Page 1 of
3 Clock running out on free trade
By Laura Carlsen
At
literally minutes to midnight on April 1, the
United States signed a free-trade agreement (FTA)
with South Korean negotiators and rushed it to
Congress. Congress now has until June 30 to review
the South Korea, Peru, Colombia and Panama
agreements before fast-track authority expires.
Anyway you look at it, the clock is
running out on free trade agreements.
The
four agreements go to a new Congress controlled by
the
Democrats, many of whom ran
on anti-free trade platforms. The Democrats have
called for new standards on labor and environment,
and increased job retraining programs for US
workers. Democratic Representative Charles Rangel
of the Ways and Means Committee heralded the
proposal, stating: "We are on the brink of
restoring bipartisanship to American trade
policy." The administration hopes to build
bipartisan support for its own aggressive trade
agenda, but is offering few real concessions so
far. Considerable distance exists between the two
proposals.
The last major deal, the
Central American Free Trade Agreement, squeaked
through by only two votes in July 2005. In recent
years, the on-the-ground costs of free trade have
been increasingly evident to workers in both the
United States and in FTA countries abroad.
Practical experience with plant closures, eroding
wages and benefits, anti-union practices, and
unemployment have led to a strong rejection of
free trade agreements among the US public.
A NBCNews/Wall Street Journal nationwide
poll in March 2007 showed that 46% of those
surveyed believed FTAs had hurt the country while
only 28% believed they had helped. Other polls
show even greater disapproval. The November
elections gave a mandate to the new Congress to
fix trade policy and free itself from the thrall
of the multinational corporations that are the
consistent winners under these policies.
But so far, the response of the Bush
administration and organizations like the World
Bank to the failure and consequent unpopularity of
free trade agreements has been to change the
language and the justifications while leaving
untouched the basic tenets. The Peru and Colombia
deals are now called "trade promotion agreements"
rather than free trade agreements, and "free
trade" has been downplayed or routinely coupled
with "fair trade" in Bushian discourse.
None of this represents any real change in
course. The agreements continue to be drawn up
according to the North American Free Trade
Agreement (NAFTA) template, and the administration
and organized business interests vehemently resist
any substantial change in the model.
The need for a FTA freeze As
the Bush administration hustled to present the
FTAs before the congressional deadline, the
Democrats were already working on the
counterthrust. "A New Trade Policy for America"
sets out a number of palliative measures but falls
short of defining a coherent new trade policy.
It is not surprising that Democrats have
been unable to come up with an alternative trade
policy. As the most experienced critics of the
current model freely admit, no one is prepared to
offer such an overarching plan. However, elements
have been identified that can make trade more fair
and sustainable. Some of them have been
incorporated into the Democrats' proposal - sort
of.
On labor, the outline presented to the
public calls to "enforce basic international labor
standards". It does not specifically refer to the
International Labor Organization's (ILO) eight
core human-rights conventions, which cover child
labor, forced labor, discrimination and freedom of
association. Of course, there's a problem in
requiring trade partners to adhere to ILO
standards. The United States itself has one of the
worst ratification records in the world. Of the
eight, it has only ratified two.
The
Democrats' proposal also refers to using the "same
dispute settlement" mechanisms. These mechanisms
are practically unenforceable. Under the labor
side agreement of NAFTA, the number of labor
violations sanctioned in 13 years comes to a grand
total of zero. Needless to say, this is not
because there have been no trade-related labor
rights violations in the United States, Canada, or
Mexico since 1994.
The proposal also calls
for free-trade agreements that would "re-establish
a fair balance between promoting access to
medicines and protecting pharmaceutical
innovation" and require adherence to multilateral
environmental agreements, among other changes in
the current model. All these intentions are
laudable but fail to deal with the root cause of
the problem - the FTA model itself.
Free
trade agreements forged in the NAFTA mold have
failed to show their usefulness in raising general
standards of living at home and within partner
countries. At the very least, the US public and
policymakers deserve comprehensive studies on the
results of these agreements before extending them.
But such studies simply do not exist.
Reports issued by the Office of the US Trade
Representative, whose job it is to promote the
model, evaluate solely in terms of "significant
barriers to US trade and investment and the broad
array of US actions to reduce and eliminate those
barriers". This approach reflects the view of the
administration that freer trade has only benefits
and no costs. This view has been belied by actual
experience in every single country where these
agreements have been applied, including the US.
Studies by Congress and the US Government
Accountability Office have been partial, outdated
or in some cases simply ignored.
Of the
studies that do exist, most of them are negative.
Even the World Bank study of 10 years of NAFTA
begrudgingly admitted that results in Mexico were
disappointing. The report cites "big events and
little time" as the cause for NAFTA's poor
performance: events disrupted predictions, and
there was not
Head
Office: Unit B, 16/F, Li Dong Building, No. 9 Li Yuen Street East,
Central, Hong Kong Thailand Bureau:
11/13 Petchkasem Road, Hua Hin, Prachuab Kirikhan, Thailand 77110
