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TechnoratiGo Ahead and Reopen NAFTA
Yes, let's punish the official who leaked the Canadian memo that created heat for Barack Obama, future president of the United States.
But let's not waste much time examining the mouth of this particular gift horse.
Let's just consider ourselves lucky that the heated U.S. Democratic presidential race may result in NAFTA (the North American Free Trade Agreement) being put back on the table.
NAFTA is deeply flawed from Canada's point of view. We failed to get the promised "guaranteed access" to the U.S. market (as the softwood lumber case amply showed), while giving up important levers over our economy -- most crucially, control over our energy.
Ottawa's failure to protect Canadian energy sovereignty has always been curious. But, with oil prices leaping wildly, it takes on a whole new level of curiosity.
Here's the problem: NAFTA contains a clause that effectively prevents us from cutting back exports of our energy to the United States -- even if it means there will be energy shortages in Canada.
This "proportionality clause" is highly unusual. Indeed, according to a new report by the Alberta-based Parkland Institute, it is "unique in all the world's treaties."
The oddity of this clause and Canada's willingness to accept it -- Mexico refused to and was granted an exception in the treaty -- has never been much of an issue in Canada. That's because anything smacking of energy nationalism has been virtually banished from this country since Pierre Trudeau put forward his National Energy Program in 1980, creating deep suspicions in Alberta of federal intrusion.
But the escalating world energy crunch should finally shake Canada out of its near 30-year slumber.
High world oil prices are at least partly a reflection of the fact that global oil supplies are dwindling; that is, we're using up oil faster than we're finding new sources of it.
This is the flip side of the global warming dilemma. While our overconsumption of oil risks frying the planet, we also risk running out of the fuel that runs the modern world -- the only world we know how to live in.
Canadians are vulnerable. We have roughly a 13-year supply of conventional oil, and a 9.3-year supply of natural gas. Yes, the oil sands are massive but, with the extremely high levels of greenhouse gas emissions released in processing, they're far more problematic than we've acknowledged.
Canada already imports about 49 per cent of its oil needs (particularly in Eastern Canada), with about half coming from unreliable OPEC sources. Unlike the United States, Canada has no stockpile of oil for an emergency. It's also very cold here; energy shortages would impact us in a particularly cruel way.
NAFTA supporters insist Canadians are well served by the proportionality clause, since we get to sell our energy to the U.S. and make lots of money.
But without the clause, we could still sell our energy to the U.S. and make lots of money. The only difference would be that we'd also have the option to sell it elsewhere -- including to Canadians who might badly want it. The price, which is set by world oil markets, would be the same.
So reopening NAFTA might not be such a bad thing. Of course, the Americans would be tough negotiators, and control over Canadian energy is not something they'd give up easily.
But we could hope that, a second time around, Canadian negotiators might at least be as tough as their Mexican counterparts.
Linda McQuaig's column appears every other week in the Star.
© Copyright Toronto Star 1996-2008
17 Comments so far
Show AllCanada should dump NAFTA and ask if it can join the EU.
Come to think of it, asking may not do it. But I for one would not mind begging (a bit).
I'd quit the loonie and the toonie in favour of the Euro in a heartbeat. (If you are American and don't know what a loonie or a toonie is, you're not entitled to comment on NAFTA.)
By all means dump NAFTA.
I don't think Canada will sell much oil to countries other than the US. If the cost of transporting a bbl of Canadian oil to china is $1.00, then the cost of transportation to the US would be maybe 25¢. So the US could pay 50¢ more per bbl & still get Canadian oil 25¢ cheaper than China.
Its 5500 miles from Prince Rupert to Shanghai. It is 1800 miles from the Sakhalin oil field in Russia to Shanghai. China may prefer to get oil from Siberia. The transportation costs are 1/3 that from Canada, the route is shorter and less subject to piracy and interdiction.
"The only difference would be that we'd also have the option to sell it elsewhere —"
Linda McQuaig is somewhat naive. If Canada would try to sell it's oil elsewhere, we'll see American Abrams M1A1 running the streets of Calgary.
Canada doesn't get a lot of companionable respect from the USA.
You've got a point there.
But I'd say this everybody hates America stuff is a bit overdone. Many are rightfully hacked about the last 12 years, but there isn't near the animosity the media likes to portray.
Trade wise, Canadians wouldn't like it if our trade did stop. Thats simply empirical fact. My opinion is simply that they would miss us.
Texas is on the other end of this piece of garbage called NAFTA, so I think the Canadians should opt out and so should we. Lets dump the thing and start over.
Dump NAFTA!!!
Colder and lonlier in the North? I don't really think so. How many Americans could find their biggest trading partner on the map, or even know who it is? Canada doesn't get a lot of companionable respect from the USA.
Canada delivers 23% of the oil America uses every day. It is also the biggest customer America has in the world. Talk about cold and lonely - America would be pretty lonely without Canada at its side. And the thing is, Canadians are fast becoming just as alienated as most of the rest of the world.
Nope. Not too smart to talk about cold and lonely.
I apologize for the d**n. It slipped out.
Arvy June 3rd, 2008 2:06 pm
I'm not talking about US Officialdom. I mean a bit of trade and us is what they's miss!
"In fact, the NAFTA provisions relating to control of Canada's resources are quite certain to make it colder (and dryer) faster than otherwise."
Which makes the point that we all need to dump the damn thing. If they get their NAFTA Super Highway, the Canadians will really be throwing eggs at us.
ezeflyer-- it would never pass
and of course, that is soooooo unacceptable
the people need not have their shopping interrupted :)
elmysterio June 3rd, 2008 8:00 pm
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FYI, I had the same problem with Glenn Greenwald's article-- I tried posting 3X, finally with minor variations. All the comments simply disappeared without an error message or other explanation.
My polite, if justifiably irritated, e-mail to CD's webmaster and editor will probably go the same route. I fervently wish and hope that some day, sites like this will improve fundamental courtesy and at least offer some feedback or reliable guidance on this distressing phenomenon.
How can the author and commenters get this far without mentioning Brian Mulroney, the super-whore who lined his pockets selling Canada to USA at bargain-basement prices?
They loved him, they made him rich long before NAFTA. That should have been our warning-bell.
The author correctly suggests Canada has been sleeping for 30 years. The brutal waking-up must include naming those responsible.
And then doing something about it.
Fat chance.
See what the Canadian Action Party is trying to accomplish:
http://www.globalresearch.ca/index.php?context=va&aid=6456
Thomas More June 3rd, 2008 1:12 pm -- "It could get cold and lonely up there."
No colder or lonelier than it was before NAFTA, or with it for that matter. In fact, the NAFTA provisions relating to control of Canada's resources are quite certain to make it colder (and dryer) faster than otherwise.
As for the loneliness, I have a feeling that most Canadians would not be sorry to be left without U.S. officialdom's version of "good neighbor" friendliness and assistance. Certainly, as Vladimir Putin said, nobody's very anxious to acquire the type of U.S. beneficence that it exports to countries like Iraq.
Put it to a vote by referendum.
I'm with the Canadians. Lets scrap NAFTA. Its not a good treaty for the citizens of any of the countries.
But I think Canadians might want to deal with us though. It could get cold and lonely up there. We aren't nearly as bad as reported.
We need to scrap this agreement altogether. Those of us on the Canadian left have been warning Canadians against any deal with the US since 1987, since the US happens to be the only country on earth that doesn't have to live up to its contractual agreements. Who's gonna make the country with the biggest military in human history stick to its contracts?
I seem to be prevented from commenting on this article. :(
If NAFTA is reopened, then the ones at the negotiating table should not solely be bureaucrats headed towards corporate jobs after leaving government and their future employers. Labor and environmental types need to be there as well. If those who presented NAFTA refuse to go along, then the option of dumping NAFTA entirely needs be on the table as well.