Canadian Centre for Policy Alternatives – July 2006: NAFTAs Broken Promises
The CCAP has put into writing, and backed up with evidence, something that I have been sure of for years – NAFTA is bad for most Canadians.
According to Statistics Canada researchers, much of the growth in gross exports over the last decade reflected the markedly elevated use by Canadian-based companies of imported inputs in their production, significantly overstating the employment impact of the growth of manufactured exports. (For example, more than one-half of auto inputs are now imported.)Furthermore, oil and gas exports alone accounted for close to 40% of the rise in exports to the U.S. over the last 10 years, and during the current resources boom (2003-05) accounted for 62% of the increase in exports to the U.S.
If free trade was supposed to usher in a new era of rising living standards, reversing the sluggishness of the 1980s, the record reveals quite the opposite. Annual growth in average personal income per capita fell to a plodding 1.55% per annum in the 1980s, from the rapid 3.9% annual average gain during the 1960s and ‘70s. During 1989-2005, personal income per capita growth continued its slide to a snail’s pace of 0.63% yearly. What is particularly striking is that GDP per capita was growing almost three times faster–1.57% annually–than personal income. While U.S. GDP per capita grew at an annual rate of 1.80%, slightly faster than the Canadian rate, U.S. personal income per capita grew at an annual rate of 1.05%, almost twice as fast as the Canadian rate during 1989-2005.