Debates of Dec. 14th, 2010

Economic Negotiations with the European Union

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Chair, there is no question that in negotiations what one country is trying to find is a way to take advantage of the others.

We want to make sure that when we have two models, those institutions are not put at risk. The Canadian Wheat Board is one, through orderly marketing; supply management is the other, through the kind of supply system matching supply to meet effective demand.

The fact of the matter is that what is worrying to us is that realized net farm income derived from the international marketplace has been in a negative position for many years. We need to ensure that we get those numbers out of the red and into the black in any negotiation going forward.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Chair, I would like to voice a number of concerns on behalf of the Bloc Québécois. From the outset, the Bloc Québécois has stated that it agrees that there should be negotiations with the European Union. Our party was in fact the first party to propose such negotiations.

The Minister of International Trade stated earlier that it was the success of the free trade agreement with the United States that gave him reason to believe that it would be beneficial for Canadians to enter into a similar agreement with another large country or large political structure, such as the European Union. If the minister were truly responsible, he would be receptive to the various proposals that have been brought before him in an effort to improve any new free trade agreement with a structure as large as the European Union. It cannot be said that the agreement with the United States is all positive. The size of the US market as compared to the Canadian and Quebec markets has caused a number of problems.

I would invite the minister and the Conservatives to pay heed to a number of the misgivings voiced by the opposition parties. I could speak about culture, but I will leave that up to my colleague, the member for Saint-Bruno—Saint-Hubert, since that is her specialty and she masters it quite brilliantly. The member for Richmond—Arthabaska spoke about agriculture, but I will touch on it again.

The Bloc Québécois believes that this kind of agreement is important to Quebec's export-driven economy. The free trade agreement with the European Union is important because it will help to diversify what are largely export-driven markets that focus on the United States, and that are facing hard times.

I just said that the minister should pay heed. This is quite important. The Conservatives have served us up a culture of secrecy across the board, and in particular when it comes to negotiations. It is understandable that the negotiation process has to be somewhat confidential, but the fact remains that parliamentarians should be better informed regarding potential issues and the process itself. The current practice is deplorable to say the least.

As I was saying, there are various aspects that are cause for concern, and I would like to state them. First, there is the question of government procurement. At the request of the European Union, the various provinces have been invited to take part in the negotiations with Canada’s chief negotiator. The European Union asked that the provinces be involved because it knew that they are in charge of government procurement, in particular procurement by provincial governments, municipalities and various institutions such as school boards, colleges, universities, and so on.

This raises a number of concerns. What limits will be imposed? The chief negotiator has indicated that there would very probably be a limit below which there would be exemptions. For example, all contracts for less than $8 million could potentially be exempted from the free trade agreement, including procurement by municipalities.

We have no assurance on that, however. I think it is important that we have a little more information, and that the government listen to what the provinces and municipalities are calling for.

There are already rules within the European Union, among the 27 member states, and it would be very desirable for the same rules to apply between the European Union and Canada and the provinces in respect of government procurement.

With respect to supply management, I heard the parliamentary secretary and the Minister tell us that the Conservative government has defended supply management since it came to power. I am nonetheless going to reiterate the arguments presented just now. Why is this issue still on the bargaining table if the Conservative government is so committed to defending supply management? How is it that after saying that everything is on the table they have not yet resolved this situation, if they absolutely want to protect it to the very end?

In fact, a question was put to the chief negotiator, Mr. Verheul, at a meeting of the Standing Committee on International Trade held on June 15 of this year: what are the main points on which the Europeans are being most demanding, and what are the main points on which we are being most demanding? His answer was particularly disturbing, because he did not clarify anything. He said:

Both countries also have sensitivities in the general area of access for agricultural products, or at least some agricultural products. This will be the subject of discussion further on in the negotiations.

If, on the one hand, we are saying we want to protect supply management, why is the negotiator saying that will be negotiated later? It would be so simple to say we are not touching it, period. It seems to me that this would be much clearer. If the Conservatives want to be clear, they only have to say it. In fact, on that point, there are also other disturbing aspects. An article about the various sections on the preliminary talks for the negotiations is even more problematic since it relates directly to supply management as a domestic support measure. In English, it says:

The Parties agree to cooperate in the WTO agricultural negotiations in order to achieve a substantial reduction of production and trade-distorting domestic support....

Collective marketing mechanisms definitely distort the domestic marketplaces of those countries that implement them. In fact, quotas and tariffs end up determining supply. There is therefore reason to believe that supply management is being targeted by this provision.

It was signed by both parties, which agreed on the issue. On the one hand, it constitutes a general commitment to co-operate under WTO rules, not a concrete undertaking to do away with supply management. That much is quite clear. On the other hand, since supply management is always taken off the bargaining table when it comes time to negotiate free trade agreements, one wonders why it is still there at all. In the current agreement with the European Union, Canada is currently incapable of clearly stating that supply management will not be affected by the agreement because the government has said that “everything is on the table”.

Supply management is crucial to the development of agriculture in Quebec, human-scale agriculture based on the principle of food sovereignty. Danger is at our doorstep, and the Conservatives must reveal their intentions.

There is a lot more to be said on other matters, such as labour standards. The Bloc Québécois wants a truly binding mechanism put in place in order to guarantee that minimum labour standards will be upheld across the board under this agreement and in all related areas. Environmental protection must be considered. Globalization must go hand in hand with environmental protection so that our communities develop in a sustainable manner.

I will stop there and take my colleagues’ questions.

[Gerald Keddy, Conservative, Parliamentary Secretary to the Minister of International Trade]

Mr. Chair, this is an important debate and certainly one that needs to be held in the House.

I want to discuss a couple of points the hon. member made, and I do not want to spend a lot of time on it because we have answered it. We will defend supply management and the very principle of it, which is farmers get their cost of production plus a profit. This is a principle that most of us understand, and it is one of the few agriculture sectors in Canada in which that actually occurs. We are very supportive of it and always have been. We have defended and will continue to defend supply management.

However, let us not forget about the rest of the agriculture sector in Canada that has a lot at stake in these negotiations as well. There is the potential of a $3 billion increase in agricultural exports to the EU. In the beef sector, the pork sector, the oil seeds sector and the processed food sector, there is tremendous potential for an increase for agriculture across Canada, from coast to coast, while we continue to protect supply management.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Chair, in answer to the parliamentary secretary’s question, we are very aware that there are agricultural sectors other than those under supply management. However, when he answers in this way, when he says they will defend supply management but there are other sectors as well, is he not setting the stage to some extent to protect the other sectors? The government might just be forced to make a few concessions in the area of supply management. He says it is a sector where farmers can earn their costs of production plus a bit of a profit. That is supply management. However, it seems to me that they need to state this much more clearly and say frankly that everything was on the table at the beginning of the negotiations, but now the Europeans need to understand that we do not want supply management touched. Why wait for the very end of the negotiations if they have no intention of making concessions in this area?

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Chair, I was very interested in what my colleague had to say. There are several questions that arise. We did not get a single answer out of the minister a few minutes ago. He seemed incapable of answering a single question about details with which we are already familiar because of the leaks that arrive in our offices from the negotiating table.

In addition to the concerns about supply management, which the member so ably outlined, there is a great deal of concern about pharmaceuticals and what is being said about the provincial pharmaceutical purchase plans. There could be increases of as much as 30% in the cost of drugs if all the protections afforded to the big pharmaceutical companies are extended.

So I would like to ask my colleague a question. In view of the fact that the minister was not even able to say how much this will cost Canadians all across the country and how much it will cost the medical plans in Quebec and elsewhere in Canada, is he worried about the government’s lack of a response and lack of knowledge of the details? Is he concerned as well about the price we will have to pay?

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Chair, earlier I quoted the Government of Canada’s chief negotiator who testified in June before the Standing Committee on International Trade. He mentioned at the time that one of the most important considerations for the Europeans, and something they focus on more than anything else, is intellectual property. This has been largely clarified since then.

It has become apparent that the Europeans want to go much further than the protection that is currently offered in Canada when it comes to pharmaceuticals. The Bloc Québécois believes that a balance must be struck between what generic drug companies are doing on the one hand and what companies launching new products are doing on the other. Checks and balances, and an enhanced assessment process, must be put in place in order to ensure that any move in a direction that benefits one group will not come at the expense of other companies, and cause them great angst, when new measures are adopted.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Chair, my colleague from Saint-Maurice—Champlain raised a very important point when he said that in its negotiations, the Canadian government should listen to what the provinces and municipalities are calling for. I will quote a statement made by the Minister of International Trade that was published in the Canadian Press on August 20 and that my colleague knows well since he is the international trade critic. It is recent; we were starting to talk about negotiations. He had a rather haughty and dismissive attitude towards the provinces and Quebec.

With each round, the situation is different. Sometimes one province drags its feet and another is very ambitious, and vice versa. There is no sustained level of participation from the provinces, but there could be an improvement in some respects.

Regarding Quebec he said:

It is not so much a matter of blocking significant issues as it is a matter of tone and lack of ambition.

Not the greatest thing to hear from the Minister of International Trade. We are happy that Quebec is participating in the negotiations, but we know that Quebec often ends up out in the hall and not at the negotiating or decision-making table. For the good of the people of Quebec, I wonder if the member thinks it would not be better for Quebec to be there as a country, as a negotiator, so that it can defend its own interests instead of hearing the minister say such things about Quebec.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Chair, yes, that is for sure. After asking the negotiator some questions, we learned that there are 22 bargaining tables or areas under negotiation and the provinces are involved in only about 10 of them. The provinces are not involved at all in the negotiations on important subjects such as financial services. And yet very clearly each of the provinces has jurisdiction over financial services. But the provinces have been excluded from those bargaining tables, and that is completely unacceptable.

We are in the Supreme Court regarding the single securities commission, but in the meantime, the free trade negotiations are excluding the provinces de facto when these are subjects that affect them. I therefore agree entirely with my colleague: if Quebec were represented as a country, it could benefit a lot more and defend its interests a lot better, particularly when it comes to supply management, which is a subject that is really better defended by the province than by the Conservatives at present.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Mr. Chair, I have a question for the hon. member. Since Quebec is at the table along with the other provinces, since the territories are involved in the discussions and negotiations and since we have the support of the municipalities to pursue this comprehensive economic agreement, why would he not trust his own negotiators to negotiate in good faith on behalf of Quebec and the other provinces?

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Chair, I think the parliamentary secretary did not hear my comment in reply to the question from my colleague. I said that the provinces are not included in the negotiations as a whole.

My colleague from Richmond—Arthabaska told me that there are even situations in which the provinces end up out in the hall. Certainly we want to trust the negotiators, but our own negotiators, particularly for Quebec, who would be present at all of the bargaining tables and who could report exactly the same thing to us as Canada’s negotiator hears at all the bargaining tables.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Chair, I am a little saddened to rise on this debate, though I know this is the first of what will be a debate that may last a year or two in our Parliament and in the European parliament as the negotiations go on.

I will talk about what the debate is not about and then I will talk about what is on the table. Thankfully, at each stage in the negotiating rounds, leaked documents have indicated exactly what will be debated and discussed at the negotiating table.

This is clearly not about any sort of functional trade policy. My colleague in the Liberal Party a little earlier said this was about trade and that the Liberals supported trade. All parties in the House support trade. Unfortunately, the Liberals have had a tendency to support a profoundly dysfunctional trade policy on behalf of the government.

Every time the Conservatives have done something that has been bad for the country, like the softwood lumber sellout that cost tens of thousands of jobs, ministers have risen in the House and said that this would give us billions of dollars in economic spinoff. Yet Canadians from coast to coast to coast have seen the results of the softwood lumber sellout, the cost of tens of thousands of jobs, particularly in my province of British Columbia and in my community. With the shipbuilding sellout, we have seen the loss of a key strategic industry that is protected by every other major industrialized economy, but not by the Canadian government. We have seen blatantly bad and dysfunctional trade policy at every step.

What does this mean? Again, when we talk about this agreement, it is not about improving family income, which has been sorely battered over the last 20 years. Through these agreements, family incomes have gone down in most cases. Middle income Canadians are earning much less than they were 20 years ago. Lower middle income Canadians are earning much less. The poorest Canadians are earning far less. This started under the Liberal government and it continues under the Conservatives.

Even Maclean's, which is certainly not a left-wing publication, said very clearly in its latest issue, “Generation Screwed. Lower incomes. Worse jobs. Higher taxes. Bleaker futures. What boomers are leaving their children”. That is what we have seen from the government. Conservatives have sold out our manufacturing industries, 500,000 lost manufacturing jobs over the last few years as they have sold out various sectors. We talked about supply management, which has been the only stable agricultural sector over the last few years. They put it on the table. When we see what the government has done, we have farmers pleading to get back to 1994 levels in agricultural research funding from the government. Farmers are pleading for a modicum of some of the product promotion supports that our major competitors get. As an example, Meat & Livestock Australia has a budget in excess of $100 million. What does Canada have? Just a few million dollars. It is clearly a dysfunctional trade policy.

What has been the result? We have seen the bilaterals. In every case we have signed these bilateral trade agreements, our exports to those markets go down in real terms. The minister will say that he will throw out apples to oranges and pretend there is no devaluation of our dollar over time. In other words, let us use the dollar of today and then we can pretend exports have increased. I was unable to get this information from the department, because it does not compare apples to apples, so I had to get this from the Library of Parliament. One example is the trade agreement with Costa Rica. Before signature, we were exporting $77 million worth of goods. Now, almost 10 years later, we are exporting $73 million. It has gone down $4 million in real terms. This is happening in case after case.

Therefore, it is not about jobs and it is not about exports. We have a cheerleading government that loves to sign these agreements no matter what the cost. It throws things on the table and ends up always being bested. With the EFTA agreement, Liechtenstein out negotiated us. When we look at every one of these agreements, the Conservative government is about the worst negotiator we have ever seen. That is why most Canadians are earning less. That is why our exports have gone down in markets after we have signed them. However, it not about trade and it is not about agricultural policy.

What is on the table? What is this agreement about?

The only credible study was actually done by the economist Jim Stanford. He indicated a net loss of 150,000 jobs. I just want to read a brief excerpt, because this is important for those who are listening across the country. I have certainly gotten a lot of emails from people who are keenly interested in what is on the table. He referenced a botched model that was thrown out by the minister, one which the minister referenced, as they do with all the trade agreements, as having billions and billions of dollars of net benefits and then of course we see what the results are.

The department never does a post-signing analysis. We never actually even see an impact statement prior to it. It is difficult for Canadians to believe just how dysfunctional the government is on trade policy. It does not do the impact studies before. It does not do the analysis afterward. It does a lot of cheerleading. There is a lot of bluster, but when we look at all the facts that we are putting on the table, that the minister was not able to put on the table, we see a sorely lacking policy.

The comments are:

Only thanks to the idealized assumptions built into the model [... ] could Canada hope to “snatch victory from defeat”: attaining aggregate economic gains despite such a marked deterioration in bilateral trade performance. The real-world experience of other free trade agreements implemented by Canada does not support the hope that a free trade agreement with the EU is the way to make that unbalanced relationship more beneficial for Canada.

We are not talking about the fantasy world of the Conservative Party. We are talking about the real world.

What is on the table? We have heard about supply management and certain of my colleagues have raised this issue. We have and will be talking about food sovereignty. My colleague from the B.C. Southern Interior will be referencing that a bit later in the debate. We have talked about the loss of jobs, about 150,000 net lost jobs. Let us talk about some of the other components within this agreement.

What has been tabled by the government, what is in the leaked documents, shows very clearly that we are looking at substantially enhanced patent protections for the extremely profitable pharmaceutical companies in Canada. We are looking at increases to our provincial drug plans, and to Canadians who depend upon those drugs to maintain their good health and often to survive, of up to 30%. I asked the minister just a few moments ago to respond to that. He had either no idea or wanted to hide those figures. He did not address the issue at all.

What else? We have the egregious investor-state provisions, and that is why Canada has one of the worst trade templates in the world. Investor-state provisions allow for an override of companies. Wherever they are, they can set up a mailbox, as we saw with AbitibiBowater, with Canadians taxpayers coughing up $130 million in that case.

This is a Canadian company using NAFTA rules, these investor-state provisions, a hot button for corporate compensation, for anything they want. It does not go through the court system. It is done in a secret backroom and it is the Canadian taxpayer who pays the tab. In the case of AbitibiBowater, it is $130 million, a Canadian company suing the Canadian government, but doing it by pretending, through a mailbox down in Delaware, that it was a company from somewhere else. It is open season.

I can say that from conversations I have had with European parliamentarians a few weeks ago, who fortunately will have the right to ratify or not to ratify this agreement, they are waking up to investor-state provisions and are extremely concerned.

There is the loss of public procurement. The government has done no study on the job losses that would result from that, but the Union of B.C. Municipalities and the Federation of Canadian Municipalities have all expressed concerns about this, and this investor-state override also has impacts on the environment and environmental protection.

What this means is that the corporate sector can say, “We do not like those environmental regulations. Either stop those environmental regulations or give us massive amounts of compensation”. In a secret backroom, they negotiated away from the public interest. It affects democratic rights. It affects our public services, our public health care, of course, which I mentioned earlier, and it is an increase in costs to all Canadians.

This agreement surely is not free, and the government has to come clean with what the impacts will be for ordinary Canadians.

[David Tilson, Conservative, Dufferin—Caledon, ON]

Mr. Chair, my colleague has said that these negotiations do nothing with respect to jobs. Yet this agreement is being done with the world's largest single market. It has a population of 500 million, and it has a GDP of more than $19 trillion.

With all of this information with respect to these markets, the population, the GDP, how can this do anything but create jobs? I do not know how the member could possibly make that statement when negotiations are being arranged for all of these things. How can the member possibly say it would not create jobs? Of course it would create jobs.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Chair, this is exactly the point I was making. I think the member for Dufferin—Caledon has illustrated it perfectly.

Conservatives do not read the trade agreements, they do not understand what is at stake and they do not do any impact studies. They just throw it up in the air and say, “Of course, this must create jobs”.

The Conservatives have absolutely no fundamentals and there is no due diligence that they have done to actually make the case. This is the essential problem in why Conservatives have a fundamentally dysfunctional trade policy.

There has been one credible study, and not a fantasyland study like the minister tried to commission, which was promptly rebutted. There is one credible study that shows a net loss of 150,000 jobs in Canada.

For those who are among the half million Canadians who have seen their manufacturing jobs lost, the idea that one can simply throw something in the air and say that it must be good is exactly the fundamental problem that so many Canadians are having with, and it is almost an oxymoron, the Conservative trade policy or their economic policy. The study shows 150,000 lost jobs. There is nothing credible on the Conservative side to show the contrary. It shows a 30% increase in drug costs, but there is nothing on the Conservative side to show, in any credible way, that they have even examined the issue.

It costs Canadians every time the Conservatives throw something up in the air, whether it is the softwood lumber sellout, the shipbuilding sellout, or this particular deal. The Conservatives have not done their homework, they have not done their due diligence, and that shows.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Chair, my hon. colleague from Burnaby—New Westminster and I have served on the international trade committee for approximately five years and have travelled together quite frequently. He is a great orator and looks at life through a different set of lens, even though we are both from British Columbia.

One of the biggest economic benefits is the free trade agreements for our province. The fact is, we have been able to implement eight since our government took office in January 2006, and we continue to look at expanding markets.

The Minister of International Trade alluded to the economic impact of this Canada-EU trade agreement earlier. It is anticipated at $12 billion, and that is b for billion. Jobs, hope and opportunity are definitely something we are looking at.

My hon. colleague stated, “All parties in the House support trade”. For the fives years we have been on the trade committee, I have not seen him support a trade agreement. I would like to clarify which trade agreement he is referring to that his party supports.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Chair, that is a very easy question to answer. I like the member from Kelowna—Lake Country so I will be gentle on him.

There is the Auto Pact, and we have been saying this all along. Managed trade, fair trade agreements, are what we support.

We have been offering a great deal of substantial feedback on each of the bills that have been brought forward by the Conservatives. We have been asking them to do the impact studies prior to. We have been asking them to do the due diligence afterwards. We have been putting forward fair trade suggestions. In fact, we will be tabling our fair trade legislation in the House soon.

As supporters of the Auto Pact, managed trade agreements and fair trade agreements, we are very strong supporters of trade when trade is fair. This is where most Canadians are coming from.

We had Conservatives in this House from British Columbia stand up and say that the softwood lumber sellout would be a great boon to B.C. industry with billions of dollars in benefits. It sounds very familiar given what we are hearing tonight. The result was tens of thousands of lost jobs, devastating communities right across British Columbia. It simply was not true.

In fact, I remember a Conservative member from B.C., not the member from Kelowna—Lake Country, who was proud of the fact that he had not even bothered to read the agreement, but he was going to vote for it.

These are the kinds of destructive dysfunctional policies that we have to stop because they are hurting Canadians. When Conservatives do not do their due diligence, when they just throw stuff up in the air and hope that somehow it will land right, that hurts Canadians profoundly. They have to stop doing that.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Chair, I would like to thank my colleague for his profound statements. I recognize him as a true patriot, one who has lived in all parts of Canada and understands what these agreements can mean for the future of our country.

I will be speaking later so I just want to zero in with a couple of questions. One concerns a quotation in an article in the Epoch Times by the National Farmers Union. It says that it obtained a draft of the agreement that says that CETA would subject farmers to draconian property rights enforcement measures, including the virtual elimination of the age-old practice of saving, reusing and selling seeds from their crops. The article goes on to say:

Under provisions in CETA [Comprehensive Economic and Trade Agreement], using saved seed could result in a farmer’s land, equipment, and crops being seized for alleged infringement of intellectual property rights attached to plant varieties owned by corporations such as Monsanto, Dow, Syngenta, and Bayer.

I would like him to comment on that.

Also, I am sure he is familiar with a document put out by the Council of Canadians entitled “Private water and CETA”. Maybe he could also comment on the fact that, according to this document, CETA will force municipalities and water utilities to consider privatization.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Mr. Chair, the member is the foremost advocate in the House for small-scale farmers, for the supply managed sector and the Wheat Board. He is a real breath of fresh air on the agriculture committee and a very strong Canadian in the House of Commons. He reads the text diligently of everything that comes before us, which is why he is able to stand up and point to specific aspects of this deal that are clearly not in the public interest.

We are getting many emails tonight and we thank the folks who are watching the debate and sending emails. Please email the Liberal and Conservative MPs and tell them that they really have to read the lead text and understand what is going on at the table.

He has just mentioned two key aspects that are extremely important. The first, of course, is the issue of what the impact will be on farmers if they are not able to use their own seed. The impact on food sovereignty is enormous. I know the member will be speaking on this a little later.

Second, there is the issue of public services, water and health care being put on the table by the government, which is highly irresponsible. It has done absolutely no due diligence or homework, as we have seen. We asked questions of the minister and he was incapable of answering a single one of them. For Canadians waking up to what this represents in so many different areas, they have to be concerned about what the government is bringing forward. That is why it is important for folks to get informed.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Chair, it is my pleasure tonight to address the House on the issue of the Canada-EU trade agreement.

A lot of my colleagues are going to be fairly technical in what they talk about, but one of the things I have noticed in working in my constituency and on the international trade committee is that, with the fundamental case for trade, everyone gets out there and most people are in favour of it, but then they are not quite sure what free trade is or why it should be supported.

Tonight I am going to use the majority of my time to actually deal with the basic case for free trade, economics 101 or why we should have free trade; and then I am going to deal with a couple of specific issues that critics of trade agreements have raised.

I want to start with a quote from the esteemed economist, Adam Smith. In Wealth of Nations, he states:

In every country it always is, and must be, the interest of the great body of the people, to buy whatever they want of those who sell it cheapest. The proposition is so very manifest, that it seems ridiculous to take any pains to prove it; nor could it ever have been called in question, had not the interested sophistry of merchants and manufacturers confounded the common sense of mankind.

What we are doing tonight by arguing in favour of a Canada-European free trade agreement, arguing in favour of generalized free trade, is arguing for lower prices for consumers, a benefit often overlooked when we discuss trade agreements.

We discuss what the good is for agriculture exporters, what the good is for manufacturers, what the good is for specific interests. But our job, our duty as members of Parliament, is to stand up for the common good of the entire country. Every single Canadian, all 33 million plus of us, are consumers.

This is what free trade does. It helps to lower the cost of goods for Canadians. It helps us access the cheapest, best-quality products throughout the world without any encumbrances. So the reason that we fundamentally push hard for free trade is very simple: it helps bring down cost for consumers; it helps make more goods available at a better price.

The classic illustration that is sometimes given, very simply, is for sweaters. One can buy a sweater for $30, and once a free trade agreement is implemented, all of a sudden the price drops to $25. At this point, consumers can then spend the extra $5; they can go and buy something else.

The opponents of free trade will argue, “What if that $25 goes out to another country, outside of Canada? Does Canada not lose the $25 that was spent on the sweater that was imported?”

Let us think about this for a moment. I take my $25 Canadian, I pay a merchant for the item, and the $25 gets shipped overseas. What does the English, French, or Japanese business, and so on, do with $25 Canadian? The only thing they can do with Canadian dollars is, really, buy something that ends up coming back to Canada. It is intricate and it works back and forth. There are exchange markets, and so on, but fundamentally, what works for individuals works for countries.

Trade works, and as we lower the cost of goods and services for Canadians, our economy becomes more productive. We can produce more goods and services with less effort. That is the whole fundamental basis of trade. That is why we push for it.

One way of thinking about it is as an individual. Let us think of what an individual does, such as a farmer. A farmer who grows his crops does not make his combine and tractors. He does not manufacture them by hand. We know what the state of agriculture was 1,000 years ago when people were forced to make their own implements by hand. The farmer has specialized, and Canadian farmers are absolutely the best in the world at producing crops of canola, grain and things of that nature. However, they have specialized; and in just the same way, business has specialized and nations have specialized.

So the goal of trade is very simply this: to lower the cost and to increase the trade. At the end of the day, every export we send out brings back an import. Of course, if we do not pay for it, if we run up extensive debts, just as with an individual, there is a problem. If we actually pay our debts and do not spend all our time borrowing money that we have no intention of paying back someday, we will have balanced trade through tourism and other investments, things of that nature.

Free trade is the specialization of labour. It works. It raises the standard of living, and it brings an increase in productivity, which makes us wealthy.

Let me deal with particularly two elements of criticism that have come into this trade agreement from certain elements or special interests in this country and have been, in general, criticisms of trade agreements that we have had with others.

The first is the case for protection of foreign private property, a foreign investment. It has gone under various names and usually the critics will talk about investor states, and so on, but fundamentally what we are looking for is protection of foreign investment, the same protection that we ask for Canadian investors when they go abroad and put their money into another country. We do it, and most people think we do it to protect foreign investors. We actually do it to protect our own economy, and let me explain why.

I have a friend who is a very successful businessman, a very shrewd gentleman who lives in Calgary, Alberta. He started an oil sands company with some partners and sold it off to some American investors. The company had some technology. The technology was incredibly useful for another country in the world; in fact, it fit its needs for production of oil precisely. The country made him a very good offer and it could have been very profitable if he had been allowed to keep his profits in that country.

It is a country that has a known reputation for expropriating foreign assets in Latin America and he rather wisely decided that he was not going to invest his money in that country because it was dangerous and risky and the president there might expropriate. That did not damage him. He took his funds and invested them somewhere else and he is busy making money in the Alberta oil patch and in other international investments.

The country involved, whose oil production is plummeting, lost because of that technology. If it had had investor provisions for foreign investors, that country would have gained. It is for the same reason that we must insist that foreigners have investment protection in Canada, that the rule of law be respected. That does not mean that foreign investors can have special privileges; it means that they receive the same treatment under the rule of law as Canadians would.

The protection of private property, which is going to be included, or should be included in all Canadian trade agreements, is very important because it protects our economy and helps us to grow. It is for our interest that we do this and not just for the foreign investors.

The other thing I wish to deal with and note tonight is some criticisms that we are opening up our government-level procurement at the municipal and provincial levels. This is again in our interest. Just as I stated earlier, it is in the interest of all Canadians to have lower costs so that we can then go out and make more purchases with the money we have saved. That applies, too, for government. It allows us to lower taxes and to grow the economy in general.

It is very interesting to note that as Canadians we get very upset when our companies are denied the ability to enter into contracts with local procurement in other states. I think of a situation that has recently been in the news, of Franklin, Ohio, which denied a Canadian company the ability to win a furniture contract. As the lowest bidder, the company would have done it and it would have benefited. So we must look to have the same protections for others as we seek for ourselves, for the same reason that free trade is good.

Let me restate. Free trade is good. We do it to raise the standard of living, which has been proven over again with the Canada-U.S. trade agreement, the NAFTA and throughout history. Trading nations are prosperous nations. This is a good agreement, and we should back it.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Mr. Chair, I would like to ask the member opposite a question.

He knows very well that the Liberals are very supportive of this agreement, but there have been some legitimate concerns raised, partly because people are not necessarily sure of the details of what is being negotiated. We hear issues raised in the media, and I am hoping that the member opposite can speak to two specific issues.

Where are we in the negotiations in terms of water and water services, particularly at the municipal level? That is an issue that has been raised, and if he could add some specifics as to what may be being negotiated, that would be very helpful.

As well, on the larger procurement side, we know that public procurement is on the table. We also recognize that there are Canadian enterprises that are poised to take advantage of those opportunities in member countries of the European Union, but there have been legitimate concerns raised about how far we will go in offering up public procurement at different levels of government here in Canada, where there may be some concerns about local jobs and concerns about flexibility.

I am hoping the member opposite can answer both of those questions.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Chair, I am afraid I will not be able to answer them in quite as great detail as my colleague would like. Partly that is because negotiations are still going on. I am sure, from what I see, the minister would be very willing to do that. However, let me first deal with the point about water.

One of the things we need to understand is that it does not matter if it is Canadian investors, foreign investors, or people interested in utilities, bottled water, and so on, our environmental laws will remain the same. There will not be special protections under environmental provisions for foreign investors or discrimination one way or the other. So our laws on that will be permitted.

As to what specific water services are being negotiated or not negotiated, I am afraid I cannot give any particular detail in that respect. One thing I can say is that we should remember that water is often included as a natural resource and will be the territory of the provinces. The other thing we should note is Canada's long-standing position that water is a natural state and is not considered a good or product and therefore will continue to remain outside Canada's trade agreements.

In regard to procurement and those issues, government procurement, including at the sub-federal level, is one of the areas of negotiation, but the details are still to be negotiated and we are going to look for benefits that go both ways.

What levels and what thresholds we end up going with and what carve-outs there will be still has to be negotiated, but based on our recent experience with the United States at that level, both Canada and the European Union will be seeking those elements.

As one can appreciate, I cannot give full details as much as my hon. colleague would like--

[The Assistant Deputy Chair, Conservative, Barry Devolin]

Order, order.

Questions and comments, the hon. member for British Columbia Southern Interior.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Chair, I have a couple of questions for my hon. colleague.

First, I wonder if he is familiar with a document entitled “Municipal Procurement Implications of the Proposed Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union”. This is a legal opinion prepared by Steven Shrybman of Sack Goldblatt Mitchell LLP for the Centre for Civic Governance at Columbia Institute. If he is familiar with it, does he have any comments; and if he is not, would he be willing to receive a copy? I have an extra copy here that I could give him.

Secondly, in previous free trade agreements, NAFTA and the FTA, municipal procurement was really not on the table when it came to subnational governments. We first saw this with the Canada-U.S. procurement agreement that was signed last year. We found out that municipal procurement was on the table and that somehow we were at the short end of this, because we were dealing with the powerful United States.

The EU has made a specific request for full access to public procurement in cities across Canada, including the right of European multinational corporations to bid on core municipal services.

As a representative who has folks living in Humboldt, where the hon. member comes from, I wonder how the folks in Humboldt would feel if a new rec centre was going to be built or new additions made to the arena and they wanted to provide local jobs, yet they were not able to do that because a big multinational came in and outbid them. What would be his reaction to that?

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Chair, with regard to the legal opinion he has, no, I have not seen it. I am not a lawyer. If he can send it to my office, I would not mind reading it.

My point about local procurement is the same one generalized. Lower costs help all Canadians. As has been pointed out, we are not going to be importing construction workers from overseas to Humboldt to build a local stadium. Local workers will be used, be they from Humboldt, Leroy, Watson or Saskatoon. Lower costs help all Canadians. They increase productivity, which increases wealth. That is true when it comes to procurement, as it is to anything else.

The example I gave about the county of Franklin, Ohio, refusing Canadian furniture because it wanted to pay more to a local supplier is going to hurt Franklin County and it is going to hurt the furniture dealer in Toronto. That is the sort of thing we are trying to stop, so that Canadian companies can bid around the world and Canadians can gain both on lower costs and greater exports.

[Gerald Keddy, Conservative, Parliamentary Secretary to the Minister of International Trade]

Mr. Chair, I thank the hon. member for his comments and, in particular, his discussion on a rules-based dispute mechanism. The word “egregious” was used in the House earlier by a member from the NDP, and I can say there have been no more outrageous and misleading statements than the ones about a dispute mechanism. I very much appreciate how the member broke that down to its lowest common denominator and explained it, because there has been a lot of misinformation. These debates seem to become the realm of misinformation.

I would like his comments on the problem that we ran into at the WTO where we failed to sign wide-ranging, multilateral trade agreements, where we had become stalled and stymied at the WTO and, therefore, forced into looking for bilateral agreements.

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

Mr. Chair, the hon. member summed it up in his question. Trade agreements were stalled at the WTO. This was a part of our economic and foreign policies. Our government took initiative. Rather than sitting around, the Minister of International Trade and the Minister of Foreign Affairs went there to break down barriers to help Canadians access cheaper goods and break into markets and to help Canadian exporters get our world-class products out there.

We have seen that with the trade agreement with Colombia that is about to come into force and with the European Free Trade Association. We are reaching out to places like Ukraine and India. We are going across the world. The ministers who have taken the initiative and the government members who helped craft the strategy need to be commended.

Canada is a trading nation. We are on three oceans. People have immigrated to our country from all over the world. We are in a great position to take advantage of our natural resources to expand our markets throughout the world. It is an important part of our economic strategy.