For most of my life, the North American Free Trade Agreement wasn’t something that people questioned.
After the free trade elections of the late 1980s, it was something that none of the major political parties really talked about. Its benefits – and disadvantages – were just there.
That is, until Trump came along, promised to renegotiate the deal and actually took some action.
It just goes to show, that in politics, everything seems permanent and unchangeable – right until it isn’t.
Now, there’s a new deal in town: the United States–Mexico–Canada Agreement, or USMCA. How the heck people are going to pronounce that one as easily as NAFTA yet remains to be seen.
The part of the agreement that’s got me interested is the requirement for 30 – and later 40 – per cent of the work on a vehicle to be done by people making $16 per hour or more.
The intent of the clause is to stop cheap Mexican labour from undercutting more expensive Canadian and American labour, but I am wondering if the result of that is going to be higher Mexican wages?
That remains to be seen. I’ve read that it might just make imported cars produced outside of North America more affordable compared to domestic vehicles instead.
The biggest disappointment with this deal is that it doesn’t remove the softwood lumber tariffs that’s hurting the lumber mill in Carrot River nor the steel and aluminum tariffs hurting the iron triangle farming equipment manufacturers around Humboldt. Yet the automobile industry is protected from further tariffs, which is good for Ontario, I suppose.
Some of the new copyright rules are a little wacky too. Now, in Canada, a copyright lasts until 70 years after the creator’s death. I can’t figure out how the creator benefits from that, but I guess Disney needs to protect their interest in Mickey Mouse. Generic versions of drugs can
only be produced 10 years after the drug it’s based on is released instead of eight, which means healthcare costs will be going up.
In the end, it’s going to take a while for the dust to settle before we really know what this new trade agreement means for us.
That is, if the US Congress passes it.