As you may have heard by now, International Trade Minister Chrystia Freeland announced today that Canada will be signing the Trans-Pacific Partnership at a formal signing ceremony in Auckland, New Zealand, in early February.
Freeland hastened to add that signing the deal and ratifying it are two different things entirely, and that on the subject of ratification, the Liberals are still far from making up their minds. In all of her rhetoric, she leans ever-so-slightly in favour of ratifying the deal (“Just as it is too soon to endorse the TPP, it is also too soon to close the door…It is clear that many feel the TPP presents significant opportunities, while others have concerns…”), but is careful to always include the contrary viewpoint as a hedge. Her careful phrasing is a massive departure from the pro-anything-trade-related effusion which typified Stephen Harper and his lapdog cabinet (there’s that famous difference in tone yet again).
Some observers are skeptical of this prevarication and feel certain that, after the whole elaborate public-consultation listening tour show is over, the beholden-to-Bay-Street Liberals will use their substantial majority in the House of Commons to push the deal through.
Initially, I have to confess, that was my suspicion. However, the Libs seem more wobbly on this with each passing month. Back in November, I pointed to incoming Agriculture Minister and Liberal good ol’ boy Lawrence MacAulay’s declaration of support for the TPP as a major indicator of which way the party was leaning. However, parsing Freeland’s carefully equivocal statements over the past several weeks has led me to conclude that she’s either got an extremely strong poker face or she is legitimately uncommitted to passing this deal.
And in a way, this makes a kind of sense. Opponents of the TPP – myself included! – sometimes get caught in the trap of thinking of major business and financial interests as being monolithically supportive of the deal. But, in Canada at least, that’s just not the case. No less a titan of industry than Jim Balsillie, founder of RIM and creator of the once-ubiquitous Blackberry, said that the TPP could cost Canada hundreds of billions and would one day come to be regarded as the worst policy blunder in Canadian history, and there certainly hasn’t been overwhelmingly vocal support for the deal from major players in the Canadian economy like the oil/pipeline complex or the Big Banks.
After all, as a landmark and widely overlooked study from Tufts University released last week projects, the TPP will have a negligible impact on the Canadian economy while costing this nation some 58 000 jobs. The total economic benefits from the deal will amount to a mere $5 billion per year, according to the study, barely more than the $4.3 billion in government subsidies the Harper government offered to the dairy industry as compensation for the profits they’ll lose under the TPP.
As numerous TPP watchers have pointed out, it’s not a trade deal. According to the Tufts study, it will lead to only the tiniest margins of growth in most TPP member nations, and will lead to decreased employment in every single one of them.
To be sure, a few narrow industries stand to benefit, and they’re making themselves heard. So, for instance, the CEO of a seafood company turned out to a TPP consultation session in Halifax (which featured “business, academic and government officials”) to express her strong support for the deal, which would quite likely benefit her business substantially. The government of Saskatchewan is pushing the deal hard, insisting it will majorly benefit their (not-exactly-family-owned-and-operated) agricultural sector.
But does the deal enjoy broad and strong support in the Canadian corporate community? I’d say it rates a “yeah, why not” on a scale from “meh” to “hell yeah!”.
Meanwhile, the TPP’s critics aren’t just articulate and well-researched – they’re also well-connected. When Freeland visited the most prestigious campus in Canada, the University of Toronto, on her listening tour, she was met with a solid wall of resistance from the faculties of both the top law school in the country and the mining-industry-endowed Munk School of Global Affairs, as U of T’s own website reported.
So we have relatively weak elite support for the deal. And that’s before we even begin to consider some of its more noxious provisions, like the corporate-rights-entrenching ISDS mechanism, which is the single aspect of the TPP most likely to generate public opposition.
Interestingly, Canada’s trade file was in the headlines this week in a not-unrelated issue – the CETA “free-trade” treaty with the European Union. The deal has sat idle since negotiations were completed a few years ago, unratified by the EU Parliament. Now, as parliamentarians across the pond, allegedly inflamed with “anti-American sentiment“, take a closer look at the issue, they are growing horrified with the ISDS provisions it contains and are demanding that Canada return to the table to fix it.
Not to renegotiate, mind you. There was an agreement in principle in 2013 and negotiations were completed in 2014, and it would set an awful precedent to reopen negotiations, so whatever you call this changing of the deal, don’t call it renegotiation:
“Both parties don’t want to re-open negotiations,” said Marie-Anne Coninsx, the EU’s ambassador to Canada.
But: “there might be some legal adjustments that would be necessary to the clause and we have indications from both sides that there’s willingness to do this,” she told CBC News.
Negotiators have been meeting weekly by video conference, as a legal process to “scrub”, or vet, the text and check 23 language translations drags on. The EU believes this section can be reworked as part of the “scrub.”
International Trade Minister Chrystia Freeland told reporters in Montreal last week that both she and Prime Minister Trudeau are holding talks and she’s confident they will get a deal soon.
“I’m not going to give you specific timelines because we’re negotiating now, and sort of — negotiating is the wrong word — we’re getting through with the Europeans, across that final mile to the finish line,” the minister said.
So, knowing what we know about the official aversion to renegotiation (Freeland reiterated recently that negotiations on the TPP are closed and it’s a take-it-or-leave-it deal), and knowing what we know about the official willingness to bend these rules by simply not calling a spade a spade, the most likely path forward becomes clear.
There are doubtless aspects of the TPP that the Liberals aren’t wild about and that they wouldn’t have agreed to if it had been them at the negotiating table rather than their predecessors. The deal was produced under intense round-the-clock pressure-cooker conditions, and no doubt several TPP member nations are feeling the same way.
One way forward for these conflicted parties is to cut side deals. The TPP already features many of these – roughly twenty between Canada and the U.S. alone. These deals are basically bilateral addendums grafted on to the main deal, and allow for major aspects of the agreement to be renegotiated – without reopening negotiations.
The most likely path forward for the TPP in Canada, as far as I can see, is through these side deals. The Liberals could use them to undercut criticisms of the worst aspects of this atrocious deal, fetishize the resulting outcome as an obviously inherently good “compromise”, pretend they got the best deal they could for Canada, and shove it right on through Parliament.
(Note that this is better than straight-up ratification, albeit only slightly.)
In my analysis, though, this is only marginally the more likely outcome. Based on the government’s cautiously vague statements on the subject as of late, I think there’s a pretty non-trivial chance that this deal doesn’t pass.
First of all, there’s not a lot of upside for them in passing it. The deal isn’t exactly popular, and the more that people who aren’t Chamber of Commerce members know about it, the less they like it. Meanwhile, with the business community’s support being tepid at best, the Libs would get minimal credit for ratification, as well as losing some of the soft support they picked up from the NDP in the dying days of the anybody-but-Harper election.
(I actually encountered several heads-up-their-asses buffoons in the comments section of the CBC’s article on Freeland’s announcement that she would sign the deal who said that they’d voted Liberal but were now questioning their decision. Like, what exactly did you expect when they said they were “pro-trade” and would have to “wait and see what’s in the deal”?)
Additionally – and crucially – there’s not a lot of point in Trudeau expending political capital to push through a not-so-hot trade deal if it winds up never coming into force. And that’s not exactly impossible, given the ambivalence of key American politicians towards the TPP.
Granted, Congress has fast-track authority, meaning the deal is subject to a straight up-or-down vote. Such votes are ripe opportunities for legalized bribery, a.k.a. pork projects. If you vote for the TPP, Senator, we’ll guarantee your state gets an additional billion in subsidies for the industry of your choice. That kind of thing.
That being said, there is substantial opposition to the deal in both parties in Congress, especially among backbenchers. (The big names in both the Democrats and Republicans are either in favour or liable to become so when push comes to shove.) Also, opposition is widespread among leading presidential candidates. Bernie Sanders is strongly against, and Hillary Clinton more tepidly so. (As with the war in Iraq, she was for it before she was against it, and as always with a Clinton, you have to question just exactly how calculated each and every word she utters might be.) Most of the Republican field of candidates is also vociferously opposed to the TPP – and they’re the party of the billionaire class!
Ever since the negotiations were concluded last October, there have been major questions about the deal’s ability to make it through Congress. My money is on Trudeau taking a wait-and-see approach to this, at least until after the U.S. Presidential elections this fall. And what better way to get credit for doing nothing than by conducting a high-profile cross-country public consultation listening tour?
Although I still think that ratification is more likely than not, I’m more optimistic on the TPP than I’ve been in a long time. Today’s signing ceremony announcement notwithstanding, I think there’s a lot to be optimistic about.
And the best thing that anti-TPP folks can do, in the face of relatively weak elite support, is to make it crystal clear to Trudeau and the Liberals exactly what ratifying this deal will cost them. Make a ruckus in the streets, write to your Liberal MP, sit in at their office, write a letter to the editor of your local paper – do literally whatever you can think of to put pressure on the Liberal Party to think twice before moving forward on this.
With a bit of luck and a lot of determination, we may yet be able to beat this thing!