995, that the U.S. would enjoy an expanded trade surplus with Mexico and that the Mexican economy would grow by four to five percent annually under NAFTA.

As we will see presently, none of those rosy predictions came close to becoming reality. (True to neoliberal form, the institute is grandly predicting “gains of $1.9 trillion” for the Trans-Pacific Partnership.) The point here isn’t to pick on one particular institution — in fact, it is quite typical. The models developed to make these predictions and explain economics are mathematical constructs disconnected from the real world.

Sure it works better in a dream world

The Chicago School and other mainstream neoclassical schools of economics rest their models on the concept of “perfect competition,” which assumes that all prices automatically calibrate to optimum levels, and that there are so many buyers and sellers that none possess sufficient power to affect the market. This model assumes that employees are in their jobs due to personal choice, and wages are based only on individual achievement independent of race, gender and other differences. That this bears little resemblance to the real world is not your imagination.

From this, mainstream economists assume all trade will be beneficial because all economic activity quickly adjusts to create a new equilibrium following a disruption. As Martin Hart-Landsberg wrote in his 2013 book Capitalist Globalization: Consequences, Resistance and Alternatives:

“[T]his kind of modeling assumes a world in which liberalization cannot, by assumption, cause or worsen unemployment, capital flight or trade imbalances. Thanks to these assumptions, if a country drops its trade restrictions, market forces will quickly and effortlessly lead capital and labor to shift into new, more productive uses. And since trade always remains in balance, this restructuring will generate a dollar’s worth of new exports for every dollar of new imports. Given these assumptions, it is no wonder that mainstream economic studies always produce results supporting ratification of free trade agreements.” [page 104]

World Bank studies promoting “free trade” agreements, Professor Hart-Landsberg wrote, assumes that tariff reductions will have no effect on government deficits, governments will automatically be able to replace lost tariff revenue with revenue from other sources and that there is full employment. He writes:

“Although working people have been ill served by capitalist globalization, many are reluctant to challenge it because they have been intimidated by the ‘scholarly’ arguments of those who support it. However … these arguments are based on theories and highly artificial simulations that deliberately misrepresent the workings of capitalism. They can and should be challenged and rejected.” [page 80]

Mexican farmers forced off their lands

Mexico had annual per capita gross domestic product growth of 0.9 percent in the first 20 years of NAFTA — one-fifth of the per capita GDP growth of the preceding 20 years. The Center for Economic and Policy Research reports that Mexico’s growth during the past 20 years under NAFTA ranks the country 18th of 20 Latin American countries and is half of the average Latin American growth rate. Among other results, the center reports:

• 4.9 million family farmers have been been displaced — more than half the total number of Mexican farmers in 1991.
• More than 14 million more Mexicans live below the poverty line than in 1994. Just more than half of Mexicans are below the poverty line, nearly identical to the 1994 rate, but the population has increased.
• Inflation-adjusted wages have risen two percent over 18 years and are barely above the 1980 level.

Subsidized corn from the United States flooded Mexico, sold below the costs of small Mexican farmers. Corn imports from the U.S. increased fivefold and pork imports from the U.S. increased by more than 20 times, according to a Truthout report by David Bacon.

As a result, Mexican farmers forced off their land either became seasonal workers on growing agribusiness farms, sought work in the cities or migrated north. Seasonal agricultural workers (those working less than six months per year) grew by almost three million — more than doubling their ranks — during the same period that 4.9 million family farmers were displaced. The number of Mexicans emigrating to the U.S. rose by almost 80 percent from 1994 to 2000, before falling significantly afterword because of the post-9/11 increased border security.

Nor did Mexicans get cheaper food as a result of the flood of U.S. corn. Public Citizen, in its just released report on NAFTA, reports that the deregulated price of tortillas nearly tripled in the first 10 years of the agreement and that a Mexican minimum-wage earner can buy 38 percent less than he or she could when NAFTA went into effect.

The only countervailing effect, the increase in factory jobs as maquiladoras (factories near the U.S. border producing for export) increased for a time, but those low-wage jobs are now dwindling because China’s wages are far cheaper than Mexico’s. The same pitiless market competition that sent jobs south now sends them across the Pacific. China now accounts for 23 percent of U.S. imports as compared to Mexico’s 12 percent, according to International Monetary Fund statistics.

A 2011 paper issued by the Economic Policy Institute summarized the effects of NAFTA on Mexico:

“From the standpoint of the business community, NAFTA’s most important achievement was that it made Mexico a much safer and more attractive location to invest and outsource U.S. manufacturing production. NAFTA’s investment provisions created new and improved safeguards for foreign investors, including new dispute settlement tribunals providing a mechanism for settling disputes with foreign governments outside of the Mexican legal system. By eliminating Mexico’s developmental state and use of local content rules, and other demands and conditions on foreign investors, the trade agreement greatly reduced the cost of doing business in Mexico, and increased the security of those investments.” [page 6]

Mexico’s conversion into an export platform does not mean higher skills for its workforce. The biggest initiative in job creation came during the administration of Vicente Fox, which offered training in low-skill jobs for landscapers, construction workers, factory workers and maids.

Hundreds of thousands of jobs leave the United States

The United States has seen a net displacement of almost 700,000 jobs through 2010 directly attributable to NAFTA, according to Economic Policy Institute calculations. Moreover, the U.S. has had large annual trade deficits with Mexico since NAFTA was implemented; in earlier years, trade was roughly balanced between the two. In addition to the job losses, Public Citizen reports these negative impacts on U.S. workers:

• U.S. food prices have risen 67 percent since NAFTA took effect, despite an increase in food imported from Mexico and Canada.
• Purchasing power for U.S. workers without a college degree, adjusted for inflation and taking into account those consumer goods that have become cheaper, has declined 12 percent under NAFTA.
• Two-thirds of displaced manufacturing workers who were rehired in 2012 experienced a wage cut; the reduction in the majority of cases was at least 20 percent.
• U.S. manufacturing and services exports to Mexico and Canada grew slower after NAFTA took effect than it had been earlier.

By making it easier for capitalists to move production, NAFTA has directly contributed downward pressure on wages. With fewer well-paying manufacturing jobs, pressure on wages not only affects manufacturing but other industries as well as displaced workers seek employment elsewhere.

Capital mobility has been an irresistible hammer for holding down wages and worsening job conditions — a study by Cornell University Professor Kate Bronfenbrenner found that more than 50 percent of employers made threats to shut down and/or move their facilities in response to unionization activity during the three-year period of 1993 to 1995, and that the rate of actual shutdowns tripled from the pre-NAFTA rate. She wrote:

“NAFTA has created a climate that has emboldened employers to more aggressively threaten to close, or actually close their plants to avoid unionization. The only way to create the kind of climate envisioned by the original drafters of the [National Labor Relations Act], where workers can organize free from coercion, threats, and intimidation, would be through a significant expansion of both worker and union rights and employer penalties in the organizing process both through substantive reform to U.S. labor laws and by amendments to the North American Agreement on Labor Cooperation.” [page 3]

That would take massive organizing to achieve. The Obama administration is actively trying to use the rules of NAFTA as a starting point for further weakening of labor, safety, health and environmental laws in the ongoing Trans-Pacific Partnership negotiations, which would tighten corporate control should the ongoing TPP negotiations be successful. The White House undoubtedly has the same goals for the Transatlantic Trade and Investment Partnership talks with the European Union.

Canadian safety net shredded to ‘compete’ in markets

Spending on Canada’s social safety net has decreased while corporate revenue has doubled and manufacturing jobs disappeared. In addition, a Canadian Centre for Policy Alternatives researcher reports, the country’s growing trade surplus with the United States has translated to few jobs. The study found:

• After 12 years of NAFTA, government transfers to individuals have dropped from 11.5% of GDP to 7.8% of the country’s GDP.
• “[M]uch of the growth in gross exports over the last decade reflected the markedly elevated use by Canadian-based companies of imported inputs in their production, significantly overstating the employment impact of the growth of manufactured exports.”
• The length that Canadians could collect unemployment benefits was reduced, the amount of the benefits were cut and the criteria for those eligible were reduced, reducing the proportion of unemployed people who qualified for unemployment insurance to one-third from three-quarters.
• Composite revenues of 40 of Canada’s biggest businesses increased 105 percent from 1988 to 2002, while their workforces shrank by 15 percent.

These developments fueled rising inequality, the centre’s executive director, Bruce Campbell, wrote:

“The most striking feature of this growing inequality has been the massive gains of the richest 1% of income earners at the expense of most of the population. The growth of precarious employment, the undermining of unions as a countervailing power to transnational capital, the erosion of the Canadian social state, and heightened economic dependence on the United States are the hallmarks of the free trade era in Canada.” [page 53]

Pressing its advantage, Canadian big business interests demanded and received tax cuts on the ground that Canada could not be competitive otherwise. Those cuts resulted in loss of C$20 billion in federal revenue for 2005 alone, the study said, on top of provincial revenue losses of $30 billion. The tax cuts were primarily given to high-income individuals and corporations, who argued that these would create “a level field of competition” with the United States but also increase labor market “flexibility” — a code word meaning lower wages and reduced job security, always the goal of capitalists.

It’s always our turn to ‘cut back,’ never the bosses’ turn

The key NAFTA provision is Chapter 11, which codifies the “equal treatment” of business interests in accordance with international law and enables corporations to sue over any regulation or other government act that violates “investor rights,” which means any regulation or law that might prevent the corporation from extracting the maximum possible profit.

Under these provisions, taxation and regulation constitute “indirect expropriation” mandating compensation — a reduction in the value of an asset is sufficient to establish expropriation rather than a physical taking of property as required under U.S. law. Older decisions become precedents for further expansions of investor “rights” and thus constitute the “evolving standard of investor rights” required under “free trade” agreements.

Toothless “side agreements” on labor rights are meaningless window dressing; the arbitration bodies that decide these cases (in secret with no accountability or right of appeal) are governed by the main body of the text, such as Chapter 11. Corporations can sue governments over regulations or laws they don’t like, but working people and governments have no right to sue.

As Mr. Bacon put it in his Truthout report:

“The most any union or group of workers got from filing a case was ‘consultations’ between the governments and public hearings. There is no process in the agreement for penalties for violation of union rights. And although there are minor penalties for violating child labor or occupational health laws, they’ve never been implemented. Not a single contract was signed as a result of the side-agreement process, nor was a single worker rehired. Those unions that have filed cases have generally sought to use the process to gain public exposure of abuses and exert indirect pressure on employers.”

The neoliberalism that began gathering steam with the rise of Margaret Thatcher and Ronald Reagan, and which has intensified since, is not the handiwork of some secretive cabal, nor is it some tragic bad turn from an otherwise “rational” system. It is the natural evolution of modern capitalism and its relentless competition. “Free trade” agreements that have little to do with trade and much to do with imposing corporate wish lists in the service of ever more inequality and power imbalances is an inevitable component.

Implementing a “reform” of agreements designed to maximize corporate profits above all other considerations and shred the remnants of democracy is less than an illusion. Overturning the entire “free trade” apparatus is indispensable to any serious project of building a better world. Trade should conducted for the benefit of all, not only the one percent — unlike the current global system in which human beings are in the service of markets instead of the other way around.