January 8, 2008
Ever wonder why Canadians and Mexicans were never asked in a referendum the kind of relationship we want to have with Americans and the White House? Ever wonder why Canadians and Mexicans dont have a veto power on the White House's policies and legislation, and yet we feed Americans with our resources? How is that possible? What does that do to the world, to all life on Earth, and to the next generations? As of January 30, 2008, the total U.S. federal debt held by the public was roughly $5.1 trillion and the annual deficit roughly $400 billion. They paid very little for our resources and with money they borrowed every year from China. Americans buy our ' home grown corporations ' with money they dont own. When they have not borrowed the money, they have invaded other nations and taken their resources. Blood resources. Blood money. How can we trust a partner that is basically bankrupted morally and economically? How can we let our governments be dealing with the White House on an agreement such as the North American Free Trade Agreement (NAFTA)?
Key words: Free Trade Agreement (FTA), the North American Free Trade Agreement (NAFTA), the Free Trade Area of the Americas (FTAA), and the Global Government of North America (GGNA).
Global Community voting on issues
Artwork by Germain Dufour
February 1, 2008
Very few people in North America have paid much attention to the Global Government of North America (GGNA). This is no criticism, because the people of Mexico, Canada, Great Britain, North Pole Region, and of the United States are only now waking up to the true nature of the GGNA despite the best efforts of our political leaders to keep it from them.
So, why should you bother?
You should start bothering because the GGNA is very good news for you now and a little further down the track. I should start by emphasizing that I speak to you as a good global citizen, with clients and business friends in most countries of the world. We, global citizens, have kept our love for the real GGNA, the GGNA of separate democracies, each with its glorious culture and history. What we fear and dislike intensely are the Free Trade Agreement (FTA), the North American Free Trade Agreement (NAFTA), and the Free Trade Area of the Americas (FTAA), which are very different things. It is when you put the inverted commas, or quotes, around the word NAFTA that the trouble starts. To justify what I am saying I fear we have to look at the basic history and the raison d'être of NAFTA. How far NAFTA has already got and where it will certainly go if we dont wake up and stop it.
The fundamental idea behind NAFTA was born after the FTA, an economic agreement between the U.S. and Canada, but only came to fruition after the United States and Mexico made all sorts of special economic arrangements. This fundamental idea was that nation-states were better off with no other needs than the best economics, and that at the expenses of the values and institutions people from each member state respected most. Those nation-states must therefore be emasculated and diluted into a new form of super-national organization called NAFTA - run, not by elected national politicians reflecting the desires of the peoples, but by a commission of wise technocrats, USA technocrats in most parts running the show.
This leads me to the key piece of the NAFTA propaganda: the claim that the USA, Canada and Mexico have kept healthy the economics of the North American continent since its creation, and that it is essential to maintain it in future. This is the big deception, which plays at the almost unconscious level. It is a warm, mystic conviction that NAFTA, with all its faults, must be inevitably good because it brings good economics. But, today, even that is questionable.
Those who promote this myth do not tolerate any rational examination of history or the facts. Indeed, they accuse those of us who query the divinity of NAFTA of being rabid nationalists, xenophobes, little Canadians, and worse. You start to be guilty of all this as soon as you dare to point out that the economy alone is not all that matters, and that, what is more important is the protection of the global life-support systems and the primordial human rights which include security. Also important are the cultural and social aspects, as well as our Canadian value systems.
Indeed, if you stand back and scratch your head a bit and take a calm look at NAFTA, you will see it is a well-tried model for destruction, not good economics. It contains three of the most important ingredients for conflict. First, it is a top-down amalgamation of different peoples put together without their informed consent, and such arrangements usually end in conflict. Whistle-blowers have been silenced since its creation, and there is no internal auditors. Third, NAFTA is institutionally undemocratic, as I shall show. Let me say here that America alone and unilaterally has invaded Iraq without the consent of Canada and Mexico and, therefore, such an action has endangered the entire North American continent, its economy, the security of its people is at risks, and peace is threatened and replaced by fear. Americans are economically bankrupted and yet they spend astronomical amounts of money with defence because of a threat they created abroad. Now that tells Canadians and the people of Mexico that economics are affected by the U.S. foreign policies, and we should have a say in those policies. Everything is connected: economics, foreign policies, social aspects, the environment, everything. The only valid agreement the U.S., Mexico and Canada should have together is the GGNA.
History has one other important lesson for us here, which is that, on the whole, democracies do not provoke war, and indeed it is hard to think of a genuine democracy which has declared war on another. So, we NAFTA-skeptics believe that a free trade association between the democracies of North America, linked through the GGNA, is much less likely to end in tears than is the emerging, undemocratic mega state that is NAFTA (and the FTAA).
Let me explain a little of how NAFTA (the FTAA is very much similar) functions and show why it is so innately undemocratic. In other words, what sort of animal are you dealing with? How bad is it now?
Even in Canada, very few people realize what huge areas of our national life have already been handed over to control by NAFTA. Put simply, these include: everything to do with a single market -in other words, all of our industry and commerce - all of our social and labor policy, our environment, agriculture, fish, and foreign aid. Even security and the Canadian forces are being handed over to the U.S. technocrates.
What do I mean by control from the U.S. technocrates? Well, in all those areas of our national life which used to be entirely controlled by the Canadian Parliament, our government or House of Commons can be outvoted in the NAFTA meetings of member states. That is a system known as "you have no democratic rights, just money to lose". If our government agrees, or is outvoted in any new ruling in those areas, then Parliament, being the House of Commons, must put it into Canadian law. If they dont, the country faces unlimited economic fines.
So our Canadian Parliament has already become rubber stamps in all those areas of our national life. Our foreign trade relations are in an even worse category: the commission of the NAFTA bureaucracy self-negotiates those on our behalf. And so in this area, NAFTA already has its own legal personality.
So to go back to where we are now, in addition, laws affecting our justice and home affairs and our foreign and defence policies must also be rubber-stamped by the Canadian Parliament if they have not been agreed by our government and all the other member states governments in NAFTA (and similarly in the FTAA). In other words, our government cannot veto new rulings in NAFTA in these areas, and it has to enact them. This all means that NAFTA technocrates actually govern Canada, not the Canadian House of Commons. If Parliament were to reject a new NAFTA ruling in these areas, we would be subject to unlimited fines as we would be in breach of our treaty obligations, which is, of course, a rather more horrifying prospect for our foreign office and political classes in their diplomatic cocktail parties and so on. A fine, after all, is paid by the taxpayer.
No rulings in NAFTA has ever been overturned by the Canadian Parliament. NAFTA technocrates act as a higher Court, the highest court in North America - superior to all our national courts including the Supreme Court of Canada - in the area which ceded NAFTA, and it must find in favor of the ever-closer economic union of the peoples of North America, ordained the treaties, and it is guilty of much judicial activism in order to do so.
There are four other features of this NAFTA system which are worth emphasizing, all of them innately undemocratic. First, the unelected bureaucracy - the commission has the monopoly to propose all new rulings and change our Canadian laws. This reflects the basic idea behind NAFTA which I have mentioned. The nation-states, the democracies of North America, must be emasculated and diluted into this new super national economic body we called NAFTA and run by the commission of wise technocrats. Second, the commission's legal proposals are then negotiated in secret by the shadowy committee of permanent representatives, or bureaucrats, from the national capital states. The U.S. have already established themselves as being by far the ruling majority technocrates of this body. Decisions are taken in NAFTA, again by secret vote. National parliaments are precluded from knowing how their bureaucrats and ministers negotiate and vote. The commission then executes all NAFTA rulings, supported when necessary by the so-called court. The technocrates pretend that democracy is maintained. But the point remains that the Canadian Parliament itself is excluded from the process. We can and do debate some rulings, but we have to pass them exactly as agreed in NAFTA.
A third features of this frightening new system enshrined in the treaties is that once an area of national life has been ceded to control from NAFTA it can never be returned to national parliaments.
The fourth feature I would mention is that no changes can be made to the treaties unless they are agreed unanimously by NAFTA technocrates. So the return of powers to national parliament by renegotiation is no realistic. The only way out is the doorway.
Canada's membership with NAFTA is also very expensive financially. The government of Canada steadfastly refuses to carry out a cost-benefit analysis because it does not want the result to be made public. So the GGNA has made private studies, which produce a cautious estimate at the cost to the taxpayer and the economy of around six billion per annum, or 2 percent of GDP. Two new studies are on the way which will take this estimate considerably higher.
It is also worth saying that the whole of the North American continent will continue in steady and irreversible demographic and therefore economic decline over the next fifty years. Add to this the unemployment and decay caused by globalisation and you have to ask why the Canadian political establishment wants to stay on the Titanic.
NAFTA spells out the final extinction of Canadian sovereignty and the sovereignty of the democracy of Mexico. Its worst feature is that it grants its own legal personality superior to that of Canada and Mexico. There is no longer even the pretense that NAFTA is an arrangement between sovereign nations, and that the U.S. technocrates are the majority. Soon we will see a NAFTA flag and an anthem.
NAFTA will eventually take over most of the rest of the powers which we have retained in Canada so far, including defence and security.
When will Canadians ever held a referendum to reject NAFTA? Canadians have been kept in such ignorance and history shows that we have accepted it all somewhat like frogs in warm water being heated from underneath. We could not react fast enough to reject NAFTA even though it is destroying all of what makes us Canadians.
The Canadian Supreme Court should start to take note of NAFTA rulings, and I submit that is not agreeable to our democracy.
I feel I must also at least touch on the moral dimension of NAFTA and also of the FTAA. I need hardly say that it is fundamentally secular, irreligious, even atheistic. The convention which was drawing up the agreement refused the supplication of the pope himself, that the agreement should contain at least some reference to our Judeo-Christian heritage.
We Canadian-skeptics love the real Canada, but we see NAFTA and the FTAA as a bad idea. It is a bad idea like slavery, communism, high-rise flats. I need to tell the damage which ideas can do when they become generally accepted and turn out to be wrong. I remember the story of the young, white Russian officer who wrote home to his fiancée in 1918 from the front against the Bolsheviks. Oh, my darling, he said. Please do not worry. In a few weeks I shall be home with you in Moscow, and we shall be married. These people are not very well armed, and their ideas are even worse. Well, three days later he was killed, so he was not entirely right about their arms, but he did turn out to be right about the ideas which inspired Soviet Communism. It is just that it took seventy years and fifty million lives to prove him so.
Let us hope NAFTA and the FTAA dont end up as quite such a dangerous idea as that. With any luck, it will start to decay from within. If we have the energy to understand it, to expose it, and to fight it. We can do that together. We can make things better. Let us build a democratic GGNA, a true democracy for all Peoples of North America.
Human and Earth Rights within the GGNA
Article 103: Scale of Human and Earth Rights
The Scale of Human and Earth Rights contains six (6) sections. Section 1 has more importance than all other sections below, and so on.
Concerning sections 1, 2, and 3, it shall be Global Governments highest priority to guarantee these rights to their respective Member Nations and to have proper legislation and implement and enforce global law as it applies and as shown in the Global Constitution.
Section 1. Ecological rights and the protection of the global life-support systems
Section 2. Primordial human rights
Section 3. The ecological rights, the protection of the global life-support systems and the primordial human rights of future generations
Concerning Sections 4, 5 and 6, it shall be the aim of Global Governments to secure these other rights for all global citizens within their respective Member Nations but without immediate guarantee of universal achievement and enforcement. These rights are defined as Directive Principles, obligating the Global Governments to pursue every reasonable means for universal realization and implementation.
Section 4. Community rights, rights of direct democracy, and the right that the greatest number of people has by virtue of its number (50% plus one) and after voting representatives democratically
Section 5. Economic rights (business and consumer rights, and their responsibilities and accountabilities) and social rights (civil and political rights)
Section 6. Cultural rights and religious rights
The Global Government of North America (GGNA) proposes:
a) A common economic zone through the elimination of remaining tariff and nontariff barriers to trade among Member Nations of the GGNA. Member Nations must also expand cooperation on trade-related areas, including border and transportation infrastructure; a concerted effort to reduce the many regulatory gaps and inconsistencies that hamper the flow of trade in Member Nations; and coordinated investment in North America’s human capital, both through education and training, and through improved labor mobility within the continent.
b) An economic space that provides new opportunities for individuals in all Member Nations: adopting a common approach to regulation, increasing labor mobility, and enhancing support for education programs.
c) Establishing a Seamless North American Market for Trade. With tariff barriers virtually eliminated, the time has come to take a more comprehensive approach to strengthening the economic prospects for citizens in all Member Nations. The first step is to encourage convergence in the most-favored-nation tariff rates each partner charges on imports from outside the GGNA. Next, the governments should reduce the remaining nontariff barriers to the flow of goods and services, and address problems arising from charges of price discrimination and subsidization by competitors within the GGNA. Finally, they should coordinate their approach to unfair trade practices by foreign suppliers to the North American market. The ultimate goal should be to create a seamless market for suppliers and consumers throughout North America.
d) Adopting a common external tariff. We recommend that Member Nations harmonize external tariffs on a sector-by-sector basis, to the lowest prevailing rate consistent with multilateral obligations. The effort should begin with goods on which current tariff rates are closest and then proceed to close larger gaps, with the goal of adopting a common external tariff, thus eliminating the need for rules of origin and further facilitating integration and better use of scarce resources.
e) Reviewing those sectors of NAFTA that were excluded or those aspects that have not been fully implemented. Each of the three countries decided to exclude unilaterally certain sectors and issues from NAFTA. Some of these remain sensitive issues; others may be ripe for review. In addition, several elements have not been implemented in the way that all had anticipated. Some changes—for example, the negotiation of a sanitary agreement to promote agricultural trade, or expanding the NAFTA services agreement to include cabotage—would be useful but also difficult. We recommend a high-level review to examine all of these issues and make recommendations on how to make the coverage of NAFTA more comprehensive.
f) Establishing a permanent tribunal for GGNA dispute resolution. The Earth Court of Justice will develop and administer the program. The current NAFTA dispute-resolution process is founded on ad hoc panels that are not capable of building institutional memory or establishing precedent, may be subject to conflicts of interest, and are appointed by authorities who may have an incentive to delay a given proceeding. As demonstrated by the efficiency of the World Trade Organization (WTO) appeal process, a permanent tribunal would likely encourage faster, more consistent, and more predictable resolution of disputes. In addition, there is a need to review the workings of NAFTA’s dispute settlement mechanism to make it more efficient, transparent, and effective.
g) Establishing a joint approach to unfair trade practices. The use of countervailing and anti-dumping duties by one Member Nation country against another has generated considerable ill will, though there has been a steady decline in the use of these trade remedies; there have been few new cases in the industrial sectors, with the most difficult cases now limited to resource and agricultural trade. The time has come to adopt a unified approach to deal with the internal and the external challenge of unfair trade practices, beginning with phased suspensions in sectors of laws governing unfair trade practices.
h) Establishing a common competition commission. Once Member Nations have concluded the resource accord described above and phased in the suspension of antidumping and countervailing duty proceedings for all sectors, they should also establish a common commission — a continental anti-trust agency — to address harmful subsidy practices, to promote healthy competition, and to protect against predatory pricing. At the same time, they should develop shared standards for identifying and responding collectively to unfair trade practices by parties outsidethe GGNA.
i) Adopting a common approach to regulation. Significant regulatory differences continue to divide the North American economic space, and as other barriers to trade, such as tariffs, fall worldwide, regulatory efficiency is becoming increasingly important as a source of competitive advantage. Canada, the United States, and Mexico each have developed rules to protect their environment and the well-being of their citizens. All three share the same broad objectives, but their actual rules have evolved largely in isolation. In many cases, the result is what has been labeled “the tyranny of small differences,” one that imposes large economic costs even when regulatory goals, processes, standards, and outcomes are quite similar.
The most obvious costs of unnecessary regulatory differences are borne by businesses and consumers. Rules that fragment the North American market reduce economies of scale and discourage specialization, competition, and innovation. Harmonization of regulation, in effect, creates a bigger market, one that would lead to more competitive exports and lower consumer prices across North America. In addition to raising compliance costs for businesses and their customers, fragmented regulation increases the administrative costs to governments and taxpayers. Regulators in Canada and Mexico each must try to achieve the same results as their counterparts in the United States and yet must do so with only a fraction of the resources. Furthermore, because much of the resulting administrative work is carried out at border points, regulatory differences are particularly damaging in their impact on border delays and congestion, as the volume of trade within North America exceeds the capacity of its border infrastructure.
Regulatory differences can have a negative impact on the very environmental and health outcomes the regulations themselves are supposed to encourage. Unnecessary delays in the approval for sale and distribution of innovative products can prevent timely access to new pharmaceuticals or medical technology that might save lives, or to new fertilizers or chemicals that could help industrial plants and farmers do a better job of protecting the environment.
A collaborative approach to regulatory reform could help all Member Nations expand economic opportunity within North America while strengthening the protection of the environment, health and safety, and other shared objectives of regulatory policy. While each country must retain its right to impose and maintain unique regulations consonant with its national priorities and income level, the three countries should make a concerted effort to encourage regulatory convergence.
j) Making transportation more efficient. The efficiency of the transportation network is critical to making North America a more competitive place to invest and to produce, and in spreading the benefits of economic growth to all corners of the continent. Among other regulatory reforms, governments should consider the benefits of allowing North American transportation firms unlimited access to each others’ territory, including provision for full cabotage (trade between two points within a country, for example, a Canadian trucker hauling freight from Chicago to Los Angeles or an American airline carrying passengers between Mexico City and Vancouver) for airlines and surface carriers.
k) Adopting the “tested once” approach for biotechnology and pharmaceuticals. The cost and quality of health care is a critical issue in all three countries. Biotechnology and pharmaceuticals play a vital role in providing new treatments that improve health outcomes and often reduce costs as well, but they face huge costs in developing and then winning regulatory approval for new products. Preliminary research suggests that regulatory cooperation in the areas of human and veterinary drugs, medical devices, pest control, and chemicals would raise the value of sales in these sectors by more than 10 percent, profits by 8 percent, and the rate of return on new products by an average of 4.8 percent. Two possible approaches to reducing the regulatory burden while maintaining rigorous standards to protect health and safety would be to adopt a “tested once” principle by which a product tested in one country would meet the standards set by another, or to establish a North America testing center with personnel from each country.
l) Integrating protection of food, health, and the environment. The North American market for agricultural and food products is highly integrated, and the intense disruption of this market by just two cases of mad cow disease demonstrates the need to ensure that regulatory processes are as integrated as their relevant markets. Greater North American cooperation also is essential in providing effective responses to threats to human and animal health and to the environment.
m) Increasing Labor Mobility among Member Nations. People are GGNA’s greatest asset. Goods and services cross borders easily; ensuring the legal transit of workers has been more difficult. Experience with the NAFTA visa system suggests that its procedures need to be simplified, and such visas should be made available to a wider range of occupations and to additional categories of individuals such as students, professors, bona fide frequent visitors, and retirees.
To make the most of the impressive pool of skill and talent within the GGNA, Member Nations should look beyond the NAFTA visa system. The large volume of undocumented migrants from Mexico within the United States is an urgent matter for those two countries to address. A long-term goal should be to create a “North American preference”—new rules that would make it much easier for employees to move and for employers to recruit across national boundaries within the continent. This would enhance North American competitiveness, increase productivity, contribute to Mexico’s development, and address one of the main outstanding issues on the Mexican-U.S. bilateral agenda.
Canada and the United States should consider eliminating restrictions on labor mobility altogether and work toward solutions that in the long run could enable the extension of full labor mobility to Mexico as well.
n) Expanding temporary migrant worker programs. Canada and the United States should expand programs for temporary labor migration from Mexico. For instance, Canada’s successful model for managing seasonal migration in the agricultural sector should be expanded to other sectors where Canadian producers face a shortage of workers and Mexico may have a surplus of workers with appropriate skills. Canadian and U.S. retirees living in Mexico should be granted working permits in certain fields, for instance as English teachers.
o) Implementing the Social Security Totalization Agreement negotiated between the United States and Mexico. This agreement would recognize payroll contributions to each other’s systems, thus preventing double taxation.
p) Creating a “GGNA preference.” Member Nations should agree on streamlined immigration and labor mobility rules that enable citizens of all Member Nations to work with far fewer restrictions than immigrants from other countries. This new system should be both broader and simpler than the current system of NAFTA visas. Special immigration status should be given to teachers, faculty, and students in the region.
Moving to full labor mobility between Canada and the United States. To make companies based in North America as competitive as possible in the global economy, Canada and the United States should consider eliminating all remaining barriers to the ability of their citizens to live and work in the other country. This free flow of people would offer an important advantage to employers in both countries by giving them rapid access to a larger pool of skilled labor, and would enhance the well-being of individuals in both countries by enabling them to move quickly to where their skills are needed. In the long term, the two countries should work to extend this policy to Mexico as well, though doing so will not be practical until wage differentials between Mexico and its two North American neighbors have diminished considerably.
Reinforcing an approach of mutual recognition of professional standards and degrees. Professional associations in each of Member Nations make decisions on the standards to accept professionals from other countries. But despite the fact that NAFTA already encourages the mutual recognition of professional degrees, little has actually been done. Member Nations should devote more resources to leading and create incentives that would encourage, the professional associations of each of the three countries in developing shared standards that would facilitate short-term professional labor mobility within the GGNA.
q) Supporting a GGNA Education Program. Given their historical, cultural, geographic, political, and economic ties, Member Nations should have the largest and most vibrant educational exchange network in the world. Currently, we do not. Despite the fact that Mexico is the second-largest trading partner of the United States, it ranks only seventh in sending students there. In 2004, only 13,000 Mexican undergraduate and graduate students attended U.S. universities. Similarly, Canada is the largest trading partner of the United States but ranked only fifth in educational exchanges, with 27,000 students in the United States compared to 80,000 students from India, followed by China, South Korea, and Japan. The number of Mexicans studying in Canada remains very low—about 1,000. And although American students study all over the world, relatively few go to Mexico and Canada. These numbers should be expanded dramatically to deepen familiarity and increase knowledge in each Member Nation.
r) Creating a major scholarship fund for undergraduate and graduate students to study in Member Nations and to learn the region’s languages. For many students, study abroad is possible only with financial assistance, but many scholarships, including the Fund for the Improvement of Post-Secondary Education (FIPSE), which has supported scholarships to and from all North American countries, have been reduced or halted. Cross-border educational study within the GGNA by its citizens should expand to reflect the degree of our commercial exchanges. To illustrate the scale of this proposal, it would lead to some 60,000 Mexican students studying in the United States and Canada, and comparable numbers of Canadian and American students studying in another Member Nation. We urge that state, provincial, and federal governments begin funding such scholarships now. The scholarships should include “language immersion” courses in each Member Nation and should encourage students to study in all Member Nations.
Developing a network of centers for GGNA studies. The European Union provides substantial funding for EU centers in fifteen universities in the United States, as well as twelve Jean Monnet Chairs. The U.S. Department of Education provides similar grants to support language and international studies outside North America, but not within North America. That should change. We recommend that the governments open a competition and provide grants to universities in each Member Nation to promote courses, education, and research on the GGNA and assist elementary and secondary schools in teaching about the GGNA. They could also administer scholarship programs. To support this effort, a student summit should be held periodically in each of the three countries.
Promoting Internet-based learning within the GGNA. A natural way to channel communication between Canada, the United States, and Mexico would be through Internet-based learning tools. Current examples include the Historica Foundation’s YouthLinks program in Canada, which enables high-school students to connect with their counterparts in other regions of Canada and around the world, and the School Connectivity Program (SCP) launched by the U.S. Department of State, which installs computers with Internet access in schools across nations that lack access to computer technology. The SCP program should be extended to all Member Nations.
Developing teacher exchange and training programs for elementary and secondary school teachers. This would assist in removing language barriers and give some students a greater sense of the GGNA identity. Greater efforts should also be made to recruit Mexican language teachers to teach Spanish in the United States and Canada.
Developing “sister school” and student exchange programs. Studying or living in another country or hosting a foreign-exchange student fosters cultural understanding. We recommend that states and municipalities encourage the development of “sister school” programs at both the secondary and university level to include the annual exchange of students between participating schools.
Encouraging imaginative ways to build GGNA connections between Member Nations. Foundations and research institutes can shape the way public and private institutions engage in a new concept such as the GGNA community. We encourage foundations and research institutes to provide support and research for addressing continental issues and developing curricula that would permit citizens of our three countries to look at each other in different ways than in the past.
Member Nations of the Global Government of North America (GGNA) should be guided by the following principles:
• Member Nations should approach continental issues together with a GGNA perspective rather than the traditional “dual-bilateral” approach that has long characterized their relationships.
• North America is different from other regions of the world and must find its own cooperative route forward. A new GGNA community should rely not only on the market, but also on building a true GGNA Community. We must maintain respect for each other’s national sovereignty by forming the GGNA protecting such sovereignty and developing the Global Constitution.
• Our economic focus should be on the creation of a common economic space that expands economic opportunities for all people in the region, a space in which trade, capital, and people flow freely.
• The strategy needs to be integrated in its approach, recognizing the extent to which progress on each individual component enhances achievement of the others. Progress on security, for example, will allow a more open border for the movement of goods and people; progress on regulatory matters will reduce the need for active customs administration and release resources to boost security. GGNA solutions could ultimately serve as the basis for initiatives involving other like-minded countries, either in our hemisphere or more broadly.
• A GGNA strategy must provide real gains for all Member Nations, and must not be approached as a zero-sum exercise. Poverty and deprivation are breeding grounds for political instability and undermine both national and regional security. The progress of the poorest among us will be one measure of success.
The threat of international terrorism originates for the most part outside North America and is due primarily on the American Government foreign policies. All Member Nations of the GGNA should have a veto on such policies. All foreign policies should be dealt by the GGNA and not by a single individual Member Nation. Security should be handle by the GGNA. Any weakness in controlling access to Member Nations from abroad reduces the security of the GGNA as a whole and exacerbates the pressure to intensify controls on intracontinental movement and traffic, which increases the transaction costs associated with trade and travel within Member Nations.
September 11 highlighted the need for new approaches to border management. In December 2001, Canada and the United States signed the Smart Border Declaration and an associated 30-point Action Plan to secure border infrastructure, facilitate the secure movement of people and goods, and share information. A similar accord, the United States-Mexico Border Partnership Agreement, and its 22-point Action Plan, were signed in March 2002. Both agreements included measures to facilitate faster border crossings for pre-approved travelers, develop and promote systems to identify dangerous people and goods, relieve congestion at borders, and revitalize cross-border cooperation mechanisms and information sharing. We should expand such programs to all Member Nations.
The defence of GGNA must consist of a more intense level of cooperation among security personnel of Member Nations, both within the GGNA and beyond the physical boundaries of the continent. The Container Security Initiative, for example, launched by the United States in the wake of 9/11, involves the use of intelligence, analysis, and inspection of containers not at the border but at a growing number of overseas ports from which goods are shipped. The ultimate goal is to provide screening of all containers destined for any port in North America, so that once unloaded from ships, containers may cross land borders within the region without the need for further inspections.
• Establishing a common security perimeter by 2024. Member Nations should articulate as their long-term goal a common security perimeter for the GGNA. In particular, Member Nations should strive toward a situation in which a terrorist trying to penetrate our borders will have an equally hard time doing so, no matter which country he elects to enter first. We believe that these measures should be extended to include a commitment to common approaches toward international negotiations on the global movement of people, cargo, and vessels. Like free trade a decade ago, a common security perimeter for the GGNA is an ambitious but achievable goal that will require specific policy, statutory, and procedural changes in all three nations.
• Developing a GGNA Border Pass. Member Nations should develop a secure GGNA Border Pass with biometric identifiers. This document would allow its bearers expedited passage through customs, immigration, and airport security throughout the region. The program would be modeled on the U.S.-Canadian “NEXUS” and the U.S.-Mexican “SENTRI” programs, which provide “smart cards” to allow swifter passage to those who pose no risk. Only those who voluntarily seek, receive, and pay the costs for a security clearance would obtain a Border Pass. The pass would be accepted at all border points within the GGNA as a complement to, but not a replacement for, national identity documents or passports.
• Developing a unified GGNA border action plan. The closing of the borders following the 9/11 attacks awakened all three governments to the need for rethinking management of the borders. Intense negotiations produced the bilateral “Smart Borders” agreements. Although the two borders are different and may in certain instances require policies that need to be implemented at two speeds, cooperation by Member Nations in the following areas would lead to a better result than a “dual-bilateral” approach:
• Expanding the GGNA border infrastructure. While trade has nearly tripled across both borders since the Canada-U.S. Free Trade Agreement (FTA) and NAFTA were implemented, border customs facilities and crossing infrastructure have not kept pace with this increased demand. Even if 9/11 had not occurred, trade would be choked at the border. There have been significant new investments to speed processing along both the Canadian-U.S. and Mexican-U.S. borders, but not enough to keep up with burgeoning demand and additional security requirements. The three governments should examine the options for additional border facilities and expedite their construction. In addition to allowing for continued growth in the volume of transborder traffic, such investments must incorporate the latest technology, and include facilities and procedures that move as much processing as possible away from the border.
Security cooperation among Member Nations should also extend to cooperation on counterterrorism and law enforcement, which would include the establishment of a trinational threat intelligence center, the development of ballistics and explosives registration, and joint training for law enforcement officials.
• Increasing information and intelligence-sharing at the local, national, and global levels in both law enforcement. Law enforcement cooperation should be expanded from its current levels through the exchange of liaison teams and better use of automated systems for tracking, storing, and disseminating timely intelligence. This should be done immediately. However, the ultimate goal needs to be the timely sharing of accurate information and intelligence and higher levels of cooperation.
Member Nations should consider a more extensive information-sharing and collaborative planning involving law enforcement as a means to build mutual trust and pave the way for closer cooperation in the future. Training and exercises should be developed to increase the cooperation and interoperability among and between the law enforcement agencies. These steps will provide better capabilities for detection of threats, preventative action, crisis response, and consequence management. At least one major exercise conducted by law enforcement authorities should be established as a goal over the next year. Of course, the extent of cooperation will be affected by the progress of reform of the police forces, customs, and judicial branch in Member Nations. In addition to the sharing of information, a Joint Analysis Center should be established immediately to serve as a clearing house for information and development of products for supporting law enforcement.
• Intensifying Mexican efforts to accelerate its economic development. NAFTA has transformed Mexico, but it has also deepened and made much more visible the divisions that exist in the country. Indeed, the northern part of Mexico, where the population has a higher level of education and is better connected to American and Canadian markets, has grown significantly faster than the center and the south.
NAFTA was designed to create new opportunities for trade and investment in Mexico and thus complement Mexican development programs. Officials hoped that Mexico would grow much faster than its more industrialized partners and begin to narrow the income gap among the three countries. However, investment has been modest, preventing Mexico from achieving higher levels of growth. Indeed, the Organization for Economic Cooperation and Development (OECD) estimated that, with significant levels of investment, Mexico’s potential growth rate could reach 6 percent. But that requires big changes in current policies. For example, the World Bank estimated in 2000 that $20 billion per year for a decade is needed for essential infrastructure and educational projects in Mexico.
The gap in wages has led many Mexicans to travel north in search of higher incomes and better opportunities. For the past three decades, Mexico has been the largest source of legal immigrants to the United States, and Mexican-Americans make increasingly valued and growing contributions to the life of the United States and, through remittances, to their families at home. Mexico is also the leading source of unauthorized migration, with attendant economic and security problems in both countries and untold hardships for Mexican migrants. Over time, the best way to diminish these problems is by promoting better economic opportunities in Mexico. Mexico also requires significant reforms in its tax and energy policies so that it can use its own resources more effectively to advance its economic development.
To achieve this objective, Mexico must reorient its economic policies to encourage more investment and to distribute the benefits of economic growth more equitably and efficiently across the country. Progress needs to be made, in particular, in the following areas:
(1) dramatically expanding investment and productivity in the energy sector;
All Member Nations need to acknowledge that a major regional effort is also necessary. To that end, Canada and the United States should build on their bilateral initiatives supporting Mexico’s development, notably the U.S.-Mexico Partnership for Prosperity and the Canada-Mexico Partnership. In both programs, the private sector in all three countries is a partner in the development effort. Mexico should also be recognized as a priority within the international development programs of both the United States and Canada, and both should explore with the World Bank and the Inter-American Development Bank ways to use multilateral development funds most effectively to address the North American development challenge. Canada recently announced a major reform of its development assistance programs, doubling overall resources while focusing its efforts on a core group of countries. Mexico is not included in that new list and it should be.
• Establishing a Global Government of North America Investment Fund (GGNAIF) for infrastructure and human capital.
With a more conducive investment climate in Mexico, private funds will be more accessible for infrastructure and development projects. The United States and Canada should establish a GGNAIF to encourage private capital flow into Mexico. The fund would focus on increasing and improving physical infrastructure linking the less developed parts of Mexico to markets in the north, improving primary and secondary education, and technical training in states and municipalities committed to transparency and institutional development. A relatively small amount of funds should be targeted for technical assistance for project design and evaluation, management, and training. If the GGNAIF is to be effective, it will need significant help from the United States and Canada, and counterpart funding through higher tax revenues from Mexico. The fund design should consider such issues as incentives and debt absorption and management capacity of subnational governments to ensure that resources are effectively used. The fund will need to be managed in a transparent manner according to best international practices, and should be capitalized through a diverse set of innovative financial mechanisms. Availability of credit enhancement mechanisms for long-term loans in pesos will be critical.
• Enhancing the capacity of theGlobal Government of North America Development Bank (GGNADBank) with the mandate of:
(1) supporting infrastructure sectors, particularly transportation;
GGNADBank’s internal procedures and the process of project certification should be reformed in order to allow for a significantly faster and more transparent deployment of funds.
All Member Nations produce substantial amounts of energy, but the region as a whole is a net importer of energy. Washington’s two neighbors are its biggest suppliers of energy. The production of oil and natural gas on the continent is not keeping up with the growth in demand.
Although North American production of oil and gas has been declining, both Canada and Mexico have the potential to develop growing supplies both for their own direct use and for export. These two countries, however, have distinct approaches to the development of energy and other natural resources that must be taken into account in the process of mapping the best path forward for North America.
Canada is committed to efficient energy markets, open investment, and free trade in this sector. Canada’s vast oilsands, once a high-cost experimental means of extracting oil, now provide a viable new source of energy that is attracting a steady stream of multibillion dollar investments, and interest from countries such as China, and they have catapulted Canada into second place in the world in terms of proved oil reserves. Production from oilsands fields is projected to reach 2 million barrels per day by 2010. The most serious constraints on additional growth are the limited supply of skilled people and the shortage of infrastructure, including housing, transportation links, and pipeline capacity. Another constraint is regulatory approval processes that can slow down both resource and infrastructure development significantly.
Mexico is also a major energy supplier and customer within North America. In 2004, it was the second-largest exporter of oil to the United States; in previous years, it was consistently among the top four suppliers. Mexico relies for a significant share of its revenues on the state oil producer (Pemex). It has major oil and gas reserves, but these are relatively untapped. Development has been hampered by constitutional restrictions on ownership, which are driven by an understandable desire to see this strategic asset used for the benefit of Mexicans. This restriction on investment, coupled with the inefficient management of the state monopoly, Pemex, has contributed to low productivity. As a result, Mexico has expensive and unreliable supplies of energy for its consumers and industries. Mexico has begun to bring in some foreign capital through multiple service contracts, but the most serious constraints on its future growth as an energy supplier are the restrictions that impede development of its own energy resources and the low productivity of Pemex. Reforms in this area are needed urgently.
Although energy security represents perhaps the most critical challenge, it is important to recognize that trade in other natural resources, including metals, minerals, wood, and other products, is also central to the growth and economic security of North America. In these other resource sectors, NAFTA has not succeeded in ensuring a free flow of goods. Resource and agricultural products such as softwood lumber, fish, beef, wheat, and sugar have been the flashpoints for highly visible trade disputes. The softwood lumber case has led some Canadians to question whether the United States will comply with NAFTA if decisions by the dispute-settlement mechanism run counter to private American interests. The United States and Mexico have failed to comply with free trade provisions on movement of trucks for more than a decade, and the failure to resolve the softwood lumber case between Canada and the United States has plagued their trade relations for the past quarter century. Changing some trade rules and the dispute settlement process may reduce this friction, as would a determined effort to reduce unnecessary regulatory differences within North America.
The GGNA is blessed with an abundant resource base. Exploiting these resources on a long-term, sustainable basis requires that Member Nations work together to resolve issues and ensure responsible use of scarce resources and the free flow of both resources and capital across all borders. As noted, the most troubled areas of cross-border trade over the past twenty years have been in resource trade, largely because of the impact of regulatory differences, including different approaches to resource pricing and income protection. Efforts to eliminate these problems on the basis of dispute settlement mechanisms have not worked as well as anticipated.
• Developing a GGNA energy strategy. Recognizing their individual policies and priorities, Member Nationss need to work together to ensure energy security for people in all Member Nations. Issues to be addressed include the expansion and protection of the North American energy infrastructure; development opportunities and regulatory barriers; and the technological and human capital constraints on accelerated development of energy resources within the GGNA. These objectives form part of the agenda of the North American Energy Working Group established in 2001. This initiative, however, has so far made only modest progress toward developing a GGNA strategy, and it does not cover oil.
• Fully developing Mexican energy resources. Although the inclination of Mexico to retain full ownership of its strategic resources is understandable, expanded and more efficient development of these resources is needed to accelerate Mexico’s economic growth. Mexico is quickly losing ground in its energy independence, and the only way to satisfy growing demands within Mexico is to find ways to unlock its energy sector. Progress can be made even under the existing constitutional constraints. As discussed above, Canada and the United States could make important contributions in this effort through the development of creative mechanisms, especially financial, that bring needed technology and capital to Mexico. The most important steps, however, must be taken in Mexico by Mexicans.
• Concluding a GGNA resource accord. In order to ensure the fullest development of North America’s mineral, forest, and agricultural resources, investors in one country need to be confident that they will not be harassed by competitors in another. To that end, Member Nations need to conclude an accord that recognizes the balance between security of supply and security of access and includes rules about resource pricing that will reduce the friction that has given rise to some of the most persistent and difficult bilateral irritants. A resource accord should also address the remaining barriers to trade in agricultural products, including barriers that arise from the different regimes in the three countries, to guarantee prices and incomes.
• Making a GGNA commitment to a cleaner environment. Expanding energy production as a driver of a more competitive and growing North American economy brings with it a joint responsibility for shaping a cleaner environment and reducing pollution. For example, Canada has signed the Kyoto Protocol on global climate change, which requires significant reductions in emissions of greenhouse gases, but that agreement does not cover Mexico, and Washington has opted out. A North American energy and emissions regime could offer a regional alternative to Kyoto that includes all three countries. Such a regime should include a tradable voucher system for emissions trading within the region analogous to the Clean Development Mechanism.
• Expanding a GGNA collaboration on conservation and innovation. The development of new technologies and conservation strategies is essential both to reduce pollution and to make the most of North America’s resource strengths. Currently, the North American Energy Working Group addresses only a limited number of energy-related opportunities for collaboration. Future initiatives should focus on development of desalination technologies, alternative energy sources, cleaner burning fuels, and more fuel-efficient passenger vehicles.
Effective progress will require new institutional structures and arrangements to drive the agenda and manage the deeper relationships that result. Canada, the United States, and Mexico already share a rich network of institutional links. A recent Canadian government study identified 343 formal treaties and thousands of informal arrangements or “light institutions” with the United States alone. Mexico has more than 200 formal treaties and agreements with the United States. There are many fewer arrangements between Canada and Mexico, but the network of contacts is still substantial and growing.
What is needed now is a limited number of new institutions to provide existing arrangements with greater energy and direction. To this end, the GGNA recommends the following institutional changes, which complement each other:
• An annual Global Government of North America Summit meeting. There is no more succinct or forceful way to demonstrate to the people of all Member Nations the importance of the GGNA than to have the leaders meet at least once a year.
• Strengthening government structures. To ensure that the summit meetings achieve their full potential, each government must take steps to reinforce the ability of its internal structures to deal effectively and imaginatively with North American issues. Steps should include strengthening links between governments by establishing minister-led working groups that will be required to report back within ninety days, and to meet regularly.
• A Global Government of North America Advisory Council. To ensure a regular injection of creative energy into the various efforts related to the GGNA, Member Nations should appoint an independent body of advisers. This body should be composed of eminent persons from outside government, appointed to staggered multiyear terms to ensure their independence. Their mandate would be to engage in creative exploration of new ideas from a GGNA perspective and to provide a public voice for Member Nations. A complementary approach would be to establish private bodies that would meet regularly or annually to buttress Member Nations relationships.
The Global Government of North America must work for the average citizen. When adequate public policies are in place to foster economic and social cohesion, increased trade and investment flows will only improve the living standard of the majority of the population. Economic and social cohesion in Member Nations is in the interest of the GGNA, because it will result in an expansion of the domestic market and it will reduce the flows of undocumented northward migration, thus enhancing security in Member Nations.
Reforms to reduce poverty and inequality in Mexico must start from within. Mexico must focus on achieving universal primary education; promoting gender equality and empowering women; building integrated infrastructure networks, water, and sanitation facilities; applying science, technology, and innovation for development; and promoting environmental sustainability. As many Mexicans have claimed, building up the tax revenue base, along with beefing up the country’s antitrust agency and its regulatory capacity, are essential to increase competitiveness. The government needs to build the infrastructure—human, physical, and institutional—for ordinary people to take advantage of the GGNA.
Economic and social citizenship in the GGNA implies the ability of citizens to exert pressure for the implementation of an inclusive economic policy at home and to be engaged in the international economy. To the extent that citizens of Member Nations see that the GGNA brings concrete benefits, a new constituency will be galvanized to support these efforts in the years to come.
Some other GGNA proposals include:
* Coordinating programs to ensure governments are prepared for large-scale emergencies or terrorist attacks;
* Joint protection of critical cross-border infrastructure, such as the Ambassador Bridge that spans the Detroit River and facilitates one-fourth of the daily $1.4 billion in trade between Canada and the United States;
* Strengthening approaches to maritime and aviation security;
* Establishing a second site for a Canada-U.S. pilot project that would check cargo and passengers before they cross the border;
* And creating a single, integrated program to allow “trusted travelers” who frequent the borders to travel quickly by air, land and sea.
NAFTA has dramatically enhanced our ability to make better use of the abundant resources of our three countries, and thus made an important contribution to economic growth within the GGNA. Over the last decade, however, our economies have faced growing challenges in increasingly competitive and globalized world markets. We need to do more to ensure that our policies provide our firms and workers with a fair and unfettered basis to meet the challenges of global competition. Unwieldy North American rules of origin, increasing congestion at our ports of entry, and regulatory differences among our three countries raise costs instead of reducing them. Trade in certain sectors—such as natural resources, agriculture, and energy—remains far from free, and disputes in these areas have been a source of disagreement among our countries. Furthermore, the NAFTA partners have been unable to resolve a number of important trade and investment disputes, which has created continuing tension in our commercial relationships. Changes in formal trade agreements will not de done. However, in other areas, notably regulatory cooperation and the expansion of transborder activities in critical sectors such as transportation and financial services, there is a shared recognition that Member Nations can and should act quickly in ways that would make a real difference in improving the competitiveness of firms and individuals in the GGNA. Shared challenge of uneven economic development. A fast lane to development is crucial for Mexico to contribute to the security of the entire region. Mexico’s development has failed to prevent deep disparities between different regions of the country, and particularly between remote regions and those better connected to international markets. Northern states have grown ten times faster than those in the center and south of the country. Lack of economic opportunity encourages unauthorized migration, and has been found to be associated with corruption, drug trafficking, violence, and human suffering. Improvements in human capital and physical infrastructure in Mexico, particularly in the center and south of the country, would knit these regions more firmly into the GGNA economy and are in the economic and security interest of all Member Nations.