Friday, 3 June 2016

Trans Pacific Partnership: will it hurt working class Canadians?

What is the Trans Pacific Partnership?

Basically, the Trans Pacific Partnership (TPP) is a giant free trade deal between the United States, Canada, Mexico and a dozen countries within pacific ocean region that has been under negotiation for nearly a decade now. It originally started off as a agreement between Singapore, Chile and New Zealand. It's expected to eliminate tariffs on goods, services, and harmonise all sorts of tax regulations when it's finished.

How can free trade from the TPP harm Canadians?

Free trade” also allows for many Canadian companies to openly trade in many international markets created by free trade agreements, regardless of a nation’s stage in development. Theoretically free trade can allow companies in foreign countries equal economic competitors, competing equally with every Canadian company as if they were located in Canada. Many “free trade” supporters advocate the elimination of tariffs, which regulations may force Canadian companies to pay extra for doing business in foreign markets. “Free trade” also has the meaning that Canada is also trading with countries, where goods can be made for $4 an-hour or less, when compare to the average Canadian minimum wage, which is around $11.25 per hour. The average wage in Vietnam is $125 to $175 per month, and manufacturers could be outsourcing many Canadian jobs to countries like Vietnam, under the Trans Pacific Partnership agreement. TPP really isn’t a trade deal that would benefit Canadians. TPP would be just like NAFTA and would provide significant incentives for Corporations to send Canadian jobs to countries that only pay poverty level wages to their workers.

Just remember that free trade agreements like the NAFTA has allowed more Canadian jobs to be lost to Mexico. NAFTA has eroded the living wage and the Canadian dream since it was ratified in 1994, not created more living waged jobs for Canadians as many expected. Just like NAFTA, many Canadian companies will be able to take advantage on the cost of labour is in most TPP countries. Most wages earned in Trans Pacific countries like Malaysia Singapore and Vietnam, will be far below the Canadian standard of living. Many of these factories in these cheap labour countries, can make almost the same quality that can be achieved in Canada, but at a fraction of the Canadian cost. Some of this cheap labour is created from poor factory working conditions and lack of safety regulations, which helps produce most goods in these countries more cheaply than it can be made in Canada.


How can the TPP benefit Canadians?

Lets rephrase the question, what is the benefit of the NAFTA for Canadians? Can the Trans Pacific Partnership benefit Canadians in a much positive way than NAFTA. Remember NAFTA, allowed many Canadian companies to set up shop in the lower waged Mexico, this also put many Canadian manufacturing workers in a race to finish at the bottom. Some critics of the NAFTA, is an unfair agreement that many Canadians simply can’t win this race, given the fact how much less the average Mexican labourer earns over their American and Canadian counterpart. The signing of NAFTA, has led to the decline of Canadian manufacturing employment, due to the persistently large trade deficits with Mexico. The Mexican minimum wage is roughly a daily rate of $5.00 Canadian, when compared to average $11.25 per hour minimum rate for Canadians. 

Can the TPP effect the wage of Canadian workers?
When you compare factory wages in Canada to other member countries in the TPP, you will find the Canadian wages to be one of the highest in the TPP member list of participating countries? We have the New Democratic Party (NDP), wanting to “reinstate a national Canadian minimum wage and increase the bare minimum rate across Canada to fifteen dollars an hour. Even the United States has a national minimum wage of $7.25. Many member states in the American union can set their own minimum wage rate, under the provision that the rate does not fall below the national minimum rate of $7.25 per hour. Even Great Britain has introduced a new mandatory national living wage (NLW) for workers aged 25 and above. Setting up a national Canadian minimum wage to the actual living wage (ALW) in Canada, would be heavily criticised on the grounds of possibly destroying Canadian jobs. The actual living wage may sound like a great idea, this is not helpful especially for small businesses in any economic climate. The Living Wage will negatively affect small business and their ability to grow in success. How could Canadian companies offer their workers actual living wage in pay, when the TPP would push down our existing wages by forcing Canadian companies to compete with workers who make roughly in the monthly range of $125 to $175, which is the wage of the average Vietnamese worker. The TPP is suppose to level the playing field for Canadian workers and businesses, which should lead to more Made in Canada exports. How could the TPP free trade agreement help create more higher paying Canadian jobs, just by cutting over 1,000 tariffs designed to protect Canadian jobs?

Trans Pacific Partnership may be able create new jobs for Canadians, among many participating member countries. Most of these new jobs maybe far less desirable and do not pay as well, as many good paying Canadian jobs that are lost to cheaper labour waged countries in the Trans Pacific Partnership. Cheaper foreign goods from many countries like Brunei, Chile, Malaysia, Mexico, Peru, Singapore and Vietnam; would mean that Canadian companies, factories, and workers will have to make concessions in order to compete with these Trans Pacific member countries. Close to one million Canadian manufacturing jobs were lost to Mexican factories, and most of those job losses were due to growing trade deficits with Mexico, since the signing of NAFTA in 1994. The reality of the Trans Pacific Partnership includes more Canadian jobs being lost to low waged participating pacific member countries. TPP will have terms very similar to NAFTA, which provides the same benefits for companies that relocate abroad and eliminate good paying Canadian jobs in order to save on labour costs. 

This TPP agreement would also undermine the working class of Canada, by giving multi-national corporations the right to move their factories from Canada, in order to protect their “expected future profits and interests”. If anyone is dead serious about rebuilding the Canadian middle class and creating the millions of good paying jobs that we desperately need in Canada. We must fundamentally rewrite our trade policies that protects the interests of hard working Canadians, not in the interests of corporations and their greed for profit. 

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