What the 'CETA' Trade Deal Means for You, Your Job, and Brexit
There's been a lot of talk about the deal between Canada and the EU, but here's how it will affect you.
The Comprehensive Economic and Trade Agreement – or CETA, as it is commonly known – is a trade deal between Canada and the European Union. Britain will be subject to this until Brexit happens – which, of course, could be a long time yet.
Either way, CETA's been making some headlines recently; on the 14th of October, the massive trans-Atlantic deal was blocked by quite a small parliament – that of Wallonia, a region in Belgium. EU bureaucrats went nuts. They'd spent over seven years negotiating this thing and they weren't going to let a pissy little bit of regional democracy hold them back.
Günther Oettinger, the EU's commissioner for the digital economy, said that Wallonia was a "micro-region run by communists, which is stopping all of Europe. It's not acceptable." Oettinger has said worse recently: he was caught on camera calling Chinese people "slit eyes", making jokes about gay marriage and criticising Germany's welfare system for being too generous. Nice guy.
The European Commission's president, Jean-Claude Juncker, had to be told to "calm down" after he furiously chided Belgium, which he said "has to do some thinking about how it functions at an international level... We made an exception to this once because it's normally up to the regions to reach an accord first." Bad Belgium. You get a pass this one time, but if you don't do what Jean-Claude says, no one will talk to you at the ambassador's reception.
It seems that, childish as it was, Juncker's threat was heard. Last week, Wallonia caved and CETA was signed, meaning that it comes into force on a temporary basis. It has yet to be permanently ratified.
But what does this labyrinthine deal mean for those of us who aren't running international companies and don't spend our lives shouting at each other in Brussels?
The most controversial thing about CETA is probably its Investment Court System. This is a re-working of a mechanism called the investor-to-state dispute settlement (ISDS), which is pretty much what it sounds like: a way for businesses and governments to settle disagreements. The mechanism is included in a number of free trade deals. It's controversial because it has been used by companies like tobacco giant Philip Morris to sue governments that bring in legislation they don't agree with (as in Australia, where plain cigarette packaging was said by Philip Morris to harm its sales). So governments can be sued if their laws could cost big business big bucks.
Under the North American Free Trade Agreement – between Canada, the USA and Mexico – Canada has been sued 37 times, losing or settling eight claims.
CETA would increase the risk to the EU and its member states of challenges by Canadian investors in the mining and oil and gas extraction sectors. The deal also opens up the possibility of dirty tar sands crude oil being exported to Europe.
Activists who oppose CETA have done well drawing attention to its corporate, secretive nature. Canadian Prime Minster and heartthrob Justin Trudeau is savvy enough to realise this, and says things like "inclusive" and "progressive" when talking about CETA, saying the deal will create more opportunities for European and Canadian workers. He paid lip service to rising wealth inequality, insisting that CETA would work for everyone, not just the few. Moreover, he has said that CETA will not lower regulatory standards.
But while the deal will give European consumers the chance to buy cheap Canadian imports – and vice versa – it is unlikely to be good for our working lives.
For a while, Romania looked like it might be the fly in CETA's ointment. The country was lobbying hard to get freedom of movement between the EU and Canada included in CETA. Hats off for trying, lads. But the Romanian dream of moving to the suburbs of Toronto to work in a maple syrup factory raises an important point: in these deals, capital always trumps labour. Your job can be moved to wherever the cheapest workers can be found, but that doesn't mean you can move to where the work is.
If you're an EU worker, you can't move to Canada without meeting the same old criteria, but cheap Canadian imports can threaten the company you work for or the industry you work in, to the point where you lose your job. You could work in the NHS and find that what you do is going to be outsourced to a Canadian service provider. For ordinary people, all that lovely free trade often amounts to nothing more than the freedom to have your job outsourced to some other part of the world.
This is something that Donald Trump has honed in on. NAFTA and the devastation it has wrought on the lives of working Americans is a drum Trump has banged ever since he got his nightmarish show on the road last year. A favourite video of his shows an executive from Carrier, a company that makes air conditioners, telling a factory of American workers that their jobs are being moved to Mexico.
It has taken over seven years for the EU and Canada to get to a point where their territories are on the point of becoming one single marketplace, a zone through which capital can move freely without being taxed (and here is another point: what will replace that tax?).
The length of negotiation hardly bodes well for Brexit fans who want to get out of the EU, particularly with recent developments in the British High Court. Moreover, Europe's top officials have shown how hostile they are to anywhere like Wallonia that dares defy the free market status quo. If CETA creates jobs, they're unlikely to be the jobs you want. It might give you the chance to buy some cheap products – fine. But if it gives companies the power to do things that are not in the public good, if it gives those same companies the chance to move jobs away to where the work is cheapest, well then that's a problem.