Free Trade Benefits Canada, eh?

Photo by Patrickklida

Every time I pass through Oshawa, Ontario I think of the Free Trade Agreement between Canada and the USA. Oshawa is the home of General Motors of Canada, the largest producer of motor vehicles in Canada. Not that long ago Canada was the fourth largest producer of cars and trucks in the world.

During the government of John Diefenbaker, the Canada-US Auto Pact was signed. For every car that the US Big Three sold in Canada, they had to build one car here. That agreement preserved the manufacturing industry in Canada. It was replaced by the Canada-US Free Trade Agreement of 1988. Canadians, we were told, should have the option of buying any car wherever it is built, without any government interference. With the adoption of the North American Free Trade Agreement in 1994, Mexico was added. The Big Three began shifting production south to take advantage of Mexico’s low wage economy.

The goal of the “free trade” agreements was never to free trade. Trade was already free for most products with only a few having low tariffs. Quotas were virtually unknown. As the organizations of big business all stressed, what they really wanted was freedom for capital. Freedom of business organizations to invest in any country without government interference and the freedom to repatriate their profits as they so wished.

The auto industry today

Michael, a friend of Susan’s, has worked on the assembly line at GM in Oshawa for 25 years. Working conditions have steadily gotten worse. Now they have two 10 minute breaks per shift and only 20 minutes off for lunch. New workers start at $20 per hour, a reduction from previous contracts. Pension contributions from the company have been cut. Now it is nearly impossible for a new worker to buy a house; down the road they may be able to save enough for a down payment on a one-bedroom condo for $350 grand in one of the new 50 storey high buildings.

GM will not say what its plans are. The production of its Camaro automobile is presently being shifted to Lansing, Michigan which will result in the loss of around 1,000 jobs. It is also rumoured that GM plans to shut down its CAMI assembly plant located at Ingersol, Ontario. Within the industry, it is widely believed that GM plans to shut down the Oshawa operations in 2019. Michael says the workers in Oshawa are expecting this.

All the automobile companies now demand handouts from federal, provincial, state and local governments before opening new plants. They get additional government grants and loans by threatening to close existing operations. We know that only too well in Canada. Between 2010 and 2013 automobile corporations have invested $29 billion in the USA, $20 billion in Mexico, and only $2 billion in Canada. We are, as one editor of Maclean’s Magazine once pointed out, “Puerto Rico North.”

Free trade and the NDP

I lived in the Toronto area in 1971. Oshawa was a thriving city. The auto workers’ union was strong. Wages and benefits were very good. The city was represented in Parliament by Ed Broadbent, MP for the New Democratic Party. In 1988 he was leader of the New Democratic Party. In the famous “Free Trade Election” that year Broadbent and the NDP were virtually silent on the proposed FTA. The opposition to the agreement was led by John Turner, leader of the Liberal Party.

I remember well that election. The trade unions linked to the NDP set up an election headquarters where the unions called their members, urging them to support the NDP. They reported that their members overwhelmingly stated that the proposed Canada-US free trade agreement was the number one issue, and that they were opposed to it. But Broadbent and the leadership of the NDP ignored this issue and instead stressed environmental issues.

The NDP has never opposed free trade agreements. At best, like Thomas Mulcair, they ask for some modifications. But free trade agreements are bad news for working people, and they know it.

These days we take the Go Train to Toronto. A Go Train bus (a city bus no less) takes us from Peterborough to Oshawa, where we switch to the commuter train that goes to Toronto. We travel from Oshawa (150,000) through Whitby (130,000) and Ajax (110,000). When I lived here before they were independent cities. They are now suburbs of Toronto, part of the six million people crammed into this area of southern Ontario. Endless massive high rise condos. Nothing that could be described as a community. Bedrooms for Toronto workers. This alienating mess, tied together by the 12-lane 401 highway, travelled by over 500,000 vehicles every day, is the result of capitalist planning. It is hard to believe that we live in one of the largest countries in the world with endless open space.

This article originally appeared on John W. Warnock’s blog.