The TPP and Its Impact On Labour in Canada

Recently the leader of the Communist Party of Canada, Liz Rowley, spoke at a public forum in Vancouver on the Trans-Pacific Partnership (TPP). She summarized it very succinctly: “there is nothing acceptable about the TPP.”

The TPP is a proposed agreement drawn in secrecy involving 12 Pacific-Rim countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, U.S. and Vietnam. Each country will have to ratify the agreement, or not, in less than 2 years before it becomes binding law. No changes or amendments are allowed at this stage. Considering that this is the largest agreement ever (it covers nearly 800 million people with a combined GDP of $28.5 trillion), and nearly 6,000 pages long, mostly in dense legalese, only two years for consultations makes the issue very urgent. [1]

On its website, the Canadian government promises to be “transparent, open and consultative with Canadians on the TPP.” [2] But what is the point of “consultations” when the agreement cannot be amended and the only outcome is ‘ratify’ or ‘not ratify’? In fact so far, the consultations have consisted mostly of presentations by Parliamentary Secretary David Lametti or Minister Chrystia Freeland, to groups of entrepreneurs, business people, politicians and other interest groups.

The TPP has been discussed in total secrecy representing the interests of corporations to the exclusion of labour representatives. Liz Rowley called this agreement a “global corporate constitution”, and outlined ten reasons why the TPP should not be ratified. [3] There is no doubt that corporations will have great profits for their shareholders and speculators since the deal will force more neoliberal policies and evermore reduced government regulations. While the selling point is trade, Canada’s trade deficits with past agreements are growing faster with free-trade partners than other countries. So this begs the questions, “How good is this deal for Canadian workers?” “Does this ‘constitution’ also guarantee workers rights?”

Is the deal good for workers?

It is not encouraging that the standard practice in all trade agreements is to leave workers out of the discussion table. In addition, in spite of all the agreements that Canada has signed, the unemployment rate is still above 7%. Considering this figure, Canada cannot afford to take away more jobs from Canadians. The government optimism that the proposed TPP agreement will create more jobs for Canadians is unfounded and it relies on the old mantra that if investors are doing well, jobs are created. The reality is that when investors do well there is more concentration of wealth for the rich and more hardship for the working class.

According to a recent Angus Reid Institute poll, Canadians expressed “fears that the TPP will result in Canada shedding of tens of thousands of manufacturing jobs.” The same poll reports that 47% of Canadians believe that the TPP will have a negative or no impact on employment, versus 21% who think the impact will be positive. A large 32% still don’t know what the TPP is about. [4]

Another analysis concludes “accepting the TPP will have long-term detrimental impacts on the prospects for full employment, economic prosperity, and the ability of Canadians to sustainably manage their economy.” [5] The rationale is that the TPP will force Canada to divert its trade from the manufacturing sector to the extractives sector.

As a response to other trade deals, Canada’s exports of manufactured goods has steadily declined since 2000 while increasing exports of raw materials. However, “an estimated 580 direct jobs can be attached to each $1 billion in exports from the extractives sector whereas the same amount of trade in manufactured goods produces 2,300 jobs – four times the jobs creating power of extractive industries.” [5] Canadians’ legitimate demands for a $15 minimum wage will further push for job losses to countries with low-paying jobs.

The claimed relative advantage that Canada may have in the service sector (finance, business service, etc.) is not a sufficient reason to accept the TPP since this sector usually demands very high salaries but for fewer jobs, not precisely favouring most workers. [6]

Canada’s autoworkers must be concerned. In the auto sector alone economist Jim Stanford predicts a possible loss of 20,000 jobs. [7] It should also serve us as a strong hint that in the U.S. the Ford Motor Company is urging U.S. Congress to oppose the TPP.

What about workers’ rights?

There seems to be more information on labour “rights” than labour gains in the TPP agreement. Fifteen articles in 15 pages (out of 6000 pages) of chapter 19 (out of 30 chapters) of the full text of the TPP deal with labour. But that’s all, more information but not more rights.

Article 19.3 and its subsections basically states that the TPP members will “follow[ing] rights as stated in the ILO Declaration” of 1998. That may not be a problem in general, except for the limitation that establishes “that labour standards should not be used for protectionist trade purposes”, which leaves the door open to corporate interpretations of “protectionist” actions in regards to labour.

Similarly, what seems disturbing is the statement about what constitutes a violation of those rights. Textually, “To establish a violation of an obligation under Article 19.3.1 (Labour Rights)…, a Party must demonstrate that the other Party has failed to adopt or maintain a statute, regulation or practice in a manner affecting trade or investment between the Parties.” I emphasize, “in a manner affecting trade or investment”; never mind workers. This seems to be a nice self-serving use of the ILO Declaration.

One ridiculous sounding article establishes the extent of “Corporate Social Responsibility.” Article 19.7 says, “Each Party shall endeavour to encourage enterprises to voluntarily adopt corporate social responsibility initiatives on labour issues that have been endorsed or are supported by that Party.” This amounts to saying, “we will shoot ourselves in the foot if we feel like.”

The remaining articles of this chapter deal with how to enforce corporate cooperation (with a token mention of job creation), labour regulations, and procedures for reclamations strictly “on matters related to this chapter”. Interestingly, the TPP proposes so-called “Labour Councils composed of senior governmental representatives at the ministerial” with no workers’ participation whatsoever!

Canadians should be suspicious of a deal made behind their backs and should reject the TPP, which seeks to control resources and cheap labour, and to curtail working class power. For workers, Canada’s free trade experience is one of job insecurity, stagnating wages, increasing income inequality, and relatively higher levels of unemployment. The TPP does not promise anything different.

It is possible to defeat the TPP, starting with spreading the information and prompting our City Councils and MPs. There is already a success story from Nanaimo, BC: “Nanaimo Mayor and Council express its opposition to the Trans-Pacific Partnership Trade Agreement and communicate this to Prime Minister Trudeau, Cabinet Ministers and every Member of Parliament.”[8]

The Canadian government website on the TPP invites comments via email: [9]

A campaign endorsed by concerned organizations also allows people to send an online message to decision-makers from the website, hosted by OpenMedia, SumOfUs, Council of Canadians, and Stand.

[1] Full text of agreement:

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