On positive trade agreements

While Stephen Harper has been putting on a clinic in how to utterly mangle trade agreements (both in effectively ceding Canada's rights under NAFTA and in negotiating the new lumber deal itself), two stories come out today suggesting that not all leaders are similarly clueless.

First, surprising kudos to the Klein and Campbell governments for agreeing to remove barriers to interprovincial trade in a way that may help business while at the same time raising regulatory standards:

Western Canada's two strongest economies agreed to a landmark internal trade pact aimed at creating the dominant economic region in Canada, the premiers of British Columbia and Alberta announced Friday.

The comprehensive deal, which took three years to draft and goes into effect in April 2007, is intended to break down internal barriers that limit trade, investment and the movement of skilled labour across the B.C.-Alberta border. The agreement also forces both governments to harmonize rules and regulations to the higher of the two standards, a process that will take place over the coming three years...

Klein added that he hopes other western provinces will see the potential of the agreement and sign on.

Taking the deal at face value, it looks like nothing short of a brilliant means of benefitting both businesses and citizens generally. From a business perspective, the cost of researching and complying with several different sets of requirements is likely to be far higher than the cost of simply meeting a higher uniform standard. From a citizen perspective, the application of the higher standard should eliminate the usual concern that free-trade agreements tend to lead to a race to the bottom; instead the top possible level of citizen protection is included.

Of course, the details can easily undermine a positive general idea, and there are some legitimate concerns about the structure of the deal both in its current form and in any future expansion. For the present, it's worth wondering whether either Klein or Campbell has preserved any meaningful standards during their respective anti-government movements, and some sources in the article are unsure as to whether the higher of even those low standards will actually be applied.

From the standpoint of future expansion, it almost certainly would be a worthwhile effort for Saskatchewan and Manitoba to sign on in the future if their own respective higher standards are also applied. But I worry that the B.C./Alberta bloc will assume that its harmonized set of standards should take precedence over any higher requirements in Saskatchewan or Manitoba law.

Those concerns aside, and even if the model isn't well applied in the Alberta/B.C. agreement, the idea is one that could easily be replicated in both interprovincial and international agreements.

Meanwhile, on an international level, several countries are joining together to show that a U.S. model for free trade isn't the only one available to states wanting to foster closer cooperation:

Bolivian President Evo Morales was joining fellow leftist leaders from Cuba and Venezuela on Friday to endorse their concept for shared regional commerce that follows socialist principles and rejects U.S. control.

Morales has said on Saturday he will officially include his Andean country in the "alternative" trade pact presidents Fidel Castro of Cuba and Hugo Chavez of Venezuela devised a year ago...

The agreement will allow Bolivia, Cuba and Venezuela to trade some products with zero tariffs and strengthen already close ties among the three countries, whose leaders are known for their strong opposition to U.S. policy.

Again, there are some obvious problems both with the agreement and with the inferences drawn about the countries' intentions. It's dangerous to accept the article's implication that the new bloc is outright "anti-U.S." rather than merely an alternative to the current American model for partial free trade. Along the same lines, it's unfortunate that free trade in the hemisphere appears to be sprouting only within competing blocs rather than based on a general agreement which doesn't proceed only along ideological lines. Finally, it appears clear that the agreement only frees up trade to a fairly limited extent, meaning that there's plenty of room for further improvement in the future.

But those flaws aside, the agreement makes clear two aspects of free trade which are all too often forgotten.

First, free trade doesn't need to be a right-wing concept. While our current models have all too often been hijacked by corporate interests, free trade is a desirable concept for a population as a whole as long as any agreement is designed to properly balance the interests of businesses and citizens.

Second, free trade doesn't have to be entirely separate from other forms of cooperation. The agreement as drafted includes an obligation for the countries involved to work together in providing charitable programs and other common goals...meaning that within the Bolivarian bloc, free trade is to be applied as a general source of agreement rather than of irritation as has often been the case between Canada and the U.S.

It remains to be seen whether any of the good ideas contained in the above agreements will be applied on a greater scale than they are now. But both models should be kept in mind as governments look for ways to develop increased business and trade without inflicting needless human costs as a result.