Clinton and Obama want out of NAFTA

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"I will say we will opt out of NAFTA unless we renegotiate," Clinton said in a televised debated with Obama in Ohio on Tuesday.

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Obama: “I Don’t Think NAFTA Has Been Good For America - And I Never Have.” Obama: “Ten years after NAFTA passed, Senator Clinton said it was good for America. … Well, I don’t think NAFTA has been good for America - and I never have.” (David Espo, “Obama Hits Clinton On NAFTA Support,” The Associated Press, 2/24/08)

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Well, that's just dandy. You guys could do us a big favour by voting either of these two guys in...... :) You see, Canada has stated that if they want to renegotiate NAFTA, then let's renogotiate.... starting with the the bit where Canada has to give priority of it's oil sales to the US........

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OTTAWA - Trade Minister David Emerson suggested the United States has a sweet deal over access to Canada's oil under the North American Free Trade Agreement, saying the two Democratic presidential candidates calling for renegotiations may not know just how good the U.S. has it under the deal.

Emerson said Wednesday that reopening the three-country trade deal would not be a one way street and that Canada also has its list of concessions it would seek if the continental pact was renegotiated.

"There's no doubt if NAFTA were to be reopened we would want to have our list of priorities," Emerson said.

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Just thought you might want to know what you're committing yourself to. :wave:

Obama's intentions don't seem clear from that small quote.

SLIGHTLY OFF TOPIC: So who can we blame NAFTA on? I've heard two different sides.

Okay, here's a better one from Obama

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Said Obama: "We should use the hammer of a potential opt-out" to force Canada and Mexico to reopen trade talks.

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As for blaming people for NAFTA, there's no one to "blame" IMHO. NAFTA has been great for all three countries. These guys are picking one battle cry (unemployed factory workers) and blaming NAFTA..... really? This sounds like protectionism. So, a few hundred factory workers get to keep their jobs, and every other US citizen has to pay more for their goods because of it? That's not a good promise to make the citizens. NAFTA is Capitalism in action. Protectionism is Communism. For gods sake they should pick which one they like and stick to it.

Obama's comment in particular makes me think that he foolishly believes that it all a one way street (forcing Canada to renegotiate?), well it's looking like Canada might want to renegotiate those oil supplies pretty eagerly.... oh, or does he only want to renegotiate the bits he doesn't like. To quote the Canadian minister "It's a complete package", if he opens any bit up for negotiation, the whole thing is opened up."

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Originally Posted by System_Error

SLIGHTLY OFF TOPIC: So who can we blame NAFTA on? I've heard two different sides.

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We can't! There have been few mainstream politicians who have not backed NAFTA in whole or in part.

I wouldn’t think Canada would want to renegotiate anything in regards to selling oil to the US. The infrastructure has already been set up, the investments have already been made and with transportation costs low to the US I wouldn’t imagine Canada would want to spend extra to ship their oil elsewhere. Its a win win for both countries.

Obama and Clinton are just pandering for votes again.

X

X. I agree, given the current climate. But there is a feeling in the industry (one of the reasons for my recent middle eastern trip) that the Saudi's might be fibbing about the amount of reserves they have left. If they are, then it will undermine OPECs ability to control the price of oil. This will be a fundamental shift in the way that oil is traded and may result in individual countries fixing the price of a barrel based upon production and delivery costs (like any other goods on the market). At present Canada's production costs are high, but their delivery (to the US) costs are low. Whereas Saudis production costs are low and their delivery costs are high. This means that Canadian companies can really only compete against Saudi ones when selling to Continental America.

However, Saudi production costs appear to be increasing at a remarkable rate (from on the ground observers - the Saudis don't allow any outsiders to verify their their figures - something which is making everyone nervous). At some point it may become economical for Canada to tanker it's oil to other parts of the world to replace the dwindling Saudi supply, if those countries are prepared to pay more for it.

When NAFTA was negotiated, no one would have dreamed of this scenario.

Since when did factory work become such a coveted profession? When I was growing up my parents and teachers always stressed getting good grades so I could attend a good college or university because "you don't want to work in a factory all your life."

Xanith's got it right - it's just pandering.

Even without the Oil it's a daft statement to make. Since NAFTA occured our manufacturing has become so intertwined that to get rid of it would hurt both countries industries.

For example: We are shipping a power plant to Mexico in the next few months. We buy American components (about $2 million dollars of Allen-Bradley and Bently Nevada kit) for our control systems and ancillaries, because if we can prove that 90% or so of the unit is manufactured in North America we won't have to pay any tax (I'm not sure on the exact percentage - that's for the accountants).

Without NAFTA, we would probably go to Siemens and Vibrometer for our stuff.... they are cheaper and better quality. That would be $2 million dollars not going into the US economy. Now, we are one tiny company in the greater scheme of things. If you magnify that out across North America, you can see how it would hurt the North American economy as a whole (because of course there are plenty of US companies buying Candian goods for the same reasons - so they're money goes abroad, rather than into the Candian economy). Not to mention that somewhere along the line, the price of goods goes up because it gets taxed...... how much tax do you think they will slap on a barrel of oil once the free trade is gone...?

For a presidential candidate to make such a nieve statement boggles my mind. It shows absolutely zero knowledge of how industry in North America works. I obviously can't vote in the US elections, but who you elect down there always has a major effect on Canada. Now the last guy you voted in was an absolute idiot, I don't think there's any denying that, and whoever gets the job next time around is going to have a hard time getting the world to respect the US again and getting the dollar out of the toilet, however from this statement about NAFTA, I honestly don't think that Obama or Clinton have enough of a grasp of how the North American economy works to fix the dollar. I'd be inclinded to vote for McCain.

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Originally Posted by homer13j

Xanith's got it right - it's just pandering.

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True, it probably is, but that's just a bad. That's either
a) Blatent lying to your public (with your fingers crossed, so that's okay)
and/or
b) Under-estimating the intelligence of the average voter to look at the cold hard facts of NAFTA, rather than it being a battle cry to protect the poor down-trodden worker bee (at the cost of every other citizens living expenses).

I'm surprised they singled out NAFTA, but in honesty, I don't think the candidates are talking about Canada as much as the other country in NAFTA - Mexico, where the labor rates are excruciatingly low in comparison to US and Canadian factory workers.

But even then, Mexico workers don't really put American factory workers out of work anymore - the Chinese worker does.

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Originally Posted by nemaroller

But even then, Mexico workers don't really put American factory workers out of work anymore - the Chinese worker does.

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I just heard a report that thousands of Chinese factories will be closing and moving to Indonesia due to rising costs of material and labor, go figure.

X

After reading up more on this issue, it appears that if NAFTA was revoked, it would do little damage to free trade between Canada and the US, since the Free Trade Agreement signed in 1988 would take effect by default.