Mr. Speaker, I find this is a rather important debate.
The only thing that concerns me at this point is that I find myself in agreement with the hon. Minister for International Trade on the Liberal side of the House. I find myself in agreement with my colleagues, of course, and with my Conservative colleagues. The only people with whom I am in disagreement are members of the NDP group over on the other side.
I notice that there are some interesting points being made by the NDP members. The hon. members are entirely welcome for any gratuitous remarks made in their direction because there are so few of them.
We are dealing with the single most significant element in the Canadian economy, trading with other nations. The NDP has given us an opportunity to express our position on this particular issue, which is foundation to the economy of our country.
Members who are opposite on this issue need to recognize much of the support that has made the country what it is today, the democratic institution that exists, the various political parties that exist, the freedom of speech that exists and the opportunities for individuals to develop their businesses, is as direct result of free trade among Canada and other countries.
Also I point out that free trade is not just in agriculture. I come from a constituency in British Columbia. We call it paradise because it is beautiful in Kelowna. I want to thank my constituents who elected me for the third time. I am humbled with the responsibility they gave me. It is an honour to represent them in the House.
In my constituency there are a number of fruit growers, as well as other agricultural producers. The fruit growers depend to a large degree on their income from the trade that takes place. The Okanagan Valley is now developing some of the finest wines in the world. These wines compete internationally and are winning awards. The wineries also depend to a large degree on international trade.
We need to recognize how dependent agriculture is on trade. We should also recognize the significance of manufacturing and how it depends on international trade.
All we need look at is the automobile assembly plants that exist in the southern part of British Columbia. Industries have sprung up around those assembly plants. Magna International is extremely successful. It has become a major auto parts manufacturing firm. The members should recognize that some of the mutual funds in which they have invested have stocks in Magna International, so they are direct beneficiaries of that particular company. Some of their friends probably work for either Ford, Chrysler or GM in the assembly of automobiles, trucks and various SUVs. All these jobs are directly dependent on international trade.
We need to recognize that trade is not only in the areas of agriculture and manufacturing but also in the area of our natural resources. Where would the economy of the country be if there was not a good arrangement for trading natural gas, oil, coal and lumber?
Let us not forget lumber which is a significant part of our Canadian economy. Lumber is an $18 billion contributor to our gross national product in British Columbia. It is a major issue. Trade with the United States is very well developed and needs to be done properly. That is what we are talking about today.
To suggest that chapter 11 somehow is an anathema to developing strong free trade is simply misleading everything. Why is that the case? I suggest that the first and most important provision of chapter 11 is to protect investors.
There is not a single person in the House who does not want their invested capital to be preserved, protected and to grow. That is what our party wants.
We want Canadians to have the same kind of protection for their investments in another country as we give foreigners investing in Canada. If there is no reciprocal guarantee for the protection of capital then why would anyone want to invest.
I cannot help but take a little shot here at the parliamentary secretary and his minister. I would suggest to them that Canadians investing abroad is not so much a reflection of the strength of the Canadian economy but rather an expectation that they can do better with their investments outside of Canada, particularly with respect to the huge tax burden placed on corporations and individuals in Canada.
We need to recognize that Canada has a negative balance today in terms of direct foreign investment in Canada and Canadian investment elsewhere. Canadians are investing more elsewhere than others are investing in Canada. We have a negative balance and it would be good if it were the other way around.
I recognize that in the past there was a point where Canada had more foreign investment coming into Canada than going elsewhere. One of the reasons for that was the fact that these foreigners needed access to our resources.
Knowing something about Alberta, which is where I grew up, oil, gas and natural gas were major contributors to the success of that province. If oil and gas had not been sold to the American market the province would not have grown in the way that it has. Alberta received that investment from foreign investors not Canadian investors. Today Canadians are realizing how important it was to invest in those natural resources, and it is going along very well. However it first took risk capital from outside Canada to see the vision and develop that particular sector of our economy.
The reason the investors came to Canada and invested was that their investment was protected. We should be forever thankful to them for having done that. I know I certainly am. If we intend to invest elsewhere we would want that kind of protection as well. Chapter 11 does that and that is why it is good.
It is not just the protection of capital in that sense. We want to make sure that it is safe in the sense that it competes fairly with other industries that are investing in the same area. We want to make sure that the competition that exists in those countries is such that it is not mitigating against the successful development of a particular country.
We need to recognize that this investment allows us to benefit from technological development. It takes money and very often takes a considerable risk in order to develop these technologies. This is what happens when good investment and risk capital comes into this country or goes elsewhere.
I will now move on to the second reason that chapter 11 is not all that bad and why the motion before the House should be defeated. It is the negative effects of tariffs.
Some countries have taken the view that they have to protect their industries and development to the point where they impose tariffs on any product competing either directly or indirectly with their local industries which are imported from another country. In many cases this mitigates against the best interests of the consumers who buy those particular imported products. This does not encourage competition in the local economy. It does not allow, encourage or provide an incentive for manufacturing or other industries to be innovative, competitive or efficient, nor does it encourage them to seek innovation or apply new technologies.
We have seen this in the lumber industry. We have in Canada some of the most modern, efficient, technologically aware and developed sawmills and processing plants of lumber of anywhere in the world. People are coming here to have a look at the way in which we do these things.
If we send lumber to other places in the world and they have inefficient plants where they cannot on a per capita basis or on a per worker basis produce the same kind of lumber or they do so with more waste, they would not be competitive. So they place a barrier and then say that they will put a tariff on Canadian lumber which goes into the particular country. The people of that country then have to pay a premium for the lumber which is produced locally because it is inefficient and they have to pay a premium on the lumber which is imported even though they could be saving dollars to do so.
Tariffs work against efficiency. They work against good competition and they very often work against good relations between nations as a consequence.
There is a need to have a level playing field. That is another reason chapter 11 needs to be protected. If people establish a business in another country they want to be sure that their business competes with another business that may be in the same area or may provide the same kind of service or product. They want the same rules that exist in that country to apply to them.
A car manufacturer goes into the United States and builds cars. It could also want to build cars in Canada. We want to make sure that all companies are operating under exactly the same rules and that the playing field is as level as it can possibly be.
That is what we need to be sure about. That is what chapter 11 would do. It would make sure that the advantages given to our industries would also exist for a company that comes here and vice versa. We need to be sure that all protections are provided.
There is one thing that I wish to emphasize at this point. No agreement that has ever been put together by human beings is perfect, and neither is chapter 11. The North American Free Trade Agreement is not perfect. The agreement with the Americas on trade will not be perfect either. It is totally false for anyone to stand in the House and imply that if the government would do this one thing the agreement would be perfect. We will always find ways in which we can improve something.
The hon. member opposite spoke earlier about buying a house. If on the day we turn the key in the door and enter and discover something we did not expect, we immediately want to change it. I doubt whether there is a person in the House who has not renovated a house to some degree somewhere along the line. I doubt there is a single person in the House who is living in a house today which is as it was when it was purchased.
We need to evolve and we need to develop. Later on today we will be talking about democratic reform, reforming this institution. Why is that? It is not because this place has not been working for 125 years or that we have made no changes. It is because we believe we can improve this place and we will.
There is another point that needs to be made. It is the philosophic base from which the motion emanates. This is where I find myself very much away from the party that presented the motion. It is almost as if to have private capital and profit is somehow bad.
Private individuals do a better job of running a business than government ever did, no matter how smart the bureaucrats are who back up the legislation and the policy development of government.
Individuals applying their capital, having a personal interest in what is developing and in what is happening with that capital, would do a better job of managing that money. It is significant that tax dollars left in the hands of individuals always produces a better economy than if the government takes it away from them, thinking that it could spend it more effectively.
We could go through all kinds of countries in the world. We could go to Ireland, the United States, Great Britain and New Zealand. We could go anywhere in the world where governments have cut taxes to see the result. The result has been an improvement in the economic welfare of everyone. People have said over and over again that when taxes are reduced revenues are reduced, and in almost every case, if not in every case, the total revenues of the government have increased and not decreased.
The net result is that it is false economy to raise taxes. The government should cut taxes if it wants more money and it should stop interfering in the lives of individuals.
Chapter 11 would protect the investment of individuals of private capital into production and services so that an incentive would be there, a profit could be made and more people could be employed. The end result is that the economy grows, things get better and we are all happier.
We need to look at the various agreements. We have had the agreement with the United States. We have had the North American Free Trade Agreement which expanded that considerably. Now we are talking about an even broader agreement.
It is interesting because we have had people saying today that somehow the summit in Quebec City two weekends ago was undemocratic. I would like to ask what is democratic. If that summit was not democratic, this institution cannot be democratic because the people who met in Quebec City were also representatives. There were 33 different duly elected heads of state representing their countries and the best interest of those nations. Is that undemocratic?
There are 301 MPs in this institution, elected to represent respective constituents. We are here to make decisions and laws. Is it undemocratic because we represent those people? It is anything but undemocratic.
It is the essence of democracy to be able to vote in the House, representing the best interest and working in the best interest of our constituents. That is what we are all about. That is democracy. At least that is how I understand democracy. If that is not the way some hon. members understand democracy, I wish they would tell us what it is. I would suggest that they would probably be defeated with their definition.
Another question is who signed the North American Free Trade Agreement. It was not signed by an RCMP officer or by a farmer. It was not signed by a president of a college, by a president of a university or by a president of a particular corporation. It was signed by heads of state who were in agreement. It was signed by them, each of whom was duly elected on a democratic basis to represent his or her country. What could be more democratic than that?
Was the process totally open and transparent? No, it was not. I take extreme exception to that. The process should be as open as possible. Has it been as open as possible? No, it has not. We need to concentrate on making these processes open so that democracy is not only done but appears to be done.