Derek Vincent Lee
Mr. Derek Lee (Scarborough-Rouge River):
Madam Speaker, as I commence my remarks here tonight in what I believe is a truly historical evening, I want to extend to the Speaker of the House and the Clerk of the House my appreciation for their courtesy and efforts to assist in the settlement of new Members of Parliament in what has been a relatively short period of time. As important, I want to thank the constituents of Scarborough-Rouge River for their electoral support that permits me to speak to the House tonight.
The riding of Scarborough-Rouge River is a constituency of urban Canadian multiculturalism. It is a riding where, thanks to the laws and institutions created by our people in this Parliament, the mix and interplay of culture are laying the groundwork of cultural understanding and tolerance which we hope will serve our nation in the decades to come.
My riding is one part of the country where we see at work the great Liberal principles of opportunity, tolerance, and reform. These principles are minimum government contributions to our society under what I could call the social contract that we have entered into in the Canadian parliamentary democracy. Opportunity is what trade agreements are all about. Liberals in the western world are no strangers to the concept of free trade. Liberals have been free traders for 200 years. North America was built on the principles of classic Liberalism.
In speaking of the subjects of opportunity and trade, I want to note sadly the death this week of Mr. Arthur G. Simpson, a man who manifested in my riding the opportunities present in our country with or without trade agreements. Through his company, A.G. Simpson
Canada-U.S. Free Trade Agreement
Ltd., Mr. Simpson operated five automobile parts manufacturing plants in Scarborough, Oshawa, Cambridge, Oakville, and Windsor. He employed more than 1,700 people. His success and that of his workers is testament to the opportunities present in our country. Mr. Simpson was an industrial builder who needed no lessons in how to think smart, manufacture, and export. He will be missed.
Economists generally accept the theory that if barriers to trade are lowered trade will increase. If trade increases then enhanced economic activity and related economic growth will occur. These principles are contained in every basic economics text.
Let us look at exactly how much trade liberalization is contained in the Canada-U.S. Free Trade Agreement for Canadian exports. First, there are the two general types of barriers to trade. There are tariff barriers and non-tariff barriers. The principal non-tariff barriers are anti-dumping duties, "buy American" legislation, countervail duties, and regulatory barriers.
These types of tariff barriers were initially described as the chief motivating reason for entering into negotiations for a trade agreement with the United States in the first place. Exporting to the United States was beginning to become a minefield of non-tariff trade barriers. Under the proposed trade agreement they still are.
Our softwood lumber export position is deteriorating because of non-tariff barriers. Even though the Hon. Minister for International Trade (Mr. Crosbie) vaunts in glowing terms the prospects that this trade agreement will bring about, it does precious little to remove nontariff trade barriers. Not the countervail, not the antidumping, not the regulatory framework; only U.S. federal purchasing regulations will be changed but not the state or municipal.
The Government's negotiating team brought back the equivalent of a consolation prize. The Government claims it has created a non-binding dispute settlement mechanism. I submit that this consolation prize is a lifeless, toothless dead fish. The Hon. Minister for International Trade will know what that is all about.
With respect to actual trade barriers, how much trade liberalization did we achieve in this area? Only one-fifth of our current U.S. trade is now subject to tariffs. While I would not underestimate the significance of this portion of our trade, the actual measure of tariff relief was small. The actual bottom line total of trade liberalization was as follows: tariff reductions to zero for only one-fifth of our U.S. exports, no relief from anti-
December 23, 1988
Canada-U.S. Free Trade Agreement
dumping or countervail or the regulatory NTBs, and only a partial rollback of pervasive U.S. buy America legislation.
The Government has presented this to the country, saying that these benefits constitute opportunity; and more than that, an economic blueprint for the future.
The Government states that out of these marginal trade gains will come the so-called winners and the prosperity promised by it. We shall see.
Let's look at the price we had to pay to get these so-called winners. We have given up all our tariffs, tariffs which have protected Canadian industry for decades. This is the so-called "cold shower" of competition envisaged by the pundits.
Out of this cold shower will appear our losers- industries and firms which are important, and even fundamental, to Canadian communities but which will fail to survive and, by their failure, throw thousands of Canadians out of work. We have given up our right to control for Canadians our energy sector. In this vital area of our economy, an area where already we are dominated by and subjected to a high degree of nonCanadian control, decisions on who, where, and when we develop our resources will, without question, and in total deference to corporate America, be made in the boardrooms of Dallas, New York, Chicago, and Los Angeles.
However, the boardroom table in Calgary, in Montreal, in Toronto will sit empty, with only a vase of wilted flowers, a two-week old copy of the Wall Street Journal, and perhaps a fax machine for communicating with head office.
Shame on the Parliament or the legislature that abandons the worker, his spouse, and his children in Lloydminster or in Campbellton to the unrestrained business decision of a person or group outside Canada, someone who knows nothing about that man, his family, his city, his pride, or his dreams, and who has absolutely no interest in the regional and national goals of this country.
That is abdication of our responsibility as legislators, and that is what this Government is doing under the guise of the Free Trade Agreement. Not only do we give up control of the boardroom, we have agreed to pool our energy with that of the U.S.A. We have had to give up our right to decide for Canadians how and when energy resources are exploited and marketed. Washington will
now help us decide, and Washington has a guaranteed share.
We have given up our right to control our capital markets for Canadians. Now decisions on credit worthiness, commercial viability and discount rates will be taken in New York and handed down to the suitcase banker. Decisions on how and when capital is invested, and even how the non-bank savings of Canadians are reinvested, have now, by this agreement, been effectively exported to wherever the Lear jet has been parked. Canadians resent this Government permitting this fundamental tool of nation-building to be tossed into the tool box of corporate America.
In one of the more cruel ironies of this agreement our negotiators set out to claim some form of exemption for our cultural industries. Well, they got an exemption in Article 2005, but there was a price tag, a price tag defined as "measures of equivalent commercial effect".
This means that if an American enterprise is prejudiced or harmed by cultural initiatives or our Government, that enterprise will have to be compensated.
The net result is that, where our cultural initiatives stray from the American commercial norm and it costs an American money, we must compensate that American; in effect, pay a royalty.
The Canadian people, Mr. Speaker, will never pay a royalty to Americans to enable us to foster our cultural initiatives. I call this price tag the Jack Valenti royalty.
As one example of the many giveaways in this trade agreement we have agreed, in a related cultural industry provision, to remove from our Income Tax Act the provision which has influenced Canadian advertisers to place their buys with Canadian magazines and publications printed in Canada.
This provision has sustained and given new life to the Canadian periodical publishing industry, and this new life is now to be placed in jeopardy.
And what about the losers, Mr. Speaker? They are there, too. All sides of this House recognize that there will be losers under this deal. Entrepreneurs will lose their businesses; workers will lose their jobs in bankruptcies; workers will lose their jobs in branch plants when those plants close following head office decisions south of the border, decisions made because the protective tariff is gone and the fact that just one extended production run in Cairo, Illinois, or Columbia, South Carolina will produce all that is required to serve the whole of the North American market.
December 23, 1988
The one thing that the working men and women in Canada will agree on is this: if this Government is going to commit this country to an economic course paid for with the jobs of our workers, then this Government had better have the programs to assist in the adaptation and retraining of those workers, or it won't be the Government for long.
One very interesting element of this trade negotiation with the United States has been the need to look closely again at the unique relationship between our two countries, a relationship that has preoccupied Canadians for two centuries, primarily because of our relative closeness geographically and culturally.
It is, I think, because we are so close to the United States of America, because we cast a shadow on each other along the border, that we have difficulty measuring our relationship objectively. It is that confusion over our relationship which hinders our ability to address this trade agreement objectively.
It is precisely because we are so close to each other that we resist being drawn closer together under this trade agreement. This is not anti-American. This is healthy Canadian self-interest. The closer our two countries get, the more we sweat. Under this agreement we will pull our country closer to the precipice, and all on the promise of a few dollars more, a few jobs more.
I am saddened to hear some Hon. Members on the other side of this place describe this agreement as the key to prosperity or the ticket to the future, without realizing how close we are to abandoning our tools of nation-building.
If we are to maintain and improve our society and increase our prosperity, it will occur because Canadians work hard for it and not because we deal or barter for it.
My conclusion, Mr. Speaker, is in reaching this agreement we have given up far more in the bargain than we have obtained. If this trade agreement was just the mutual elimination of tariffs, which it could have been, we could freely address the future proudly as a nation. But such is not the case. This agreement is much, much more. It is that way because the Americans bargained for those other things, and we gave them away.
If we are to have this agreement, then we will not abandon our workers, we will not pay royalties to exercise our cultural sovereignty, we will not neglect rural and agricultural Canada and native Canadians, we will not permit erosion of needed social programs, and
Canada-U.S. Free Trade Agreement
we will never abandon or sell our independence to continue to build this country and provide its citizens with the opportunities essential for their future.
I know that if this legislation is made law, all Members on both sides of the House will address the 10 years of transition to full implementation with those objectives in mind.
Subtopic: CANADA-UNITED STATES FREE TRADE AGREEMENT IMPLEMENTATION ACT MEASURE TO ENACT