Some Hon. Members:
Subtopic: CANADA-UNITED STATES FREE TRADE AGREEMENT IMPLEMENTATION ACT MEASURE TO ENACT
I believe I have a mandate, as we won more votes than all of the other six candidates combined.
Let me now address a matter of which I am particularly proud to mention. A small but important part of my constituency, 6 per cent in fact, includes the Four Nations of Hobbema. I am a member of the Ermineskin Tribe of Cree Indians in Hobbema.
During my first campaign, I referred to a quote by one of our country's greatest patriots, Chief Dan George, when he said:
Let me humbly accept this new culture and through it rise up and go on. Like the thunderbird of old, I shall rise again out of the sea; I shall grab the instruments of the white man's success-his education, his skills. With these new tools, I shall build my race into the proudest segment of your society. 1 shall see our young braves and our chiefs sitting in the houses of law and government, ruling and being ruled by the knowledge and freedoms of our great land.
One of the great leaders of the Four Nations of Hobbema, Chief John Samson, started this dream along the path of reality in the early sixties when he hitchhiked here to Ottawa with Mr. Stan Daniels to bring native concerns to Canada's attention.
I would like to indicate that many of those concerns, for example as they relate to energy, health, agriculture and others, are very similar to areas outside of the Four Nations of Hobbema. I must, however, indicate to the House that I was dismayed, to put it politely and mildly, when anti-free traders came to our reserves. They came to scare our people, as they did in other areas, whether it was about social programs or sovereignty.
What a lot of rubbish.
On the reserves they said: "You will lose the Indian Act. You will lose your treaty rights if you support the Free Trade Agreement." This was proliferated without any substantiated arguments whatsoever. Perhaps it was because they knew that the
Constitution Act, Section 25 and Section 35, entrench those treaty rights, and the Free Trade Agreement has nothing to do with that whatsoever.
The Four Nations of Hobbema have been doing business in the United States for the last eight years at least. They have not lost their sovereignty. They have not lost their social services. They have not lost their treaty rights. They now have a chance to continue maximizing on those economic opportunities in the United States as they work toward self-reliance.
With the mandate expressed in Wetaskiwin, including Devon, Calmar, Thorsby, Warburg, Breton, Bentley, Rimbey, Buck Lake, Alder Flats, Ferintosh, Mulhurst, Ma-Me-O, Nisku and all points in between, we want to register support for the Free Trade Agreement and, in particular, Bill C-2.
Last, I want to refer to youth because a significant part of our population is 25 years of age and under. As future employers, employees and consumers, we should provide as secure an economic environment as possible. According to the Economic Council of Canada, the Canada-U.S. agreement will lead to the creation of an additional 30,600 jobs in Alberta. I want to ensure Wetaskiwin gets its share. The Right Hon. Prime Minister (Mr. Mulroney) said in this House on October 5, 1988:
We go forward with confidence in our future, confidence in our
country and, most of all, confidence in the youth of Canada . . . We
have set a course for a stronger, a more united and a more prosperous Canada.
We want to ensure to those youth in the Wetaskiwin constituency that there will be a positive opportunity for them to become nation builders, nation builders as all of our elders, parents and senior citizens have been in the past.
In conclusion, I would ask the pessimists of this agreement to consider: What if it works? Are we as Canadians afraid of success?
If it works, that is fantastic.
As a Golden Bear, I learned early that the only limits we have are those we place on ourselves.
I want to return with a gift to my constituency this Christmas season: Yes, Wetaskiwin youth, you can have those jobs because you can compete. Go for it, Hugh Denim, Derrick Thorne, Ralph Void, Four Nations, because you can compete. The Free Trade Agreement
December 23, 1988
will allow us to shape a stronger economic future. Madam Speaker, Wetaskiwin supports Bill C-2.
Finally, Madam Speaker, I want to thank the Progressive Conservative team with which I am anxious to work towards making our native land a strong and united Canada.
Mr. Jim Peterson (Willowdale):
Madam Speaker, I rise to speak on the eve of this trade deal becoming law. It is now cast in stone. It has been made evident to us that no amendments will be permitted and that no amendments can be debated.
In spite of my tremendous misgivings about this deal, all of us in this Chamber and all Canadians hope that it will work. We hope that the expectations of those supporting it are met, and we hope that their promises to Canadians about this deal are kept.
We remind the Government of what its promises concerning this deal have been: More jobs, better jobs, secure access to the American market, greater prosperity for all Canadians, security for our social programs including medicare, unemployment insurance, health care, and pensions.
The Government promised an adjustment and retraining program. It has promised us that our programs to create regional economic opportunities in Canada will be protected. It has said that we will maintain our ability to preserve and promote Canadian culture. The Government has indicated that we will be able to create new social programs, such as child care and maternity leave.
Canadians are watching. Canadians will not let the Government forget its promises. They will keep these promises tacked to their refrigerator doors.
Because further negotiations are continuing with the United States concerning the implementation of this deal, it is important that the Government does its homework. It is important that it does its homework much better than it has in the past.
For example, the Americans have already created this long list of what they consider to be Canadian trade practices that they find offensive under the terms of the deal. Where is our list? We have undertaken with the Americans to review their laws and our laws in terms of
Canada-U.S. Free Trade Agreement
trade to see if they might be harmonized. I hope we bargain astutely.
There is also the important definition of subsidies. We implore the Government to do its homework. We do not want these issues negotiated as if they are just the closing of one more Canadian branch plant.
According to this deal, I think Canadians will find themselves in a different type of business world. First, American firms are given national treatment here in Canada. They must be treated the same as Canadian firms. We can no longer require that subsidiaries here in Canada produce jobs, hire Canadians, create exports or do research and development here. We can no longer require productivity gains that come from procedures such as world product mandating.
What will happen to our plants here in Canada? Already we have more foreign ownership of our industries in Canada than in any other developed country in the world. Under this deal we will see further rationalization of branch plants on a North American basis, such as with Gillette, Catelli, and Northern Telecom, where the plants move out of Canada. We will see them being phased out in Canada because the bigger plants in the United States can simply put on a few extra runs, a few extra shifts and service the entire Canadian market.
An even greater concern is where new plants will be established in order to take advantage of this new North American market. Let us pretend that we are rational business people and the board of directors of a company that is called upon to make this type of decision. Let us consider the advantages that the United States has as a base for these new plants.
First, the U.S. climate is more amenable and construction costs are less. Second, establishing in the United States means being closer to the biggest part of the North American market. Third, wages in the United States, in many cases, are much lower than here in Canada. In nine U.S. States the minimum wage law is $3 or less per hour and 12 states have absolutely no minimum wage laws.
In addition, if we establish in the United States, we have the advantage of a free trade zone with Mexico, the so-called Maquiladora Region. It is a band three kilometres to four kilometres deep that runs along the entire border inside Mexico. Goods produced in that area come into the United States totally duty-free. The wages paid in that Maquiladora zone are less than 80 cents U.S. an hour.
December 23, 1988
Canada-U.S. Free Trade Agreement
General Motors has 24 plants in the Maquiladora zone of Mexico, employing 27,000 workers. If we are talking about a level playing field, that is not it.
Let us look at another advantage. Industries which relied on cheaper Canadian energy, industries that are energy intensive, no longer have to come to Canada to get it either for the consumption of energy or for the transformation of energy into a further by-product. They can now take our abundant Canadian energy and use it to produce and sell back the finished goods into Canada.
We have given up one of the great advantages we were given at the time of creation. While we got the distances and the cold weather, we were given the energy. But we have now given away that one advantage.
When we consider further as a board of directors where we would locate our new plant, we must consider, as more of our Canadian financial institutions are taken over by American firms, whether we would want to be closer to the head offices where the real decisions are made.
Finally, we have not defined subsidies under this trade deal. U.S. trade law will still apply so that we have no exemption from Section 301 of the 1974 trade Bill and no exemption from the omnibus trade Bill. The U.S. trade laws can still apply, and will apply, as they are amended by the Americans from time to time. We did not get that exemption.
If we are going to establish our plant, we are going to put it in the United States so that if Canada applies its trade laws we would lose only one-tenth of the market. It will not be put in Canada where the U.S. can still apply its trade laws and wipe out nine-tenths of our market.
I despair under this trade deal as to whether we will get those new jobs, those new industries that have been promised to us.
I think we have an even greater challenge in Canada in terms of our economic destiny. Canada is largely a resource based economy. In 1930, Argentina, a country similar to Canada in many ways, had the fourth highest standard of living in the world. It is now thirtieth.
Are we going the way of Argentina? How do we learn to compete head-on with the great manufacturing powers such as Japan, Korea, Taiwan, Malaysia, Singapore, the Common Market countries and the United States? They did not do it simply through trade
deals. In Canada it will require a concerted effort and a new way of looking at things. Simply allowing the market-place to determine the types of jobs we have in Canada will not give us what we need. I suggest that to be world leaders in this fight for competitiveness, Canadians, over the next few years, will have to start looking 20 and 30 years down the road to see where we want to be. We will have to start planning what type of economy we will build.
For those in the House to whom planning is an anathema, take a look at successful businesses. They plan their futures. They have five and 10-year plans and work toward them. If we are to be successful the way many of the newly-emerging industrialized countries have been, we too will have to plan. We will have to put together our best management, labour, entrepreneurs, financial institutions and educators, and set directions for where we want to be and then work toward those plans.
One very major component of anything we will achieve has to be education. We in Canada are falling behind our major world competitors in the way we educate our people. We have the fewest scientists and engineers being graduated of any industrialized nation. In terms of skills training, only 30 per cent of the people who graduate from high school either go on to postsecondary education or have actual skills training. That means that 70 per cent of our young people are going into the workforce untrained. We have to address this problem immediately.
I commend to Hon. Members of all Parties the National Apprenticeship Council that was recommended in our platform for this election, bringing together Government, business, labour and educators to set in place a national apprenticeship program. I believe that we can learn extensively from Local 183 of the International Labourers Union and Local 506 of the Operating Engineers Union, which in Toronto have entered into cooperative arrangements with the businesses they work with. The unions and businesses are working very closely together to set up their own training programs to meet the needs that are not being met in any other fashion.
On September 16, Jean de Grandpre the head of the Prime Minister's Industrial Readjustment Council, indicated in a speech to the Montreal Neurological Institute that in Japan, 8.6 per cent of the Gross National Product is spent on education. In Canada, it is about
December 23, 1988
half that at 4.8 per cent. No wonder Japan has had such spectacular economic success.
Another aspect for incorporation into our planning is the need for research and development here in Canada. We know that technological innovation is the single greatest factor in determining economic growth. In the 1984 election, the Government promised to double research and development here in Canada by the end of its first term in office. In fact, the level of research and development in Canada has actually decreased. It is now at the abysmally low rate of 1.35 per cent of Gross National Product.
In Canada, through Government support, we provide for 20 per cent of the industrial research and development that is done. In the U.S.A., it is twice that rate at 40 per cent. Again, as leaders such as Jean de Grandpre have said: "And to continue the bad news for Canadian technology, Government support last year was less than it was the year before". There is great concern over the Budget that has again cut incentives for R and D.
Last, we have to look at the new approaches in many other countries that have succeeded in creating productivity and competitiveness. In Japan, for example, through MITI and other institutions that co-operate with financial institutions, labour, the Government and business, they have a plan whereby robots are leased to businesses so the businesses can afford them. In Taiwan, a Dr. Casper Shih, a Canadian, has been running a program which has targeted 1,500 small businesses. They send in experts at government expense to study how they can increase productivity and exports. The businesses, if they accept these suggestions, can pay for the new products they require, such as computers or robots, out of increased productivity, and that is the only way they pay for them. It is an imaginative approach which has worked tremendously well in that environment. Programs like these are worthy of study.
In addition, we will need financial support. A person in my riding of Willowdale told me the other day that he wanted to start a new business. He was prepared to put up farmland in eastern Ontario as collateral. The financial institutions would not lend on it because they do not want farmland in that part of the country. This is a travesty.
We have to set our own course to create an economy in Canada which is competitive and strong. The trade deal will cause us some problems in setting our own economic course and our own economic goals.
Canada-U.S. Free Trade Agreement
Because of the provisions regarding investment, we can no longer require performances on exports, R and D and jobs in Canada from certain firms. Our energy is no longer an advantage to us alone. We have given up the right to use certain types of tariff policies such as drawbacks in order to assist the establishment in Canada of competitive world-class manufacturing operations. We can no longer have any sort of managed trade such as the Auto Pact, lauded by all sides of the House as a deal that worked for the benefit of Canada. It was not free trade, it was managed trade. One car had to be produced in Canada for every car brought into Canada duty free.
In conclusion, we on this side say to the Government, Canadians are watching. They expect the Government to honour its promises. We beg of it, in the continuing negotiations with the Americans on implementation of this deal, negotiate better than it did in forming the deal.
Start with the real issues. The issue is not who we trade with, the real issue is what we trade with. Start with education. Start with research and development. Start planning a national approach for the benefit of all Canadians. That is what Canadians expect. That is how we are going to get our economic growth through the years.
It is a great honour for me to sit again with you in this Parliament.
I am very pleased to once again be the Member of Parliament for Willowdale. It is a honour for me to have returned and a great pleasure to be with you.
Mir. A1 Johnson (Calgary North): Madam Speaker, I am honoured to have the opportunity to address this House on an issue of such national significance as the Free Trade Agreement between Canada and the United States of America. The agreement will play a vital role in the development of my constituency of Calgary North as well as the whole of Canada.
As so many others have done, I would also like to extend my congratulations to the Hon. Member for Vancouver South (Mr. Fraser) on his well deserved reelection as Speaker. His reputation as a member of this house for fairness, wisdom, and effectiveness is known to us all. It is with pleasure and respect that I recognize
December 23, 1988
Canada-U.S. Free Trade Agreement
him as Speaker and you, as his representative, in this venerable House today, Madam Speaker.
It is with a complex mixture of humility and pride that I have taken my seat in this Chamber and with which I address you today. I am deeply indebted to the people of Calgary North for the confidence they have placed in me and for the overwhelming support they gave me on election day. I intend to ensure that they are effectively represented while I have the opportunity to serve them here.
I would like to extend my warmest congratulations to the Right Hon. Prime Minister (Mr. Mulroney) and his Cabinet for the outstanding leadership they provided in the recent election.
It was leadership that Canada needed, leadership that Canada wanted, and leadership that Canadians once again have. I am proud to be a part of the Progressive Conservative team that will lead Canada into the 21st century. I would also like to thank members of my family who worked so hard to help me achieve my lifetime goal of being a representative here. My sincere appreciation to June, Cynthia, David, and Thomas; to Keith, Mark, and Nickie.
Calgary North is one of the oldest constituencies in Alberta. It has its roots in the original constituency of Calgary East, and it was created by redistribution in 1952. The citizens of Calgary North have shared the Progressive Conservative vision for more than 40 years, having been represented by Mr. Paul Gagnon who, as you know, brought clarity and integrity to the deliberations of this House for the last four years.
It is an honour to follow in his footsteps and those of such other dedicated servants of the people as Bill Wright, who represented Calgary North with determination after succeeding Eldon Woolliams, who is still remembered on the Hill as an outstanding member and a hard-working contributor to the activities and committees of this House. This vital Canadian constituency was first represented by the late Hon. Douglas Scott Hark-ness, who made a substantial contribution to this House and to the nation as the Minister of Agriculture in 1957 and later as the Minister of National Defence in the early 1960s.
Calgary North is essentially a residential constituency and the people who live there are ordinary Canadians who, under the leadership of dedicated Members of Parliament, have, as I have indicated, guarded the Progressive Conservative vision of Canada for more than 40 years. These people work in the oil and gas industry as geologists, engineers, geophysicists, technicians, drillers, foremen, technologists, secretaries, clerks, accountants, lawyers, administrators, salesmen, roughnecks, and labourers. They work in the oil and gas service industries providing computer services, well logging, consulting, catering, well serving, pipeline construction, operating and maintenance services. They teach in schools and universities, such as the University of Calgary and the Southern Alberta Institute of Technology. They operate day care centres, work in stores as sales clerks, supervisors, and managers. They serve in restaurants and motels. They drive trucks, build homes as carpenters, electricians, dry wallers, and labourers. They work for the telephone and communication companies, for newspapers, and for printing companies. They work for Governments providing social services, health care, and administrative support. They process meat and agricultural products. They sell real estate and insurance, and they provide financial services and computer support for industry. They work in a wide variety of manufacturing industries; most important, in manufacturing high-technology products.
Calgary North is a constituency that makes people welcome. This is demonstrated by the great diversity of ethnic and cultural backgrounds that are represented in our communities. Calgary North is home to native Canadians, to people of British, French, Irish, Japanese, Korean, Vietnamese, Indian, Chinese, Czechoslovakian, Italian, Hungarian, Yugoslavian, and German backgrounds. Indeed, Madam Speaker, virtually every culture, ethnic group, and race is represented in this community where all thrive and share the vision of a land of opportunity.
These people are the quintessential ordinary Canadians and free trade is important to them. It is fundamental to them in achieving their vision of Canada. On November 21, they decided what course they wanted their future to take.
It is with the vision and convictions of my constituency that I address this House today. Not only am I privileged to represent Calgary North with its heritage of hard work, hospitality, and free enterprise traditions, I am also proud to be a member of the Progressive Conservative team that has developed a vision for
December 23, 1988
Canada that is consistent with this heritage; a team with great leadership already in place and ready to start implementing its decision by implementing the Free Trade Agreement.
This is a vision which sees a nation bold enough not only to compete with the best in the world but to allow people the maximum opportunity to act freely and reach their full potential. It is a view of Canada as a caring society, one which provides a safety net for all those who fall, but a safety net which is taut enough to allow them to bounce back. It is not a socialist vision of a country so complicated by government regulations and bureaucracy that the very people it tries to help become entangled in its mesh, their lives and opportunities smothered in debilitating red tape.
The Canada which I and my constituents envisage cannot come about unless we have a healthy, dynamic economy. The Free Trade Agreement is a fundamental cornerstone in making this vision a reality. This agreement promises a nation which is sovereign, competitive and resourceful. It releases Canadians to trade freely. It permits Canadians to hone and perfect their skills. It allows Canadians to prosper.
Let us take a look at why the Free Trade Agreement is so important to the people of Calgary North. For the oil and gas industry, the Free Trade Agreement provides assured access to our largest export market. Calgary North has suffered too often from boom and bust cycles. Once the Free Trade Agreement is in place, we will no longer have to worry about waking up one morning and discovering that our exports have been cut off or that we have a made-in-Canada price for oil, a made-in-Canada price that sucks $60 billion out of the Alberta economy. That is right, Madam Speaker. Hon. Members on the other side may be upset that this Progressive Conservative Government has put a stop to the practice of ripping off Alberta. They are not happy with the concept of market prices for our resources, but the people of Calgary North have made their position clear.
During the recent election as a newcomer to politics I was shocked at the depth to which the opposition Parties would stoop. I had numerous calls from elderly constituents, some of them literally in tears because they had been told they were going to lose their pensions and their medicare. There is nothing which can excuse the development of this abject fear in our senior citizens. The stories we have heard, that we cannot compete with the U.S. because of our medicare costs, are completely ridiculous. It costs a Canadian company only $18 per
Canada-U.S. Free Trade Agreement
month per employee for complete medicare. An American company trying to compete would have to pay up to $100 or more for the same type of coverage. Even if there were such a condition in the Free Trade Agreement, there is no way that we would have to consider lowering our programs in order to be competitive.
The Free Trade Agreement means a stronger economy and the ability to work on eliminating the deficit and reducing the national debt. It is only then that we will be able to pay for better services, not only for pensions and health care, but for education where there is a real need for expanded programs and the development of enriched curricula.
For the people of Calgary North who work in the retail and wholesale trade, the Free Trade Agreement means increased economic activity, greater consumption, growth in sales, and more jobs. Under the Free Trade Agreement, with the elimination of tariffs, there will be a better selection of goods and lower and more competitive prices. Not only will owners, managers, and employees in the retail and wholesale sectors benefit, but the ultimate beneficiaries will be ordinary Calgarians and ordinary Canadians.
In manufacturing, the larger market provided by the Free Trade Agreement will mean opportunities for increased efficiency and product specialization. This is particularly important in high-technology industries, such as the manufacture of telecommunications and electronic components.
In the petrochemical industry 75 per cent of our products are exported to the United States. At the present time tariffs on polyethylene are 12.5 per cent and 18 per cent on methanol. Under free trade these will be removed. I can assure Hon. Members that we will see significant expansion and diversification, and many more jobs for people in Calgary North in this important oil and gas-based industry. This is an important point. It is essential to have diversification and expansion of industries that process and upgrade our natural resources, if the people of Calgary North are to avoid the boom and bust cycles I mentioned earlier.
The Free Trade Agreement will also contribute substantially to increases in construction activity. The increased economic activity will require more residential and more commercial building. This will mean more jobs for our carpenters, electricians, and trades people. Less expensive materials will be available and therefore there will be opportunities to purchase buildings and
December 23, 1988
Canada-U.S. Free Trade Agreement
building materials at lower prices. I could go on. However, from my perspective the most important thing about the Free Trade Agreement is what it says about Canada and the world.
The world is changing. Many trading blocs have been and are being established. We are all familiar with the European Economic Community, OPEC, and the Australia-New Zealand pact. It is not that simple. Other informal blocs exist or are forming, and they will eventually become formalized. For example, Canadian coal companies do not have a free market in Asia. There is an informal agreement that every year no country in the Pacific Rim will discuss coal purchases until the Japanese have met with Canadian coal producers and hammered the price as low as they can get it. Then other customers, such as Korea, Taiwan, and Hong Kong will come in and negotiate their terms. These tactics, and many others, conspire to isolate Canada to its disadvantage.
South American and Malaysian countries are also discussing the establishment of trading blocs. This is the new regime in international trade, and Canada must develop its own alliances. In my view, the Free Trade Agreement is the first step in this process. Canada is a trading nation with some 30 per cent of its GNP directly related to trade, as compared with approximately 15 per cent in Japan and 10 per cent in the United States. We have 25 million people strung out like a string of beads across the Arctic Circle. They cannot afford to be isolated from world trade and the substantial market these new trading blocs represent.
Unlike the EEC agreement, the Free Trade Agreement with the United States does not prevent us from negotiating similar deals with other countries. This must be our future goal, but first let us get on with the Free Trade Agreement.
Madam Speaker, as I said earlier, my riding of Calgary North is a most friendly and neighbourly area. The ordinary Canadians who live there are the same who were hosts last Winter to the world during the 15th Olympic Games. In my opinion, these people are far from being self-centered, because several thousands of them worked as volunteers to entertain the world during this prestigious event. They show the same kind of friendship and enthusiasm whenever they welcome other Canadians in their midst, no matter their race or colour, not only to live and prosper together, but to share their hospitality.
We are an open and warm community with diverse origins and traditions. We believe that the Free Trade Agreement with the United States is a concrete manifestation of our openmindedness and desire to meet the world community on an equal footing.
The people of Calgary North have decided. They have a vision of Canada that embraces not only free trade with the United States of America, but one which looks outward to the whole world, and a vision that within Canada there would be less regulation and more freedom and opportunity.
In closing, Madam Speaker, may I take this opportunity to wish you and your family, and most particularly the Right Hon. Prime Minister, the Right Hon. Leader of the Opposition (Mr. Turner), the Hon. Leader of the NDP, all my colleagues in the House, my constituents, and their families, all the blessings of the season.
Ms. Dawn Black (New Westminster-Burnaby):
Madam Speaker, I am pleased that the people of New Westminster-Burnaby have given their confidence to me to represent them here in the House of Commons. My constituency has a long history of sending men and women from the New Democratic Party here to represent its interests.
In fact, a portion of Burnaby was once represented by a great parliamentarian, former Leader of our Party, and distinguished Canadian, Tommy Douglas. It was Tommy Douglas and the CCF who had the courage to lead the political fight to bring universal medicare to Canadians and Canadian families.
In recent years the new riding of New Westminster- Burnaby was ably represented by the present Hon. Member for Burnaby-Kingsway (Mr. Robinson) and by a woman who has been at the forefront of the struggle for world peace, Ms. Pauline Jewett.
The overwhelming concern of the people in the riding of New Westminster-Burnaby is the trade deal that we are debating tonight. This is an historic debate for Canada, a debate that will affect the future of our country. The men and women who came here before us have ensured that Canadian social and cultural values were protected and have built our country on a cooperative model.
In contrast, the society in the United States has been driven mainly by market principles. We in the New
December 23, 1988
Democratic Party are simply saying that our Canadian traditions, our social policies, and our values should prevail. We must maintain our own political independence.
The major industries in New Westminster-Burnaby are fishing and forestry, and there is fear in the hearts and minds of the men and women who work in those industries because of this Free Trade Agreement. They have watched, as we all have watched, the President of the United States reimpose the unfair tariff on shakes and shingles, and they know that the Progressive Conservative Government in Ottawa imposed an unfair 15 per cent export tax on softwood lumber. There is no protection in this legislation against further punitive action by the United States.
B.C.'s fishing industry, according to the B.C. Fisheries Council, generates $733 million a year in sales and employs up to 8,000 men and women.
The trade regulation exempts regulations in respect of the east coast fishery. Why not for the west coast fishery? Where is the fairness in this deal for British Columbia?
The Fisheries Minister is now asking for new regulation that will only provide for landing. The Fisheries Council has already said that some of the major employers in British Columbia will move to Washington State if there are no proper grading or gutting regulations to ensure that Canadian fish can go to Canadian ports and plants to be processed. Thousands of B.C. men and women will lose their jobs. Where is the fairness for B.C. workers and their families? Next week Canada presents this proposal, and it must protect the B.C. fishery.
While a majority of Canadians stand to be hurt by this trade deal, Canadian women will suffer disproportionately. This Tory Government has given no consideration to the economic crisis facing Canadian women today.
Working women are concentrated in the very sectors that will be hardest hit by the trade deal. Almost 85 per cent of working women work in the service industries: health, education, telecommunications, and computer services. All are directly affected by this deal.
The pressure to compete on a level playing field will also put pressure on our minimum wage laws. Canadian women will pay the price, because too often they are
Canada-U.S. Free Trade Agreement
concentrated in jobs that pay as little as the law requires.
Women's organizations from across Canada have told this Government of their very real concern. But once again, Canadian women have been ignored by this Progressive Conservative Government. Where is the fairness for Canadian women?
I have listened again and again, and most recently to the preceding speaker, to government Members saying that we New Democrats frightened Canada's older citizens during the recent election campaign.
I find this to be a very patronizing attitude toward our seniors. Older Canadians built this nation. Older Canadians have defended Canada in two world wars; older Canadians struggled through the Great Depression and the hungry 1930s; older Canadians, Madam Speaker, can and do think for themselves.
One Voice, the Canadian Seniors network, made a presentation last July to the legislative committee considering the trade deal. I should like to read the closing paragraph of that presentation. It is as follows:
One Voice does not want us to close without stating that Canada's seniors, some 2.7 million persons, have a huge stake in this country. They have worked, fought, argued, voted, volunteered, saved and enjoy Canada. They don't want it to remain the same. They see it as a vibrant, progressive, evolving, participatory nation with sound basic principles stated through our provision for those who need special consideration, recognizing differences in regions, cultures and experiences. This Canadianism is worth protecting. It is our identity and seniors want to remain independently, uniquely Canadian.
Those are the words of the seniors. I do not think that we frighten them.
My final point relates to the issue of subsidies. The Government failed to reach agreement in this most critical area. During the next five to seven years the Governments of Canada and the United States will negotiate what constitutes a subsidy. Already Ronald Reagan has told the U.S. Congress that his administration has no higher priority than the elimination of Canadian subsidies which adversely affect U.S. industries.
Of course our social programs are in jeopardy, if not directly by the Americans, then indirectly as Canadian big business demands lower costs in order to compete on the so-called level playing field.
Already, only one month after the election, the Canadian Manufacturers' Association is calling for a royal commission on social programs.
December 23, 1988
Canada-U.S. Free Trade Agreement
This confirms the prediction by New Democrats that business groups will apply pressure to reduce social spending in Canada. But there is one exemption on subsidies. If any government subsidy is "sensitive to the defence of the country" it will be permissible. The result of this exemption may well mean an increased focus on military industries. This is not what the majority of Canadians want for our country.
A former Deputy Minister of Finance recently made other points about the negotiations, as reported in the Financial Times of November 28, 1988. I quote the words of Mickey Cohen, a former Deputy Minister of Finance:
We will face greater pressures to harmonize, either because the Americans are asking for it or because our own businessmen are saying, "If we're going to compete, we have to look more like the guys we're competing with. Our cost structures have to be more sound." That all along has been the valid criticism of the responsible people in the Liberals and the NDP. The problem isn't in the four corners of the agreement. It's in the pressures that will come indirectly from it.
It is not just New Democrats who are concerned about this disastrous trade deal; it is health care workers, nurses, older Canadians, teachers, church groups. In fact, a majority of Canadians are opposed to this disastrous trade deal. The Government must listen. This Government must address the deep felt concerns of Canadians.
New Democrats in this place and New Democrats right across Canada will continue the fight to protect our social programs; will continue to push for environmental protection; will continue the fight for fair regional development programs now and after the implementation of this deal.
Hon. Charles Mayer (Minister of State (Grains and Oilseeds)):
At the outset I should like to congratulate the Speaker of the House on his re-election as Speaker, as well as his re-election as a Member of Parliament. As well, I should like to congratulate you, Mr. Speaker, on your reappointment as Deputy Speaker of this place, an office you discharged so well in the previous Parliament.
I also want to thank the people of Lisgar-Marquette, a new constituency arising out of redistribution, who saw fit to elect me as their representative in the House of Commons of Canada.
It was the fourth time that I sought election to this place and the fourth time that I have been successful. Given that it was a new riding in which I offered myself for election for this Parliament, I want to express a
particular note of thanks for those who supported me in that election.
I believe that I found support among the voters for several reasons. Elections are not simple affairs. People in general pay a lot of taxes to government, which governments use, in turn, to provide more and more services to the people of the country, and elections are held so that people can pass judgment on the performance of government and what it proposes for its next mandate.
There were many issues in the last election. I do not think very many of us would disagree that one of the most important issues, if not the most important, was trade. That is why we are here tonight. That is understandable because Canada is very dependent on trade.
It has been said many times but I think it bears repeating. Roughly 30 per cent of everything Canada produces has to be traded. Agriculture, which is part of my responsibility in this Government and has been my life as a farmer and continues to be, is very obviously part of that. In fact, somewhere between 40 cents and 50 cents of every dollar a Canadian farmer earns comes from trade. Trade is very important to us.
That tells you a couple of things. It tells you first that we produce in surplus, and we have to be thankful for that. Second, when we export that much, it tells you that we better be good at what we do. In fact, we are. We export about 80 per cent of the wheat we grow because it is high quality and because we are reliable suppliers with a good reputation. We export, on average, close to 70 per cent of all the Canola we produce, either in raw form or as oil. We export something like 50 per cent of the barley we produce. We export 40 per cent of the hogs we produce, so you can see from those numbers that agriculture is very dependent on trade.
What this trade agreement with the U.S. does is simply provide us with an opportunity to continue to be able to sell into the largest and richest market in the world on a more secure basis. It is just that, an opportunity. It is not a guarantee. It is not a perfect deal. It provides us with a much better opportunity to continue to sell in that market.
To use Canola as an example, people have talked about the fact that we lose the Western Grain Transportation Act immediately with respect to that product shipped into the U.S. through the West Coast. On the other hand, tariffs on Canola oil going into the U.S. are
December 23, 1988
being phased out over a ten-year period. Those people say that that is not right. We should not have signed the deal on that basis. That is an example of where we did not get everything we asked for and would have liked to have had. They are right, it would have been better to phase out our transportation assistance over the same ten-year period.
However, if you look at the numbers you will find that after three years we are net beneficiaries so that we have the next seven years we enjoy a net gain. In fact, from the figures I have, the Canola industry stands to benefit to the tune of $25 million over that ten years. Even though it is not a perfect deal, you can see that on balance we are better to have the arrangement than to be without it.
We firmly and freely admit, up front, that it is not a perfect deal, but it is much better to do those kinds of things with that agreement than not to have it and face the possibility of the Americans using one of the sections of their Agriculture Adjustment Act to restrict us even more.
The Hon. Liberal Member for Willowdale (Mr. Peterson) talked about planning. We are going to have to plan. We agree with him. Certainly one of the things we must have when we plan is certainty. If we are to sell into a market, one of the things that gives us certainty is a set of rules. That is what this arrangement is. He asked: "How are we going to get our own agenda if we do not have certainty of access?" This agreement provides us with much more certainty of access than we would have without it.
The Opposition says we cannot compete. The Americans have a longer growing season than we do. They are able to produce two crops a year. Their yield per acre is higher than ours. In some cases they are right but understand that because of our climate and because of the shorter growing season, we have long days and cool nights during the summer which allow us to produce a different and we like to think a higher quality product. It is for that precise reason that Canola is in demand in the U.S. We should not be fooled by people who say that we are uncompetitive because of our northern climate. It is exactly the opposite.
We produce probably the highest quality milling wheat in the world. Last year the Americans bought almost one million tonnes of wheat from Canada. I understand, as well, that last year the U.S. was the largest wheat exporter in the world. It exported over 40 million tonnes. Why would they buy from Canada at the
Canada-U.S. Free Trade Agreement
same time that they are exporting 40 million tonnes? Not because we are good fellows and they want to do us a favour, they bought it from us because we produce a high quality product.
If you read the agreement it provides that we shall have more certainty of access to that market. That gives us a chance to plan. It gives us a chance to invest for a more certain return over a long period of time.
The Opposition has said that the U.S. will put our vegetable growers out of business. Again, do not be fooled by that. People should know that there are substantial food processing industries in Wisconsin, Michigan, and New York State. You would think if anyone was going to put those three states out of business it would be California. Look on the map. Compare the latitude of southern Ontario to that of Wisconsin. It is roughly the same. In fact, southern Ontario is farther south than the northern parts of Wisconsin. You want to know something? Some 25 per cent of the canned vegetables in the U.S. come from Wisconsin. That does not mean we are going to have any kind of guarantees in that market, but it sure tells you that with a better set of rules we will have more certainty of access.
We did not elect any Members from Prince Edward Island. That province is well known for growing potatoes. I come from Manitoba and we like to think we produce some pretty high quality potatoes. We do. Yet, I think it is fair to say that P.E.I. has a reputation for producing probably the highest quality potatoes in Canada. I visited the province during the election campaign and went into the Cavendish Farms processing plant. They told me that 30 per cent of their production went to the U.S. They want the trade agreement because it gives them more certainty of access to that market. Look at the map again and figure out how far it is from Charlottetown to New York and then compare that with the distance from Charlottetown to Toronto. Look at the population down there and the tremendous potential that represents for a high quality product to be processed here and sold in the U.S.
If you look at the value added side of agriculture, in percentage terms Prince Edward Island has the most value added agricultural sector in Canada. That means investment, jobs, transportation. If you are in Prince Edward Island and produce a high quality product, which they do, and you have a large market closer than Toronto, the largest market in Canada; if you have a market in the U.S. which is larger than the biggest market in Canada and you are closer to that U.S.
December 23, 1988
Canada-U.S. Free Trade Agreement
market, does it not make sense to put in place an agreement that provides a set of rules that gives you more certainty of access to that market? That is all this agreement does.
When you start looking at some of the things we are doing in this agreement, it makes you wonder what the people in the Opposition have been saying. Why should we as Canadian farmers-and I speak as a Canadian farmer-be afraid when we have a product second to none around the world?
As I said, 40 per cent of our hogs are exported. That is a pretty impressive record. It speaks to the quality of the product that we export. There is an outfit in Saskatoon called Intercontinental Packers. It began selling into the U.S. market four years ago. To be more specific, it began selling to the California market four years ago. At that time it had very little product moving into the United States.
During the election campaign I had a chance again to visit with one of the people who manages the company. He told us that they, out of 28 brands, are now number three in the California market. This company has 200 jobs in Saskatoon. It is a value-added type of situation. The hogs are produced in the province, as is the barley. The barley is fed to the hogs. The hogs are taken to the slaughtering plant. They are processed and then shipped to California. That is good for us. He thinks that within five years, with the trade agreement, he can create an additional 500 jobs in Saskatoon selling what we produce in Canada to the United States. The agreement gives him certainty of access, or more certainty of access, so that he has the confidence to go to talk to his bankers, to expand his production, and to buy more hogs from farmers. The farmers buy more barley from their neighbours. It is good for us. Members have talked about being hewers of wood and drawers of water. This is an example in agriculture where we do not have to do that any more. We can provide jobs.
There are other opportunities in the United States. We produce in Canada the highest quality Durum wheat in the world. It is pasta wheat. It is used for making noodles, for lasagna, spaghetti, and those kinds of things. The United States has a $1.5 billion market for noodles. I wonder what is wrong with the noodles sitting on the other side of the Chamber when we hear some of the doom and gloom that they come up with.
That pasta market from 1972 until 1984 grew at a compound rate of 11.6 per cent per year. Do you know
what Canada's share of that market is, Madam Speaker? It is two-thirds of 1 per cent. Italy sells three times as many pasta products to the United States as do we. Japan and China together sell as many pasta products to the United States as do we. Why? It is incredible when we look at the quality of product. We have the best quality wheat, good people, and good transportation. This agreement provides security of access to that market. It will encourage our people in Canada to build plants to produce these products to send to the United States.
In 1986, there was a $6.8 billion market in the U.S. for cookies and crackers. Imports grew at 13.2 per cent over the last 12 years. I ask Hon. Members to think about that. It is not 2 per cent or 5 per cent. It is over 10 per cent per year on the import side. Canada's share is 1.1 per cent, yet we produce the best quality wheat in the world. There is a rich market next door to us. This agreement gives us more security of access, a better opportunity for us in the West to grow things we are good at growing, to process, and to provide jobs, yet the Opposition is against it.
We are not saying that there are any guarantees. All we are saying is that there is an opportunity. That is why people came to the country in the first place to farm. They did not come here with a guarantee. They came because there was an opportunity. They had some vision. They were willing to work and sacrifice. It was the same thing with my family. I am the first generation in my family born in this country. Why did my parents come here? They came because there was an opportunity. They did not come because there was a guarantee. They believed in themselves and the country. They worked hard and they have made it what it is. That is what we are doing today-providing more certainty of opportunity to give not only this generation but the next a better opportunity. That is simply what it is.
We face a large accumulated debt in Canada. There are two ways to get out of it. We either produce our way out of it, which means packaging it, transporting it, and marketing it. A big part of what we market, especially in agriculture, means export. Or, we print and we borrow it. We know what printing and borrowing have done to us. They gave us 22 per cent interest rates in the early 1980s. It does not work.
What are Members opposite proposing as an alternative? Instead of standing up to say that we think this part is bad, but this is good, they say that everything is bad. Tell us what the options are. They say: "Go to the GATT".
December 23, 1988
I spent 10 days, as did the Minister of State for International Trade (Mr. McDermid), at the GATT. Some of us were down there. We know what that is like. It is very difficult to deal with 95 countries to get agreements. We provided an opportunity for members from the Liberal Party and the NDP to be part of the process. They are such enthusiastic supporters of GATT. We never heard a peep out of them. We could not find hide nor hair of them. Where were they?
That is not true.
They did not show up. We would have done everything we could to have made them part of the process. I asked about them. Where were they? They did not come near the place.
What are their alternatives? Do they want to print and borrow it? There are 25 million people in the country. Better access and more secure access-and 1 am talking about agriculture and other areas of opportunity to us-that is what this agreement is all about.
The NDP members want to tear up our NATO agreement and our NORAD agreement. They want to ignore or to pretend that we do not have allies in defence and that we do not need them.
The Liberals want to tear up the trade agreement. 1 do not understand why these people are afraid of our allies. Why should they be afraid of our allies? There is a large country to the south of us with which we have very good relations. It does not mean that we will always have everything our way and that there will not be disputes. Sure, there will be disputes. When as much trade is done between Canada and the United States as we do, there will be disputes. But, with the dispute settlement mechanism in place we are provided with a much better opportunity to deal with disputes in the future than we have had in the past.
It is not binding.
When there is a large market, the agreement provides us with better access and more secure access.
It is not guaranteed.
I did not say that it was guaranteed. There are no guarantees. When there are better opportunities to deal into that market on a more secure basis, why are Members opposite so nervous about entering into the agreement?
Canada-U.S. Free Trade Agreement
What I find discouraging about the process that we are going through here tonight, and we have been going through it for almost the last year, is that there are no alternatives offered. It is an interesting ploy that when one cannot offer an alternative one stands up and misrepresents, distorts, twists, and exaggerates. One tries to frighten people. One says that everything will be awful and that everyone will lose their pensions and their identities. They say that the Americans will come up here to take our medicare cards out of our pockets. When people are afraid hopefully they will do what is wanted of them. That is not what we are as Canadians. We are good at what we do. We are good in so many areas.