How Trade Agreements Facilitate Short-Term Profits for Multinational Corporations
In 1997, Canada restricted import and transfer of the gasoline additive MMT because it was a suspected neurotoxin that had already been banned in Europe. Ethyl Corp., the U.S. multinational that supplied the chemical, sued the government for $350 million under the North American Free Trade Agreement and won! Canada was forced to repeal the ban, apologize to the company and pay an out-of-court settlement of US$13 million.
Photo credit: Shutterstock
The free trade agreement between Canada, the U.S. and Mexico was never designed to raise labor and environmental standards to the highest level. In fact, NAFTA and other trade agreements Canada has signed—including the recent Foreign Investment Promotion and Protection Agreement with China—often take labor standards to the lowest denominator while increasing environmental risk. The agreements are more about facilitating corporate flexibility and profit than creating good working conditions and protecting the air, water, land and diverse ecosystems that keep us alive and healthy.
Canada’s environment appears to be taking the brunt of NAFTA-enabled corporate attacks. And when NAFTA environmental-protection provisions do kick in, the government often rejects them.
According to a study by the Canadian Centre for Policy Alternatives, more than 70 percent of NAFTA claims since 2005 have been against Canada, with nine active cases totaling $6 billion outstanding. These challenge “a wide range of government measures that allegedly interfere with the expected profitability of foreign investments,” including the Quebec government’s moratorium on hydraulic fracturing, or fracking.
Quebec imposed the moratorium in 2011 pending an environmental review of the controversial gas-and-oil drilling practice. A U.S. company headquartered in Calgary, Lone Pine Resources Inc., is suing the federal government under NAFTA for $250 million. A preliminary assessment by Quebec’s Bureau d’audiences publiques sur l’environnement found fracking would have “major impacts,” including air and water pollution, acrid odours and increased traffic and noise. Fracking can also cause seismic activity.
According to the CCPA, Canada has been sued more often than any other developed nation through investor-state dispute settlement mechanisms in trade agreements. Under NAFTA, “Canada has already lost or settled six claims, paid out damages totaling over $170 million and incurred tens of millions more in legal costs. Mexico has lost five cases and paid damages of US$204 million. The U.S. has never lost a NAFTA investor-state case.”
NAFTA does, however, have a watchdog arm that’s supposed to address environmental disputes and public concerns, the Commission for Environmental Cooperation. But Canada is blocking the commission from investigating the impacts of tailings ponds at the Alberta oilsands.
Environmental Defence, Natural Resources Defense Council and three people downstream from the oilsands asked the CEC to investigate whether tailings leaking into the Athabasca River and other waterways represent a violation of the federal Fisheries Act. According to the complaint, the tailings ponds, which are actually much larger than what most people would think of as ponds, are spilling millions of litres of toxic liquid every day. Environmental Defence says the CEC found “plenty of evidence that tar sands companies were breaking Canadian law and lots of evidence that the Canadian government was failing to do anything about it.”
It’s the third time in the past year that Canada has prevented the commission from examining environmental issues. Canada earlier blocked an investigation into the protection of polar bears from threats including climate change and one concerning the dangers posed to wild salmon from BC fish farms.
Trade agreements are negotiated in the best interests of corporations instead of citizens. On top of that, federal and provincial governments keep pinning our economic hopes on volatile oil and gas markets, with little thought about how those resources could provide long-term prosperity. Recent plummeting oil prices show where that leads.
These priorities are screwed up. We end up with a boom-and-bust economy and the erosion of social programs as budgets are slashed when oil prices drop. Skewed trade deals allow corporations to override environmental protections that haven’t already been gutted, and create a labor climate in which wages, benefits and working standards fall.
It’s time for Canada to recognize that a diversified economy and citizens’ right to live in a healthy environment are more important than facilitating short-term profits for foreign and multinational corporations.
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One of nature's epic events is underway: Monarch butterflies' fall migration. Departing from all across the United States and Canada, the butterflies travel up to 2,500 miles to cluster at the same locations in Mexico or along the Pacific Coast where their great-grandparents spent the previous winter.
Millions of People Care About Monarchs<p>I will never forget the sights and sounds the first time I visited monarchs' overwintering sites in Mexico. Our guide pointed in the distance to what looked like hanging branches covered with dead leaves. But then I saw the leaves flash orange every so often, revealing what were actually thousands of tightly packed butterflies. The monarchs made their most striking sounds in the Sun, when they burst from the trees in massive fluttering plumes or landed on the ground in the tussle of mating.</p><p>Decades of educational outreach by teachers, researchers and hobbyists has cultivated a generation of monarch admirers who want to help preserve this phenomenon. This global network has helped restore not only monarchs' summer breeding habitat by planting milkweed, but also general pollinator habitat by planting nectaring flowers across North America.</p><p>Scientists have calculated that restoring the monarch population to a stable level of about 120 million butterflies will require <a href="https://doi.org/10.1111/icad.12198" target="_blank">planting 1.6 billion new milkweed stems</a>. And they need them fast. This is too large a target to achieve through grassroots efforts alone. A <a href="https://www.fws.gov/savethemonarch/CCAA.html" target="_blank" rel="noopener noreferrer">new plan</a>, announced in the spring of 2020, is designed to help fill the gap.</p>
Pros and Cons of Regulation<p>The top-down strategy for saving monarchs gained energy in 2014, when the U.S. Fish and Wildlife Service <a href="https://www.fws.gov/southeast/pdf/petition/monarch.pdf" target="_blank">proposed</a> listing them as threatened under the Endangered Species Act. A decision is expected in December 2020.</p><p>Listing a species as endangered or threatened <a href="https://www.fws.gov/endangered/esa-library/pdf/listing.pdf" target="_blank">triggers restrictions</a> on "taking" (hunting, collecting or killing), transporting or selling it, and on activities that negatively affect its habitat. Listing monarchs would impose restrictions on landowners in areas where monarchs are found, over vast swaths of land in the U.S.</p><p>In my opinion, this is not a reason to avoid a listing. However, a "threatened" listing might inadvertently threaten one of the best conservation tools that we have: public education.</p><p>It would severely restrict common practices, such as rearing monarchs in classrooms and back yards, as well as scientific research. Anyone who wants to take monarchs and milkweed for these purposes would have to apply for special permits. But these efforts have had a multigenerational educational impact, and they should be protected. Few public campaigns have been more successful at raising awareness of conservation issues.</p>
<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="91165203d4ec0efc30e4632a00fdf57d"><iframe lazy-loadable="true" src="https://www.youtube.com/embed/KilPRvjbMrA?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
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