Madam Speaker, this is a rather fundamental debate that we are having today. Unfortunately the motion does not address the issues that we as Canadian parliamentarians must address; what it does is put in very stark relief the two ends of this House of Commons.
Sitting at one end of the House and crossing over the aisle sits the Liberal-Conservative coalition, which is essentially a group of flamboyant and radical free traders. These members read in a textbook that free trade is good, so they do not make any sort of intervention, attempt any sort of managed trade, or implement any policies that would lead to job development or industrial strategies in this country. That is what we have seen over the last 20 years.
Many Canadians know that this approach has led to the collapse of our manufacturing industry, to the collapse of many of our strategic industries and, as I will point out later on, to an actual fall in real income for most Canadians.
One would think these radical free traders would look to see if the economic theories that they have learned in a textbook actually work, but no, there is no evaluation. There is no real, consistent understanding of the impact these policies have had, and that is unfortunate.
The Prime Minister never actually ran a business and never met a payroll. He learned his economics from textbooks, and it shows. The Conservative government has been appallingly shortsighted in putting in place industrial strategies for the automobile sector, for the steel sector, for our shipbuilding sector, for our softwood lumber sector, and for a whole range of vital and strategic industries. We have seen the loss of real jobs, and that is due in part to the fact that we have not had a trade strategy that makes any sense.
At the other end of the House, stretching across both aisles now as a result of the new members we earned in the last election, sits the New Democratic Party. We are strong fair traders. We believe that trade needs to generate additional jobs. We also believe that the people in the country have a role to play in ensuring that industrial strategies are put into place for the preservation and enhancement of our automobile sector, our steel industry, our softwood lumber industry, and our shipbuilding industry.
We in the New Democratic Party believe that government, working with the public sector and the private sector in mixed economic development, has a role to ensure there is a rise in real income for most Canadians.
Perhaps nothing throws the difference between fair traders and radical free traders into more relief than the motion we see before us today.
I would like to discuss certain aspects of the NDP approach to fair trade before continuing with my speech on specific considerations.
The NDP believes in fair trade that promotes human rights such as women's and union's rights. We believe that international free trade must be adjusted to increase the capacity of individuals to negotiate collective agreements, tackle gender equality issues and reinforce human rights, not diminish them. In the case of the Canada-Colombia agreement, this government's approach—and that of the previous government—has diminished human rights rather than advancing them.
We also believe in respect for institutions that promote fair trade, such as the Canadian Wheat Board, as well as supply management. Our farmers and communities across Canada depend on these institutions to keep the local economy going. In our opinion, these fair trade organizations must be protected; however, the other parties, the Liberal and Conservative parties, do not believe in them.
We also believe in agreements that respect the environment by relying on sustainable development. That is the main difference between the Conservative-Liberal coalition and the New Democratic Party. Free trade agreements have been used to contravene environmental regulations. Many companies have found ways to get around all the environmental regulations that most Canadians want.
We believe that our fair trade agreements must serve to strengthen a policy and an approach based on sustainable development and respect for the environment. We also believe in fair agreements that respect economic diversity and also, for example, the existence of a third sector. We often speak of a public and private sector. However, there is also a cooperative sector, where communities can put together their economic resources in order to develop. I could give you many examples where the cooperative sector has strengthened local or regional economies.
Thus, fair trade must be used to strengthen this economic diversity. In a sense, we believe in economic diversity. The Conservatives and the Liberals, who are working together, have similar views on trade and believe in only one approach: the private sector and big business. The right regulations can stimulate the economy. Otherwise we end up with a monoculture. By putting all our eggs in one basket we are not strengthening community ties and local economies.
We have here the issue of this particular motion. There is that difference between Liberals and Conservatives, who are perfectly happy selling out Canadian jobs, and the NDP that believes firmly in reinforcing our economy, reinforcing our vital industries like the automotive sector, the softwood lumber sector, shipbuilding and I can go on and on, but there is a very clear difference in our approaches.
We have this motion today that has three elements and I would like to touch on each one of them. Unfortunately, some of them are factually wrong. It is too bad, but it is a fairly innocuous motion. We will have to decide in the next few days how we take all this together. The first element states:
That, in view of the growing protectionism in the United States, which is reminiscent of the counterproductive behaviour that led to the great depression of the 1930s,--
In this sense the Liberal motion changes history unfortunately. I think it is referring to Smoot-Hawley back in the early 1930s. The Liberals are radical free traders. These theoretical folks just love to look at their textbooks and say, “This theory will have to work”, without ever checking on the consequences of their actions. They say that Smoot-Hawley was the cause of the Great Depression. That is simply not true. Smoot-Hawley came as a result of the Great Depression, which had already started. Essentially, the Great Depression, in part, came from a lack of regulation. Does that sound familiar? Of course it does.
I would like to cite one of our international colleagues, the Australian Labor Party, which is part of the same international entity that the NDP is part of, and the new Prime Minister, Kevin Rudd, who said, “The time has come, off the back of the current crisis, to proclaim that the great neo-liberal experiment of the past 30 years has failed, that the emperor has no clothes”.
Prime Minister Rudd is referring to the fact that a lack of regulation, again, has put us back in the same kind of economic circumstances that we saw in the 1930s. Smoot-Hawley was not the cause. Smoot-Hawley was a right wing Republican attempt to deal with the crisis that began with no regulations, no protections in place for the public across North America.
Curiously, this particular motion does not refer to what the antidote was for the Great Depression, which was not only a series of regulations to protect the public but, what the NDP has always been calling for, the great economic stimulus that came out of the New Deal. That was missing from the Republican approach. There was no economic stimulus. There was no investment. What Franklin Delano Roosevelt did with the New Deal was provide that economic stimulus that the NDP has been pushing now for months, convinced our Liberal partners to come on the majority coalition, and then they sold us out and went with the Conservatives.
In any event, we will see if the Conservatives can be trusted to bring in that economic stimulus in a fair and effective way. Many of us do not believe that they can be trusted. Certainly, they have broken their word before. However, the point I am making is that it was economic stimulus in the New Deal that actually started to push the United States out of the Great Depression.
Therefore, the first clause of the motion is factually wrong. It is, I guess, in keeping with the proud Liberal tradition, but aside from that factual error perhaps pretty innocuous.
Second, it states:
--this House calls upon the Government to intervene forthwith and persistently, with the United States Administration, and the Congress, in order to protect Canadian jobs,--
That is something certainly that we could support. That is something that we have been pushing for. However, let me preface my remarks in this regard with what is actually happening in the United States and in Canada.
Since NAFTA was implemented in 1989, and we have the figures right here, there has been a hollowing out of Canada. Essentially, for most Canadians they have lost in real income. We have seen a loss of real income that is the equivalent for the lowest 20% of the Canadian population of about a month and a half of income. In real terms, they have lost a month and a half of income since NAFTA was implemented. For the lower middle class they have lost about two weeks of income.
Each and every Canadian family in that income class, and we are talking about more than six million Canadians in those families, has lost about two weeks of income in real terms. The middle class has lost about a week of income in real terms for each and every year since NAFTA was implemented.
This is not solely a result of NAFTA. It is also because of the foolish economic policies or lack of economic policies that were put in by the Liberals. Like the Conservatives, they do not seem to change much as they bounce across the floor, but fundamentally we can say that the bottom line is that they have failed over the past 20 years. When most Canadian families are earning less in real terms than they were 20 years ago, one would think that one member of the Conservative-Liberal Party would say, “Well gee, maybe we should change our economic approach”.
What the NDP is saying, with a growing number of Canadians, is that since Liberals and Conservatives are not changing their economic approaches, we are looking to change the government. That is why we are seeing more and more New Democrats in this House of Commons as we go through each election. We understand that this is not sustainable. Telling the middle class to accept less every year and telling the poorest Canadians to accept much less every year is simply not a sustainable economic policy.
I will just conclude my remarks on the Canadian income categories by saying that the wealthiest 20%, which is what these economic policies have been intended to do, not a flood upwards, the wealthiest 20% now take most Canadian income. The Canadian income pie is less and less equal, more and more skewed to corporate lawyers and to corporate CEOs. That is why the NDP is saying that we need a much more balanced approach, a much more mature approach, in keeping with what we are seeing around the world.
We are saying in this motion that we want to intervene with the United States administration. The important thing to note is that when we are talking to President Obama and talking to Americans, we have to understand that they are going through exactly the same thing. Two right wing, radical free traders, Kenneth Sheve and Matthew Slaughter, who has the oxymoronic title of being a former economic policy adviser to George Bush, said in a recent issue of Foreign Affairs:
[Income] inequality in the United States is greater today than at any time since the 1920s. Less than four percent of workers were in educational groups that enjoyed increases in mean real money earnings from 2000 to 2005; mean real money earnings rose for workers with doctorates and professional graduate degrees--
--corporate lawyers and CEOs--
--and fell for all others.
That is nearly 97% of Americans who saw their real income go down.
These explanations around the issue of so-called protectionism miss a basic point. U.S. policy is becoming more protectionist because the American public is becoming more protectionist, and this shift in attitude is a result of stagnant and falling incomes.
It is no secret why President Obama was elected on a platform of renegotiating NAFTA, rebuilding it on a fair trade model. It is no secret why we have seen this in the House of Representatives. I was on the phone yesterday talking to friends of mine in the U.S. Congress. They are talking about these issues. The senate rejected senator McCain's ridiculous amendment, certainly not an amendment that was in keeping with the way most American senators felt. It was rejected 65 to 31. It is because Americans are increasingly concerned about the same income fall that we have seen.
If we are intervening with the United States administration, we have to start on that basis. We have to start on the basis that these free trade agreements and all the economic right wing policies that have gone with them have not been good for American workers and they have not been good for Canadian workers. That is the fundamental problem. I would hope that at least one of our colleagues from the Conservative or Liberal Party would actually start to look at the real facts, the bottom line, not the textbook theory.
We all know the textbook theory. I can spout the textbook theory as well as anyone in this House, but the real, practical results are a fall in real income for Canadians, a fall in real income for Americans, and that is why we are having to deal with these issues, where more and more workers are saying, “We have to protect jobs here at home”.
How do we communicate with the United States administration and Congress? We can do it on a win-win basis.
I will cite the most recent figures available. November 2008, for Canadian trade with U.S. from iron and steel mills, targeted, as we know, in the house of representatives bill and targeted, as well, in the senate bill, they will go into conference but one can assume that iron and steel will get through that conference and we will have to contend with this and deal with the administration, the American senate and congress, in a meaningful way.
In November 2008, we exported $349 million worth of iron and steel to the U.S. and imported $401 million from the United States. In other words, the U.S. has a trade deficit with us in iron and steel. That essentially means that we buy more iron and steel from it than it buys from us. In November 2008, that is, essentially, what those figures mean. What that means is that we have an opportunity for a win-win. We have an opportunity to go to American senators and members of congress and say that we would like to exempt them from a “buy Canada” clause so we can use American iron and steel and we would like them to do the same with the “buy America” clause.
There is just one tiny wrinkle in that. Over the last 20 years of Liberal inaction and Conservative inaction, and their lack of industrial strategies, neither government chose at any time to put in place a “buy Canada” clause. That is something the NDP has been pushing for, which is why there are more New Democrats in this House as we go through each election and why we overflow from one side to the other side of this House. Canadians want to know why the Liberals did not bring this in and why the Conservatives are not bringing in a 'buy Canada' clause. They will simply say that it must be illegal or that it is not in keeping with their textbook theory. However, the reality is that this would provide us with the leverage we need to sit down with the American administration and have a win-win negotiation by exempting our iron and steel in the same way that we would exempt theirs.
I come to the third part of the motion which states, “urge the United States to respect its international agreements”. I will cite a couple of articles, first, by the Canadian director of the United Steelworkers, Ken Neumann, and second, by the United Steelworkers president, Leo Gerard, a very proud Canadian.
Ken Neumann stated:
The US has had laws requiring the use of domestically-produced goods for government contracts since the 1933 Buy American Act. These laws are consistent with international trade obligations.
Linda Diebel said the same thing in the Toronto Star.
Buy Canada is legal and buy America is legal for provincial and municipal entities as it is for state and municipal entities. Instead, we are sending millions of taxpayer dollars to buy overseas what we could be building here at home. Many people have cited the Navistar plant, where we are spending $274 million for military contracts in Texas when we, as taxpayers, provided $65 million to the Navistar plant in Chatham, Ontario.
This approach does not make sense, a purely theoretical approach that we will not have buy Canada because it would interfere with our theoretical approach on free trade. It is legal. It would create more jobs in Canada and that is why the NDP is pressing the government and its Liberal colleagues to put in place a buy Canada policy and save Canadian jobs.