THE BLOG
08/29/2018 10:05 EDT | Updated 08/29/2018 10:06 EDT

Canada Must Say No To NAFTA And Donald Trump If The Price Is Too High

This renegotiation was supposed to be about addressing what was wrong with the original NAFTA, not perpetuating its shortcomings.

After spending weeks sitting on the sidelines of North American Free Trade Agreement (NAFTA) talks, Canada is now back at the table and aiming to hammer out a final deal. We must not sell the farm to get there.

Literally.

On Monday, United States President Donald Trump announced that the U.S. and Mexico had signed a new bilateral trade deal, and took a swipe at Canada's supply management system for dairy and poultry products when asked about Canada signing on to the deal.

Edgard Garrido / Reuters
A joint news conference on the closing of the seventh round of NAFTA talks in Mexico City on March 5, 2018.

It is an old and, frankly, tiresome complaint. The fact is, Canada's system of supply management, which includes strict import controls, ensures a stable income for farmers and a stable supply of affordable milk, chicken, turkey and eggs for consumers, all without government subsidy.

The U.S., on the other hand, heavily subsidizes its farmers, and Trump himself has said he plans to cut even more cheques for farmers in the future. No discussions on Canada's farm policies can take place without a discussion about those in the U.S.

Canada's Foreign Affairs Minister Chrystia Freeland cut short a diplomatic trip to Europe to go to Washington and discuss trade. Even before she arrived, Trump was issuing nonsensical threats to slap tariffs on Canadian cars and trucks if Canada does not capitulate to his demands on renewing the NAFTA deal.

This makes no sense. There is no such thing as a strictly Canadian-made car or truck. The auto industry is heavily integrated across North America, with parts going back and forth across the border several times as vehicles are assembled.

Some of the few details announced so far sound promising, to be fair.

Slapping a tariff on any vehicles that reach final assembly in Canada would just end up hurting American consumers, since most of the vehicles made here go there, and hurt the Detroit Three auto companies.

Talk about shooting yourself in the foot. Canada would no doubt feel the need to retaliate against any such tariffs. The result would be economic carnage on both sides of the border. No one wins in that case.

Some of the few details announced so far sound promising, to be fair. Increased North American content rules for cars and trucks is a step in the right direction. So is the apparent pledge to pay Mexican autoworkers $16 an hour, although we have no real idea what this means. Does it apply to all autoworkers, or just assembly? How will it be monitored and enforced?

And what about other manufacturing jobs? Auto is not the only industry sending good manufacturing jobs to Mexico in search of cheap labour. A pay raise for one sector does nothing to address the poverty-level wages for workers across the Mexican economy without real reforms to that country's labour laws to ensure workers there have the right to fight for better working conditions through truly independent unions.

Kevin Lamarque / Reuters
United States President Donald Trump announcing a bilateral trade agreement with Mexico to replace the North American Free Trade Agreement (NAFTA) on Aug. 27, 2018.

Without real and systemic reforms to Mexican labour laws and working conditions, Canada will continue to lose good jobs to Mexico.

It's difficult to assess fully the Mexico-U.S. deal, however, without more details. We need to know more about cultural policies, government procurement and the ability of government to use its resources to build the country's economy or to address systemic inequities for women and Indigenous peoples.

We need to know whether private investors retain extraordinary rights to sue governments over lost profits through secret arbitration tribunals. I also have concerns about any intellectual property rights clauses the deal might contain, and their impact on drug costs.

We need to know these kinds of details before we sign onto anything.

More from HuffPost Canada:

The original NAFTA was not good for workers, especially workers in Canada. This renegotiation was supposed to be about addressing what was wrong with the original NAFTA, not perpetuating its shortcomings.

Trump will bluster and make his threats. He will say things on Twitter meant to strong-arm Canadian negotiators into signing a sub-standard deal.

Regardless, Canada must remain committed to the social justice principles it entered these renegotiations with, this week, and for as long as it takes, and remember that no deal is better than a bad deal.

We can't let ourselves be bullied into signing anything that does not serve the needs of Canadian workers.

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