Jack Layton, MP, DéputéToronto – Danforth
Leader, New Democratic PartyChef, Nouveau parti démocratique
March 1, 2008
Senator Barack Obama
United States Senate
713 Hart Senate Office Building
Dear Senator Obama:
Canadians are watching the Democratic Primaries with great interest, particularly the debate around the future of the North American Free Trade Agreement. Working Canadians, like working Americans, are deeply concerned that this agreement has cost hundreds of thousands of jobs and has not helped us build the greener, fairer economy that we must leave as a legacy to our children.
I have heard you say: “I believe in trade, I just want to make sure that the rules of the road apply to everybody and they are fair and that they reflect the interests of workers and not just corporate profits.”
I could not agree more. It has become apparent that a rising tide does not in fact lift all boats.
Both of our countries have seen impressive economic growth rates, increased productivity and investment flows. Yet, in the United States, Mexico and Canada, income inequality has grown dramatically in the almost fifteen years since NAFTA took effect. The very wealthy have reaped most of the benefits of increased trade and investment, while ordinary people have watched high-quality manufacturing jobs move elsewhere. There is a growing gap between the rich and the rest of the people.
In Canada, this prosperity gap has reached crisis proportions. Despite the fact that most Canadians are working longer hours, 80% of families lost ground or stagnated in both earnings and after-tax returns compared to the previous generation. Real wages have not increased in more than 30 years. The share of corporate profits in our economy is at its highest point since1961, yet the corporate contribution to the public purse is declining.
In Canada, we have had ten budget surpluses in the last decade, and yet most Canadians believe they are a mere paycheque away from poverty. Eighty per cent of Canadians think the government should intervene to close the gap between the income groups. But successive Canadian federal governments have failed to deliver policies that will turn this growing disparity around. While aboriginal peoples, single mothers and recent immigrants are the most disadvantaged groups, the middle class is also losing out.
The United States and Mexico face similar challenges, albeit in quite different contexts. In your own country, the erosion of social security, the plight of the uninsured in health, the strength of powerful business lobbies in Washington and the shocking poverty of the working poor in African-American and Hispanic populations, are realities you are intimately acquainted with. Your commitment to resolving these issues explains the excitement your campaign has generated across the country. In Mexico, despite constitutional guarantees, the majority of people – including many migrant, self-employed, informal sector workers and the unemployed – have no social assistance whatsoever. The crisis in the rural sector with the most recent phase-out of agricultural tariffs will throw millions more into extreme poverty.
This growing inequality has become institutionalized through NAFTA and will become even more entrenched through the Security and Prosperity Partnership (SPP). These agreements have provoked a chill on government regulation of the economy, as international trade rules override domestic rights. Regulatory harmonization has trumped social harmony. The provisions of Chapter 11 have unduly emphasized corporate rights at the expense of our governments’ capacity to regulate in the public interest. This is sometimes correctly referred to as a democratic deficit.
The New Democratic Party has noted for over a decade the inadequacies of our free trade agreements that do not offer sufficient protection for workers, for the environment, or indeed for the capacity of governments to regulate in the public interest. We have also expressed grave concerns about the dispute settlement process, for both its procedures and the non-respect of decisions rendered – as in the case of the softwood lumber dispute between our two countries.
NAFTA, with all its weaknesses, was the first trade agreement to incorporate side agreements on labour and environmental protection. As you have noted, such side deals are not enough. While they provide documentation on the growing problems in these areas and create forums for trilateral cooperation, they do not have the authority to impose sanctions for violations of the rules or to put in place common solutions. The promised leveling up of environmental and social standards has simply not happened.
On behalf of the New Democratic Party of Canada, our caucus and our membership, I warmly welcome your commitment to rethink NAFTA. Everyday Canadians, Americans and Mexicans are ready for such leadership. Leadership that is ready to tackle complex problems with forward-looking solutions. Our two countries are trading nations, close
neighbours and culturally and historically related in many ways. I look forward to strengthening these ties in a way that respects the sovereignty of each of our countries and ensures that we are each democratically accountable to our own people. Together, we can prudently lay the groundwork to craft trade agreements which will lead to improvements for the vast majority who have been left behind since NAFTA came into effect in 1994.
The Democrats in the U.S. can count New Democrats in Canada as allies in the vital effort to improve upon NAFTA and help build a modern 21st century North American economy that is prosperous, fair and sustainable for today’s families and future generations.
Sincerely yours, Jack Layton, P.C., M.P., Ph.D.
Clearly there is support (with good reason) for rethinking NAFTA from our friends to the left in Canada as well.
This endorsement of sorts, also suggests that there is belief (at least among the leadership of the New Democratic Party of Canada) that Barack Obama, not Hillary Clinton, is the American presidential candidate who will bring about that necessary change.
Thanks again to our friends in Canada for forwarding this letter.