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  • Eyes on Trade is a blog by the staff of Public Citizen's Global Trade Watch (GTW) division. GTW aims to promote democracy by challenging corporate globalization, arguing that the current globalization model is neither a random inevitability nor "free trade." Eyes on Trade is a space for interested parties to share information about globalization and trade issues, and in particular for us to share our watchdogging insights with you! GTW director Lori Wallach's initial post explains it all.

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May 30, 2008

Book Recommendation: Evil Hour in Colombia

Ever since we've started working on Colombia, I've been looking for a good single volume history of modern Colombian history. I read Marco Palacios' "Between Legitimacy and Violence," which reads a lot like many Latin American history texts assigned in college, with a lot of emphasis put on an CEPAL-like analysis of import and export trends shaping the political economy.

But for a great single volume at just over 100 pages that is up-to-date that will help you understand what you read in the newspaper, it doesn't get much better than Forrest Hylton's 2006 book, "Evil Hour in Colombia." It briskly surveys the 19th and early 20th century, but the bulk of the book is dedicated to the post-Violencia (1946) history, or the period that Colombia has been at civil war.

Evilhourincolombia Importantly, Hylton also shows how the paramilitary "demobilization" and the decline in killings and displacements in recent years are not the result of things getting better in Colombia, but rather of a more consolidated criminal control of the state apparatus. In other words, put Tony Soprano in charge of a government, and you'll have a criminally-enforced "peace." (As James Vega shows in a piece for The Democratic Strategist, such tactics can often just postpone more civil war.)

There are some shortcomings of the book, mostly having to do with the length. Some characters and their importance aren't explored in great detail. For insance, while Hylton sets out to correct the shortcoming of other histories that "give short shrift to radical popular movements," key moments in popular history like the struggle to create a unified Afro-Colombian movement in the 1980s through today, are scarcely mentioned. But these defects are more than made up for by the brilliant synthesis of material related to civil-military-narcotrafficker relations.

May 29, 2008

Who will play that funky music in our electoral future?

(Disclosure: Global Trade Watch has no preference among the candidates.)

We don't get into election analysis here beyond the trade issue. But a couple of months ago, my hometown pride swelled as the extra long primary season took candidates into parts of the country like my home Kentucky that rarely figure into national politics.

That was a few months ago. Given the way things have turned out in Appalachian states, however, I now hear the daily quips about from East Coast "liberal" friends, acquaintances and "fr-enemies" that range B00000drbv01lzzzzzzz_2 from ridicule to vitriol about the "backwater's" 15 minutes of fame. There has been a "discovery of the other among us" - the white working class (WWC) - as I get to hear any number of jokes about incest and hicks. Some politicos are choosing to pathologize the WWC, while some suggest than even the whiteys know not the full depth of backwardness that is within them. (And, btw, all the candidates need to leave the amateur sociology to the pros.)

Some of the more sophisticated analysts have taken to asking whether the WWC is even needed for electoral purposes anymore. Alan Abramowitz and Ruy Teixeira have written a paper entitled "The Decline of the White Working Class and the Rise of a Mass Upper Middle Class." This is a useful companion piece to Ruy's 2000 book with Joel Rogers entitled "America's Forgotten Majority: Why the White Working Class Still Matters." They look at the work of Larry Bartels and Thomas Frank, and offer some commentary on an emerging GOP strategy to attract WWC voters authored by Ross Douthat and Reihan Salam. Among the main findings of the more recent paper:

Continue reading "Who will play that funky music in our electoral future?" »

Your baby should put poison in her mouth

... or at least that's the message from the Bush administration this week, according to Inside U.S. Trade:

The Bush Administration sent a letter to House and Senate conferees on the Consumer Product Safety Commission (CPSC) reform bill, H.R. 4040, raising some new objections to both bills but also repeating its long-standing objections to many aspects of the Senate bill....

Image_preview The administration objects to Section 44 of the Senate bill, which it said would cause complaints from trading partners. According to the letter, this part of the bill requires CPSC to prohibit toy imports from manufacturers with a “persistent pattern” of producing toys with substantial safety hazards, while there is no such similar measure taken for domestic manufacturers in the same circumstances. Within the World Trade Organization, members have committed to subjecting imports to the same treatment as domestic products.

The administration also has similar objections to Section 38c of the Senate bill, which allows imports to be refused at the border if they fail to meet inspection and record keeping requirements.

These sections “could prompt complaints from U.S. trading partners and could encourage trading partners to adopt similarly restrictive measures against U.S. exports,” the letter states.

The insidious thing about WTO rules is that 1) they give neoliberal governments the excuse of the neoliberal straightjacket to refuse to take action; and 2) they actually prohibit common sense approaches to policy problems.

For instance, in this case, there's a lot we don't make anymore in these here states, not least of which is toys, as we showed in last year's report. What we do make here, gets multiple levels of regulation. We only have one bite at the apple, so to speak, when it comes to imports. It would make sense for regulators to be able to take action at the border, but instead are subjected to bizarre standards to subject non-existent domestic toy-makers to an additional level of regulatory scrutiny from what they already face (which is not high enough, but is many times higher than what imports face along the supply chain from China).

May 28, 2008

Bhagwati channels Dean Baker on immigration

I knew this day would come. My friend and former boss Dean Baker has been taunting the neoliberals to embrace his idea of free trade in health care and immigration. This was good politics, so long as no neoliberals did so. It served to show their hypocrisy for subjecting steelworkers to unrelenting low-wage competition, while not opening up the immigration floodgates to low-wage doctors. It also showed that our trade policy is not a random inevitability, but structured by real people to benefit real favored interests at the expense of others.

The problem with the strategy is that neoliberals have actually long been much warmer to this idea than Dean let on. As early as the 1970s, corporate lobbyists were trying to figure out ways to put immigration and social services under emerging neoliberal institutions. By 1994, the Clinton administration offered up health insurance and our H-1B visa programs to WTO General Agreement on Trade in Services coverage. And as our report shows, this move by Clinton has hurt the prospects for his wife's health care package.

Many corporate lobbyists (and some WTO nations) want to create a GATS visa that would put the whole of U.S. immigration policy under WTO jurisdiction. This pretty much the gist of the Bhagwati and Madan piece in the WSJ that Dean praised today:

Mode 4 concerns doctors and other medical providers going where the patients are. It offers substantial cost savings, since the earnings of foreign doctors are typically lower than those of comparable suppliers in the U.S.

Now, while it may be interesting to think about the economics of liberalizing immigration, it is something altogether different to think about the constitutionality and institutional aspects of doing so through the WTO. We've found that those in favor of more...

The WTO has no mandate to negotiate migration policy, nor should it... We reject the guest worker model, which inevitably ties migrant workers' right to stay and work in a country to employment with a specific employer, making them vulnerable to extensive abuse that sometimes borders on indentured servitude and undermines domestic and international labor standards.

...and of less immigration...

A WTO-imposed guest-worker scheme would be even more devastating as the global bureaucrats would have sanctioning ability to force our submission to their sovereignty-destroying whims.

...prefer to duke it out on the national stage, where with power comes accountability, rather than at the WTO, where there is no popular accountability. I hope that Dean will clarify that he means he is for free trade for professionals in theory, not in WTO practice.

May 22, 2008

Book Recommendation: How to Rule the World

Mark Engler, a writer for Foreign Policy in Focus and bunch of other good guys, has a book out through Nation Books called "How to Rule the World: The Coming Battle Over the Global Economy." I can't recommend it highly enough.

Large Mark is a long time global justice activist and commentator who understands better than most the evolution of the movement during the Bush years. His book is in some ways a version of Jeff Faux's The Global Class War for a newer generation. (I'll review Jeff's book sometime soon too.) Whereas Jeff all but dismisses the global justice movement that arose in Seattle, Mark takes the movement as his principal political orientation.

The book challenges activists to think about the divisions within the ruling class, particularly in between what Mark terms neoliberal and imperial globalists. The first are represented by Bill Clinton, and the latter by George W. Bush. He counters leftists who suggest that the people behind the war and the WTO are the same unitary block or driven by the same logic. By pointing to Wall Street opposition to the war, and false arguments about "blood for oil," he shows this not to be the case.

He counsels us to avoid getting to a point of such extreme but understandable frustuation with Bush's war that we gladly swallow a snapback to Clintonian neoliberalism. While Mark doesn't provide a blueprint of how to do that, he talks about ways that the 3 poles of resistance - World Social Forum-style eclecticism, NGO incremental reformism, and state takeover - are responding and could be going even further. And he gives some due credit to the debt relief movement, which has been making impressive accomplishments in recent years... even under Bush.

This is required reading for anyone grappling with what mass-based collective action will look like in a post-Bush era.

Poker and peas

Our lawsuit against the govament is getting some traction in the poker world. According to Poker News:

Public Citizen contends that President George W. Bush's administration is illegally withholding details of its agreement with the European Union, which gives the European Union access to more business sectors in the United States as compensation for the country closing off its borders to online gambling...

They aren't the only ones concerned with the details of the trade concessions. Representatives Barney Frank (D-Mass.) and Ron Paul (R-Texas) joined forces in late March to send a letter to U.S. Trade Representative Susan Schwab requesting the information be released as well.   

Another gaming site asks:

Personally, I find it interesting that Public Citizen would find this issue so important. If anything they appear to be against the WTO and globalization in general, but they apparently hate secret trade agreements even more. Politics makes for strange bedfellows, but at this point, we'll take any help we can get to keep this issue in the news.

Yep, Public Citizen is first and foremost a good government group. Once we get some transparency and democracy, we can haggle over what's good policy. And of course by our count, the WTO has been awful for public interest legislation, with U.S. public interest policies rules against 5 out of 5 times (the global figures are 28 out of 30).

In other news, is CAFTA leading to food smuggling of unsafe peas? Here's the Miami Herald:

Redland fresh-produce importer Fresh King used fake importers, false invoices and rigged lab tests to evade a pesticide alert on imported [Guatemalan] peas, according to a recently revealed federal grand-jury indictment...

Mary Bottari, director of the Harmonization Project at Public Citizen's Global Trade Watch, said voluntary food safety testing was ''totally subject to abuse'' because there were no accreditation standards for the labs and no requirement that the results be sent to the FDA.

''The issue of how these folks can currently buy their own laboratory is one of the single most important things being discussed on Capitol Hill with regards to food safety,'' Bottari said.

Canadian NAFTA leak shake-up

Looks like NAFTA just contributed to one more job loss...

Ian Brodie, Prime Minister Stephen Harper's chief of staff, is expected to leave the Prime Minister's Office this summer, signalling a shake-up in time for a fall election...

Sources said Mr. Brodie made the decision before the delivery of a report looking into leaks of information regarding the North American free-trade agreement, which influenced the Democratic primary race in the United States. ...

It was later alleged that Mr. Brodie told reporters during the news media lockup for the Feb. 26 budget that Ms. Clinton's campaign had reassured Canadian diplomats that her tough talk on NAFTA was just posturing, although that wasn't what was subsequently reported. Mr. Harper appointed Kevin Lynch, the Clerk of the Privy Council, to conduct an internal investigation into the matter.

May 21, 2008

Oregonians Bring The Pain to the Death Squads

The Oregon Fair Trade Campaign rallies outside of the office of Rep. Darlene Hooley (D-Ore.), who has yet to take a position the Death Free Trade Agreement (aka Colombia FTA).

America's backyard gets a carraige house

Military dude plus trade lady plus Julie Sweig (and others) have put out a new Council on Foreign Relations task force report saying that it's time for the U.S. to move past a trade obsessed focus in our dealings with Latin America, and that the Monroe Doctrine is dead. Here's a key clip:

The Task Force finds that trade... and development aid have not and cannot alone lead to sufficient reductions in poverty and economic inequality in Latin America. The growth of the informal sector, while often successful in increasing incomes for the poor, undermines the economic base of Latin American countries and the effectiveness of state institutions, which are critical in addressing the region’s fundamental challenges.

At the same time, you don't get former USTR Charlene Barshefksy to sign off on your task force without the obligatory hail marys at the FTA altar:

The United States should also approve pending free trade agreements with Colombia and Panama. Free trade remains an important policy tool for expanding economic opportunities in the region and the United States. Rejection of these agreements would severely damage close allies, send a negative signal to other countries in the region, give rise to the view that the United States is an unreliable partner, and strengthen countries in the region that espouse anti-Americanism.

Oh yeah, and trade is responsible for the stellar growth in Latin America, which, wait, wasn't so stellar. Can we say that if something good happened it was because of trade, but if something bad happened, trade had nothing to do with it? As a leading presidential aspirant might say, "yes, we can."

May 19, 2008

Public Citizen sues the U.S.

We wrote before that the United States has claimed that the details of the compensation deal made in exchange for the U.S. withdrawing the gambling sector from WTO commitments are "classified in the interest of national security." That seems pretty ludicrous, no? Ludicrous enough, in fact, that Public Citizen, through our Litigation Group, are suing to force the Bush administration to make the details public.

Read our full press release here; here's an excerpt:

The Bush administration is illegally withholding the details of its offer accepted by the European Union to bind more sectors of the U.S. economy to World Trade Organization (WTO) jurisdiction as part of a settlement relating to a WTO ruling against the U.S. ban on Internet gambling, Public Citizen contended today in a lawsuit filed in the U.S. District Court for the District of Columbia.

...The USTR claims the settlement is classified and cannot be released as a matter of national security. Public Citizen is representing journalist Ed Brayton, who filed a FOIA request for the compensation deal. The USTR denied Brayton’s request and his administrative appeal, contending that the settlement was properly classified in the interest of national security.

...The suit asks the court to find that the USTR is illegally withholding the settlement agreement and to order the agency to provide Brayton a copy of the agreement.

How to break a strike

Advocates of NAFTA argued that they pact would help keep consumer prices low and move the economy towards a more efficient allocation of resources. Just one serious drawback: such permanent tariff reductions remove political uncertainty from firms' cost-benefit calculation. Put differently, the price attached to risk was reduced. And manipulating risk levels is one of the few weapons that the working class has to gain concessions from the rich: think strikes, for instance.      

When firms can be certain that they will never have to pay tariffs on the reimportation of their products produced offshore, strikes matter a wee bit less, as this story over the weekend from the NYT summed up:

The auto industry’s longest strike in more than 40 years, a walkout at a parts supplier that disrupted production at 32 General Motors plants, will end within days if the picketing workers ratify a tentative agreement reached late Friday with their employer, American Axle and Manufacturing....

People involved in the negotiations have said they expect the agreement to call for closing two or three plants, offering buyouts worth as much as $140,000, and drastically reducing the wages and benefits of workers who remain with the company...

American Axle has said it needs to cut wages nearly in half, from about $28 an hour to as little as $14, to remain competitive with rivals that have squeezed similar concessions from the U.A.W. During the strike, the company threatened to permanently close the plants where workers were picketing and shift work to Mexico instead.

This is capping off nearly 15 years of NAFTA being used to break labor's back. Our friend Kate Bronfenbrenner did a study for the North American Commission on Labor Cooperation showing that after passage of NAFTA, as many as 62 percent of U.S. union drives faced employer threats to relocate abroad, and the factory shut-down rate following successful union certifications tripled. Such defeats provide the institutional backdrop to a generation of wage stagnation and corporate takeover of government.

May 16, 2008

Linda Sanchez v. Bart Simpson

Fair trade champion Rep. Linda Sanchez (D-Calif.) is pushing a bill that would grant U.S. consumers and states greater power to serve legal papers on foreign manufacturers that sell defective products in the U.S. market. As we documented last year, foreign producers can rarely be held liable for damages they cause U.S. consumers, a reality not helped by WTO rules and that has promoted offshoring of U.S. jobs and importation of unsafe products. As Ed Mierzwinski from PIRG put it in his testimony for Sanchez's subcommittee (also on our behalf):

By making it easier to hold foreign wrongdoers accountable, your bill would help consumers gain access to justice and also help equalize pressure on U.S. firms that may bear unequal treatment under our laws.

Of course, your bill importantly does not eliminate any responsibility or liability for U.S. manufacturers, importers, distributors, or retailers. It simply makes it easier for consumers to obtain redress from foreign manufacturers. All wrongdoers should always be held accountable.

Bartsimpsongeneratorphpmj8_2 Last year, for example, Mattel used what I call the Bart Simpson defense (“I wasn’t there, I didn’t do it, and it’s not my fault”) when it initially blamed a third-party Chinese supplier for failing to follow its lead paint requirements on a toy that was later recalled.8 Mattel, of course, under the Consumer Product Safety Act and the Federal Hazardous Substances Act, violated U.S. law by entering the banned hazardous substance into U.S. commerce. It trusted, but failed to verify. Mattel would still face liability even if one of its third-party foreign suppliers also did under your act...

Unfortunately, globalization has provided too many firms in the global supply chain with the wrong incentives: they want to cut corners, they want the cheapest supplier, they don’t do third party testing and they use cheaper, dangerous chemicals instead of safe ones. This has placed consumers worldwide at risk. By strengthening U.S. product safety laws and strengthening the ability of U.S. consumers to seek redress from more wrongdoers, actions by U.S. policymakers can benefit all consumers worldwide, since it will ultimately be more efficient for manufacturers and retailers to supply everyone to meet U.S. levels of safety rather than face U.S. levels of liability.

Who you calling fatty, fatty?

Indian officials and analysts had some choice words for President Bush (and the US of A) this week, quoted in the NYT, after the U.S. government seemed to blame India for the increase in global food prices:

Pradeep S. Mehta, secretary general of the center for international trade, economics and the environment of CUTS International, an independent research institute based here, said that if Americans slimmed down to the weight of middle-class Indians, “many hungry people in sub-Saharan Africa would find food on their plates.”

Fatboys He added, archly, that the money spent in the United States on liposuction to get rid of fat from excess consumption could be funneled to feed famine victims...

In response to [Bush's] remarks, a ranking official in the commerce ministry, Jairam Ramesh, told the Press Trust of India, “George Bush has never been known for his knowledge of economics,” and the remarks proved again how “comprehensively wrong” he is...

Indians from the prime minister’s office on down frequently point out that per capita, India uses far lower quantities of commodities and pollutes far less than nations in the West, particularly the United States.

As humorous and undiplomatic as some of these exchanges might be, they obscure the underlying cause of the current food crisis: the erosion of food sovereignty and managed food systems by decades of neoliberalism, the WTO in particular. As our friends at the University of Tennessee documented in their groundbreaking synthesis of farm policy from a few years ago:

WTO promotes policy choices that rely on the assumption that some “invisible hand” in agricultural markets will move the sector -- prices, supply, demand, income, structure, distribution, and the works -- to a higher plane if left to the devices of the free market.

Ending today's crisis must become the most urgent mandate of those who write the rules governing domestic and international agriculture and trade policy. The way out lies not in more of the same but in a balanced application of policy measures left discarded in our headlong rush to an imagined “free market” in agriculture.

Farmer prosperity in the U.S. and the developing world is not only possible, it is achievable. It can be ours at less cost and within a shorter time span than the hoped-for benefits of liberalized agricultural trade promised by the wealthy nations of the world to their developing country counterparts. The choice is ours to make: whose future will be protected, and what kind of global food system will be the outcome of U.S. agricultural policy?

May 14, 2008

Miss.-1: Another Fair Trade Victory

It's been quite a year in Mississippi politics. First, Sen. Trent Lott (R-Miss.) left the Senate to become a lobbyist. Then, Rep. Roger Wicker (R-Miss.) was elevated to his seat. Both Lott and Wicker are dedicated foes of fair trade, voting wrong on over a dozen pieces of legislation each.

Now, fair trader Travis Childers (D) has taken that open seat by a nearly ten point margin. As John Nichols reports, Childers campaigned heavily on a "no more NAFTAs" platform. He follows on the impressive net fair trade additions of Bill Foster (D-Ill.) and Don Cazayoux (D-La.).

Some of you may remember in Nov. 2006, how we tallied 30 net fair trade additions to House's membership. Well, it is with some excitement that I say we have now surpassed that to reach 31. How does the math work out? Well, 2 supposed fair traders flaked on us - Reps. Nick Lampson (D-Texas) and Tim Mahoney (D-Fla.). These two voted against fair trade on both the Peru FTA (Nov. 2007) and Fast Track cancellation (April 2008). In Mahoney's case, it was particularly bad, since he campaigned strongly against CAFTA in the seat left by Mark Foley, who occasionally voted with fair traders (on Fast Track, for instance). So the victories of Childers, Cazayoux and Foster bring us to 31.

May 13, 2008

Corporate takeover of everything department

And the food crisis roils on, thanks to NAFTA and WTO's neoliberalization of the food supply. Mexican farmers continue to be displaced in the wake of NAFTA:

“We migrate because we don’t think there are options,” Mr. León said. “The important thing is to give options for a better life.”

Viewed against the backdrop of rising food prices in a global marketplace, Mr. León’s fight to keep farmers from abandoning their land is much more than a refusal to give up a millennial way of life.

As Mexico imports more corn from the United States, the country’s reliance on outside supplies is drawing protests among nationalists, farmers’ groups and leftist critics of Mexico’s free trade economy. Earlier this year, as the last tariffs to corn imports were lifted under the North American Free Trade Agreement, farmers’ groups marched against the accord in Mexico, asking for more aid.

And the few that made it across the border are now getting slammed by ICE stings. And has anybody noticed that the destruction of Mexico's traditional economy and import substitution schemes have not led the way to more efficiency, but greater instances of narcotrafficking and narcoterrorism? I mean, seriously, we seem close to having a failed state on our borders.

In other news, apparently the Supreme Court is so taken over with corporate concerns that they can't even hear international human rights cases any more, most recently in the case of apartheid in South Africa. And though it's not directly trade related, I thought this piece on the Senate compromising on banning menthol cigarettes showed an outrageous form of health and environmental racism:

Menthol is particularly controversial because public health authorities have worried about its health effects on African-Americans. Nearly 75 percent of black smokers use menthol brands, compared with only about one in four white smokers.

That is why one former public health official says the legislation’s menthol exemption is a “cave-in to the industry,” an opinion shared by some other public health advocates.

“I think we can say definitively that menthol induces smoking in the African-American community and subsequently serves as a direct link to African-American death and disease,” said the former official, Robert G. Robinson, who retired two years ago as an associate director in the office of smoking and health at the Centers for Disease Control and Prevention.

McCain self censors from telling Americans what polls say they want to hear

Pew Center has a new poll out in response to this question (hat tip to Deborah James for the link):

In general, do you think that free trade agreements—like NAFTA, and the policies of the World Trade Organization—have been a good thing or a bad thing for the United States?

Bad thing: 48%

Good thing: 35%

In other news, Sen. John McCain (R-Ariz.) has come out in favor of punitive tariffs on climate change laggards, but according to the NYT:

In the prepared text of his speech, e-mailed to reporters on Sunday night and Monday morning, Mr. McCain went so far as to call for punitive tariffs against China and India if they evaded international standards on emissions, but he omitted the threat in his delivered remarks. Aides said he had decided to soften his language because he thought he could be misinterpreted as being opposed to free trade, a central tenet of his campaign and Republican orthodoxy.

As we noted a couple of months ago, McCain's (and Obama's and Clinton's) climate change policies are seriously limited by his beloved "free trade" deals.

May 12, 2008

Standing tall

Here's what's hot:

May 09, 2008

WTO gets all up in our safety

When will it stop? First, the WTO was used as an excuse to not pass a tough toy and product safety bill - now, it's been used to block Democratic legislation to have firms that export food and drugs to the U.S. market pay registration fees. According to Inside U.S. Trade, the Europeans are raising a fuss over new legislation by Rep. John Dingell (D-Mich.):

Dingell’s bill opens the door to the FDA accrediting a foreign government to certify the safety of its domestic food facilities, which is similar to the EU system. But it goes much further than EU law in terms of requirements and products covered. While the EU requires safety certification for only designated high risk foods, Dingell’s bill would require every food facility to be certified by either an accredited government or private certifier in order to avoid a 100 percent testing requirement and stringent port restrictions (Inside U.S. Trade, April 25).

On the new fees proposed in the draft bill, the [European Commission] questioned whether they complied with the U.S. WTO obligation that any fee charged should not be higher than the cost of services provided. Dingell’s draft would charge importers a $10,000 annual registration fee, as it would certified labs, and all food facilities would have to pay a $2,000 registration fee.

The commission acknowledged that the EU charges importers fees under EU Regulation 882/2004, but does not do it in the blanket way of the Dingell bill. Instead, fees are charged in proportion to the size of an import shipment, and different weight thresholds are charged at different rates. This mitigates the charges on small businesses, sources said. [emphasis added]

The WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS) in Annex C, paragraph 1f states that any fees imposed on imported products should be equitable to fees charged on domestic like products and “should be no higher than the actual cost of the service.” GATT VIII, paragraph 1a, states that all fees “shall be limited in amount to the approximate cost of services rendered.”

I'll be doing a review of Jamie Galbraith's new book "The Predator State" sometime shortly, but he raises a good point in the book about the necessity of standard-setting in the fight against neoliberalism. The corporate ideologue's strategy in legislative battles like the one Dingell is involved in is to first fight the bill, then if that fails, ensure that no standard is set at all by carving out as many companies ("small" businesses, foreign companies) as possible, and then make the method of calculation practically impossible to administer. What are we left with once the carving is done? It's certainly not a standard in the historic consumer movement sense of the term.

May 07, 2008

The End of Francis Fukuyama?

Interesting piece in the FT on the role of trade in the elections:

Two months ago most analysts discounted the bulk of the anti-trade rhetoric coming from the Democratic presidential race as easy to wriggle out of. But as the race has got tighter and the economy has become an even greater concern to voters, Barack Obama and Hillary Clinton have become steadily more specific in their pledges...

“The specificity is unprecedented. The longer this process goes on, the more promises these candidates make,” says Christopher Wenk, senior director for international policy at the US Chamber of Commerce, which has been lobbying for further trade liberalisation. “Hopefully . . . they can wiggle their way out.”...

Francis Fukuyama, author of The End of History, which many took as a lodestar of the Clintonite 1990s, says the two candidates are only giving voice to much deeper shifts in US political attitudes during the past few years.

“There is a structural change going on,” he says. “American politics goes through generational swings and most of the electorate believes the pendulum has swung too far in a laissez-faire direction in the last two decades. No successful candidate can ignore that.”

N.C.-3: Another fair trade victory

In North Carolina's 3rd district, fair trade leader Rep. Walter Jones (R-N.C.) held off a primary challenge by a margin of 20 points - a decisive victory for the fair trade, anti-war Republican. Rep. Andre Carson (D-Ind.) in Indiana's 7th district - who took the seat a few months back in a special election and voted for fair trade on the Fast Track resolution - also emerged victorious.

In other news, the AFL-CIO has filed a complaint under CAFTA about labor abuses in Guatemala. This article by Mark Drajem in Bloomberg also touched on Colombia issues...      

The complaint says four union leaders or their family members have been killed this year, and many others have had death threats. Also, workers who attempt to join a union, bargain or strike are often fired, it said...

Proponents say approving the agreement with Colombia would give the U.S. a new mechanism to improve labor rights in the South American nation. The AFL-CIO, which opposes the deal, argues that once the accord is approved, Colombia would have no incentive to continue to protect labor leaders.    

``Once they take that vote, the pressure is off,'' Lee said. ``In fact, that seems to be what happened in Guatemala.''   

Also, Nick Kozloff has an interesting piece in Counterpunch on the Colombia FTA and Afro-Colombians.

May 05, 2008

La.-6: Another fair trade election victory

Don Cazayoux, the Democrat who just won the Louisiana-6 House seat long held by the GOP, campaigned and won on a fair trade platform. Here's what he told the Daily King Fish:

I support fair trade agreements that raise labor standards for all workers - both here in the United States and abroad - while ensuring that American businesses remain competitive. I will vote to close tax loopholes that reward companies for moving our jobs overseas. I oppose the Colombian Free Trade Agreement in its current form and believe that we need to renegotiate CAFTA and NAFTA to include more protections for our workers.

Cazayoux takes the open seat vacated by Rep. Richard Baker (R-La.), who voted against fair trade on 18 out of 18 votes in his 22 years in Congress, including NAFTA, WTO, Peru FTA, and CAFTA (which even many GOP in La. opposed, including now-Gov. Bobby Jindal, who William Kristol says might be McCain's running mate).

UPDATE: Special elections this cycle have been good for fair traders. And as we documented back in March, fair trader Rep. Bill Foster (D-Ill.) took Denny Hastert's seat. Foster ran paid ads on trade. Also, fair traders were able to keep several more seats that were opened up through the special elections of Reps. Andre Carson (D-Ind.), Laura Richardson (D-Calif.), Jackie Speier (D-Calif.), and Niki Tsongas (D-Mass.). This crew all voted for fair trade in the Fast Track cancellation vote in April.

Turns Out Americans Don't Like Our Current Trade Policy, Says a New Poll

The poll points out what many observers already know. From the first presidential contest in Iowa to early state battles in South Carolina and Wisconsin to Tuesday's approaching primaries in Indiana and North Carolina, trade has and continues to play a dominant role. This follows a 2006 election when 37 congressional challengers calling for a change to our status quo trade policies replaced NAFTA-supporting incumbents.

(Disclosure: Global Trade Watch has no preference among the candidates.)

May 02, 2008

Redundant trade, Larry Summers, NAFTA

This piece in the Times featured an issue that we will be doing a report on soon: redundant trade.

Cod caught off Norway is shipped to China to be turned into filets, then shipped back to Norway for sale. Argentine lemons fill supermarket shelves on the Citrus Coast of Spain, as local lemons rot on the ground. Half of Europe’s peas are grown and packaged in Kenya...

Increasingly efficient global transport networks make it practical to bring food before it spoils from distant places where labor costs are lower. And the penetration of mega-markets in nations from China to Mexico with supply and distribution chains that gird the globe — like Wal-Mart, Carrefour and Tesco — has accelerated the trend.

But the movable feast comes at a cost: pollution — especially carbon dioxide, the main global warming gas — from transporting the food.

Under longstanding trade agreements, fuel for international freight carried by sea and air is not taxed. Now, many economists, environmental advocates and politicians say it is time to make shippers and shoppers pay for the pollution, through taxes or other measures.

“We’re shifting goods around the world in a way that looks really bizarre,” said Paul Watkiss, an Oxford University economist who wrote a recent European Union report on food imports.

He noted that Britain, for example, imports — and exports — 15,000 tons of waffles a year, and similarly exchanges 20 tons of bottled water with Australia. More important, Mr. Watkiss said, “we are not paying the environmental cost of all that travel.”

Larry Summers had a must-read piece in the FT:

growth in the global economy encourages the development of stateless elites whose allegiance is to global economic success and their own prosperity rather than the interests of the nation where they are headquartered. As one prominent chief executive put it in Davos this year: “We will be fine however America does but I hope for its sake that it will cut taxes and reduce regulation and put more pressure on young people to study in the ways that are necessary for it to be able to keep competing successfully.”

The chief executive was sincere and he captured an important truth. Even as globalisation increases inequality and insecurity, it is constantly and often legitimately invoked as an argument against the viability of progressive taxation, support for labour unions, strong regulation and substantial production of public goods that mitigate its adverse impacts.

In a world where Americans can legitimately doubt whether the success of the global economy is good for them, it will be increasingly difficult to mobilise support for economic internationalism.

And Lori makes a point in the WSJ that a lotta folks have been missing:

Regardless of the ebb and flow of concern over free trade, some globalization critics say the dangers to the accord are real.

Next year's North American summit would be "an opportune time for a President Obama or a President Clinton to follow through on their pledge to renegotiate," said Lori Wallach, director of Public Citizen's Global Trade Watch division. She said either leader would be "under enormous pressure to make some changes in those agreements," in part because of the potential impact on domestic-policy priorities such as addressing climate change or the health-care crisis.

"The real issue that could threaten [Nafta] isn't politics, but the agreement's actual outcomes," not just for workers in the U.S. but also in Mexico in particular, she said. "People don't have a problem with trade -- it's this version of the rules."

Inglis and CAFTA 30 still feeling the pain

Rep. Bob Inglis (R-S.C.) was one of the CAFTA 30 - the most unlikely reps to vote for CAFTA back in the summer of 2005 by one vote. We predicted that these members would be hearing about their vote for a long time.

We turned out to be right. The Spartanburg Herald-Journal reports that Inglis has a primary challenger who is bringing up the CAFTA issue:

Energy, high gas prices and the future of fuel highlighted the first debate between Republican Rep. Bob Inglis and his primary challenger, Charles Jeter, Wednesday night at the University of South Carolina Upstate...

Jeter also criticized Inglis for supporting the Central American Free Trade Agreement, or CAFTA, saying such a policy was responsible for draining Upstate jobs.

In other news, the Bush administration has failed to live up to its promise of supporting Alabama's sock industry after getting Rep. Bob Aderholt (R-Ala.) to vote for CAFTA on that basis. This week, they announced a safeguard on Honduran socks, several years later and at a lower rate and for a shorter time period than promised.

Forward motion on debt and the IMF

I'm just getting back from vacay, but there's a few things I wanted to drag out of my email backlog and share.

First, in case you hadn't heard, the Jubilee Act passed the House. This is a major victory for the global justice movement, as it not only expands debt cancellation  for 24 additional impoverished countries, but also rolls back some of the conditionality that has been used to turn developing countries into basketcases.  The vote was 285-132, with many GOP joining the vast majority of the Dems in passing the legislation (only Reps. Jason Altmire (D-Pa.), Chris Carney (D-Pa.), Brad Ellsworth (D-Ind.), Kirsten Gillibrand (D-N.Y.), Nick Lampson (D-Texas) and Gene Taylor (D-Miss.) among Dems voted no - the first 5/6 are freshmen!)

I recently asked some friends who work on IMF issues to rebut the statement: "The IMF is dead." A few have responded. Mark Weisbrot also had a good column in the LA Times talking about how the IMF is dying, but is still not dead yet:

The collapse of the IMF creditors cartel has been a huge blow to U.S. influence. It was most pronounced in Latin America, where most of a region that used to be referred to as the United States' "backyard" is now governed by states that are more independent of Washington than Europe is.

The problem is that poorer developing countries, especially in Africa, remain dependent on foreign aid from the IMF (and the World Bank and other sources) to fund their basic budget and import needs. This can be harmful to their development and their people. In recent years, the IMF -- insisting that such measures are necessary to hold down inflation -- has imposed conditions that limit their public spending and, according to the fund's own internal evaluation, have prevented these countries from spending aid money on urgent needs, such as healthcare and education.

These countries need to join the rest of the developing world in breaking free of the IMF's policy conditions. The U.S. Congress may consider legislation that would pressure the IMF to use some of its huge gold reserves for debt cancellation and to limit the IMF's control over policy in poor countries. These would be important steps forward for the world's poor.

Our bud Rob Weissman had a similar piece at Huffington Post:

Although the Fund has promised that it would reform the way it imposes conditions on poor countries, a new report from Eurodad, the European Network on Debt and Development, finds that, over the last six years, IMF conditions have not changed in number or kind.

One thing has changed, however. Impressed by the IMF's repeated failures, middle-income countries have paid back their loans to the Fund, and are not taking out any news ones.

This in turn has two consequences. For now, at least, the IMF has lost its hold over most middle-income countries -- but it maintains its iron grip on the world's poorest countries. And, the Fund is experiencing a financial crunch of its own. It had depended on the interest payments from middle-income countries to support its budget.

Developing countries are not shedding tears over the IMF's financial distress. "At long last, the IMF is experiencing first hand serious budget cuts," says Cheikh Tidiane Dieye of Environment and Development in Africa (ENDA), based in Senegal. "The poetic justice of this is palpable. In Senegal, the IMF has mandated budget cuts for years. As a result, we have been unable to invest in health care, education and other essential services. If the IMF's loss of financial power is accompanied by a loss in political power, this could be good news for all Africans."

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