NAFTA For and Against

In Support: Tariffs merely serve to protect inefficient businesses from competition. Raises cost of products to consumers. Huge market under free trade brings manufacturing costs down, benefits consumers.

Canada is replacing low-tech jobs with high-tech jobs. Low-tech jobs are low paying. (Moving to Mexico, US) But not all low-tech jobs will leave simply for cheap wages in Mexico. There are other factors for business to consider: cheap power, transportation, health care, educated work force. All available in Canada.

Canadian firms can bid on US and Mexican government contracts. Environment will benefit because there are minimum standards the country must meet. Culture is excluded from agreement.

Opposition to NAFTA: Encourages movement of jobs out of the country. Why? Lower wages; don’t have to pay for health care and pensions; low environmental standards; low workplace safety standards.

To compete with US and Mexico in NAFTA, Canada may have to lower its wages, reduce social benefits and its environmental standards. Perhaps Medicare (OHIP) will have to be abandoned as an unfair subsidy to business.

Benefits of free trade are uneven across the country. Natural resource export industries are benefiting while some domestic manufacturing are losing out. Culture is not adequately protected. Recent battle over “split-run” magazines supports this.

The Future? Can we maintain traditional markets? Developing countries are marketing cheap raw materials. Can we export more manufactured goods? Requires funding (R&D) from industry and government.

Can we take advantage of new opportunities to trade in services? Can we (should we) decrease reliance on trade with US? If its economy softens, we are badly hit. Can Canadian firms compete with large US firms and cheap Mexican labour? When Canadian firms get big and profitable, they often get bought up by foreign firms.