Chapter 11 too costly???
WHAT THE HECK???
The linked article claims that at $314M CAD a provision which generates stability for investors and thus makes all of those bound by better investments a bad idea. When it comes to international trade $314M is NOTHING. Canada's GDP is $1.3T CAD... with the T standing for TRILLION. And guess who our biggest trading partners are? That's right, our fellow NAFTA members. So, this deal encapsulates a pretty massive portion of our GDP.
I won't argue that things can be improved. In fact, I have argued that all along. But don't sit there and acknowledge that it serves a purpose (reassuring investors and trade partners) and then claim that an amount equal to less than half of a tenth of a percent of our GDP is too costly. In fact, it is probably closer to a quarter of a tenth of a percent.
Too costly for what? Obviously, we can technically afford it, otherwise Canada would be in economic trouble having been held to this for so many years. So it isn't strictly "too costly".
Oh, and by the way... that $314M... isn't even annually. It is since 1994!!!!! So... 24 years worth of costs. So, averaged, it is more like $13M CAD/year. OOPS... now, we're more less at 1/1000 of a percent of GDP annually. In other words, the sum total cost of the this chapter of NAFTA has over it's entire existence failed to cost us even a meaningful fraction of a single year's GDP.
Also, the article goes on to claim that Canada, if anyone, should want it gone since it has cost us more than anyone. But here is the question. The US has a MUCH bigger economy than Canada. And Canada has lost more to this clause than anyone. Then it means that the impact from this MUST be even smaller to the US. Also, if the US's biggest trading partner in NAFTA is suffering the worst from this, then it must be generating an overall positive outcome for the US. And yet... they want it gone?
The article suggests absolutely no possible replacements for it which could yield the same sort of value. Nor what the cost of such alternatives might be.
At the end of the day $314M is a lot of money... to an individual. Or to most companies. Over any time frame. To really large companies or, I don't know, COUNTRIES... it isn't even that big of a number. Not even if it were annually. Which it isn't. At $13M annually, you amusingly get to a cost some individuals could even afford and there are many large companies which could manage that. Not to mention every developed nation on the globe.
None of this means we SHOULD pay it of course. But, since the article mentions it serves a value, without some indication of how much it would hurt us to NOT have it in place, the conclusion seems downright ridiculous. If investors lost faith in Canadian goods and services because they didn't have these protections in place... it could seriously hurt our economy. When you consider the cost is less than 1/1000 of a percent of our GDP, you'd have to be pretty confident that removing it would either boost the economy or, at the least provide some reassurances that it wouldn't affect the economy by more than 1/1000 of a percent. And, simply removing it, we can be sure WON'T improve the economy. Removing a source or investor confidence will, at the least, have no affect. But much more likely will have a negative effect.
And therein lies the problem... 1/1000 of a percent is a VERY small number indeed. Removing these protections could hurt our economy by far more than that while still being so small as to be impossible to determine with any degree of certainty that eliminating this was to blame.
The linked article claims that at $314M CAD a provision which generates stability for investors and thus makes all of those bound by better investments a bad idea. When it comes to international trade $314M is NOTHING. Canada's GDP is $1.3T CAD... with the T standing for TRILLION. And guess who our biggest trading partners are? That's right, our fellow NAFTA members. So, this deal encapsulates a pretty massive portion of our GDP.
I won't argue that things can be improved. In fact, I have argued that all along. But don't sit there and acknowledge that it serves a purpose (reassuring investors and trade partners) and then claim that an amount equal to less than half of a tenth of a percent of our GDP is too costly. In fact, it is probably closer to a quarter of a tenth of a percent.
Too costly for what? Obviously, we can technically afford it, otherwise Canada would be in economic trouble having been held to this for so many years. So it isn't strictly "too costly".
Oh, and by the way... that $314M... isn't even annually. It is since 1994!!!!! So... 24 years worth of costs. So, averaged, it is more like $13M CAD/year. OOPS... now, we're more less at 1/1000 of a percent of GDP annually. In other words, the sum total cost of the this chapter of NAFTA has over it's entire existence failed to cost us even a meaningful fraction of a single year's GDP.
Also, the article goes on to claim that Canada, if anyone, should want it gone since it has cost us more than anyone. But here is the question. The US has a MUCH bigger economy than Canada. And Canada has lost more to this clause than anyone. Then it means that the impact from this MUST be even smaller to the US. Also, if the US's biggest trading partner in NAFTA is suffering the worst from this, then it must be generating an overall positive outcome for the US. And yet... they want it gone?
The article suggests absolutely no possible replacements for it which could yield the same sort of value. Nor what the cost of such alternatives might be.
At the end of the day $314M is a lot of money... to an individual. Or to most companies. Over any time frame. To really large companies or, I don't know, COUNTRIES... it isn't even that big of a number. Not even if it were annually. Which it isn't. At $13M annually, you amusingly get to a cost some individuals could even afford and there are many large companies which could manage that. Not to mention every developed nation on the globe.
None of this means we SHOULD pay it of course. But, since the article mentions it serves a value, without some indication of how much it would hurt us to NOT have it in place, the conclusion seems downright ridiculous. If investors lost faith in Canadian goods and services because they didn't have these protections in place... it could seriously hurt our economy. When you consider the cost is less than 1/1000 of a percent of our GDP, you'd have to be pretty confident that removing it would either boost the economy or, at the least provide some reassurances that it wouldn't affect the economy by more than 1/1000 of a percent. And, simply removing it, we can be sure WON'T improve the economy. Removing a source or investor confidence will, at the least, have no affect. But much more likely will have a negative effect.
And therein lies the problem... 1/1000 of a percent is a VERY small number indeed. Removing these protections could hurt our economy by far more than that while still being so small as to be impossible to determine with any degree of certainty that eliminating this was to blame.
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