Despite free trade claims, big business lobby's members shed jobs and amassed wealth

December 22, 2003

OTTAWA--With the 15th anniversary of the Canada-US Free Agreement just days away, a new report from the Canadian Centre for Policy Alternatives examines the free trade claims of the big business lobby, the BCNI (now the CCCE), in relation to its own performance over the last 15 years.

Straight Talk: Big Business and the Canada-US Free Trade Agreement Fifteen Years Later, authored by Bruce Campbell and David Macdonald, looked at BCNI's free trade jobs claim in relation to the employment record of 39 of its own member companies during the last 15 years. It found that overall, the 39 companies increased their combined revenues by $144 billion, a 105% jump during 1988-2002 These same 39 companies decreased their collective workforce by 100,268, or 14.5% during the same period.

The report also examined the claim that social programs would not be threatened, but rather would be strengthened under "free trade." It found evidence of massive cuts in public transfers to persons, from 13.5% of GDP to 10.5% of GDP during 1992-2002. This is the equivalent of $55 billion in the latter year. It also found strong evidence that the Canadian social state is converging downward to the level of the American social state. Although non-military spending in Canada was 5.7 percentage points of GDP greater than the US in 2001, that number is substantially down from 15.2 percentage points of GDP gap in 1992.

"Certainly big business has benefited from free trade, with significant gains in income, wealth and CEO pay packages," said Bruce Campbell, one of the report's authors. "However, the FTA failed to deliver the goods big business promised. And the effect on well-being of a large majority of Canadians and on the social cohesion of society, has been negative on balance."

"Despite this, the big business lobby is pushing for still deeper forms of economic integration with the US. Will the Paul Martin government resist big business pressure to go further down this path? The signs are not encouraging" concludes the report.