December 18, 1987 (33rd Parliament, 2nd Session)


William Warren Allmand


Mr. Allmand:

In any case, this kind of remark from the government side shows that they are embarrassed by the statements of Mr. Kierans. They cannot sit and listen to that sort of thing because it upsets them and tears holes in their argument.
In addition to reducing our tariffs to zero over a 10-year period-and the United States is reducing its tariffs to zero- what else did we give up, and why was it necessary? With respect to the energy provisions-and I have to read from the elements of the agreement of October 5 because if I try to read from the detailed legal text of December 11 it would take me a whole afternoon-this is what they said in the agreement:
There is broad agreement to assure . . . non-discriminatory access for the United States to Canadian energy supplies-
I think Canadians should examine that statement in detail. They go on to say in the agreement:
Both sides have agreed to prohibit restrictions on imports or exports, including quantitative restrictions, taxes, minimum import or export price
December 18, 1987

requirements or any other equivalent measure, subject to very limited
That is providing the United States with very wide access to our energy resources.
One must ask why was this necessary in what is described as a free trade agreement. Generally in a free trade agreement both sides reduce tariffs or eliminate them. It might have been sufficient if we eliminated our tariffs over a 10-year period and they eliminated theirs over a 10-year period. But no, Mr. Speaker, not only did we have to agree to eliminate our tariffs so that they would eliminate theirs, we had to throw in unrestricted access to our energy resources, as I just quoted the deal.
Is that appropriate in a so-called free trade agreement? Why was it necessary to put that in? We submit that it was not necessary. It indicates poor bargaining strength on the part of the Government and an inability to negotiate from strength.
What else did we give up? Let us look at the provisions with respect to investment. Again to quote from the elements of the agreement it says that the Parties have agreed to provide each other's investors national treatment with respect to the establishment of new businesses, the acquisition of existing businesses and the conduct, operation and sale of established businesses. What does that mean? It means that Canada has agreed to treat American investors and American companies operating in Canada just as Canadian companies. We have given up the right to screen foreign investment from the United States and control how U.S. investors operate in Canada. We have given up our right to legislate on that as we see fit in the best interests of this country.
Again one must ask why was this necessary if we had already agreed to eliminate all our tariffs. Again we gave up something that we should not have given up and something that was not necessary.
Let us look at the provisions with respect to financial services, banks and financial institutions. Once again we gave up a long standing tradition of control over our banks and financial institutions which has existed in this country for years and years.
With respect to the Auto Pact we have weakened it. We have given up the safeguards that made the Auto Pact effective in bringing investment and jobs to this country.
Concerning agriculture, we have put Canadian farmers in competition with American farmers despite the fact that Canada has a shorter growing season. Our farmers must deal with harsh winters and all the expenses that that entails. In general, Canadian farmers are farther from mass markets compared to American farm producers. Despite all of those things the Government has thrown our Canadian farmers into the same market-place as the larger American corporate
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farmers from California, Florida and Arizona where there are very long growing seasons and lower costs.
These are some of the things that we gave up in the deal in addition to reducing our tariffs to zero. I have to repeat again and again that usually one would expect in a free trade agreement that a country, in this case the United States, would reduce or eliminate its tariffs and we would eliminate ours and there would be no tariffs on either side. That is what one would expect. But no, this Government, this weak-kneed Government decided to give access to our energy supplies and agreed to give up the right to control investment in American business operating in Canada, and we have given up our traditional control over financial institutions, banks and so on. The Government has thrown our agricultural communities into what I consider to be unfair competition with American producers and the safeguards in the Auto Pact have been given up. All those things are written right into the agreement.
What about those things we have given up that are not written in the agreement which, by the way, Conservative Members pretend do not exist. Here I am referring to the way in which this agreement undermines our regional development programs, our social programs, our labour programs and our environmental programs.
With respect to our regional development programs, they will still be subject to countervail from the United States. They have been countervailed before. In addition, they will be subject to the pressures of harmonization as a result of competition between Canadian firms and U.S. firms. I say that our regional development programs will still be subject to countervail despite this deal with the United States.
Let us look at what the United States Department of Commerce has already said about some of our regional development programs. For example, because we have a fishing vessel assistance program that is a sort of unfair subsidy to fishermen and, therefore, subject to countervail. They have said that our agricultural and rural development programs were countervailable and they imposed countervailing duties because of those programs. I could go on. I have a list of 12 regional development programs which the American Department of Commerce consider to be countervailable and imposed duties as a result. Nothing has been done in this deal to modify or moderate this ability by the American Government to countervail against our regional development programs.
What about our social programs, our labour standards, and our environmental laws? What about such things as medicare, family allowance, day care programs, minimum wages, unemployment insurance, health and safety standards, affirmative action programs and so on? Because these things are not written specifically into the deal the Government said they are not touched by this and that they are protected.
You do not have to be very intelligent to know that if a Canadian firm, subject to all these laws and standards that I have referred to, is in competition with an American firm, that

December 18, 1987
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has complete and total access to Canada, it will lose out to the American firm that will have lower costs. In many States of the U.S., and in its federal Government, there are not the same high standards of unemployment insurance, minimum wages or affirmative action as we have here in Canada. The Canadian firm will be subject to higher costs because of those things. The American firm will have total access to Canadian markets to sell its goods and services.
I would like to refer to a statement made about 10 days ago at a symposium on this so-called free trade agreement in Montreal. Manfred Meier-Preschany, former chief of worldwide loans for the Dresdner Bank in West Germany said:
Without a free trade deal Europeans are almost forced to invest in Canada to reach the Canadian market. But free trade would allow them to serve Canada from plants in the United States.
If large European firms are given the option of locating a manufacturing plant in either Canada or the United States, they will, "almost by definition use the United States". That is because of such factors as transportation costs, taxation rates, market size and labour laws.
This deal will not bring jobs or investment to Canada. It will weaken our standards, weaken our programs and bring down our costs so Canadian firms can compete with American firms and thereby the pressure to harmonize with the lower standards in the United States will have to take effect. Either that or sooner or later firms will move to the United States where they will have lower costs, lower standards but still sell into Canada, thus having the best of both worlds.
Who wins in that deal, Mr. Speaker? Of course the Canadian firms. That is why business is in favour of this deal. Canadian firms can move to the United States. They are free to invest there but the workers who live in this country are not as free to move. They are not like capital.
In conclusion, we have to ask Canadians what kind of a country they want. Do they want one that becomes, as a result of this deal, a quasi-colony of the United States, an appendage of the United States? Do they want a free and independent country that will be able to act in its best interests whenever it sees fit to do so?
It is very interesting to note that we terminated our last colonial link with the United Kingdom with the Constitution of 1982. When we brought the Constitution home and established our own amending formula, the Constitution became completely Canadian. That long process started with the Battle of Vimy Ridge in the First World War when Canadians fought as an individual nation. We proceeded through the Statute of Westminster, the abolition of appeals to the Privy Council and the establishment of a Canadian Governor General. It went on and on, and in 1982 we became a fully independent country. It has only lasted for five years. Now this Government has sent us in the other direction. We will become a colony of the United States unless Canadians can stop this Government in a general election.
I ask Canadians, people beyond the House of Commons, to think seriously about this issue and to think about what kind of country they want. Do they want one that is part of the United States empire or one that is a free and independent country?

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