A couple of weeks ago, commenting on a U.S. counter-offer to Canada’s still guarded procurement offer to the Obama administration, International Trade Minister Stockwell Day said the Americans accept the premise of a Buy American exemption for Canadian companies, but it was “a matter of what we do and how broadly we can get this put in place now” (italics mine). A new report from the Canadian Centre for Policy Alternatives decodes that statement, and finds that we, meaning the Harper government and provinces, are prepared to give away almost everything for almost nothing in return.
“Despite strenuous diplomatic efforts, there is virtually no chance that Washington will agree either to scrap the Buy American rules or to exempt Canadian suppliers from them. With the initial Canadian proposal for a meaningful exemption sidelined, Canada is now negotiating in a fog and a panic,” concludes economist Scott Sinclair in the CCPA report, titled ‘Buy American Sellout: Giving Away Canadian Procurement Sovereignty.’
“At U.S. insistence, the negotiations are increasingly focussed on the mechanics of Canada covering its provinces and municipal governments under the WTO-[Agreement on Government Procurement]. Yet… even if Canada fully committed provinces and municipal governments under the AGP, it would not significantly increase Canadian suppliers’ access to U.S. markets.
“Such a deal would, however, severely curtail the democratic authority of provincial and local governments to maintain and adopt purchasing policies that benefit their citizens. If Canadian negotiators give up too much ground, it could well pry open Canadian public services to U.S. for-profit corporations.”
WHAT IS AT STAKE
Sinclair lists some of the local policy options that would disappear with a ‘successful’ new agreement with the U.S. government on procurement:
• “Many municipalities have contracting policies that give preference to Canadian suppliers, allowing them to reject the lowest bidder in favour of a Canadian supplier if the local employment and spin-off benefits outweigh the price difference.
• “Buy local food policies are becoming increasingly popular with municipal governments across the country. Canada’s largest city, Toronto, recently adopted a purchasing policy that supports local food production, with other major cities such as Vancouver and many smaller Canadian communities considering following suit.
• “Both Quebec and Ontario require that, to qualify for generous public subsidies to purchase renewable energy, such as wind and solar, the energy producers must use specific levels of local goods and services. Such policies encourage the transition to renewable energies, while creating green jobs and supporting the local development of green technologies.
• “Ontario has ensured that new subway cars for Toronto are produced in Thunder Bay, supporting hundreds of high-skilled, well-paid jobs in a hardpressed region of northern Ontario.
• “Provincial governments across the country save millions of dollars annually through centralized purchasing of pharmaceuticals, restricting tendering by requiring the use of cheaper generic drugs where they are equally effective.
• “The deliberate focus of service delivery in a wide range of human services – including health, education, child care, and social services – is on local organizations, often community-based not-for-profits, meeting local needs.
• “Finally, communities across Canada have been resisting pressure from corporations, many U.S.-based, to outsource essential public services such as municipal waste, sewage, and water services.”
The report asks why the federal government and provinces are willing to give all of this up, especially without any hope whatsoever that the market access would be reciprocated in the current or any future procurement proposal.
BUY CANADIAN MAKES MORE SENSE
“Instead of tilting at the windmill of an unattainable exemption,” suggests the CCPA report, “our governments should emulate what is best in the U.S. buy-local procurement policies and employ them to benefit Canadians. This stance would undoubtedly irk certain American interests, but they could hardly cry foul. The Canadian government would simply be creating a more level playing field which would both benefit and protect its citizens.”