CUSMA Trade Agreement
Madam Speaker, as has been mentioned before by my colleague from the NDP, I would caution the government to move prudently on this.
We have already seen the Democrats not wanting to give Mr. Trump any kind of victory. Therefore, we have not seen a lot of co-operation from the U.S. If we get too far ahead of ourselves regarding ratification, that could be an issue. Therefore, I would echo the comments of my colleague from the NDP that as a result of the uncertainty we see in the U.S., we need to be cautious as we move forward with ratification.
The government’s legislation aims to implement the Canada-United States agreement. The government is calling it by its acronym CUSMA. The bill would reaffirm key NAFTA provisions, but it would also introduce new conditions on Canadian trade and economic strategy.
Mexico and especially the United States are Canada’s natural trading partners. A framework agreement that governs trade and other commercial issues between all three countries is essential.
I would like to state from the beginning that the Conservatives will support the speedy ratification of CUSMA’s implementing legislation. However, having said that, it is also important to say that the deal and how it came to be is not without significant flaws.
In the beginning of negotiations, the Prime Minister pushed an agenda, including issues that were not on the radar of the Americans whatsoever. This nearly derailed the whole deal. It was very similar to what the Prime Minister did just months before negotiations of the trans-Pacific partnership with his erratic behaviour. The government pushed non-trade-related matters, which seemed to irritate the Americans, instead of seeking to find common ground on priorities and mutual interests.
As a result of taking that type of tactic to negotiations, the Americans negotiated most of the steel provisions with the Mexicans and then brought Canada in at the eleventh hour to deal with some of the remaining issues that had not been dealt with. We had an opportunity to be at the table with our most important and significant trading partner, but we were talking about issues the Americans did not want to talk about. As a result, they decided that since we did not want to talk about trade and NAFTA, they would talk to Mexico. We should think about the implications of that. We were not even at the table at the time the agreement came into effect. That speaks volumes to how the government handled this process.
As I said before, of course the Conservatives are going to support the bill. We reached out to stakeholders. I had a chance, like some of my colleagues, to talk to stakeholders across the country. They said that they needed certainty, that they needed a deal. There was no question about that. However, the concern is that the Liberal government talks about what a great deal it is, but that is definitely not the case as we move forward. What stakeholders and people have told us is that a deal is better than no deal. That is why Conservatives will be supporting the bill.
The government did not fight for our own interests. Let us think about that. It talked about the interests that were important to the Liberal Party and its political brand. The Liberals were focused on non-trade issues instead of worrying about the national interests of Canadians.Let us consider auto manufacturing, agriculture and lumber. After four years, we still do not have a softwood lumber deal. I do not even know if the conversation has been brought up. Despite our many interests, which include auto manufacturing, agriculture, lumber and prescription drugs, the Prime Minister represents his own political interests. That should be very concerning for Canadians.
In addition, during the negotiations, the Americans decided to impose devastating steel and aluminum tariffs for close to a year. This was after months of them asking the Liberals to fix the loopholes that allowed steel dumping into the United States via Canada.Now we have a bill before us that does not put safeguards in place. The Americans asked us to do this four years ago, but because the Liberals decided it was not important, we ended up with steel and aluminum tariffs. For years our manufacturing sector was under a bunch of uncertainty. We saw our jobs move to the states and a number of other things. Only now are the Liberals reacting. It it almost as though they created the crisis so they could point out they fixed it. That is what Canadians should really understand.
Canadian businesses and producers are still reeling after this very difficult period. The imposition of these very avoidable tariffs on Canadian steel and aluminum have served to erode our competitiveness and have impacted thousands across the supply chain. The Liberals announced a $2-billion assistance package for the steel and aluminum sector, but almost none of this money has gone to the workers.
I talked to a number of businesses the other day. They said that before steel and aluminum tariffs were lifted, there was a big push from the government to get their applications in and it wanted to work with them. Then, all of a sudden, there was radio silence.Are all those companies left holding the bag with respect to not having money and not having access or is the government going to follow through? It is easy to announce and reannounce programs. It is more difficult to ensure the money gets out the door. This is a huge issue. The reality is that these tariffs were avoidable. There was no reason for those steel and aluminum tariffs and the pain that our manufacturing sector has had to endure over the last couple of years.Once again, the Liberals talk about all the money that has been collected, which I believe almost $2 billion.
My point is that very few businesses have received any money. We studied this at committee for quite some time. Company after company said that the application process was difficult and that was hard to figure out how to make this thing work. They also said that they were not getting money. Once again, the announcement talked about the money, but the proof was whether the companies had the kind of help they required, and that was not the case.
This was all avoidable if the government had acted when the Americans asked it to close the loophole that allowed cheap and dumped steel to flood the American market, using Canada as a transit country.
The Liberals have lurched from crisis to crisis on trade and tariffs. They have been constantly out of step with Canadian workers and manufacturers. The government’s negotiations of CUSMA also delivered no progress on buy American provisions with respect to government procurement.Another issue we have not talked about is buy American. It is concerning for our Canadian manufacturers. Are they going to have the ability to access some of those things? It is a major blow to Canadian businesses and jobs across the country.
The Liberals also made concessions on the Canadian supply-managed agriculture sector, which the foreign affairs minister deemed to be key to our national interests. The Americans did not budge when it came to their use of agriculture subsidies. As a matter of fact, we have seen the subsidies grow over the last number of months.
The government and the Prime Minister also made key concessions on intellectual property, which will see provinces burdened with higher costs for biological drugs. The government also restricted future trade deals, with unparalleled provisions granting Americans an indirect veto over Canadian trade partners. Think about this for one second. This is an issue of sovereignty. While the U.S. negotiates trade deals with China, basically it has told us that we need to get its permission if we want to move forward on any deal with China. This is huge. This was not discussed a whole lot in the general public, but has long-term consequences for our ability to do our job as Canadians and get our products to market.
I will give credit where credit is due. One of the major achievements was to preserve chapter 19, the dispute resolution provisions. The minister mentioned that. It is fair to say that it was a concern if we did not have an independent third party to look at some of our challenges. Therefore, I will give credit to the Liberals on that one, but that will probably be it right now. However, that was definitely important.A trade deal is judged by what one has gained from the negotiations. In this deal, compared to previous versions, Canada lost a number of key sectors and gained absolutely nothing. However, the Liberals go on tour around the country like they are some kind of heroes and it makes no sense. They have lost ground from previous governments. We do not talk about it as a save, but it could have been a lot worse.
However, to travel around the country and say somehow this is an amazing deal for Canadians is just not true.It has been very clear from the beginning that the Liberal government was unprepared to renegotiate the NAFTA deal. When the negotiations started, the Liberals kept stumbling and in the end, they were forced to take a deal where they lost on many fronts.
As I mentioned earlier, we will support the bill because it is essential to provide our businesses and producers with certainty. We have heard that on the ground. They have also suffered enough under the government. The Liberals have mismanaged the economy and trade. They have created a lot of uncertainty as we move forward.
Another thing we need to point out is that last year the U.S. grew its economy by 3.2%. That was after a government shutdown for the first quarter. In 2018, when the government was shut down for a large part of the first quarter in which it only had 2% growth, it still was able to notch up growth of over 3.2%.We need to compare our record with that. In the last quarter of 2018, we saw growth at 0.3%. This quarter it was 0.4%, which is not quite a third of that of the U.S. The U.S. economy is on fire right now and the best we can muster is a growth of 0.4%, with all the money we are spending and all the deficits we are creating. The comparative is important to understand.In order to compete with the United States and Mexico, our business environment needs to be more competitive or else we are setting up our businesses to fail in the face of strong competition from our counterparts to the south.
How is Canada doing with respect to competitiveness? The government has managed to make things worse on this front as well.
Let us start with the most important mistake first, and that is the carbon tax. First, let us just get this out of the way in the beginning. The carbon tax is not an environmental plan; it is a tax plan. It will do nothing for the environment. The Liberals are fully aware of this and Canadians know it as well.The Liberal carbon tax is not a plan to lower emissions. It is just another cash grab, which is hurting already overtaxed Canadians. Small businesses and their employers are already being overtaxed. The Liberals have increased CPP and EI premiums. They have increased personal income tax rates for entrepreneurs. They have made changes to the small business tax rate that will disqualify thousands of local businesses.Dan Kelly, president of Canadian Federation of Independent Business, said: Many small businesses want to take action on climate change, but the carbon tax is putting them further behind. In fact, 71 per cent have told us that the carbon tax makes it harder for them to make further investments to reduce their emissions.
Seventy-one per cent of small businesses have said that the carbon tax makes it harder for them to make further investments to reduce their emissions. What more proof does the government need, when the ill-advised carbon tax makes no impact on the environment and makes our businesses uncompetitive.Last Friday, the Canadian Press reported that the average carbon tax rebate Canadians received in 2018 was significantly lower than the amount the Liberals had claimed they would receive. When announcing the carbon tax rebate program, the Liberals established the average payment would be $248 in New Brunswick, $307 in Ontario, $336 in Manitoba, and $598 in Saskatchewan. However, the actual average rebates have been much lower: $171 in New Brunswick, $203 in Ontario, $231 in Manitoba and $422 in Saskatchewan.
Like the Prime Minister himself, these carbon tax rebates are simply not as advertised. The Liberals continue to cover up the true costs of the carbon tax. They still have not told Canadians how much more it will cost them for everyday essentials, like groceries, gasoline and home heating.With less money being returned to Canadians, they will have even less money in their pockets, thanks to the Prime Minister and his Liberal carbon tax. The Liberal carbon tax will go up, if he is re-elected in October. Environment Canada is already planning for $300 per tonne, which is 15 times more expensive than it is today.Make no mistake, a Conservative government will scrap the carbon tax, leave more money in the pockets of Canadians, let them get ahead and allow our businesses to stay competitive.
How else is the government making Canada’s business environment uncompetitive? It is a good question, because Canada recently fell to the lowest spot ever in competitiveness. Canada has fallen out of the top 10 in a ranking of the world’s most competitive economies. We are now 13th. Let us think about that. In an age where we are competing with one of the largest and most successful economies in the world, the U.S., which is ranked at number three, not only are we not in the top 10 anymore, we have dropped to 13th.Competitiveness drives our economy.
It helps us to compete when we have deals and when we try to move our goods and services across the border. This will only continue to make it tougher for Canadians to succeed financially in the coming years.
As I mentioned, the United States is number three. We are trying to compete with the world’s biggest economy and it is tough when we see it use tax reform and regulation reform. What we a doing is making it more difficult for Canada to compete as a country. If we look at the other things that are going on right now, and some of the things we talk about when it comes to competitiveness, there is the whole issue of pipelines. We have tanker moratoriums and things like that.
Let us think about that. In a day and age when the U.S. is building more pipelines, we have bills like Bill C-69. I noticed in the paper this morning that six premiers have come together to say that if something is not done, this is going to create a potential national unity crisis. In terms of the investment that we have chased from this country, it is almost $100 billion in energy investment.
Let us look at the things we are doing. We have a country south of the border that is looking for ways to reduce regulation and red tape. We have a government here that is barely chugging along in terms of its GDP. As I said, it is 0.3% in the last quarter and 0.4% in this quarter. That is without the new rules in this legislation that is before the House right now.
If we look at bills like Bill C-69, which is to increase the regulatory reform when it comes to pipelines, and Bill C-48, where we are trying to get our goods to market around the world, this is one more thing that makes us uncompetitive as we move forward. One of the things we need to be on guard against is that as the U.S. and countries around the world are reducing and streamlining regulation, we are making these things more difficult.We need to look at what we are doing as a country. Trade deals are important. The U.S. is extremely important as a partner. As I said before, stakeholders have told us that it is more important to have a bad deal in place, for certainty, than it is to have no deal at all. Therefore, as we move forward on these issues, one of the things we need to be talking about is not just the trade deals we have right now, but how we are going to become more competitive in the future.
Looking at the kind of money we are spending on deficits, the current government has racked up almost $80 billion in deficit spending, and yet we have very little to show for it when we start talking about GDP growth and some of these things. There was the tax on small businesses that we experienced two or three summers ago. How are these things helpful in terms of making us more competitive?
As I look at what is going on around the world, I believe we are heading in the wrong direction. I believe we should be doing much better, given the fact that the U.S. economy is on fire south of the border. Yes, we need to do other things, like work on how we can get our goods and services across interprovincial borders and a number of these things. However, one of the things we need to constantly work on is how we streamline to reduce the burdens that business owners have to deal with.
In looking at this bill before us today, we realize that it would create some certainty for some businesses. In the long term, the challenge will be how we deal with this issue in terms of competitiveness. How do we deal with the issue that we need to do a better job of getting our goods and services to market? How do we deal with the issues of trade infrastructure in this country? When we were in government, we spent a number of dollars on trade infrastructure, as it was very important to us. We have not seen a whole lot of money go out the door in terms of infrastructure. There has been some talk about an infrastructure bank, and yet in the three or four years, there has been very little money flowing out the door. We have somewhere in the neighbourhood of almost $80 billion in deficit spending and we do not have a lot to show for it.
Sure, we have more programs, but at the end of the day, what do Canadians feel about that? I would say that Canadians are not feeling that they are any better off. As a matter of fact, we have seen it reported in the press that Canadians are feeling the pressure, in terms of what they have to take home at the end of every month.As we move forward, these trade deals are important, but we have to continually focus on competitiveness here at home. We have to figure out ways that we can reduce taxes, reduce regulations and streamline the process, and then we can move in a direction that helps us to compete around the world. We have a great opportunity, with what is going on around the world right now, to attract the best and the brightest.
I would encourage the government to continue to move in that direction. I can assure members that when we have the opportunity to form government in October, some of the things we are going to be looking at are how we become more competitive as a country and how we compete with the U.S. and other countries around the world.In closing, the Conservatives will be supporting this deal.
However, we have some concerns with how it was handled. We have concerns with some of the crises that were created that we believe did not need to happen. We will do our best to try to fix these things when we are elected with a strong, stable Conservative government in October of this year.