Ontario Federation of Labour

Ontario Federation of Labour

February 08, 2010 10:47 ET

Ontario Federation of Labour Calls on McGuinty Government: Reject Lopsided "Buy American" Deal

Unbalanced and asymmetrical trade deal would inhibit local job creation

TORONTO, ONTARIO--(Marketwire - Feb. 8, 2010) - Ontario Federation of Labour president Sid Ryan today called on Premier Dalton McGuinty to reject the Stephen Harper brokered Canada-U.S. trade deal, which would restrict the ability of provincial and municipal governments to support domestic firms employing Canadian workers when they procure goods and services.

"Certainly, the "Buy American" provisions of U.S. stimulus spending have impacted Canadian businesses and Canadian workers," said Ryan. "But you don't solve a problem by creating a bigger problem."

The proposed trade deal, negotiated in secret and without public consultation or parliamentary scrutiny, would allow Canadian firms to bid on some procurement contracts funded by Washington's Recovery and Investment Act of 2009. However, approximately $200 billion (U.S.) of the $275 billion in contracts authorized by that Act have already been allocated. Should the U.S. Congress enact another package with "Buy American" provisions going forward, Washington has agreed only to re-open negotiations.

In exchange, the Harper government has offered to open our provincial and municipal government procurement markets on a permanent basis. Sub-national governments would be left unable to implement preferential procurement policies, which are a proven and powerful tool for ensuring that taxpayer money is spent in ways that aid local job creation.

"The benefits and costs of this deal are so unbalanced and asymmetrical as to be shocking," said Ryan. "Canadians get temporary and partial access to a stream of stimulus spending that has largely dried up, and in return, we forever give up the ability to spur and shape job creation through policies like the local procurement provisions of the recent Green Energy Act. This is like amputating a leg to cure a sore toe."

Although many aspects of the proposed deal remain shrouded in mystery, it appears that it would not allow Canadian businesses access to federally-funded mass transit or highway construction projects, which the U.S. has exempted from its WTO commitments. Additionally, Canadian firms would not be allowed to supply public utility services such as telecommunications, nor would Canadian suppliers be allowed to provide construction-grade steel, vehicles, or printing. Unlike in Canada, municipal governments in the U.S. are completely exempt from the deal.

"We've recently seen how the local procurement provisions of the Green Energy Act could act as a catalyst for the creation of good, green jobs. In a very short period of time, this government policy has made possible the creation of tens of thousands of jobs in energy, manufacturing and services," said Ryan. "Why would any government in its right mind give up the ability to use such policies? Certainly, this is a bad deal for Ontario, and we expect Premier McGuinty to recognize that and act accordingly."

Contact Information

  • Ontario Federation of Labour
    Patrick (Sid) Ryan
    416.209.0066 (cellular)
    Ontario Federation of Labour
    Mike Belmore
    Communications Director
    905.308.4300 (mobile)
    Ontario Federation of Labour
    Sheila Keenan
    Communications Director
    416.443.7665 (direct)
    416.737.5798 (cellular)