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The Troubled Economics, and the Curious Politics, of the Canada-Korea Trade Deal

There are many motivations to explain the Harper government’s rush to sign free trade deals.  Since coming to power, the Conservatives have implemented 6 FTAs, have “concluded” 2 more (with Korea and, purportedly, with the EU), and have fully 14 other FTA negotiations on the go.

To some extent Conservatives actually believe in these things. I doubt that even they honestly swallow the rhetoric about FTAs spurring major new jobs and growth here. But Conservatives clearly support the pro-business institutional framework that NAFTA-style deals help to permanently enshrine. And their backers in the business community are enthusiastic that more free trade commitments (including those dealing with services deregulation, intellectual property, liberalization of procurement, investor rights, national treatment, and other key non-tariff measures) will lock Canada into a business-dominated trajectory for many years after the Conservatives have been voted out of office.

However, I think that political factors are more important in explaining the Conservative rush to sign FTAs — more than any belief that would actually boost the economy. Given the consistently disappointing performance of the Canadian economy over the last 3 years, the government is concerned to “look busy”: that is, it must be seen to be moving forcefully to do something about the economy. These FTAs will have zero immediate impact on key indicators like employment, investment, and exports (and their long-run impact, likely negative in my view, won’t be dramatic in any event). But signing FTAs is a high-profile symbolic act, which makes the government seem competent and globally engaged (especially when cheered on by the breathless boosterism of most of the media).

More important, I suspect, is the Conservatives’ political calculation that a spate of new trade agreements would be a useful wedge issue with which to attack the opposition parties in the run-up to the 2015 election. They would like to stereotype the opposition as “anti-trade”, thus reinforcing their own (increasingly shaky) claim to be the best “economic managers.”  Unfortunately for the Harper government, the Liberals never play along: they back all the trade deals, despite token noises about various refinements or amendments. But the Tories’ line of attack does put the NDP in an awkward position.  The NDP is working hard to portray itself as a non-threatening, incrementalist, business-friendly, government-in-waiting. Being pilloried as “protectionist” and “anti-trade” by the Conservatives is very harmful to that effort. So the party endorsed the Canada-Jordan FTA (a deal that is economically meaningless to Canada — although it does contain similar objectionable structural features as the NAFTA). They hoped this would stop the Conservatives from claiming that the NDP always opposes trade. But unsurprisingly, that token act did not silence the Conservative guns. So the party (under leader Tom Mulcair and trade critic Don Davies) has been seeking other ways to defuse the “protectionist” label — and hopefully without fully alienating core supporters who have been opposing NAFTA-style trade deals for a generation.

My advice to the party in this regard has been to turn the tables on Mr. Harper. Show that he is the Prime Minister who has overseen the greatest deterioration in Canada’s international trade performance in the postwar period. If our goal is promoting trade (and Canadian exports, more specifically), then Mr. Harper’s record speaks for itself: Canadian exports of goods and services fell from 37% of GDP when the Conservatives were elected to 31% at present, and the current account balance melted down from a $30 billion surplus to a $53 billion deficit. The more free trade agreements we sign, the worse our trade performance becomes. The debate over FTAs is almost beside the point: Canada’s trade is failing painfully not because of foreign trade barriers, but because of the structural deindustrialization of Canada, the failure of Canadian firms to innovate and produce desireable high-value products, and our dangerous and growing reliance on exports of unprocessed natural resources. (I say “almost beside the point,” because of course existing FTAs clearly contributed to that structural regression.) I would love to debate Canada’s trade failures with any Conservative, and point out that their infatuation with signing still more FTAs is not addressing our true trade problem — and in fact will make it incrementally worse.

In the absence of a successful effort to reframe the trade debate, however, then whether you support an FTA or not seems to become (by default) a litmus test of whether you support trade.  The Korea deal, officially signed on September 22, is now before the House of Commons, and hence will be the first major test of both the Conservatives’ wedge strategy and the opposition response. Given debate within Europe about the CETA (and in particular growing European opposition to its investor-state dispute mechanism), it is questionable whether that treaty will make it to the Commons before the election. So how the parties position themselves on the Korea deal may indicate how the whole trade issue will play out in the next campaign.

We have been debating the economics of the Korea deal for a decade (since the Chretien government first opened negotiations). Canada’s trade relationship with Korea is very lopsided, both quantitatively and qualitatively. We import more than $2 from Korea, for every $1 we export there, and the resulting bilateral deficit (close to $4 billion in 2013) significantly contributes to Canada’s miserable current account performance — which anyone other than a died-in-the-wool Walrasian must acknowledge has sapped Canadian employment and income substantially in recent years. Canada exports primarily unprocessed or barely-processed resources to Korea (the top 4 exports in 2013, in order, were coal, copper, aluminum, and wood pulp). We buy back increasingly sophisticated value-added products (the top 4 imports in 2013, in order, were motor vehicles, computer circuits, auto parts, and smart phones). Our relationship with Korea is thus a fitting microcosm of the structural deindustrialization of our trade which has occurred since the turn of the century. Of course, that deindustrialization is due in significant part to the effect of NAFTA (and similar deals) in locking Canada into a resource-extraction pigeonhole, and hamstringing pro-active policy efforts to attain a more diversified, value-added development trajectory.

A punchy campaign against the proposed Korea deal, combined with the politics of minority government (which limited every government’s leeway from 2004 through 2011), put the deal on the back-burner. Opposition from the auto industry (including an active grassroots effort by my former union, the CAW, and influential opposition from auto companies and car dealers) was a crucial factor in sidelining the Korea deal for years. We all knew, however, that a Conservative majority would put pedal-to-the-metal on this FTA (like others).  So after winning its majority in 2011, the government moved quickly to finalize the deal.

The automotive features of the deal are inferior to those negotiated by the US in its deal with Korea (implemented in 2012). Yet under that deal, US auto imports from Korea have grown 22 times faster than US auto exports to Korea (causing a dramatic widening of the bilateral auto deficit). Overall US merchandise exports to Korea have actually declined under the deal. The US benefits from major direct investments by Korean automakers; this is not the case in Canada (Korean automakers have no production here at all).  The US also enjoys a services trade surplus with Korea that partly offsets its growing merchandise deficit — another feature absent from the Canada-Korea situation. So the effects of this deal will be inevitably worse for Canada than the negative outcome already experienced by the US.

Moreover, those negative effects will not be limited to Canada’s automotive sector. Many other industrial sectors will also be negatively affected, due to the same fundamental structural weakness which explains the automotive imbalance: namely, a very unbalanced starting point, an asymmetry of market presence, and weak technological and innovative capacity on the part of Canadian-based producers in these high-value-added industries. Our previous research at the CAW analyzed the likely impacts of bilateral free trade on 20 different merchandise sectors. Of those 20 sectors, 15 are projected to lose net sales as a result of bilateral liberalization, 4 are projected to gain net sales, and one (petroleum products) is expected to experience no change in net sales. The overall decline in net sales will drive corresponding losses in output and employment, which could be as high as 30,000 jobs across all the sectors considered. Computers and electronics manufacturing could experience the largest proportional decline in output and employment, followed by machinery, and then by automotive products.

Metal manufacturing (both primary metals and fabricated metal products) would also be very hard hit. Since the end of the recession in 2009, Canada’s metal exports to Korea have declined by half. But our imports from Korea have grown by almost 50%. The result is a primary metal and metal products deficit with Korea that reached almost $500 million in 2013 (accounting for one-third of Canada’s total global deficit in metal and metal products). Canada imports almost $3 in primary metal and metal products from Korea, for every dollar we export back there. So it is quite wrong to suggest that the auto industry is the only sector at risk from this deal; most manufacturing will experience a net decline in sales, output, and employment from the expansion of Canada’s already unbalanced bilateral trade flows with Korea.

Much has been said about the benefits of the deal for Canadian pork and beef exports, and I concur that they will likely expand as high Korean tariffs in these sectors come down. However the scale of those gains, as well as the argument that our meat exporters are being significantly undercut by U.S. competition into the Korean market (since Korean tariffs on meat imports are falling gradually under the US-Korea deal), must be taken in context. Canada’s meat exports to Korea have declined substantially since 2011. But exports that year were unusually high (twice 2010 levels) and hence should not be used as a benchmark to evaluate the effects of the US deal on Canada’s exports. Relative to longer-run export performance, the erosion in meat exports to South Korea has been modest — and certainly less severe than experienced by our exports of autos (down 82% since 1999) or steel (down by half since 2009). Imagine if the Canada-Korea deal allowed meat exports to bounce right back to that (unusual) 2011 peak. That would imply $175 million in incremental exports — enough to offset less than one-twentieth of Canda’s existing bilateral deficit with Korea (never mind the certain increase in that bilateral deficit under free trade). In fact, the potential upside to meat exports is more modest than this; for example, the Canadian Cattlemen’s Association has predicted that with the full elimination of the Korean tariff (which would take 15 years) Canadian beef exports would grow by $40-50 million from current levels. Those gains would be important, to be sure, to beef and pork exporters, but they do not constitute a significant benefit in macroeconomic terms. The “meat-for-cars” trade-off implicit in the federal government’s Korea strategy will produce far more losses than gains for Canada.

I recently appeared before the House of Commons standing committee on International Trade to discuss the deal. My speaking notes provide more detail regarding the economic arguments against this deal. I also recommend previous research from the CAW, Unifor, and the CCPA on the topic, including:

Canada’s Auto Industry and the New Free Trade Agreements: Sorting Through the Impacts by Jim Stanford (Ottawa: Canadian Centre for Policy Alternatives, 2014), 34 pp. (Describes Canada’s lopsided auto trade with Korea, and proposes ways in which a trade deal could be more balanced.)

A Case of Politics over Economics: Renewed Canada-Korea Trade Negotiations, Unifor Briefing Kit, January 2014, 8 pp. (Reviews impacts of free trade with Korea in the US and EU cases.)

Employment Implications of Trade Liberalization with East Asia by Daniel Poon and Jim Stanford (Toronto: CAW-Canada, 2006)), 33 pp. (Predicts up to 33,000 job losses from bilateral free trade with Korea.)

It is almost mathematically impossible that this deal could do anything other than widen our already damaging bilateral trade deficit with Korea, it will absolutely reinforce Canada’s structurally subservient role as a supplier of raw materials and importer of high-value products and services, and it further reinforces the negative structural features (investor rights, etc.) that are the most important elements of every NAFTA-style deal. I am willing to bet $500 of my own money with the trade minister or critic of any of the federal parties that Canada’s bilateral trade deficit with Korea will widen by at least $1 billion over the first 3 years after the deal is implemented: in other words, that the deal will spur more imports from Korea than exports to Korea, and hence that net demand for Canadian products (and the workers who make those products) will decline further under free trade.

I think the economics are pretty straightforward. This brings us to the politics, which are anything but. The NDP decided to support the Korea deal. Don Davies’ detailed speech in the House of Commons announcing this support is interesting to read. He acknowledges concerns in the auto industry, but argues that the auto industry itself is supposedly “divided” on the matter (claiming that every auto company except Ford has endorsed the deal). That is factually incorrect (Chrysler has not supported the deal, and its CEO has spoken publicly against it), and very misleading (Toyota and Honda were the companies most opposed to free trade with Korea, but they stood down once the Harper government promised to negotiate a parallel deal with Japan). Only GM (with its fully-owned export-oriented Korean subsidiary Daewoo) actually supports the Korea deal on its own merits, and even its public statements have been wishy-washy. This “divide-and-conquer” strategy by Mr. Davies’ was startling. He also invoked a repertoire of standard free trade arguments to support the deal: it levels the playing field, we must keep up with other countries who sign FTAs, it allows for accellerated dispute settlement, and so on. He claimed the deal was “essential” for Canada’s food industry (surprising, given that Canada’s total food exports to Korea in 2013, $250 million, equaled one-quarter of one percent of Canada’s total food industry shipments that year). He acknowledged the NDP would prefer to have a deal without the investor-state dispute settlement mechanism which is proving so controversial around the world, but indicated that his party would support the deal anyway. He dismissed concerns about other negative structural features (intellectual property rights, a significant liberalization of federal government procurement, national treatment and other investor rights, and a clear dergulatory bias in the provisions governing services industries) that are the key reasons why progressives around the world oppose these “trade” deals (which are not, as we have been saying for a quarter-century, actually about trade).

In my appearance before the Commons committee, Mr. Davies directed all of his questions at me, invoking similar themes as in his speech, and citing the evidence of long-time free trade boosters like Ian Burney (Canada’s chief trade negotiator). Here is the transcript of the whole session, which makes for some more interesting reading. He played off concerns of the auto industry against other industries (including some with Unifor members) that might benefit from more exports to Korea (more divide-and-conquer). I replied that most industries (not just auto) would lose net sales and jobs under the agreement. He cited a long list of business advocates from various sectors who support free trade (yes, we are aware that business lobbyists support free trade, and we think we know why). I believe I held my own in the debate (the hostile questions from the Conservative ranks were predictable and less well-informed than Mr. Davies’ well-researched questions). But I will admit that the experience was surprising and somewhat surreal.

I expected the NDP to endorse one of the big new trade deals (I suspected it would be the CETA), motivated by political positioning and an attempt to parry Harper’s “protectionist” thrust. What I did not expect was for the party to enthusiastically and uncritically take on board traditional arguments about the supposed mutual benefits of NAFTA-style “free trade”. It is one thing for the party to pick its battles, trying to avoid Harper’s demonization strategy. It is quite another for it to add its own endorsement to the dominant view that so-called “free trade” is a neutral, mutual, efficiency-enhancing evolution in the global economy. The NDP’s positioning will make it all the harder for anyone to raise concerns about any free trade agreement. I expect NDP partisans to soon begin denouncing free trade critics as “protectionist” (that’s already occurred on Twitter). And it makes it all the more likely, in my estimation, that the party will ultimately endorse the CETA. Right now they are buying time with the argument (which they’ve invoked for years now) that they want to “study” it. But the party’s silence on negative features which we already know are in the deal (drug patents, investor-state dispute settlement, liberalization of procurement, etc.) already speaks volumes. Mr. Davies tried to distinguish between CETA and the Korea deal, mentioning (among other factors) that the ISDS provision of the former are in force for 20 years, while the latter can be cancelled on 6 months notice. I doubt that will provide a sufficiently credible basis for the party to turn thumbs down on CETA, now that it has endorsed the broadly similar Korea deal. The most vulnerable aspect of the CETA is its investor-state provisions, which have sparked enormous and potentially decisive opposition in Europe; but by endorsing the Korea deal (with its ISDS), the NDP has thrown that card away.

In my judgment, the NDP decision to support the Canada-Korea FTA will likely be a bellweather moment in the evolution of that party’s politics, and its relationship to the traditional social constituencies (organized labour, NGOs, and social movements) which once formed its core base. It will set off further complicated dyamics within those constituencies themselves, as activists try to balance loyalty to the party with principled concerns over the anti-democratic and economically damaging features of neoliberal globalization. The Canadian wing of the UFCW (which at the time was campaigning successfully to become the new bargianing agent for federal NDP constituency workers) immediately followed the NDP in endorsing the deal, even suggesting (improbably) that it would actually benefit Canada’s auto industry. (The UFCW’s US parent organization also endorsed the US-Korea trade deal, along with the United Auto Workers, both motivated by political loyalty to President Obama’s Democrats. However, the United Steelworkers sharply opposed the US-Korea deal, and it will be interesting to see what that union, very close to the NDP but a vocal critic of FTAs, will now say about the Canada-Korea deal — especially given the damage being done to Canada’s steel industry by our lopsided bilateral trade in primary metals and metal products.) The two Green Party MPs were the only ones to vote against the Korea deal on second reading; Elizabeth May’s speech emphasized the anti-democratic nature of the treaty’s investor-state dispute settlement system.

Of course, the bigger challenge facing alter-globalization activists is how to change the overall political discourse around trade and free trade. If we were winning the broader ideological battle on this front, then there is no doubt in my mind that the NDP would have taken a more principled stand. To some extent, we can’t blame any electoral party for shying away from a battle of ideas that the social movements themselves cannot seem to win. In this regard, the challenge I outlined earlier about reframing the debate around Canada’s real trade problems, rather than debating yet another free trade agreement, should be our most important priority — all the more so in light of the now-near-unanimity in our House of Commons regarding the virtues of so-called “free trade.” Unifor’s recent discussion paper “Imagining a Fair Trade Future” is a good start in that effort. Let’s see what else we can do in our research, lobbying, and mobilizing to find new storylines to slow down the Harper government’s FTA juggernaut. The successful popular mobilization against ISDS in Europe over the past year should remind us if we get large numbers of people aware and concerned about what these deals really mean, then politicians (of any stripe) will trip over themselves to support our cause.

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Comment from Ron Waller
Time: October 17, 2014, 11:12 pm

Mulcair definitely failed on free trade. He should’ve grabbed the bull by the horns and taken leadership on the issue, instead of walking on eggshells and supporting the failed ideology. He could’ve rallied people around him boosting his numbers. Instead he prostrated himself before right-wing voters who will never vote for him.

The free trade ideologues have framed the issue such that any opponents are anti-trade protectionists. But this is a false dichotomy. In the post-war era, tariffs were at historic lows: Krugman: US tariff history

Therefore fair trade supporters have to be aggressive in re-framing the issue. The ideological extremes are free trade and protectionism. Fair trade is the balanced approach in the center.

Free trade simply allows first-world businesses to make a quick profit bypassing first-world regulations. It creates a global economic Wild West and regulatory race to the bottom. This is the very opposite direction we need to be taking if we are to prevent global warming and economic instability from destroying civilization.

We must establish a global regulatory regime and the only way to enforce the rules is with tariffs and sanctions. With free-trade globalization, all countries will do is talk about lowering GHG emissions. There are no disincentives or consequences for environmental freeloading. (Not to mention other abuses, like child slave labor, for God sake…)

In the 25 years before the 1988 FTA, the economy grew by 176%. In the 25 years after, it grew by 74%. Yet red Tories like Mulroney and Trudeau keep giving speeches about all the prosperity free trade brought to Canada. It’s insane.

Usually when an idea fails people abandon it and take an alternative approach. With economics, the more free-market ideology fails the deeper we commit to it.

The reason conservatives are winners and center-left activists are losers is because the cons are better salesmen. They are, of course, used-car salesmen selling people around the world an economic clunker.

But until the center-left learns how to persuade and manipulate public opinion, they will be on the sidelines watching neocons and pretend liberals destroy the economy and the world. Our children and grandchildren will likely not accept our incompetence as a lame excuse for handing down to them a world without a future.

Comment from Ron Waller
Time: October 19, 2014, 11:31 am

BTW, all people into progressive economics must read Joseph Stiglitz’s books “Freefall” and “The price of inequality.” They really expose all the problems that free-market ideology has caused over the past 35 years in much more depth than Krugman and Reich (although they are definitely worth reading too.)

Here’s a sample passage on free-trade globalization from “Inequality”. (Thinking of creating a blog where I just rip passages I highlighted when reading his books…):

The way globalization has been managed, however, has itself led to still lower wages because workers’ bargaining power has been eviscerated. With capital highly mobile— and with tariffs low— firms can simply tell workers that if they don’t accept lower wages and worse working conditions, the company will move elsewhere. To see how asymmetric globalization can affect bargaining power, imagine, for a moment, what the world would be like if there was free mobility of labor, but no mobility of capital. Countries would compete to attract workers. They would promise good schools and a good environment, as well as low taxes on workers. This could be financed by high taxes on capital. But that’s not the world we live in, and that’s partly because the 1 percent doesn’t want it to be that way.

Having succeeded in getting governments to set the rules of globalization in ways that enhance their bargaining power vis-à-vis labor, corporations can then work the political levers and demand lower taxation. They threaten the country: unless you lower our taxes, we will go elsewhere , where we are taxed at lower rates. As corporations have pushed a political agenda that shapes market forces to work for them, they have not, of course, revealed their hand. They don’t argue for globalization— for free capital mobility and investment protections—saying that doing so will enrich them at the expense of the rest of society. Rather, they make specious arguments about how *all* will benefit.

There are two critical aspects to this contention. The first is that country’s overall output as measured, for instance, by GDP. The second is that if GDP is increased, trickle-down economics will ensure that all will benefit. Neither argument is correct. It is true that when markets work perfectly, free trade allows people to move from protected sectors to more efficient unprotected export sectors. There can be, as a result, an increase in GDP. But markets often don’t work so nicely. For example, workers displaced by imports often can’t find another job. They become unemployed. Moving from a low-productivity job in a protected sector to unemployment lowers national output. This is what has been happening in the United States. It happens when there is bad macroeconomic management, so the economy faces a high unemployment rate, and it happens when financial sectors don’t do their jobs, so new businesses aren’t created to replace the old businesses that are destroyed .

There is another reason why globalization may lower overall output; it typically increases the risks that countries face. Opening up a country can expose it to all kinds of risks, from the volatility of capital markets to that of commodity markets. Greater volatility will induce firms to move to less risky activities, and these safer activities often have a lower return. In some cases, the risk-avoidance effect can be so large that everyone is made worse-off.

But even if trade liberalization leads to a higher overall output for a given economy, large groups in the
the to a higher overall output for a given economy, large groups in the population can still be worse off. Consider for a moment what a fully integrated global economy (with both knowledge and capital moving freely around the world) would entail: all workers (of a given skill) would get the same wage everywhere in the world. America’s unskilled workers would get the same wage that an unskilled worker gets in China. And that would mean, in turn, that America’s workers’ wages would fall precipitously. The prevailing wage would be the average of that of America and the rest of the world and, unfortunately, much closer to the lower wage prevailing elsewhere. Not surprisingly, advocates of full liberalization, who typically believe that markets function well, DON’T ADVERTISE THIS OUTCOME. In fact, unskilled workers in the United States have already taken a beating. As globalization proceeds, there will be further downward pressures on their wages. I don’t think markets work so well that wages will be fully equalized, but they will move in that direction, and far enough to be of serious concern. The problem is particularly severe today in the United States and Europe: at the same time that labor-saving technological change has reduced the demand for many of the “good” middle-class blue-collar jobs, globalization has created a global marketplace, putting the same workers in direct competition with comparable workers abroad. Both factors depress wages. [Something critics of free trade have argued from the start.]

How, then, can globalization’s advocates claim that everybody will be better-off? What the theory says is that everybody *could* be better off. That is, the winners could compensate the losers. But it doesn’t say that they will— and they usually don’t. In fact, globalization’s advocates often claim that globalization means that they can’t and shouldn’t do this. The taxes that would have to be levied to help the losers would, they claim, make the country less competitive, and in our highly competitive globalized world countries simply can’t afford that. In effect, globalization hurts those at the bottom not only directly but also indirectly, because of the induced cutbacks in social expenditures and progressive taxation.

The result is that in many countries, including the United States, globalization is almost surely contributing significantly to our growing inequality. I have emphasized that the problems concern *globalization as it has been managed.* Countries in Asia benefited enormously through export-led growth , and some (such as China) took measures to ensure that significant portions of that increased output went to the poor, some went to provide for public education, and much was reinvested in the economy, to provide more jobs. In other countries, there have been big losers as well as winners— poor corn farmers in Mexico have seen their incomes decline as subsidized American corn drives down prices on world markets. In many countries, poorly functioning macroeconomies have meant that the pace of job destruction has exceeded that of job creation. And that’s been the case in the United States and Europe since the financial crisis. Among the winners from globalization in the United States and some European countries, as it’s been managed, are the people at the top. Among the losers are those at the bottom, and increasingly even those in the middle.

Stiglitz, Joseph E. (2012-06-04). The Price of Inequality: How Today’s Divided Society Endangers Our Future (Kindle Locations 1734-1738). Norton. Kindle Edition.

Comment from Joe
Time: October 25, 2014, 1:18 am

“We must establish a global regulatory regime and the only way to enforce the rules is with tariffs and sanctions. ”

You can’t do that under capitalism, you guys never learn anything. You can’t reform the beast, the left lost big time. You are just a bunch of progressive (regressive) also rans.

Comment from Joel Harden
Time: October 28, 2014, 10:16 am

Thoughtful piece Jimbo — I want to focus on the political elements of what you’ve raised. This is the line that stuck in my brain towards the end:

“To some extent, we can’t blame any electoral party for shying away from a battle of ideas that the social movements themselves cannot seem to win.”

This made me remember that, not so long ago, we (left social movements) had the 1% and its minions nervous. In 2001, the Economist described critics of us as “terribly dangerous”:

Since then, we’ve had (in 2008) the worst economic crisis since the 1930s, and the flowering of new grassroots movements that have shifted the left’s apolitical obsession with “defending the middle class”, to campaigns about the 1% vs. the 99%. We also had a raging debate on capitalism recently thanks to Piketty’s book, and others (like you Jim, and Klein’s latest effort) who continue to pose systemic critiques.

But for the electoral Left, it seems, that is all distant noise. The recent Olivia Chow campaign for Toronto Mayor proves that milquetoast campaigns yields milquetoast support, but that doesn’t appear to have penetrated the craniums of the NDP’s braintrust. They prefer to fit into the framework of mainstream politics over taking any substantive risk to connect to a more compelling, inspired vision.

And that’s a pity, because the “Orange Wave” of 2011 happened on the heels of social movement inspired protest — not the technocratic “well framed” messages of election planners. There was a connection, if contradictory, between Layton’s image and a defiant mood of the times. If Mulcair’s NDP think they can sleepwalk into better results, they are deluding themselves. Quebec voters (perhaps the most agile of any Canadian electorate) will toss them to the curb, and unapologetically back whoever is best poised to defeat the Conservatives.

All of which takes me back to your original point Jimbo, that we are witnessing a very hollow political moment, with relatively low social movement activity, and that’s resulted in the NDP’s easy lurch to the right on trade. I agree.

The question for me (given I, like you, think capitalism remains crisis-prone) is what social movements and the mindful left outside the NDP plan on doing when opportunity knocks again.

In the case of CETA, or Canada-Korea, shifting this particular debate beyond “trade”, “globalization”, and towards 1%/99% analysis is a very useful. It would be unwise for our friends in UNIFOR or the Steelworkers to cater the “protectionist” BS tag that even the NDP is peddling.

Comment from Nigel Southway
Time: December 28, 2014, 8:43 am

Guys… don’t panic… we are in a post industrialized world now…don’t you know…. We are going to get rich on service and moving other people’s money about so we won’t have to actually make much of anything anymore. We can all get jobs making questionable policy for government about how to prolong the agony. In the meantime our youth under/unemployment will continue to rise and we can be confident that wealth transfer of resources and jobs out of the country will continue to flourish.
The above is not going to change as long as we follow the current policies and I see a growing sense of understanding of the issue but also a strong feeling of helplessness in the general population.
It’s a real shame if we have to use politics to drive sound citizen focused policies but we are getting little support from the main stream economists who avoid the real issue of out of control globalization policies and always think they have the next simple magic pill when the rest of us live in a much more complex world?
I don’t see a fix with the current mainstream economists thinking toward this huge problem where our governments in the western world have lost the plot since the ill-conceived Washington consensus was allowed to flourish.

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