Major trade bill dropped today: our statement

Here's our press release:

Public Citizen Supports Landmark Trade Expansion Legislation

TRADE Act Addresses American Public’s Demand for Change During Presidential Campaign With a New Way Forward on Trade, Globalization

WASHINGTON, D.C. -  Following a presidential primary season highlighting broad public concern about current trade policies, the Trade Reform, Accountability, Development and Employment (TRADE) Act introduced today by Sen. Sherrod Brown (D-Ohio) and Rep. Mike Michaud (D-Maine) reveals a way forward to a new trade and globalization agenda that could benefit more Americans, said Public Citizen. The bill is supported by a broad array of labor, consumer, environmental, family farm and faith groups and more than 50 House and Senate original cosponsors.

“The TRADE Act is exciting because it describes concretely new trade and globalization policies that many Americans would support and shifts the debate toward future consensus about what we are for, rather than focusing on opposition to the current model,” said Lori Wallach, director of Public Citizen’s Global Trade Watch division.

The legislation requires a review of existing trade pacts, including the North American Free Trade Agreement (NAFTA), the World Trade Organization (WTO) and other major pacts, and sets forth what must and must not be included in future trade pacts. It also provides for the renegotiation of existing trade agreements and describes the key elements of a new trade negotiating and approval mechanism to replace Fast Track that would enhance Congress’ role in the formative aspects of agreements and promote future deals that could enjoy broad support among the American public.

“Corporate interests have hijacked past trade pacts to get special protections - patent extensions that jack up drug prices, subsidies for offshoring production and more. The TRADE Act tips the scales back in balance with a trade agenda that also suits workers, the environment and everyday consumers,” said Wallach. “The special interests who pushed our current trade pacts claimed that opponents of NAFTA and WTO were anti-trade, which was never true .We invite them to show their commitment to trade expansion by supporting the TRADE Act, which will build a new American consensus in favor of trade.”

According to a May 2008 Pew Research Center poll, 48 percent of respondents believe free trade agreements are bad for the country, including 42 percent of Republicans and 52 percent of Independents. Only 35 percent of respondents consider them positive. A Wall Street Journal/NBC poll released in January 2008 found that 58 percent of Americans think “globalization has been bad … because it has subjected American companies and employees to unfair competition and cheap labor.”

These polls reflect many Americans’ negative experiences under our current trade model. Since 1975, when Fast Track was first enacted, the U.S. trade balance has shifted from a slight surplus to an unsustainable $709 billion deficit in 2007. A net 4.7 million manufacturing jobs have been lost, and while American worker productivity has doubled, American median wages are only 1 percent above 1970s levels. Since NAFTA and the WTO went into effect, an array of domestic public interest laws have been successfully attacked while imports of unsafe food and products have surged.

“Presidential primary candidates from both parties responded to the American public’s demand for trade policy change, and both leading Democratic candidates committed to renegotiating bad trade deals like NAFTA,” said Wallach. “This bill provides the specifics of what a broad array of labor, consumer, environmental, faith and family farm groups representing millions of Americans expect for a future trade agenda.”

The TRADE Act’s sponsors, Brown and Michaud, highlighted how the legislation offered specific positive trade policy solutions to the public’s concerns.

“The TRADE ACT will help Congress and the White House craft a trade agreement that benefits workers, business owners and our country. We want trade, and we want more of it,” said Brown. “The TRADE ACT is a critical first step on a new path for trade.”

Added Michaud, “The TRADE Act is a tremendous step forward in fixing our broken trade policies by setting out a new course on trade that will benefit businesses and workers in the U.S. This legislation outlines what a good trade agreement must and must not include. In this election year, with trade such a major focus of the debate, it’s important that the American people and the presidential candidates hear our message on trade. This legislation will help shape the debate on trade for years to come.”      

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Public Citizen is a national, nonprofit consumer advocacy organization based in Washington, D.C. For more information, please visit www.citizen.org.

Maine rocks fair trade

This is some great footage from the Maine Fair Trade Campaign's recent convention, with none other than our own Lori Wallach, making the case for a different trade model. Fair trade champion Rep. Mike Michaud (D-Maine) also riles up the crowd about 6 minutes in:

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."

Friday Film Fun: Caravan/Prague: The Uneasy Road to Change

Katie Clifford, Global Trade Watch intern extraordinaire, wrote up a quick blurb on Caravan/Prague: The Uneasy Road to Change. We'll leave you with this on a beautiful Washington, DC Friday afternoon:

"Caravan/Prague: The Uneasy Road to Change is a film by Zack Winestine that chronicles a bicycle caravan as it makes its way across Europe in order to shut down the annual meeting of the World Bank and IMF.

"Representative of the power for change that can result from definitive action by a small number of people, Caravan is one of many examples of people around the world taking a stand against the corporate control of global trade policies. This firsthand account is an honest and inspirational look at one groups' fight to ensure that fair trade becomes a reality."

In the meantime, you can take your own stand against corporate-dominated trade and tell your congressperson to publicly oppose the Colombia NAFTA expansion. No cross-continental bike riding necessary!

"Don't call me protectionist"

Sen. Sherrod Brown (D-Ohio), in an op-ed in the most unlikely of places, the Wall Street Journal editorial page:

We take for granted our clean air, pure food and safe drinking water. But these blessings are not by chance: They result from laws and rules about wages, health and the environment. Trade agreements with no rules to protect our health, the environment and labor rights inevitably create a race to the bottom and weaken health and safety rules for our trading partners and for our own communities.

But cheerleaders for current U.S. trade policy, while mostly shrinking from a debate about the issues that matter to middle-class America, insist that those of us who want more trade - but trade under a very different set of rules - are protectionists.

Senator Brown goes on to highlight an argument we've made many times at Eyes on Trade regarding the most damaging provisions of the Colombia FTA:

"Supporters sell [the Colombia FTA] as a free-trade agreement, a great opportunity for American companies because it eliminates tariffs on our products. If that were true, the agreement would be a few lines long. Instead, we have a trade agreement that runs nearly 1,000 pages and is chock full of giveaways and protections for drug companies, oil companies, and financial services companies, and incentives to outsource jobs now held by Americans."

Exhibit B in non-permanence of neoliberalism: IMF is dead

After the demise of Fast Track this week, Exhibit B shows again how movable the neoliberal institutions are. From the FT earlier this week:

The board of the International Monetary Fund voted on Monday to cut 15 per cent of its staff and sell about $11bn (€7bn, £5.5bn) in gold reserves in one of the biggest shake-ups of its funding since it was founded.

The IMF plan to cut 380 jobs and sell 403.3 tonnes of gold, about an eighth of its reserves, still has to be approved by other authorities...

“We think it is time to retool and move away from pure lending towards a business model that offers a group of experts to help countries adopt the right policies,” the IMF said.

You can just smell the spin when a LENDING institution claims it's going to be doing a mite less lending, and instead be a stable for otherwise unemployed experts. In fact, as friends who have worked at the IMF tell me, all of the IMF's economists are here on work visas. Some of them have been here 20 years, and have houses in Silver Spring, and kids at Sidwell Friends. If they're fired, they must go home.

But what's a deported Malawian central banking expert to do back home? Well, the Malawian central bank or government might be a good place to drop off a job application. But tragically, after 30 years of IMF structural adjustment, there isn't much of a government left to go back to. Indeed, thanks to the stunning success of the IMF at shrinking the size of developing country governments to the size where you can drown them in a bidet, neoliberal economists have made themselves unemployable.

The IMF's financial difficulties comes from the fact that it has no more borrowers. Latin Americans got peeved and created their own Bank of the South. Asians got peeved and decided to just hoard ever greater dollar reserves on their own (contributing to our own current account problems, but that's for another time.) Currently, Turkey accounts for most of the IMF's lending portfolio. As Mark Weisbrot and Erinc Yeldan showed a few years ago, this hasn't been particularly good for Turkey. And then, this happened:

Turkey's economy can withstand global economic turmoil, Economy Minister Mehmet Simsek told Reuters, to the point that a new IMF stand-by agreement is not needed and is indeed "unlikely."

Oh, well. Despite the IMF chief Dominque Strauss-Kahn''s declaration this week that "the IMF is back," it's pretty clear that it's down for the count. One down: two to go (WTO and World Bank - both are in critical condition.)

If you're in DC this weekend and would like to participate in some of the civil society events planned, the Bank Information Center has a webpage that is a great resource.

Our side's brains speak into a camera

Listen here to our friends Ha-Joon Chang and Kevin Gallagher, sharing wisdom from their new books. Thanks Tim for putting this together!

Liability in a globalized world

Much of the U.S. consumer movement has encouraged the development of punitive damages, mostly because of the massive holes in our regulatory and social safety net structure. Now, the New York Times reports that other countries are pushing back when asked to enforce U.S. punitive damage awards.

Still, as Europe rolls back its own social safety net, some European analysts are looking more favorably on the U.S. punitive damages' system as a stopgap measure to protect consumers. Ironically, U.S. courts, as reported in the article, are rolling back and limiting punitive damages claims... but with no social safety net to take its place. Seems like both continents are moving rightward, although in Europe, the frog may be getting so slowly boiled that there's less screaming about this issue. In the U.S., we may already be too boiled to tell.

Actually, we're not just moving back to a neutral place where there are no punitive damages. Through trade deals like NAFTA, corporations are actually creating systems of corporate "punitive damages" where the force of the law is used to their enrichment. Occasionally, they're claiming corporate-style punitive damages at the same time that they're using NAFTA to attack traditional pro-consumer punitive damages. From the NYT:

Foreign lawyers and judges are quick to cite particularly large American awards. Julian Lew, a barrister in London, recalled a Mississippi court’s $400 million punitive award against a Canadian company in 1995 with scorn. “It did bring America into total and utter contempt around the world,” Mr. Lew said.

The Canadian funeral home multinational, Loewen, at the bottom of this case actually used NAFTA to try to collect investor-state damages from the U.S. government for the attitude problems of the Mississippi "jury of your peers," in a case that the U.S. lost on the merits (the overall case was won on a technicality). We document the history here. Whatever one thinks of the tactics used by the Mississippi lawyers and judge, it seems like quite an overreach to make the U.S. government liable under NAFTA for these local problems that are just part of the institutional reality of this country.

Also, as we documented in our toy report, corporations are actually using offshoring as a way to limit their liability to consumers. As even the American Enterprise Institute's Doug Besharov conceded:

“[f]or many American claimants, the full enforceability of products liability laws stops at the shoreline. The situation worsens every year as imports fill more and more of the United States market... [the lack of liability creates an] artificial price advantage [that] will help [foreign producers] build market share, at the expense of United States consumers and insurers as well as competitors.”

Freedom from Progress

Unlike many of the Capitol Hill staffers on this fair Saint Patrick's Day, we did not start the morning off with an 8 am beer. So here we are, at work, trying not to let vague feelings of ancestral oppression drive us to drink. But in an effort to come up with something kitschy for the big green day, I was looking around my desk for a hook, and found one in Ed Gresser's new book Freedom from Want. (Which, has a green cover... see?)

This slim volume by the former USTR official and Baucus staffer was put out by Soft Skull Press. For those of you who were graffiti heads in the 1990s, you'll remember that this is the same press that put on William Upski Wimsatt's Bomb the Suburbs. And books by graphic novelist Seth Tobocman, and even a book about the Seattle WTO protests. Which one of these things is not like the other? I am pretty sure Gresser is the only Soft Skull author to have high end Washington think tank book readings, at the Carnegie Endowment and I believe earlier in the year at the Naval Barracks as well. A little editorially confusing, and a little strange why a mainstream publishing house wouldn't publish such an impassioned defense of status quo trade policies.

The basic premise of the book will come as a surprise to anyone who reads editorial pages or fought the Peru FTA last year: namely, that mainstream American liberals applaud the global justice movement. The fact that there is still a near-total consensus among elites in favor of our trade policy is dodged by pointing out the rare exceptions: Senator Bernie Sanders of Vermont, a random quote by Gov. Howard Dean, also of Vermont.

Gresser's mission with the book is to convince the hordes of liberals under the sadistic control of the Citizens Trade Campaign that they should instead embrace the Clinton trade legacy because, in no particular order, countries have traded since the dawn of time, unemployment is low, people in developing countries prefer manufacturing jobs to agriculture jobs, colonialism was really a period of "Victorian Globalization" and freedom, FDR liked to trade with other countries, and Ed knows a distracting amount about Chinese and Greek classic civilization.

Indeed, the book is the 2.0 version of a USTR press release: dodging the major critiques made by the global justice movement in favor of obfuscation, only with tedious historical tangents (i.e. "For two centuries China has been the shape-shifter among the powers. Like the little god Proteus in Homeric legend...") , and chatty asides about the physical appearance of Clinton-era bureaucrats (i.e. "pugnacious, white-haired Bob Cassidy with his boxing-thickened ear").

Ed's book is a useful refresher on the kinds of lines that elite Democrats use when in office, and it will be particularly useful for the many younger folks in the movement who can't remember when we had a Democratic president. Unlike elite Republicans, who tend to ignore the global justice movement's critiques altogether, elite Dems do actually make an attempt to respond, and justify their favored policies with some reference (however strained) to social justice.

So there actually is a chapter on trade and the environment that addresses environmentalists' critique of the WTO dispute settlement system. But it drags you into the weeds pretty quickly in an attempt to create doubt about what environmentalists are saying. The enviro critique doesn't have to be disproved, just rendered sufficiently questionable that an uninformed activist might say, "Oh, I guess it's pretty complicated and the truth is probably somewhere inbetween." There's also the attempt to race and class bait, and suggest that global justice advocates are somehow against the poor at home and abroad because supposedly the sweatshop movement doesn't want there to be factories in developing countries and wants U.S. consumers to pay high prices for imported shoes.

In short, counter-information will be the name of the game to the extent that the 1990s cast of characters on economic policy are revived in a Dem-run D.C. It's tougher to confront this stuff than the simple Bush-bashing and Tom Friedman-dissing than has become de rigeur over the last 8 years. Our side needs to reflect on our own thoughts about working class strategy, about democracy and participation, and about rolling back neo-liberalism in favor of a system that allows policy space at home and abroad. In short, be prepared to hear arguments in favor of child labor cast in progressive-sounding rhetoric, fight the urge to gag, do your homework, and respond as forcefully as possible!

Finally, I'll fight the urge to post some Dropkick Murphy's, and instead get as close to Irish as I'll get today: a cover of U2's excellent activist anthem Sunday Bloody Sunday by slam poet / NIN-protege Saul Williams. Enjoy!

Book Recommendation: Bad Samaritans

I'm pretty sure that I've recommended my prof Ha-Joon Chang's Bad Samaritans' book in the past, based on some advance chapters I had seen. Now that I've read the book fully through, let me double up on that recommendation and say that I think it is the finest and most accessible distillation of his ideas to date, and it's even getting grudging praise from the mainstream press. Thom Hartmann has a much longer review just published, but let me point out a few highlights:

• This is a book about globalization that you could buy for your parents. Ha-Joon is a very witty guy who has appropriated the best of Thomas Friedman's anecdote-heavy style, and turned the conclusions on their head. For instance, in a chapter on whether the poorest countries should adopt neo-liberal trade policy and compete with the big guys, Ha-Joon darkly muses on whether he would win any parenting awards by subjecting his own son to grinding labor market competition.
• The examples skew towards the U.S. and Europe, rather than more recently developed countries in Asia, which I think only makes it more accessible for the non-globe trotting audience here in the U.S. There are some great historical examples from the U.S., Europe and Japan about how the popular press and punditry hundreds of years ago (and even more recently in Japan) tried to discourage them from branching out into different production now thoroughly associated with the countries.
• He doesn't dodge some of the difficult debates in economic development, such as whether democracy is necessary for development, boldly noting that the U.S. was not a democracy in the formal sense until 1965. He also doesn't pander to the anti-corruption line, as he explains that latest neo-liberal trap. Corruption may be wrong, but it's only in certain instances that it retards development.
• Finally, Ha-Joon makes analysis of imperialism a lot less frightening to your middle-of-the-road reader. It's presented in a factual way related to power in the global economy, with all the best in British political economy as opposed to sectarian tradition (the chapter on FDI has a great line from the Keynesian economist Joan Robinson: the only thing worse than being exploited by capital is not being exploited by capital.) He also clearly exposes the parallels between the unequal treaties of the 19th century, and WTO policies today.

Labor standards do not equal rising living standards

To listen to some of the recent chatter in the presidential debate about trade policy, you would think that the only problem with NAFTA is that it didn't contain core international labor standards in the main body of the text. As we've pointed out, core labor standards are only the beginning of what needs to be fixed with the failed NAFTA model, and many labor unions think even the labor standards achieved in the Peru FTA - supported by all the top contenders for president - didn't take us to where we need to be on that issue alone.

But this debate even obscures a larger issue: that labor standards are not going to put food on anyone's plate. As our own Lori Wallach notes over at Huffington Post,

Strong labor standards are necessary, but they are not sufficient to alter trade agreements' damaging economic outcomes for Americans. Labor rights requirements in trade pacts will provide workers in trade partner countries with essential tools to organize for improved wages and conditions over many decades as part of creating a social contract that may take a century to establish, as it did in the United States. However, a future president has a duty to secure tangible gains for Americans who are losing their jobs and seeing their wages stagnate today, and who fear for their children's futures in the coming decades. That requires changing the status quo trade model by eliminating provisions that promote immediate offshoring of U.S. production and jobs. The foreign investor protections included in these agreements directly incentivize offshoring by removing the risks normally associated with relocating to low-wage developing countries.

Indeed, the *best* case scenario for labor rights in an FTA over the short-to-medium term is that there is a lawsuit brought by the U.S. government against a developing country for failure to comply with labor rights (subject to multiple and difficult to meet conditions). This could be awesome, no doubt about it, and would provoke an important debate. But lawsuits alone will not put food on the table in either the U.S. or Mexico.

How did we get into the position where labor rights became the outer horizon of the thinkable? For some insight on the question, I highly recommend this article by Robert Howse, "From Politics to Technocracy". Howse is probably more sympathetic to the overall GATT-WTO agenda that we here at EOT, which makes some of his insights all the more interesting. His read on history is that the basic trade policy infrastructure was drawn up in a time of Keynesian welfare states in developed countries, where "one simply assumed a certain toolbox of effective nontrade policy instruments, and the stability and viability of the social bargains within states as well, or at least the stability of institutions that construct and reconstruct such social bargains." In other words, many in the group assumed massive domestic redistributive interventions in the "free market" were just fine, while they should be limited in actions between governments internationally. All of this, it was thought, could be technocratically managed, if one were to restrict "politics" to the domestic sphere.

But the growth of neoliberalism in the 1970s and 1980s (which I would argue was fed by this very group of trade lawyers) decimated the ability/willingness of states to have effective domestic responses to economic problems.

Stimulating? Or, well, not so much?

As congressional leaders, the Bush administration and presidential candidates tout the stimulus plan (that probable $600 check you'll be getting in the mail to spend and thereby help the U.S. economy) they forgot one thing: nothing anyone buys here is made here. Thus, the plan may be well, less than stimulating.

Alan Tonnelson, U.S. Business and Industry Council, has much more on this in the Pittsburgh Post-Gazette. Some highlights:

• "Consumer goods are the types of purchases likeliest to be made with rebate or other stimulus dollars that are spent (as opposed to saved). Yet in 2006 -- the last year for which detailed data exists -- more than 61 cents out of every dollar Americans spent on such goods was spent on imports. In 1997, that figure was about 38 cents."
• "Failed trade policies deserve much of the blame. Starting with the North American Free Trade Agreement in 1993, too many recent U.S. trade deals have focused too tightly on helping multinational companies move jobs and production offshore, instead of opening foreign markets to U.S. made goods."
• "Americans for now may have no choice but to accept that many of the stimulus plans' benefits will leak overseas, and that near-term economic performance will be modest at very best. But it's not too early to insist that U.S. leaders start recreating the foundations for solid, healthy growth -- and stop making policy as if the global economy and the trade-related mess they created didn't exist."

So when you do your stimulus check spending, think about all the things you can buy that are made in the U.S.! Or at least try to think of one thing you can buy that is still made in the U.S...

NAFTA and WTO: job killer, or slave overseer?

Anyone who has spent time in social or political movements knows that language and slogans are often painfully fought out in overcaffeinated and excruciatingly long meetings in poorly lit rooms. When I was active in the sweatshop movement in the late 1990s / pre-9-11 2000s, the topic of discussions was whether our movement was "anti-globalization," "anti-corporate globalization," anti-Global Apartheid, "pro-people's globalization," or all or none of the above.

Immediately after 9-11, there were the long meetings about how and whether we should rhetorically connect the imminent war/invasion to the IMF/World Bank protests supposed to be happening in late September, 2001. And of course there is constant hand-wringing about the terms "free trade" and "fair trade," and what if anything any of these terms mean.

Such convos aren't really my cup of tea. If you like any of these titles, peg 'em on. But in doing the research on our most recent toy report, I got a bit of a labeling bug too, this time around whether we should call NAFTA or WTO a "job-killing" agreement:

The shift of U.S. toy production to China has been a long time in the making. 1972 was the first year that America imported Chinese toys, following President Nixon’s visit to the country.  China was first granted normal trade relations status in 1981, meaning it faced lower tariffs than a communist country would otherwise face. This status was renewed every year through 2001. By 1986, China was actively liberalizing its economy and lobbying for membership in what would become the WTO, and was rapidly expanding its U.S. toy exports. By 1991, China had overtaken Japan as the number one U.S. source of foreign-made toys. Throughout the 1990s, the Clinton administration passed nearly a dozen trade agreements with China,  which continued to edge out other countries for U.S. toy market share. By the end of the decade, China accounted for a majority of toys sold in the United States.  When Congress approved China’s WTO membership in 2000, Chinese-produced toys already accounted for nearly 57 percent of U.S. toy purchases – a figure that has increased to 74 percent (nearly $15 billion) since that time.

These facts illustrate a point we try to make regularly on this blog, that many of the industrial impacts in terms of jobs occurred as tariffs were lowered (in the GATT or preference programs for poor countries) prior to NAFTA and the WTO. So when movement folks say that NAFTA is a "job-killing agreement," they:

• are saying in a roundabout way that the U.S. trade deficit continued to increase after NAFTA, and with NAFTA countries in particular. With trade policy that either mandated balanced trade (s/t that is NAFTA and WTO-illegal) or under trade that automatically balanced due to exogenous factors, there would have been jobs in tradable sectors here that aren't here now; or
• NAFTA's (essentially) permanent reductions in tariffs and investor rights incentivized companies that wouldn't have done so otherwise to relocate production overseas, thus reducing jobs in tradable sectors that might have been here otherwise.

When most people say NAFTA is a job-killing agreement, they do NOT mean that the total number of jobs in the US somehow declined (unemployment has been fairly constant, except during the late 1990s thanks not to trade policy but to Alan Greenspan). They are making a point about jobs in TRADABLE sectors (ie. primarily manufacturing), and linking either in a macro sense to the deficit, or in a micro sense in terms of the incentives affecting individual business decisions. Indisputably, there are fewer union jobs and fewer manufacturing jobs than there used to be, and we've been in a trade imbalance scenario, so somehow that has to be explained.

So why do corporations even fight for these trade policies, if they had already offshored so much of their production prior to NAFTA and the WTO? I think the short answer is that it's an unholy alliance between a few exporters (think Caterpillar and agri-business), with a lot of industries that have already offshored production (think toys, apparel) and want to lock in duty-free access for their products coming back into the U.S. market, and with the whole of the multinational corporate lobby (esp. the services and pharmaceutical sector, but also the above) who want some insurance against progressive political change. There's no quicker way to get backdoor, international deregulation at the state, local and national levels of government than pushing these deals.

So perhaps a more apt metaphor for NAFTA rather than "job-killer" is "slave overseer" or "prison guard." The new neoliberal world order begun in the 1970s has prejudiced people both in the U.S. and abroad, and agreements like NAFTA and WTO from the 1990s and today merely serve as an enforcement apparatus to lock in and maintain this state of affairs.

The problem remains that people would probably rather see themselves as dignified workers losing a job rather than as prisoners or slaves. So, I'm taking suggestions - best metaphor wins!

Numerology, lingerie, and a half-hearted post

Dean makes a funny about numerology and David Brooks today:

David Brooks' column is full of nonsense on trade this morning. The point is to propagandize on behalf of current trade policy, which is taking a beating in popular opinion as of late. Brooks includes a wide range of factors which are somehow supposed to imply that the current trade policy is good.

Just to to take a couple of my favorites, Brooks points out from 1991 to 2007 the trade deficit grew to $818 billion from $31 billion. "Yet, .... during that time the U.S. created 28 million jobs and the unemployment rate dipped to 4.6 percent from 6.8 percent."

Let's see, according to my calculator, the sun came up 5,840 times during this period. Therefore, by Brooks logic, trade must facilitate astronomical processes. For those familiar with economic theory, the expected impact of trade would be on wages, not the number of jobs. And most workers have seen very small wage gains over this 16 year period as the bulk of the benefits of productivity growth have gone to highly-paid workers.

Brooks also cites a study by Robert Lawrence and Martin Baily that purports to show that 90 percent of the jobs lost in manufacturing are due to domestic causes. I have no idea what this is supposed to show. A trade deficit of 6 percent of GDP (now closer 5 percent) corresponds to at least 3 million lost manufacturing jobs. Does it make any difference for anything in the world how these lost jobs are divided between the loss of existing jobs or the failure to create new jobs? It certainly doesn't matter for any economic theory with which I am familiar.

Brooks also extols the fact that the people in this country have lots of kids -- that's great if you like global warming, otherwise it doesn't seem like such a great thing. Perhaps the best line is that the United States "benefits from low levels of corruption." This is probably because actions like having a CEO wreck a company, and then get a hundred million dollar severance package, are perfectly legal.

Tasini talks sweatshop lingerie:

When you slip on your Victoria Secret garb, remember this: it comes to you partly due to the wonders of so-called "free trade." And, in particular, that little Victoria Secret garment (I guess "little" is redundant in this context) may even hail from Jordan--which was supposed to be the poster child for how one forges the "right" kind of so-called "free trade" deal. But,  instead, Victoria Secret exposes the exact fallacy of so-called "free trade."

Billy Bragg takes on the corporate power mongers, in another in our series of Top 10 Best Songs About Trade:

Protectionism Killing Economy? Um, no.

CNBC asked today at 6:30 am on Squawk Box is "Protectionism Killing Economy?"

Lori Wallach, director of Public Citizen's Global Trade Watch division debated John Fund of the Wall Street Journal, but really it wasn't much of a debate.

Watch it here (if it doesn't appear via the link, search for "Lori Wallach"):

Protectionism Killing Economy?

A few of my favorite parts:

• John Fund: "[Alan Greenspan] is a pure free trader no matter what his economic analysis might lead him to say."
• John Fund: "The majority of Democrats in Congress voted for it" (note: the Dem vote was 108 supporting to 116 opposed)

Lori Wallach: "A majority opposed it actually..."

John Fund: "If you add in the Senate a majority of Congress supported it."

Lori Wallach: "They haven't voted yet. Check your facts!"

• Host: "We can't dictate the laws of these countries but we can open markets..."

Lori Wallach: "You just made my case. If these trade agreements were just about trade we wouldn't be having this debate...Have you guys read the agreement? Have you?" [silence]

U.S. Chamber of Commerce: we hate Americans

Chamber of Commerce President Thomas Donohue: "You know, when you come to immigration and trade -- I've sort of come to the point that I don't blame the politicians as much as I blame their constituents." This was regarding Fast Track's expiration and the immigration bill.

Hat tip to Alan Tonelson.

Free Traders Trying Desperately to Compete

WisBusiness.com reports today,

Free Trade Stuff launches its website and a new line of free trade-related products today. The new company, formed by three recent University of Wisconsin alums, will focus on apparel in its initial stages. The company hopes to expand its line of products to cater to consumers tired of Fair Trade rhetoric.

The company’s first two t-shirt designs include a red shirt with the slogan “tariffs are for wussies” across the chest and a white shirt with a blue hand logo and the words “You’ve been slapped by The Invisible Hand,” a reference to the work of famous economist Adam Smith.

Unfortunately for this entrepreneurial business, in Wisconsin it will be hard to find a market for anti-fair trade products where during the NAFTA/WTO era almost 100,000 manufacturing jobs alone have been lost - and outsourcing continues to climb the skill ladder.

One might say that their business model is not very competitive at least in Wisconsin or perhaps in all of the United States where during the 2006 midterm election there was overwhelming support for fair trade policies and candidates, with 37 seats flipping from NAFTA-supporters to candidates who called for a new direction on American trade policy, including the election of one of the most outspoken members of the freshman class on this issue, Rep. Steve Kagen, a Democrat from Northern Wisconsin.

PS Looking at the website each shirt is $15! Looks like a massive ripoff to me, especially when they're willing to pay the lowest price for labor that they can find anywhere in the world!

How to be a pacesetter on trade

Did anyone see the debates last night? I gotta say, after Monday's statement from the Edwards' campaign, you could really tell many of the candidates taking it to the next level on trade policy. Read Edwards' messaging from Monday, followed by other candidates' messaging from last night, and you'll see that a lot has been cribbed.

In one category of remarks were Edwards’ trade critiques that other candidates gladly also made. This includes reforming trade adjustment assistance (a perennial DC favorite), labor standards, and hiring some trade prosecutors to “enforce” the agreements on the books. Some of these are fine ideas, but they are unlikely to be either meaningfully implemented or to affect the nature of the U.S. workplace in a fundamental manner. Then there were the category of remarks on currency, tax codes and food safety, which are a little gutsier because they do challenge the corporate bottom line. But some of the candidates followed Edwards' lead on these as well.

So what was new in the debate? For me, the clearest example was Edwards' challenge of corporate power per se, which was picked up on by Obama: 

• Edwards: "NAFTA was written by insiders in all three countries, and it served their interests - not the interests of regular workers."
• Obama: "And the problem that we’ve had is, is that we’ve had corporate lobbyists, oftentimes involved in negotiating these trade agreements, but the AFL-CIO hasn’t been involved; ordinary working people have not been involved. And we’ve got to make sure that our agreements are good for everybody, because globalization right now is creating winners and losers. But the problem is, it’s the same winners and the same losers each and every time."

Obama was the only other candidate that picked up on Edwards' point. Many candidates talked about their strong support for labor legislation, picket lines and the like. But only Edwards and Obama were willing to draw those class lines, suggesting corporations are pushing for one interest in trade policy, while workers are pushing for another, and then suggesting that they would take the side of the workers.

Drinking, Dieting, Industrial Policy

As I recently noted, Ha-Joon Chang is coming out with a book very soon in the US - "Bad Samaritan: Rich Nations, Poor Policies and the threat to the developing world." The book has spawned a sharp debate over at the Financial Times over the desirability of active trade and industrial policies.

After having studied industrial policies myself, I remember being surprised to hear a presenter at the American Enterprise Institute say that "the arguments for industrial policy don't hold up to closer scrutiny." Granted, any argument for or against industrial policy has to be sensitive to local conditions (landlocked Chad is unlikely to build a successful shipbuilding industry, as Martin Wolf notes), so I didn't quite understand what the presenter was referring to... was the statement meant to discredit the boom years of Latin America in the 1960s, Korea in the 1970s, China in the 1990s? It couldn't have been to celebrate the experience of Latin America or Africa for the last quarter century - during which time practically no industrial policies were practiced (except in Chile, as I talk about here.), right?

So I have still been waiting for further clarification from orthodox economists about what is meant by this pooh-poohing of the lessons of history. Here are the arguments, summarized from the FT debate, with the quick and dirty response taken from Ha-Joon:

• Orthodoxy: Dude, industrial policy is so 19th century. Sanity: Latin America, Asian, and Scandinavian development did not happen in the 19th century, dude.
• Orthodoxy: Korea didn't use industrial policy (that's why it grew before the late 1970s), except when it did (that's why it didn't grow in the late 1970s, early 1980s). Sanity: That is so 1980s of you. Korea used industrial policy before, during, and after the period in question, and it grew the whole time, except when it didn't, and that was due to a little something called a world recession.
• Orthodoxy: Free trade is the best! But if you practice free trade and you don't grow, blame it on on some other policy. Sanity: Where are we, Middle Earth?

The whole debate is worth a read, and it is not as idiotic in tone as I have made it seem. But the days when orthodox economists could shove facts under the rug for 20 years is gone, and you can tell it's causing some growing pains. To part, here are some choice Hajoonisms:

• I feel like a man being accused of promoting a copious consumption of vodka when all I have done is to recommend moderate amount of red wine as a part of balanced diet.
• It may be possible to dismiss the US as an "exception", but if there are another two dozen countries that have to be dismissed as "exceptions", then the theory has simply too many holes (the exercise reminds me of the pre-Copernican practice of drawing "epi-circles" in order to square evidence with geo-centrism).
• I think it is wrong to dismiss one’s opponent’s theory by labelling them with negative words (‘nineteenth-century’). How would Alan feel if I described him and his colleagues as "defenders of free-trade theory that was so strongly advocated by American slave-owners and opium-trafficking British imperialists"?
• I am a man whose book recommending the Mediterranean diet has been reviewed by a well-known anti-fat dietician, who unintentionally misrepresented me as praising beneficial qualities of all fats, when I had only praised olive oil. This was bad enough, but then a few other anti-fat dieticians read the review, go into a Pavlovian reaction on seeing the word, "fat", and accuse me of promoting excessive consumption of all fats, brandishing American obesity figures and Scottish heart-attack statistics. I regretfully have come to conclusion that I was absolutely right to say what I said at the end of chapter three in the book – "Trade is simply too important for economic development to be left to free trade economists".

Fair Traders Dominate Hill's 50 Most Beautiful People

As we reported last November, fair trade is winning big - and not just in the elections. The Hill just released its fourth-annual list of the 50 Most Beautiful People on Capitol Hill. Interestingly enough, 100% of the senators and the majority of the representatives on the list are fair traders, with the most beautiful person on Capitol Hill none other than Rep. Brad Ellsworth (D-Ind., picture to the right from the DCCC), who campaigned last year with a lot of fair trade love:

Bad trade agreements and corporate giveaways are just sweetheart deals for big corporations that don’t need them.

Other notable fair traders include Rep. Heath Shuler (D-N.C.) and Sen. Sherrod Brown (D-Ohio). According to the Hill,

"Sherrod Brown’s combination of rumpled cool and passionate progressivism makes him the unsung beauty of the upper chamber...how could a woman not fall for an workers’-rights advocate who wears a pin with a canary in a cage instead of the ubiquitous American flag?"

Push the candidates farther on trade issues

We have a new action item out. Click here to take action. Here's an excerpt from our latest:

After seeing what a powerful issue fair trade was in the 2006 elections, you'd think that our failed trade and globalization policies - and how to replace them - would be a top agenda item for presidential candidates. After all, last November the Democrats picked up two House seats each in Iowa and New Hampshire with candidates running on trade.

While it's true that John Edwards and then later Hillary Clinton have come out against the proposed NAFTA expansion to South Korea, what about the NAFTA expansion deals to Peru, Panama and Colombia? What do they think about the undemocratic "Fast Track" trade negotiating process? Do they have a clear vision for how to make a clean break with NAFTA-style policies of the past? What is their plan to deal with WTO? China trade?

We need to get presidential candidates on the record now on the important trade and globalization policies with which the next President must grapple. And, with two imminent debates asking for the public to help create the questions for the candidates, now you have a chance to do so.

This comes on the same day as some interesting news reports on the Edwards campaign's plan to unveil policy proposals on trade and globalization. Jonathan Tasini has the write-up here.

Just for fun...

It's a congressional recess week, so all the action right now is in the districts. For you people in DC, here's an entertaining way to pass a few minutes: "The Fellowship of the Ring of Free Trade." (Of course, like any YouTube video, half the entertainment is in the comments.)

(There's also a "sequel" here, not available on YouTube presumably for copyright reasons...)

Deflating the $500 billion number

Since 2005, a lot of pundits have been throwing around the following number:

Harvard's Dani Rodrik, a long-standing globalization skeptic, argued recently that "closed markets may have been a fundamental problem during the 1950s and 1960s; it is hard to believe they still are." But this complacency is wrong. The Peterson Institute for International Economics calculates that the removal of remaining trade barriers would boost U.S. income by $500 billion a year. Whether or not you accept this particular number, there's no doubt further liberalization can unlock huge benefits.

As it turns out, this number is totally bogus, finds L. Josh Bivens of the Economic Policy Institute in a recent brief. Among Josh's findings:

• The mainstream estimates done by the U.S. government and World Bank -- even in their most optimistic models, and Josh runs some numbers even more "optimistic" still -- find gains from trade that are less than 5 percent of the $500 billion figure found by Peterson.
• The methodology that Peterson used "are premised overwhelmingly on the assumption that barriers to trade exist even when no explicit price or quantity restrictions on imports or foreign investment can be identified."
• Finally, rather than relying on the trade theory that has been standard for over half a century that predicts the wage stagnation of the U.S. workforce that we have (in fact) seen over the period, Peterson examines "only those workers directly displaced by trade. This group generally never shows up in most trade theories, which assume full-employment always and everywhere. Displacement, in short, while a real-world problem, is decidedly not the biggest cause of income losses due to trade and trade liberalization. Rather, the largest cost from trade is the permanent and steady drag on the wages of all American workers whose education and skills resemble those displaced by trade. Waitresses, for example, do not generally lose their jobs due to trade, but their pay suffers as workers displaced from tradeable goods industries crowd into their labor market and bid down wages. Not acknowledging these wage costs is a very good way to minimize the total debit column in the balance sheet of globalization’s impact on American workers."

Lawyers talk about outsourcing (this makes me feel dirty)

Via BusinessWeek is this gem: the IT industry folks are all over the H-1B issue, and they've produced a YouTube video (that has been viewed over 50,000 times) showing lawyers discussing how to exploit loopholes in the law to outsource jobs and save labor costs. These folks go through a step-by-step process on how to pretend to seek U.S. workers (as required by U.S. law) while actually finding any possible way to disqualify them in favor of hiring cheaper outsourced labor. Some choice quotes:

• "Our goal is clearly not to find a qualified and interested U.S. worker."
• "If necessary [to disqualify a U.S. job-seeker from the recruitment process], schedule an interview, go through the whole process, to find a legal basis to disqualify them for this particular position. In most cases, that doesn't seem to be a problem."

Just watching this YouTube clip (below) makes me want to go wash my hands. The lack of shame is amazing. I suspect this law firm will get in a bit of hot water as a result of the video, but a real fix for this problem would have to involve far more than pointing a finger at a law firm and a company or two. It would also have to address, at the very least, taking out the de facto immigration policy (in the form of, for instance, the WTO GATS' "Mode 4") in our trade agreements; and on a deeper level, the broader topic of wage arbitrage and the race to the bottom in wages and labor standards. That's the real issue, rather than the "is-it-xenophobia-or-corporate-greed? debate" that InformationWeek thinks is the relevant one.

Bono takes it personal and makes it personal

It's a little off of our general beat here at Eyes on Trade, but there's been some pretty funny coverage of an outburst by Irish rocker Bono at a recent conference on foreign aid.

When scholars at the conference rightfully pointed out that no country has ever developed on the basis of foreign aid, Bono heckled some choice words from the audience.

He went on to say: "You'd think somebody farted in here when the words 'debt relief' came up - ooh, debt relief, that's so uncool," and praised U.S. Cold War strategery in Europe, and Ireland's low taxes - a pretty funny aside, since Bono and fellow bandmates have caught flack back home for tax avoidance.

Sneaky catfishes

BNA reports (sorry, not linkable):

The Department of Justice announced June 7 the arrest of David S. Wong and David Chu for allegedly conspiring to deceive customs agents by falsely labeling catfish to be imported into the United States (United States v. Virginia Seafood Corp.,C.D. Cal.,No. 2:07-cr-00449,indictment 5/24/07).

The indictment, which was returned on May 24 by a federal grand jury in the Central District of California, charges 10 seafood companies and six individuals "for a scheme to import millions of pounds of falsely labeled Vietnamese catfish into the United States," the Justice Department said in a June 7 press release.

Between June 2004 and June 2005, Virginia Star Seafood Corp. and International Sea Products Corp. illegally imported over 10 million pounds of Vietnamese catfish falsely labeled as sole, grouper, flounder, and conger pike, according to the indictment. The indictment alleges that the seafood companies conspired to deceived Customs and Border Protection officials.

There's two ways to look at this. Economic libertarians would say that having any such labeling requirement invites this kind of attempt to evade the law. Parents of children, however, would say that we have a right to know what's going on our dinner table. Says Rep. Artur Davis (D-Ala.) summed up what many fair traders are thinking, especially after Alabama banned the sale of catfish imported from China after 14 of 20 samples tested positive for fluoroquinolones - a banned antibiotic:

Rep. Artur Davis (D-Ala.) in May sent a letter to FDA calling for tougher inspection standards for catfish imported from China. "It is alarming that only 1.3 percent of imported fish, fruit, and vegetables are currently inspected," Davis said in the letter. "The FDA, the federal agency with responsibility for the safety of 80 percent of the food supply, needs to take the lead in maintaining a rigorous, flexible, and transparent food safety process."

Growth accounting

For those who like to make simple connections between trade policy and growth, it don't get much simplisher than this:

In the first quarter, trade subtracted a full point from the G.D.P., which expanded just 0.6 percent, the slowest in more than four years. While trade has occasionally aided growth for a quarter, it has not added to a full year’s growth since 1995.

Globalization (finally) Understood

Today, the Wall Street Journal joined the ranks of Ralph Gomory and Alan Blinder with the front page story, "Globalization's Gains Come with a Price," (subscription site) admitting (possibly for the very first time) the high costs of globalization to people in the United States and around the world:

Many developing nations seem to be following in the footsteps of the U.S., where the income gap has grown sharply since the early 1970s. A 2006 study of Latin America, a region long marked by profound gaps between rich and poor, by World Bank economists Guillermo Perry and Marcelo Olarreaga found that the income divide deepened after economic liberalization in nine of the 12 countries examined.

On Jordan Standard and Bush's Corporate "wink and a nod"

Sen. Sherrod Brown (D-Ohio) was on CNN last night talking about the state of play on the Deathstar Deal, and had this to say:

I think the comment from some individual leaders in the Chamber of Commerce, National Association of Manufacturers is that they're kind of getting a wink and a nod from Secretary Schwab - the U.S. trade rep Schwab saying and perhaps Secretary Paulson saying well, these standards look good, labor will be happy, environmentalists look happy, they are good in terms of the substance. But they know they are not going to be enforced. We went through this with Jordan in 2000. Congress passed a Jordan trade agreement. It's one I voted for because it had strong labor and environmental standards. It has not been enforced and Jordan has become a sweat shop for that part of Asia. With Bangladeshi workers working there producing all kinds of apparel that ends up in our country, duty free, products of sweat shops.

The Jordan FTA is an important piece of evidence as people consider the Deathstar Deal. Consider the following:

New World Poll on International Trade

In a new poll by World Public Opinion, released in collaboration with The Chicago Council on Global Affairs that tracked attitudes of respondents in 18 countries and the Palestinian Territories, there is overwhelming support for environmental and labor standards in trade agreements.

This popular sentiment has been influential in transforming the trade debate from whether to include labor and environmental standards in trade pacts to how to include labor and environmental standards and this most recent poll proves it.

And as Bloomberg's Mark Drajem notes, (not linkable) "In the U.S., two-thirds of those polled said trade is harmful for workers' job security and 60 percent called it detrimental for job creation."

The specific questions in the poll are much more useful than standard polling questions, which really only test people's responses to corporate buzz words like "freedom" (as in free trade), rather than on the rules and effect of real world trade policy, which is anything but "free."

Obama: Making Trade Too Complex?

Yesterday, Barack Obama gave his first big foreign policy speech as a presidential candidate.

He says about trade:

We cannot negotiate trade agreements to help spur development in poor countries so long as we provide no meaningful help to working Americans burdened by the dislocations of the global economy.

This statement sounds harmless enough, but what exactly is it saying? What exactly is the connection between trade and development? The coded sentence may refer to WTO negotiations, which corporate lobbies have argued will help development in poor countries. But the civil societies of these poor countries do not agree, and the World Bank's own data (PDF) - when coupled with UN projections on government revenue losses - show that the poorest countries under the WTO's Doha "development" Round will be net losers.

And the greatest impact on U.S. workers from current trade policy is NOT those that are dislocated - actually losing their job - but on the entirety of the workforce that sees stagnant wages and rising inequality (PDF). Bob Kuttner of the American Prospect recently wrote that it would take $2 trillion to adequately retool the American social safety net to deal with trade's impact. Is that in one of Obama's position papers? We'll be waiting.

Everyone's Talking about Trade: Blog Roundup

Everyone is talking about trade these days.

Check it out:

• Trading Issues on MyDD
• Trading Questions on MyDD
• Outsourcing You on MyDD
• The Perot-Gore Debate Over NAFTA on MyDD
• Need Help Understanding Fast Track Debate on MyDD
• Globalization Won't Stop; How To Deal With It on DailyKos
• Deep-Six Trade Pacts on DailyKos
• Edwards' Big Announcement Drives Populist Wedge Between Dem Opponents & K Street on DailyKos
• Globalization Gets Martin Luther Figure on DailyKos
• Cause & Effect: The Anatomy of a Big Progressive Victory on DailyKos

In honor of Jim Jontz, fair trade hero

Jim Jontz, an indefatigable advocate for economic and social justice and the environment, was a mentor and inspiration to many. His passing is an enormous personal loss to all of those whose lives this gentle, brilliant man touched.

But, by nature of the quality of Jim's personality and what his life’s work accomplished, his mission and his values live on. As a member of Congress, Jim was an organizer extraordinaire - always providing strategy and a plan, often from a corner of the Rayburn room off the floor of the House where his allies awaited his wisdom between votes. As the first Executive Director of the Citizens Trade Campaign, the national labor, environmental, consumer, family farm and faith coalition, Jim was an organizer extraordinaire helping to visualize and then create the nation's powerful fair trade movement. As leader of several environmental organizations, Jim was an organizer extraordinaire delivering real victory for the planet and its inhabitants. In creating the Working Families Win project for Americans for Democratic Action, Jim was an organizer extraordinaire creating from scratch an impressive program that has transformed the tone of U.S. political discourse on economic and social justice issues.

Because he taught by example and mentored countless young people, he is survived by legions of those who aspire to replicate his tireless, passionate and fearless advocacy for what is right. Jim Jontz raised a "family" of advocates who join him in living Margaret Mead's proverb: Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.

Please see Jim's obituaries by the Associated Press and at the Indianapolis Star.

Corporate Lobbyists Hate Americans

Today, interesting news in CongressDaily's Balance of Payments - Trade Limbo (sorry, not linkable), a discussion of the labor standards negotiations for the pending trade agreements. In discussion of groups opposed to adding labor standards to the agreements, Martin Vaughan reports,

Several groups, including the U.S. Council for International Business and Emergency Committee for American Trade, have circulated papers outlining their objections to Democratic proposals on labor, and are making clear that they would prefer to see the trade agenda collapse than accept those demands.

Hmm, these corporate lobbyists must hate working Americans pretty bad that they would rather lose their own jobs of furthering a destructive trade agenda than allow other Americans more protections at their own jobs.

Women and Trade

More-of-the-same failed trade policies are hurting everybody, but these bad trade policies have a disproportionately negative effect on women. Not surprisingly, women's organizations are increasingly weighing in on trade issues and signing on to change the direction of trade policy (PDF).

Check out this document outlining why more-of-the-same trade policies have proven harmful, especially to women, and why Trade Is A Women's Issue (PDF).

Especially disturbing is that under agreements such as NAFTA, with their unenforceable labor provisions, basically anything is allowable (emphasis added):

NAFTA has locked in a model of unenforceable labor and human rights in the EPZs [Export Processing Zones], wherein women face such threats as on the job discrimination, sexual harassment, and violence. Women workers in many factories in Mexico have reported rampant physical abuse and sexual harassment. In addition, mandatory pregnancy testing as a condition for employment is often standard practice.

Women have a strong interest in making sure this Congress changes the direction on trade policy. This is an important opportunity for women's organizations to broaden their focus from restricted motherhood choice, sexual harassment and workplace abuse at home to participate in changing a set of policies that allow this same unfortunate discriminatory treatment abroad. Participating in the trade policy debate provides a chance to make a real difference in the lives of women all around the world.

To learn more about gender and trade, visit the International Trade and Gender Network.

U.S. foods deficit shifting political realities on trade

One of the big policy issues in debates about economic development (mostly for poor countries) surrounds the issue of food security and sovereignty. Food First and other groups have brought a lot of attention to what happens when agribusiness in both rich and poor countries undermine a country's ability to feed itself.

Believe it or not, food deficits are not just an issue for poor countries anymore. The United States too has been on the verge of an overall agricultural trade deficit (defined as most things that grow out of the earth plus animals minus lumber and fisheries) for several years - much to the contrary of the vision of America's role in the global trading system sold to U.S. farmers.

On Moustachioed Elitists

The papers are a'tizzy over the baby steps that the Bush administration is taking to rectify the China trade imbalance. Witness the Times:

"But rather than posturing, the White House would do better if it educated Americans about free trade’s benefits, which include cheaper clothes, televisions and cars, all of which hold down inflation."

This line is becoming extremely common-place in the post election season, when scores of House and Senate seats flipped to the fair trade column. Aside from the numerous factual missteps in the piece (Dean Baker schools the Times over at Beat the Press, where a lively conversation about what inputs really go into Boeing's planes is taking place), the elitism of this kind of a notion is really striking.

It recalls 19th century "crowd theory" - witness Gustave Le Bon on the French Revolution:

What does NAFTA have to do with marriage?

How often is it that NAFTA comes up in the New York Times featured weddings? Not very often. But this past week our very own Todd Tucker made it so. He is too humble to make note of it himself, but we at GTW would like to take this opportunity to draw attention to the happy occasion. Sunday Times, April 1st:

"The bridegroom, 28, is the research director of the global trade watch division of Public Citizen, specializing in the legal, economic and political consequences of trade agreements, including Nafta."

Congratulations Todd! The day will be remembered by Tuckers, Bousheys and trade wonks the world over.

Taking important steps, but no acceptable Fast Track

Trade news today focused on the Charles Rangel - Sander Levin proposal to make certain limited changes to flawed trade pacts that the Bush administration has already negotiated. You can read the some teasers on the proposal here.

GTW director Lori Wallach had some analysis of the Rangel-Levin proposal:

Trying to ameliorate the problems in a Bush trade agreement is no small task, and from what can be gleaned from the available summary of trade principles released today by Democratic Ways and Means leaders, this proposal takes important steps towards that goal by demanding changes to some of the worst aspects of the Peru and Panama Free Trade Agreements. However, it excludes several serious issues that also must be remedied in these pacts.

But so far, the full proposal being sent to the Bush administration has not been released. Although it was summarized at a Democratic Caucus meeting, Democratic lawmakers did not have an opportunity to discuss the proposal at the meeting, as the session moved quickly to other business after the presentation was concluded.

Given the level of distrust that the American public has for this White House and the passionate opposition among the Democratic base for both Fast Track and President Bush, there is no prospect the new Democratic majority would provide the president with more Fast Track authority - which means in the future there should be no need for trying to limit the damage of Bush NAFTA-style trade agreements.

We're keeping our eyes on trade and globalization policy

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