Call me crazy, but as our elected representatives return to Parliament next week, I’m actually feeling a little hopeful.
That’s because as we approach a critical election next year, the pressing issue of inequality might finally take centre stage. It’s more than a hunch. Inequality is clearly forming roots in the public imagination.
The soil was fertilized by the success of Thomas Piketty’s authoritative economic tome on inequality, Capital in the Twenty-First Century , and we’re now seeing the problem being raised by a diverse group of people and organizations — from Pope Francis to Bank of England Governor Mark Carney, from the World Bank to the United Nations’ International Labour Organization.
And if the success of The Hunger Games books and the wildly entertaining blockbuster movies about a post-apocalyptic America ruled by autocrats and defined by deep inequality are any indication, there is genuine pop-cultural fascination with the implications of the gap between the rich and the rest.
Closer to home, I was emboldened last year when the late Jim Flaherty, finance minister at the time, spoke publicly about his discomfort with the Conservatives’ ill-advised promise to introduce income-splitting for families.
“It benefits some parts of the Canadian population a lot. And other parts of the Canadian population virtually not at all,” Flaherty said, riling the Conservative caucus and Prime Minister Stephen Harper. Flaherty had already mused aloud that he wasn’t “sure that, overall, (income-splitting) benefits our society.”
And he was right.
As several studies have now made clear, the Conservative income-splitting plan benefits a very few affluent families with one breadwinner and a stay-at-home spouse at the expense ($3 billion, specifically) of everyone else.
Still, it is significant that a finance minister of our decidedly right-wing government showed the political courage to criticize a policy that will clearly make inequality worse. This test — whether a policy choice will exacerbate inequality — should be the test for any government in making political choices.
A new report released Thursday by the Broadbent Institute, which looks at the distribution and concentration of wealth based on new data released to us from Statistics Canada’s Survey of Financial Security, shows just how important this consideration must be.
While the growing income share of the richest 1 per cent often dominates the headlines, looking at the distribution of wealth as opposed to income provides a broader view of the economic resources available to an individual or family.
A family’s wealth can be thought of as the amount of money that would be left over if they sold all their assets and paid off all their debts. Assets might include such things as houses, vehicles, stocks, bonds and savings. Debts might include mortgages, student loans or consumer debt.
These new data paint a sobering picture of a deeply unequal Canada, with concentrations of wealth that are difficult to believe.
For example, the wealthiest 10 per cent of Canadians accounted for almost half (47.9 per cent) of all wealth in 2012, while the poorest 10 per cent held more debts than assets.
The share of wealth at the bottom is particularly disconcerting: 30 per cent of Canadians together owned less than 1 per cent of all wealth; and the bottom half of Canadians controlled less than 6 per cent of wealth combined.
It’s important to put the distribution into context. The median wealth of the richest 10 per cent — meaning half in this group own more, half own less — was more than $2 million in 2012. In contrast, the median wealth of the poorest 10 per cent was a debt of $5,100.
Moreover, when you exclude pensions, the richest 10 per cent of Canadians own an even larger share of financial assets, which include things such as stocks, bonds, mutual funds, investment funds, income trusts and tax-free savings accounts. The richest 10 per cent controlled almost $6 of every $10 (59.6 per cent) of such assets in 2012, more than the bottom 90 per cent combined.
Meanwhile, the bottom half of the population combined held less than 6 per cent of financial assets and the bottom 70 per cent of the population only 16 per cent — a clear shot across the bow of the various rosy reports trumpeting post-recession financial wealth recovery for Canadians.
These data, though disheartening, can help focus the minds of Canadians and our elected officials to understand the urgency of taking action to combat inequality.
Because in the end this situation is the result of political choices, not some inevitability. As Ed Broadbent, a long-time champion of combating economic inequality, has explained, “Democratic politics, at its best, is about choosing what kind of society we want to live in.”
And deep and persistent inequality shouldn’t be a characteristic of Canadian society.
This article originally appeared in the Toronto Star.
Canada has an inequality problem. It’s deep. It’s persistent. And it’s time to take action. This report uses custom Statistics Canada data to take a closer look at the concentration and distribution of wealth in Canada.
Ecocide law, unlike any other law, has the capacity to disrupt what we perceive to be immoveable. How can we possibly decouple from fossil fuels, from economies based on making money out of heavy extractive industries, from businesses that are threatening to sue governments that refuse to allow them to destroy their lands? This is a question that is voiced in many different ways but the essence of it is always the same - the sense that we are so stuck in a system that we cannot see the way out.
And law holds this system in place. But law is just a tool. Just as a knife can be used to create a delicious meal, so too can it be used to kill. It is the intent behind the tool that counts and that shapes the use of that tool. Words too can be used to express our intent constructively, or they can be used destructively. My dear friend Vandana Shiva was recently attacked verbally and very publically in the press - words were used to slice her up, yet still she stands strong. That takes enormous courage. The intent behind her words is based on a deeply held reverence for the sacredness of life.
The intent behind much of our laws are rarely based on the sacredness of life; all too often our laws are based on the supremacy of ownership and property - “I own” has in many respects superceded the collective right to life. Yet, we are now waking up, blowing the horn. The intent behind law can be changed. Many, like Vandana, are standing up and speaking out. Only the very few benefit from a system based on ownership by a few over the many. Property rights - now used to control seeds and land - lead to much suffering, especially where there is no accountability at the very top. This we are seeing in communities right across the world. Ownership based on destruction can and does lead to significant harm, in particular when it plays out collectively. I am thinking of here transnational corporations and governments who sign-off contracts that bind-in communities without being held to account where significant harm to the wider community results.
The hornblowers of our time are those who stand up and speak out, yet the law as it stands today protects those who are causing the harm. Those who speak out risk the wrath of those who seek to destroy, not those who seek to give support. Now more than ever we have a shrinking democratic space.
Do we fight or do we create a new space? A new space based on life-affirming principles is also a space where we face the harm and give it a name. That takes courage too. When we do that we disrupt the seemingly immoveable. Vandana Shiva is creating a new space - a space based on greater freedom; seed freedom. Ecocide law protects that space and supports those who sound the horn. It closes the door to the destruction of our seeds and also the destruction of our soil and our society. The sacredness of life permeates every aspect of our being and to destroy it is a crime.
Blow that horn - it is being heard. Our vision shifts when can name the harm and when we can envision a better world. By making visible that which must be seen and heard, we can turn and move from Ecocide to Ecolibrium.
Ecolibrium Now
How we make visible our support for something new to emerge takes imagination - our capacity to envision what that world could be. That is something that has led to a group of people in Stroud exploring how they can help seed out and support Ecocide law through the creation of a book. Bringing together artists, illustrators, poets, writers and photographers, a book is now taking shape - called Ecolibrium Now.
But - it is not visible yet.
So much time and energy has been gifted by agreat team who are bringing this vision into being. Everything is in place; the next step is to print the book and take it out to the world.
Now is the moment that the Ecolibirum Now team are reaching out for support to the community of all who support Ecocide law: they have a need - the need to pay for the printing. Their costs are higher because it is a book of much beauty, colour, imagery and photos as well as text. Plus, they have chosen a more ecological path - to print on 100% post consumer waste paper with eco-inks (much more difficult to do as most printing is either on regular paper with limited ink use or on FSC paper. To print on 100% post consumer waste means printing in large batch, rather than on demand, which means higher up-front costs).
Ecolibrium Now is a book ready to come into being!
You can help bring to life Ecolibrium Now by pledging funds to the Ecolibrium Now team. And you have a choice: you can receive something in return or you can choose to gift freely. Either way, by gifting funds a new space is created where a vision based on life-affirming principles can begin to take shape.
• To contribute to the creation of this book, please gift here.
• Want to read more? Visit their ecolibriumnow.com here.
• And you can watch their great 3 min video - made by the wonderful AverageCurlyKid - onStroudCommunity.tv
Something great is happening here - and Ecolibrium Now is an expression of our collective intent. Please help share this vision and reach out to every one around you. In so doing each of us becomes a participant in co-creating Ecolibrium Now.
Naomi Klein finds kernels of hope amid climate change and untamed capitalism.
By Kevin Begos, Associated Press, reposted from the Denver Post, Sept 30, 2014
“This Changes Everything: Capitalism vs. the Climate” (Simon & Schuster), by Naomi Klein
Cutting the vast amounts of man-made pollution that feed global warming is an enormous challenge for societies that gobble up coal, oil and gas. But in “This Changes Everything,” Naomi Klein argues that those fuels aren’t the root problem — capitalism is. That message is likely to motivate fans of Klein’s earlier books, such as “No Logo” and “The Shock Doctrine,” but it also leads to a tough question.
Is blaming capitalism for climate change just rhetorical hot air — or a brutal and uncomfortable truth?
Whatever side you take, Klein deserves credit for not sugarcoating the problem. She writes that limiting global warming won’t be quick, easy or without disruptions, yet holds out hope that the end result will be better for people, the environment and even the economy. But make no mistake: “This Changes Everything” argues that we don’t just have to cut carbon pollution. We have to change society, and our own lifestyles. Klein writes: “Our economic system and our planetary system are now at war.”
And while Klein is predictably hard on big business and conservatives who deny climate change, she doesn’t spare environmental groups or liberals. Klein pointedly shows how easy it is to ignore global warming, noting that until recently she “continued to behave as if there was nothing wrong” with the “elite” frequent flier card in her wallet.
Klein is dismissive of environmentalists who say better technology can limit climate change, yet she doesn’t resolve some of the contradictions in that position. China, Germany and other countries have used capitalism and mass production to turn out vast quantities of better and cheaper solar panels and wind turbines. In the U.S., Texas has become the national leader in wind energy by treating it as another business for people to make money on.
Yet worldwide carbon emissions are rising, not falling.
And like everyone else, Klein struggles with perhaps the toughest global warming challenge: how to cope with the explosive growth of newly capitalist economies.
China is now the world’s largest emitter of carbon pollution, but only 30 years ago Beijing was filled with bicycle-riding workers dressed in Chairman Mao tunics. Today there are BMWs and clouds of pollution generated by vast numbers of people who are embracing capitalism, not revolting against it. And after the recent huge climate march in New York City, India’s environment minister responded by saying that developed countries such as the U.S. need to cut emissions, not developing ones. He told The New York Times that “India’s first task is eradication of poverty” and that “we will grow faster, and our emissions will rise.”
Klein is calling for a global social revolution to combat global warming, but many countries don’t much like it when Westerners who have long benefited from cheap fossil fuels try to tell them what to do.
Yet China and India’s runaway growth also makes clear that Klein’s core point has merit. She writes that “we know where the current system, left unchecked, is headed.” The vast majority of climate scientists say global warming is here, caused by humans, and probably already dangerous, and that the world needs to start significantly reducing carbon pollution. If it doesn’t, scientists predict that in a few decades, much higher temperatures and more acidic oceans will start to cause “severe, pervasive and irreversible impacts for people and ecosystems.”
“This Changes Everything” isn’t all doom and gloom. Klein notes that an aggressive new movement of climate activists has emerged in the last few years. As a mother, she writes passionately about the need to consider the impact on future generations, and she gives many examples of places where wind and solar energy is dropping in price and becoming a cleaner and more realistic alternative to fossil fuels.
“This Changes Everything” may motivate more people to think and act on climate change, and that’s good. Yet capitalism isn’t the only problem. The old message from a 1970 cartoon on the first Earth Day still hangs in the air: “We have met the enemy, and he is us.” SOURCE
Here’s the job impact by industry, assuming an average year under a $30/ton tax
By the Editors, reposted from BloombergView, Sept 30, 2014
Where they’ve been tried, the evidence shows, well-designed carbon taxes have succeeded in reducing greenhouse-gas emissions. But that doesn’t necessarily end the debate over their effects — nor should it. The next question is whether that success is bought at the expense of jobs and incomes.
The answer is no. As long as the tax is well-designed, it can cut emissions at little or no economic cost. And that is a conservative assessment: In practice, a carbon tax has been shown to provide an economic boost. The reason is that the revenue raised by a carbon tax can be used to cut other, more damaging, taxes.
In general, taxes make economies less efficient. But some do more harm than others. Taxing “bads,” such as pollution, actually improves the allocation of resources, whereas taxing “goods,” such as labor, reduces the economy’s capacity to produce. In principle, therefore, using the revenue from a carbon tax to cut other taxes can yield a double benefit: reducing pollution and expanding the economy.
There are transition costs that have to be reckoned with. But even making allowances for them, it’s plausible that carbon taxes help the economy, and not just by reducing greenhouse gases.
The evidence shows it’s worked in practice, not just in theory. The chart shows the results from a study of countries that tax carbon, comparing in each case two projections for gross domestic product — actual GDP with the tax in place, and hypothetical GDP with the equivalent revenue raised in other ways. Typically, GDP was a little higher thanks to the carbon tax.
Granted, one can always question the details of such studies. But at the very least, the evidence suggests that concerns about economic damage from moderate, well-designed carbon taxes are overblown.
So much for output; what about jobs? The Netherlands and the U.K., which introduced some of Europe’s narrowest and most targeted carbon taxes, saw no net impact on employment. Denmark made greater use of green taxes, and saw employment rise by about 0.5 percent — again, as compared with projections assuming no introduction of a carbon tax. In Germany, employment increased an estimated 0.2 percent. A 2013 review of nine countries by the Institute for European Environmental Policy found none where a carbon tax had led to job losses.
Such estimates come with two warnings — both of which suggest proceeding with caution. First, the economic benefits of a carbon tax can take time to come through. Second, while the economy as a whole may benefit from a carbon tax, that won’t be true of every business or industry. Energy-intensive sectors will be hit. In some countries, output of metals and minerals fell compared with what would have happened without the tax; in others, production of pharmaceuticals was reduced. In most cases, the drops were less than a tenth of 1 percent — but they were drops nonetheless. And jobs in those industries were affected accordingly.
The debate about a carbon tax shouldn’t ignore the transition costs and the more long-lasting effects on jobs and output. How the tax is phased in and how to help those most affected by it should be part of the discussion, and will be necessary to win public support for the policy. But that’s not an argument against doing it. Carbon taxes can help the economy as well as the environment — as long as the revenue is put to good use. Our next editorial in this series will turn to that crucial question of design. SOURCE
UNCEDED TAHLTAN TERRITORY, BC – September 29, 2014
This afternoon the Klabona Keepers in alliance with the Secwepemc lit a estsu kun’desk’āke (Grandmothers Fireplace) at the entrance of Imperial Metals Red Chris Mine to gather the Indigenous and settler communities to unite, and in one voice demand action. This fire is lit under the collective jurisdictions of all Nations connected by the water and the salmon and has been lit to halt the Red Chris Imperial Metals mine operations until further notice out of concern for their community of Iskut, which is located only 18km away from the mine site.
On August 4th, 2014, Imperial Metals Mount Polley mine unleashed billions of gallons of toxic wastewater into the deepest glacier fed lake in the world and into the river host to second largest salmon run in the world. It is common knowledge that sudden and catastrophic failure is a consistent and major risk of all large tailings storage facilities using earthen dams. The bigger the dam, the higher the risk. The Imperial Metals Red Chris mine’s storage facility in Tahltan territory is much larger and uses the same structure and technology as the Mount Polley Mine and so it is not a question of if, but when the storage facility would breach and destroy yet another integral salmon- bearing watershed, the Stikine River of the Tahltan territory.
The Klabona Keepers have never given their consent to Imperial Metals Red Chris Mine and after hearing from other Indigenous nations impacted by the Mount Polley disaster, they will not give their consent to the destruction of their territory and the decimation of their salmon, their moose, their ecosystems.
Secwepemc Elder and Ts’peten (Gustavson Lake 1995) Defender Wolverine makes clear that, “neither the provincial government nor Imperial Metals corporation have jurisdiction on this territory. There has been no treaty, no purchase.”
The Tshilqotin decision has affirmed the collective title and jurisdiction of unceded and unsurrendered Indigenous Nations. The Klabona Keepers and the Secwepemc are exercising their natural law, and asserting their jurisdiction to regulate industry in their own Territories.
“We can not be blinded by money. The land and water is the lifeblood of our Nation and we will not compromise it. We are doing this for our future generations.” Mary Quock
How many rivers, creeks, lakes and watersheds until we say enough?
By Heather Moyer, reposted from the Sierra Club, Sept 30, 2014
Late Monday the Federal Energy Regulatrory Commission (FERC) approved the controversial Cove Point liquefied natural gas (LNG) export facility in Maryland. The Sierra Club and a large coalition of groups — including Earthjustice, Chesapeake Climate Action Network, Patuxent Riverkeeper, Potomac Riverkeeper, Shenandoah Riverkeeper, and Lower Susquehanna Riverkeeper — have been fighting this plan since its announcement because it means a massive expansion of natural gas fracking.
More than 40,000 people submitted comments opposing Cove Point.
“FERC’s decision to allow LNG exports from Cove Point is fundamentally flawed because the agency failed to consider the simple fact that exporting LNG will mean more drilling and fracking, and that means more climate pollution, more risk of contaminated groundwater, and more threats to the health of people who live near gas wells,” said Deb Nardone, director of the Sierra Club’s Beyond Natural Gas campaign. “FERC should be standing up for the public good, not the interests of dirty polluters.”
Once in full operation, Cove Point will also emit thousands of tons of dangerous air pollutants and millions of tons of greenhouse gases that will only add to increased climate disruption.
Beyond the increased fracking, the super-cooling process that turns fossil fuel vapor into LNG requires an immense amount of energy — so much energy, in fact, that the LNG lifecycle is as dirty as coal. The industry wants to build enormous shipping terminals that would pave over fields, fill wetlands, and destroy estuaries.
As Deb noted about this Cove Point approval, FERC continues to bury its head in the sand and conclude that it is impossible to predict the effects related to the production of gas to be exported, or consumption of that gas once it is exported. This is despite the fact that even the Department of Energy agrees that if exports occur, they will induce additional gas production.
The Sierra Club and the coalition against Cove Point also believe that FERC has failed to procide for adequate public participation regarding this project. FERC must develop a full environmental impact statement that covers the entire effect of the project.
Some in Maryland are already planning a rally in response to the bad decision (6pm Tuesday, Sept 30, at 701 E. Pratt Street in Baltimore).
The Harper Cabinet quietly ratified the Canada-China FIPA on the afternoon of Friday, Sept. 12, 2014. Lately I have received messages from people asking if the FIPA can still be stopped and what else might be done to limits its potential harm.
Sadly, there is no longer anything that any legislature, government, or court in Canada can do to avoid the FIPA taking effect on Oct. 1, 2014. The time for action was two years ago when the FIPA was made public. Many thousands of Canadians responded to this need at that time and since. Yet our institutions — especially the federal government — evidently did not.
In particular, it is remarkable that no thorough and public study of the FIPA was done by the federal government before the treaty’s ratification. As a result, there was no basis for a serious and well informed public evaluation of the treaty. If the decision to ratify was a mistake — for example, because it may commit Canada to a dependent status as supplier of raw and unprocessed resources for the Chinese economy or because it does not ensure a level playing field between Canadian and Chinese companies — the consequences of that mistake will now be unavoidable by Canada for decades.
Incidentally, due to the efforts of the Hupacasath First Nation and those who supported and funded their legal challenge to the FIPA, a review of the treaty by a Federal Court judge did take place. Yet the judge who took the case, at the urging of the federal government, focused narrowly on the FIPA’s implications for the Hupacasath alone, and not for any other First Nation let alone Canadians as a whole.
Also, again at the government’s urging, the judge adopted an exacting standard of proof in his scrutiny of the Hupacasath’s anticipatory claims about impacts of the FIPA (the claims were of course necessarily anticipatory because the FIPA’s impacts will come only in the future and over decades). In turn, it was easy for the judge to accept the government’s argument that concerns about the FIPA, again for the Hupacasath only, were too speculative to require consultation with those affected before the FIPA could be ratified.
The Hupacasath appealed this decision but the appeal was made largely moot when the federal government ratified the FIPA while the appeal was pending. Readers can judge for themselves whether this timing of ratification was a respectful response to the ongoing legal process to determine aspects of the FIPA’s constitutionality.
The important point here is that the Hupacasath legal action could have led to a broad and thorough review of the FIPA to inform the public and support a more careful decision on whether to ratify. However, the federal government urged, and a Federal Court judge accepted, that the review should instead be very narrow.
Beyond this legal challenge by the Hupacasath, the only detailed public study of the FIPA, which focused on its unique or non-reciprocal terms, was by me. And I am the first to admit that it is a pathetic state of affairs when a lone academic supplies the only detailed public analysis of the text of a treaty that will have important and long-lasting implications for Canada in our economic relationship with one of the world’s most powerful countries.
In any event, my own study is forthcoming in the Canadian Yearbook of International Law and a near-final draft was made public and shared with members of the federal Cabinet in May 2014. For the record: the offices of federal Ministers James Moore, Jason Kenney, John Baird, Tony Clement, Lisa Raitt (my MP in Burlington, Ontario), Leona Aglukkaq, Bernard Valcourt, and Ed Fast were all given a copy of the study last May. None replied. As I thought when I sent them the study: at least they will not be able to say that no one ever told them in detail, before ratification of the FIPA, how its terms favour China and how they differ from Canada’s other FIPAs.
What can and should be done now
Whatever the background, it is now clear that the efforts of many of us to ensure closer study and informed public evaluation of the FIPA before its ratification were in vain. Now the question is what might be done to limit its potential harm? I suggest that future governments could be asked to take various steps.
1. The federal government could in future commit to renegotiate the FIPA to address its non-reciprocal elements and unique concessions to China.
Barring agreement from China, the government could give notice to terminate the FIPA at the earliest opportunity. The earliest date that Canada can terminate the FIPA, according to its terms, is Oct. 1, 2030. If the FIPA is terminated at that time, it will continue to apply to existing Chinese investments until 2045. In light of this, the option of termination provides no relief in the foreseeable future.
2. Critically, then, Canadians need an institutionalized way to learn how this FIPA is affecting governments, legislatures, and courts at all levels in Canada.
Unfortunately, the China FIPA is uniquely secretive because of the international legal right it gives the federal government to keep lawsuits by Chinese investors against Canada confidential until an award has been issued. This means that the government can settle a controversial lawsuit by changing its decisions, or paying out public money, without public knowledge.
The Harper government has said that it will disclose lawsuits by Chinese investors against Canada on a website, as it has done for several dozen investor-state lawsuits by U.S. investors under NAFTA. Yet there are problems with the credibility of this commitment.
• First, no other trade or investment treaty concluded by Canada provides that the federal government can keep these pre-award documents confidential. For many years, Canada was a leader in the international push for openness in investor-state arbitration. Why the change in this FIPA? If the Chinese government insisted on secrecy in lawsuits against China, why did the federal government not include a requirement that lawsuits against Canada be made public? The FIPA is non-reciprocal in ways that disadvantage Canada. It could have been made non-reciprocal in its provision for openness in investor-state arbitration to ensure at least that Canadians would be informed of Chinese investor lawsuits against Canada.
• What happens if a government faces a lawsuit by a Chinese investor that would be controversial if made public? Can we trust that all governments over the 31-year minimum lifespan of the treaty will not succumb to the temptation to keep the lawsuit secret? The federal government cannot commit future governments to a policy of openness in investor-state arbitrations under the FIPA, other than by binding Canada to that commitment in the FIPA itself. It did not do so.
• China is clearly less committed to openness in investor-state arbitration than Canada’s NAFTA partners. It seems reasonable to expect that the Chinese government may in some cases want to pressure Canada to block publication of information about a lawsuit under the FIPA. The very fact that the federal government agreed to conclude a FIPA that is non-reciprocal in important respects indicates that the government might also accede to demands by China in the FIPA’s implementation.
• Chinese investor lawsuits against Canada are of interest to Canadians because they may cause our governments to change decisions under pressure from China or Chinese investors. They may also lead to very large pay-outs of public money to Chinese companies in settlements behind the scenes. This makes it essential that the lawsuits be public so that Canadians can evaluate the costs and benefits of the treaty.
• Canadian investor lawsuits against China are also of interest to Canadians. Yet, under the treaty, China has full discretion to withhold information about such lawsuits and the treaty appears to bar Canada from releasing any pre-award documents it obtains about such lawsuits. This is not in the interest of Canadians or Canadian investors seeking to evaluate business conditions and political risk in China.
• Despite the federal government’s claims, its disclosure of documents in U.S. investor lawsuits against Canada under NAFTA has not been as timely and fulsome as would be the case in a Canadian court process. Also, the details of settlements of NAFTA lawsuits that appear to have involved payments of compensation by a provincial government to U.S. investors are murky; in my experience, the federal government and affected provincial governments have been unwilling to confirm whether provincial funds were paid to settle specific NAFTA lawsuits. If governments are not forthcoming with such information when sued by U.S. investors under NAFTA, why would we expect them to disclose it under the China FIPA?
• Ultimately, the federal government’s commitment to release information about investor-state lawsuits under any treaties that provide for investor-state arbitration should be made part of a law that clearly binds the government. It is unacceptable that governments in Canada, without public knowledge, may change decisions about proposed legislation or regulations, or pay out public money to foreign companies, due to lawsuits or threats of lawsuits by foreign investors.
3. For these reasons, the federal government and provincial governments should introduce legislation to require officials to make public any information they obtain about the use of the FIPA (or Canada’s other treaties that allow for investor-state arbitration) by foreign investors and by officials themselves in order to allow the public to know when and why the treaty has been invoked.
This is essential for the public to be able to evaluate government responses to their exceptionally powerful obligations under the FIPA and similar treaties.
4. Under the China FIPA, a future government could also commit to rigorous Investment Canada Act reviews of proposed Chinese takeovers of Canadian companies in the face of increasing ownership and control of the resource sector by Chinese companies.
The utility of the Investment Canada Act is limited in this respect by monetary thresholds and other conditions — and the FIPA gives China broader rights to block Canadian investments than vice versa — yet even so the Investment Canada Act can play an important role.
5. The exceptionally long lifespan and significance of the FIPA calls for careful and ongoing independent evaluation of its costs and benefits over the long term.
For example, it is possible that concerns about the FIPA are overblown. Many of the FIPA’s defenders have said this over the last two years, albeit without serious analysis to back up the claim. The next 16 years present an opportunity, indeed a necessity, to study the FIPA’s impacts closely.
Will Chinese investment help Canada to obtain value-added benefits from new resource development in Canada? Will the environmental impacts for Canada be managed appropriately? Will the rights and interests of Canadian workers, communities, and First Nations be respected? Will Canadian businesses suffer a competitive disadvantage due to the FIPA’s non-reciprocal rights for Chinese investors in Canada and China? Will Canadian investors be protected from mistreatment in China despite the FIPA’s allowance for all governments in China to keep their existing laws, rules, and practices that discriminate against Canadian companies?
Monitoring and evaluation of the FIPA will need to be broad-ranging and, above all, public and independent. Perhaps an independent commission could be established to play this role for all of Canada’s treaties that provide for investor-state arbitration as part of a broader review of Canada’s national economic strategy. The commission would have to reflect genuinely a range of viewpoints. It must not be left to the usual crowd of promoters in and around the federal Department of Foreign Affairs and International Trade and in the investor-state legal industry.
Given that the current federal government failed to do any public and independent review of the FIPA before it was ratified, we cannot expect the government to carry out a proper review now. From my perspective, the government appears more interested to deny the non-reciprocal and unique aspects of the FIPA and downplay the costs and risks of investor-state arbitration.
With this in mind, Canadians deserve an explanation for why the federal government would agree to a non-reciprocal treaty with China that departs from Canada’s past FIPAs in significant ways. Did China pressure the federal government to conclude the treaty by, for example, detaining Canadian nationals in China? What role did lobbyists in Canada play behind the scenes and who were they working for? What role was played by law firms that stand to benefit by representing Chinese investors in takeovers of Canadian companies and in lawsuits against Canada?
More broadly, an independent review could examine the role of investor-state arbitration in all of Canada’s trade agreements and other FIPAs. Investor-state arbitration is a controversial mechanism with important implications for democratic accountability and judicial independence and significant risks for public finances. Pending a review of these matters, the federal government should not conclude any more treaties that provide for investor-state arbitration.
6. Finally, I suggest that the federal government needs to develop a national economic strategy that prioritizes the interests for Canadian businesses, workers, and communities to benefit from value-added activities in resource extraction in Canada, while remaining open to trade and investment with China and other countries.
The federal government has drifted far from this priority. Resource extraction and associated infrastructure in Canada should not go ahead where it will leave behind massive environmental damage in Canada or where the lion’s share of the wages and profits will go to foreign workers or companies.
These are ideas about how those of us concerned about the China FIPA could ask future governments to disclose, monitor, and limit the harm done by this treaty. None are satisfying when compared to the stark reality that the Harper Cabinet has locked in Canada to a non-reciprocal treaty for at least 31 years. Yet it is also not a reason to despair. Public scrutiny seems all the more important now as a safeguard against further concessions by the federal government to foreign companies in the brave new world of the FIPA and investor-state arbitration. SOURCE
Gus Van Harten is a law professor at Osgoode Hall Law School at the University of Toronto.
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“This Changes Everything: Capitalism vs. the Climate” (Simon & Schuster), by Naomi Klein
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