Monday, 7 August 2017
NAFTA renegotiation may be good for Canadian consumers
Megalomaniac U.S. President Donald Trump wants to renegotiate NAFTA, the North American Free Trade Agreement. He's even threatened to terminate the agreement if he doesn't get what he wants. Yup, sounds like Trump. But believe it or not, renegotiating NAFTA to make it more favourable to U.S. business interests may actually be a good thing for Canadian consumers.
For example, Trump wants Canada to open its dairy sector to U.S. competition. I didn't know this until recently, but Canada has a very tightly-controlled dairy market that relies on supply management. And unbeknownst to many if not most Canadians, supply management is the reason why Canadian consumers pay higher prices for dairy products than we would be paying if the market was more open to competition.
Another economic sector in Canada that Trump is demanding greater U.S. access to is the telecommunications sector. You know, TV, cable, satellite, wireless service and so forth. It's no secret that Canadians pay a lot more for internet and wireless than people do in other jurisdictions. So would it hurt to allow American companies to come into Canada and provide services that are now mostly provided by the oligopoly that we call Rogers, Bell and Telus? No, I think it would help. The inevitable result would be lower prices for Canadian consumers. I am well aware that government has tried time and time again to create regulations to prevent the gouging of Canadians. But these regulations have had little impact, if any, on what Canadians pay to use the internet or a wireless device. What we really need is more choices and more competition, which Canadians will have if the folks in our federal government would get off their protectionist asses and let the American companies in.
Now I know there are many people out there among my fellow Canadians that will say we need to protect our industries to protect Canadian jobs. I think it's just the opposite. I think we have to open up our economy more so that Canadians have access to more markets, both across the border and overseas. Closed economies never work. They never have and they never will. If you want to see what it's like to live in a closed economy, then I suggest you hop a plane and travel to North Korea, or get a time machine and go back to the days of the Soviet Union. But trust me, you won't like what you see.