Frances Russell, Winnipeg Free Press, March 5, 2008 - Canadians and Mexicans should pressure their governments to renegotiate the North American Free Trade Agreement — Canadians to regain control over energy and Mexicans to regain control over agricultural land.
Canadians and Mexicans and Americans should all support the NAFTA renegotiation proposed by Democratic presidential candidates Barack Obama and Hillary Clinton. The U.S. senators want to strengthen NAFTA’s labour and environmental standards. But most importantly, they want to abolish NAFTA’s nefarious Chapter 11 which allows private capital to trump democratic government.
Before NAFTA, private investors’ grievances were adjudicated on a government-to-government basis. But NAFTA allows foreign capital to sue government directly.
And sue they have — for tens of millions of dollars — challenging the public’s right to regulate the environment, culture, agriculture, natural resources, jobs and health and safety. As of Jan. 1, 2008, there have been 49 investor-state claims under NAFTA: 18 against Canada, 17 against Mexico and 14 against the U.S. So far, Canada has paid $27 million in damages and Mexico, $18.7 million. To date, investor claims against the U.S. have been dismissed.
Two cases provide a flavour. An Exxon-Mobil subsidiary is suing Newfoundland and Labrador for $40 million because the province demanded a fixed amount of local research and development. Chemtura Corp. is suing Canada for $100 million over the ban on its pesticide Lindane, a neurotoxin and suspected carcinogen. NAFTA is “very much a relic of the Roaring Nineties,” says Scott Sinclair, director of the Canadian Centre for Policy Alternatives’ trade and investment research project. “That’s another era now and it’s just not an appropriate framework for managing the problems of the early 21st century. There is a growing recognition we need active democratic governments to protect the environment on issues like climate change and to deal with the growing inequality which again is a consequence of the patterns of trade that have developed under NAFTA and other trade agreements.”
Sinclair points out Chapter 11 not only costs taxpayers but chills government from regulating in the first place.
NAFTA also plays an even greater — but disguised — role in this and other U.S. election campaigns. Illegal immigration, primarily from Mexico, is a major flashpoint in American politics. But Obama and Clinton have not connected illegal immigration to NAFTA’s Mexican agricultural “clearances.” NAFTA forced Mexico to liberalize and corporatize its agriculture. U.S. agribusiness giants like Cargill and Archer Daniels Midland effectively pushed millions of small farmers off the land into the slums of Mexico City and finally to the U.S. border.
A Mexican government study reports the number of agricultural households plunged from 2.3 million in 1992 to 575,000 in 2002. Those woRandall King in the primary sector (forestry, hunting and fishing as well as agriculture) represented 26.8 per cent of the total woRandall King population of Mexico in 1991 but only 14.6 per cent in 2006.
“NAFTA negotiations took place without taking into consideration the views of Mexico’s civil society,” writes Americas Policy Program researcher Ana de Ita in Fourteen Years Of Nafta And The Tortilla Crisis. Mexico now imports most of its corn from the U.S. because its agricultural land grows fruit and vegetables for North American tables.
“So while agricultural and food exports from Mexico are concentrated in a small number of lavish products for the U.S. elites, Mexico has lost its ability to feed its population and has increased its dependency on the import of basic goods,” de Ita continues.
In Canada, the Obama-Clinton NAFTA intervention has pulled our energy sellout into the light. To scare the Democrats away from touching NAFTA, the Harper government is warning Americans that their privileged access to our oil and gas could be disrupted, a bogus threat since this Alberta-centric government would never touch the Oil Patch’s sacred cow.
NAFTA makes Canada’s oil and gas America’s oil and gas. Canada cannot reduce its exports to the U.S. unless it reduces its consumption by the same amount. Although Canada is obliged to secure the U.S. energy supply, it has no security of supply for 40 per cent of its population. Nor does it have an emergency strategic petroleum reserve. Canadian trade lawyer Steven Shrybman says “if we had any self-respect, we should have rescinded the deal a long time ago.”
Richard Heinberg, educator and author of eight books including The Party’s Over: Oil, War and the Fate of Industrial Societies, says NAFTA’s “strange clause…formalizes Canada’s status as a resource satellite of its imperial hub to the south.” Meanwhile, an energy crunch in Canada is “fairly imminent.
“So Canada’s energy security and global climate security are both held hostage by a provision within a trade agreement — a provision that is unique in all the world’s treaties,” Heinberg continues in his Feb. 7 Energy Bulletin blog. “Canada has every reason to repudiate the proportionality clause, and to do so unilaterally and immediately.”
The peoples of Canada, Mexico and the U.S. all have very good reasons to renegotiate NAFTA. But only in the U.S. are politicians even talking about it.
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