Congress Passes Buy America in Stimulus

On votes of 246-183 in the House and 60-38 in the Senate, Congress passed the biggest economic stimulus package of all time, which included Buy America provisions. The Washington Post has a truly touching story about how fair-trade champion Sen. Sherrod Brown (D-Ohio) flew from his mother's memorial service to cast the deciding vote. Our hearts and prayers go out to Sen. Brown and his family.

Here's the final version of the language:

    Sec. 1605. Use of American Iron, Steel, and Manufactured Goods. (a) None of the funds appropriated or otherwise made available by this Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron, steel, and manufactured goods used in the project are produced in the United States.

    (b) Subsection (a) shall not apply in any case or category of cases in which the head of the Federal department or agency involved finds that--

    (1) applying subsection (a) would be inconsistent with the public interest;

    (2) iron, steel, and the relevant manufactured goods are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality; or

    (3) inclusion of iron, steel, and manufactured goods produced in the United States will increase the cost of the overall project by more than 25 percent.

    (c) If the head of a Federal department or agency determines that it is necessary to waive the application of subsection (a) based on a finding under subsection (b), the head of the department or agency shall publish in the Federal Register a detailed written justification as to why the provision is being waived.

    (d) This section shall be applied in a manner consistent with United States obligations under international agreements.

The conferees' report made the following note regarding Buy America provisions:

Section 1605 provides for the use of American iron, steel and manufactured goods, except in certain instances. Section 1605(d) is not intended to repeal by implication the President's authority under Title III of the Trade Agreements Act of 1979. The conferees anticipate that the Administration will rely on the authority under 19 U.S.C. 2511(b) to the extent necessary to comply with U.S. obligations under the WTO Agreement on Government Procurement and under U.S. free trade agreements and so that section 1605 will not apply to least developed countries to the same extent that it does not apply to the parties to those international agreements. The conferees also note that waiver authority under section 2511(b)(2) has not been used.

It seems that this last sentence refers to the president's ability to waive Buy America requirements for countries that aren't parties to procurement agreements with the U.S. (i.e. Brazil, India, China, for starters.) It's actually fairly troubling that the president has so much discretion in these matters in the first place. The history of this power is that Congress, in 1979 on a fast-tracked vote, decided to waive much of its authority over procurement, handing it to the president, who could then waive the requirements to comply with flawed trade deals. Clearly, this whole system - born as it was of a kind of double delegation of legislative powers - needs a major rethink.

In other news, our colleagues Terry Stewart and Elizabeth Drake put out a useful paper debunking some of the myths surrounding Buy America perpetrated by corporate-backed think-tanks. It's chock full of useful material. Here is something I did not know:

Myth #5: Insisting on the use of domestic goods will reduce the effectiveness of the recovery plan by imposing unreasonable requirements where U.S. goods are unavailable or prohibitively expensive.33

The Facts: This assertion ignores the language of the recovery bills and U.S. experience applying similar provisions in the past. First, both the House and Senate versions of the Act allow domestic sourcing requirements to be waived where the relevant goods “are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality.”34 This waiver provision is also included in the Buy American Act,35 and data relied upon by Hufbauer and Schott indicate that such non-availability waivers were necessary to permit foreign sourcing for only 0.29 percent of all federal contract dollars spent in 2007.36

Moreover, the House and Senate bills permit domestic sourcing requirements to be waived where their application would increase the cost of the overall project by more than 25 percent.37 The 25 percent threshold reflects cost competitiveness standards that currently apply in Buy America requirements attached to federal highway and mass transit funds.38 Similar cost waivers are available for direct federal contracting under the Buy American Act, though they have been set at different levels administratively.39 Such cost waivers were needed to justify 0.20 percent of the federal government’s spending on foreign manufactures for domestic use in 2007 – a mere 0.01 percent of all federal contracting dollars spent.40

Clearly, unavailability and cost differences present obstacles to domestic purchasing in only a tiny portion of contracts, and, where such issues do arise, procurement officials are able to use their waiver authority to address them. The same will be true under the economic recovery plan.
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Saskia Sassen on monarchism; me on good books

Saskia Sassen has a fascinating piece on how the current era of globalization has increased executive power at the expense of Congress and democratic deliberation more generally. What will this mean for Obama?

The development of a global corporate economy has further strengthened the executive branch and weakened the legislative. This process started long before the second Bush administration and cuts across political parties. It began in the 1980s, when the current globalization phase took off, and has continued since...

A question appropriate for this week In fact, economic globalization has had its own autonomous effect in sharpening executive power and in weakening the legislature. This is separate from questions of national security and abuses of executive privilege. It will take more to stop this consolidation of power than having an administration that does not abuse its executive power and that would eliminate the Patriot Act, though this would certainly make a difference...

A new president genuinely willing to respect the balance of power and willing to cancel the Patriot Act will still be in a structural position of growing power in today’s liberal state. A hollowed-out Congress confined to domestic matters weakens the political capacity of citizens to demand accountability from an increasingly powerful and globally oriented executive. Today, the liberal state produces its own democratic deficit.

There is an ironic possibility in all of this. Can a president intent on fighting for a better and more just democracy actually use that expanded executive power to do this?

Also, for those of you interested in some good book recommendations, check out my essay on David Rothkopf, Ha-Joon Chang and Mark Engler's latest over at the Dissent website. The conclusion seems appropriate for this week of change:

THIS OCTOBER, the International Monetary Fund (IMF) and World Bank meetings came to Washington, and, as they do every year, an impassioned bunch of activists mounted protests, decrying the neoliberal agenda that has deregulated markets, pitted worker against worker, and devastated local communities and the environment.

The difference this time around was that, in the wake of the most significant financial meltdown of our times, the bankers were echoing the protestors’ calls for re-regulation. Indeed, as the number of people protesting the global institutions has shrunk since September 11, 2001, the mainstream acceptance of their basic critiques has swelled...

As economic conditions worsen, there will be a bevy of rich individuals and governments attempting to claim the reform mantle as their own. The WTO, IMF, and World Bank are already attempting to reposition themselves as the ideal brokers for solutions to the climate, finance, and food-price crises—despite their role in creating or exacerbating them. Decades of political marginalization have left too many progressives too timid to lay out their alternative visions in a meaningful policy form. If they fail to do so now, the current “told you so” moment will be sweet but short.
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Fair-Trade Champions Moving On Up

The latest addition to the House Ways and Means Committee is none other than beloved Rep. Linda Sanchez (D-Calif.), the former Teamster and co-founder of the House Trade Working Group. She voted the fair-trade position 100% of the time, including on WTO withdrawal, Fast Track cancellation, and NAFTA expansion to Chile, Singapore, Australia, Morocco, Central America, Bahrain, Oman and Peru.

Other fair traders elevated to Ways & Means include Reps. Danny Davis (D-Ill.), Brian Higgins (D-N.Y.) and John Yarmuth (D-Ky.), who have virtually identical records to Sanchez for the period that each has been in office.

And let's not forget Obama's labor secretary nominee, Rep. Hilda Solis (D-Calif.), who also has been a consistent fair trade champion.

Unfortunately, Baucus' Senate Finance Committee went the other way, adding arch anti-fair traders Sens. Tom Carper (D-Del.) and Bill Nelson (D-Fla.) to the makeup. Additionally, Sen. Bob Menendez (D-N.J.) - who has voted the fair-trade position on 9/18 votes - was added to the committee.

Read Sanchez and Solis' floor statements on the NAFTA expansion to Peru after the jump.

Continue reading "Fair-Trade Champions Moving On Up " »

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Ron Kirk tapped as next USTR

President-elect Obama today announced Ron Kirk as his U.S. Trade Representative, something that's been percolating around the news and blogs for a couple days now. Here's our statement on this appointment:

Ron Kirk Selected to Deliver on President-elect Obama’s Campaign Pledge to Reform U.S. Trade Policies

Ron kirk

Whether Ron Kirk is a good choice for trade representative will be determined by his ability to deliver on President-elect Obama's pledges to the American public to create a new trade and globalization policy that benefits more Americans.

As a past supporter of the North American Free Trade Agreement (NAFTA) and China Permanent Normal Trade Relations (PNTR), Kirk will face close scrutiny as he assumes the responsibility for delivering on Obama's pledges to fix existing trade agreements and create a new trade policy that benefits more people. Kirk's vocal opposition to Fast Track during his 2002 U.S. Senate race puts him in line with the majority view in Congress and positions him well to deliver on Obama's campaign pledge to replace Fast Track with a process that provides a greater role for Congress to ensure that American trade agreements promote the public interest.

Whatever Kirk's past views on various trade policies, his future course of action must reflect the powerful expectations for change created by Obama's trade reform pledges. His actions must also reflect the new political realities created by congressional elections that resulted in 71 House and Senate supporters of the trade status quo being replaced by those who were elected campaigning for a new approach. Scores of Democrats and Republicans used attacks on NAFTA and China PNTR to win elections nationwide this year and these candidates and the Democratic House and Senate campaign committees featured more than 140 television ads criticizing the trade status quo.

Continue reading "Ron Kirk tapped as next USTR" »

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Becerra: Trade Not an Obama Priority

Rep. Xavier Becerra (D-Calif) has reportedly turned down the Obama USTR job. According to Politico:

The California Democrat – the first high-profile figure to reject an Obama job offer – says he turned down the U.S. trade representative gig because he was concerned that trade would not be a big priority in the new administration...

Becerra told the Spanish-language newspaper La Opinion he had concluded that trade “would not be priority number one, perhaps not even two or three,” according to a loose translation of his remarks, adding that, “To do this job well, it would be necessary to travel a lot ... and also I have a family.”

As we document in a new report "Closing Santa's Sweatshop", the USTR - along with agencies like the Consumer Product Safety Commission, responsible for safety of imported toys - has a lot to tackle in the coming years. This includes renegotiating existing trade deals like NAFTA and the WTO to create policy space for product safety and climate reform.

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Becerra Roundup

Obama's courting of Rep. Xavier Becerra (D-Calif.) for USTR continues. Here's a news round up.

Here's Mark Landler from the NYT:

If President-elect Barack Obama appoints Representative Xavier Becerra, Democrat of California, as his chief trade negotiator, it would punch several political tickets at once for Mr. Obama.

Mr. Becerra, who has emerged as the leading candidate to become United States trade representative in the Obama administration, is known as a defender of workers’ rights and as a skeptic of trade agreements. That would please union backers of Mr. Obama, who spoke in the campaign about reopening the North American Free Trade Agreement...

Trade experts said the appointment of Mr. Becerra would suggest that Mr. Obama intended to make good on his campaign pledges to hold existing and new trade deals to tougher scrutiny.

Mr. Becerra, who entered Congress in 1992 and serves a district in Los Angeles, voted in favor of Nafta but now says he regrets it. In 2005, he helped lead the Democratic opposition to the Central American Free Trade Agreement, emerging as an impassioned voice for the rights of workers. The deal passed the House by two votes...

Some analysts suggested that choosing Mr. Becerra would be a gesture to Mr. Obama’s Democratic base after a series of economic appointments — Timothy F. Geithner as Treasury secretary and Lawrence H. Summers as a top White House adviser — that were viewed as sympathetic to business.

“We’re comfortable with it,” said Thea M. Lee, public policy director of the A.F.L.-C.I.O. “President-elect Obama has signaled that he wants trade policy to go in a different direction. The choice of Congressman Becerra indicates that he is going to hold trade policy to a high standard.”

And David Sirota over at Open Left:

Beccera hasn't accepted yet, but if he does, my initial reaction is that this is a solid choice. No, it's not perfect - Beccera voted for the landmark China PNTR deal in 2000 and for the Peru Free Trade Agreement. But perfect shouldn't be the enemy of the damn good.

Getting a U.S. Trade Representative who is on record against the NAFTA trade model and with votes against CAFTA and Oman is a huge change from both the Bush administration and the Clinton administration. And it's not just a good pick because it's a change from really bad Trade Representatives, the selection itself is good - and way, way, way better than what it could have been. The selection suggests Obama is serious about reforming our trade policies, and it should be applauded.

Here's John Nichols in the Nation:

Becerra has a long history of engagement with trade debates. That made it particularly significant when, in 2006, he announced that "it has become very obvious that our system for devising trade agreements, so very important to this country's functioning around the world, has not only broken, but it has broken completely."

Becerra is not a resolute fair-trader like Ohio Senator Sherrod Brown, Vermont Senator Bernie Sanders or Ohio Representative Marcy Kaptur. Like Obama, he's a mixed bag who will still need to be prodded by activists, especially as new debates about trade in services evolve. Becerra backed NAFTA as a House freshman, and has voted for several other trade deals. He has since acknowledged, however, that he was wrong to support schemes that may increase commerce but tend to concentrate "the benefits of that commerce in the hands of very few." That's encouraging. Even more encouraging is the fact that since his election to the House in 1992, Becerra has consistently opposed the "fast-track" model for negotiating trade agreements. When Congress grants fast-track authority to a president, it cedes to the trade representative most of its ability to shape policy, retaining only the right to accept or reject a final agreement. If Obama and Becerra simply develop a new approach to negotiating trade agreements, one that involves consultation with Congress, it will be much more likely that labor, consumer and human rights concerns will be addressed.

It is on those human rights issues that Becerra has been a particularly strong player in recent years. The Congressman delivered a national Spanish-language radio address last spring in which he defended the Democratic rejection of Bush's proposed Colombia free trade agreement on the grounds that, "Colombia still remains a dangerous place for those who advocate for worker rights. More than 2,500 labor leaders have been assassinated in Colombia since 1986. What would we say if labor leaders were being assassinated in our country every day, just for standing up for their rights as workers? That is what is happening in Colombia today." The message Becerra delivered was radically at odds with that of Republican and DLC free-traders. If he keeps delivering it as trade representative--along with other fair-trade themes he has articulated--Becerra could become the face of the change in trade policies that Obama promised, and that working people here and abroad can believe in.

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Rep. Becerra Offered Trade Representative Post

This just in...

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Team Obama Making the Rounds on Trade

According to the Politico, Team Obama is making the rounds on trade:

Officials in charge of the policy area for his transition team have done extensive outreach to all stakeholders, including labor, business, trade skeptics and the centrist New Democrats.

Democratic constituencies that have been loudly critical of the Bush administration’s trade policy, and its treatment of them along the way, are praising Obama’s listening tour.

“We’re very pleased to see their willingness to reach out to the diverse group within the Democratic caucus as well as other interest groups that are interested in the trade issue, compared to what we were used to under the Bush administration, [which was] just plugging forward without talking to anyone, Republicans or Democrats,” said Rep. Michael H. Michaud (D-Maine), who is one of the leaders of the House Trade Working Group who opposes the Bush trade agenda.

Victoria McGrane reports that Dan Tarullo and Lael Brainard (of Georgetown U and Brookings Institution, respectively, and also the Clinton administration) are among the top rumored picks for USTR, along with Reps. Adam Smith (D-Wash.) and former Rep. Jim Davis (D-Fla.).

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Diaz-Balart skewers NAFTA with song (old)

I was digging around recently in our archives, and I came across this gem that I thought I would share. It's a 1993 floor statement by Rep. Lincoln Diaz-Balart (R-Fla.), who was once a fair trader, and voted against NAFTA, WTO, China PNTR and several times against Fast Track. But that was back in the Clinton years, when the oppo was in charge. Under Bush, he's been an ardent anti-fair trader, voting wrong on each of the 12 votes during that time period. But we can always remember, can't we Linc?   

SAY `NO' TO NAFTA -- (BY LOWELL J. REYNERTSON) (Extension of Remarks - October 19, 1993)
[Page: E2473]
HON. LINCOLN DIAZ-BALART in the House of Representatives

Mr. DIAZ-BALART. Mr. Speaker, I rise today to share with you a song written by one of myLincoln_db constituents, Mr. Lowell J. Reynertson, that warns us of some of the evils of the North American Free-Trade Agreement. I would like to commend Mr. Reynertson for his efforts and clever lyrics. Mr. Reynertson played this song at a recent town meeting in my district and I want to share it with the rest of the House of Representatives.

Shout from the rafta, SAY NO TO NAFTA, for it will send all U.S. workers down the drain.
Why do we hafta, still get the shafta, to pull this off I guess they think we have no brain.
Let's ram this NAFTA, right up their afta, the mandate vote to change our ills is still our aim.
If we pass NAFTA, we must be dafta, which means the lobbying of beggars still remain.
We're not as stupid as we look, we know when we are being took,
most heard it said I'm not a crook, it's time we played things by the book.
Our nations debt would go away, if living wages we'd OK,
so that in comfort all could stay, and income taxes gladly pay.
There'll be no lafta until here afta, if all these grafta NAFTA draftas get their say.
Let's stand united and not be slighted, and we can send these trouble-makers on their way.
We've gorged the greedy, ignored the needy, which has resulted in our buying power shot.
For change indeedy with mouths to feedy, we must awaken all the powers that we've got.
Let's make the people understand, a living wage all could demand.
If we would unionize this land, then everything would be so grand.
Let's put this country on a roll, and not get deeper in the hole.
There's far too many on the dole, so decent jobs would be our goal.
We'd be productive, and not corruptive, if opportunities existed as before,
But if we hafta, put up with NAFTA, then all the hopes and dreams we made would be no more.
But should this grafta, stick us with NAFTA, then we must tax-exempt all U.S. goods we make.
Restore these taxes, by raising taxes, on those that sold out all good labor by their take.
We know that then we must compete, impossible would be this feat.
Without our way of life deplete, from NAFTA's draftas sly deceit.
So if our servants sell us out, their days are numbered, few will doubt.
We'll rise and shout, you've made your clout, is mainly what this song's about.

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Loser Tells us How to Run the Country

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

Hey, remember that guy named Mark Penn? Yeah, he worked for the paramilitary-linked government of Colombia to help pass a NAFTA expansion to that country, while at the same time running a presidential campaign of someone who opposed that pact. Hey, how did that work out for that particular consultant, and that particular candidate?

Gee, I can't remember back that far. But he sounds like the kinda guy I want to take advice from. Here's what Marky Mark wrote in Politico today:

Much of today’s gridlock problems are the fault of President Bush, who in his 2000 campaign pledged to defuse partisanship but who, upon entering the White House, pushed it as far as it could go at every turn. Virtually every initiative that would have required the common-sense center to coalesce has collapsed. ... Trade and global economic policy are also a mess because the center could not win out.

And yet, freed from the constraints of the left and the right, and under the right leadership, there is a vital center waiting to enact all of these measures. If Obama wins the presidency, it will fall to him to put together coalitions that would earn congressional support. Yet even the likelihood of expanded Democratic congressional majorities does not ensure success. After all, during his first two years in office, President Bill Clinton enjoyed Democratic majorities in the House and Senate, but conservatives succeeded in 1994 by portraying his first two years as surrender to liberal big government.

During President Clinton’s next six years in office, working with Republican congressional majorities, he achieved partial immigration reform, welfare reform, a balanced budget and significant increases to the minimum wage. While some on the left denigrate these achievements as triangulation, it was actually a centrist government molded by the left and right pulls of Clinton and Republican leaders such as House Speaker Newt Gingrich and Senate Majority Leader Trent Lott, each bound by what centrists in both parties would be willing to pass.

This brings us back to the bailout. Solving this immediate economic crisis is just a first step. America needs reform of energy policy, entitlements, immigration and health care, to name just a few pressing national problems, if it is going to remain competitive with the rest of the world in the 21st century. Free and fair trade represent further challenges.

The nation’s center could probably find solutions to all of these problems pretty quickly.

Ow, mom. This historical revisionism stuff hurts! Didn't that Bill Clinton administration Mark is talking so fondly about LOSE its congressional majorities after pushing NAFTA instead of health care? And, heChe_founding_father y, wait, didn't the Bush administration Clinton go almost its entire two terms without any Fast Track trade authority because people just didn't trust him on trade?

Most people would say something is centrist if it serves the interest and matches the view of the median voter / citizen. Folks, I don't know how many polls, and more polls, and research papers have to be published before establishment elites start realizing that a centrist position on trade is a fair-trade position. I guess when you're gunning for the Colombian gunners, your sample gets a bit skewed.

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Thoughts on Bailout Vote

In no particular order...

Bomb_2 Wall Street might have needed a bailout, and it's conceivable that the Paulson-Dodd-Frank approach was the right one. But this case has to be made by credible people who can distill the problem into soundbytes. There are very few people in the leadership of either party that have such credibility: remember that the Republicans spent years crying that trade agreements with Central America and Oman were vital to U.S. economic prosperity, and many in Democratic leadership spent much of 2007 arguing the same for the NAFTA expansion to Peru.

Now, as the economy tumbles around us, we've got folks in Congress who only want to talk about NAFTA expansion to countries like Panama. You can only cry wolf so many times before you lose all credibility. History will not judge kindly those policymakers who spent the last few years wasting political capital and legislative time pushing ridiculous FTAs with small, poor countries instead of dealing with the housing and financial crises. And as Sirota points out, answering basic questions in a non-fearmongering fashion should be a basic prerequisite for allocating 5% of our national income.

Most consistent fair traders voted against the bailout. But there were consistent anti-fair traders like Rep. Henry Cuellar (D-Texas) who opposed, while very serious fair traders like Rep. Phil Hare (D-Ill.) voted for it. Here's his statement. Nevertheless, with (mostly) left and (mostly) right uniting in shared opposition to the package, you had a bit of an uprising dynamic. As John Nichols writes,

They do not usually unite--although it has happened a few times in recent years on trade votes. And they do not usually hold together in the face of whipping--not to mention outright bribery--by party leaders... on Monday, urged on by two of the Capitol's more consistent dissenters, California Republican Darrell Issa and Ohio Democrat Marcy Kaptur--who developed something of a rogue coalition to whip the "no" votes--the outsiders briefly became the bosses of Capitol Hill."

Financial deregulation and trade are not separate issues: in fact, they're closely linked, since NAFTA and the WTO- style pacts have been used to further tear apart financial safety nets. Bill Clinton, when he failed to get Congress to approve Glass-Steagall repeal in 1998, had his trade team make a WTO commitment to repeal it. If it hadn't been repealed in 1999 by Gramm-Leach-Bliley, the United States would have been in violation of our WTO service-sector commitments, and could have faced trade sanctions. Similarly, backers of the Peru FTA from last year gave Citigroup more tools to lock in that country's failed social-security privatization. Going forward, there may be any number of trade pact blocks on the reregulation of the financial sector. More on this later...

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Trade battles on the big screen at national conventions

If the presumptive presidential contenders and their advisors have still not figured out - ahem - the political costs of surrendering to so-called "free trade" policies of the NAFTA/WTO variety against the interest of, well, almost everybody, they might be surprised to find some people getting a little riled up about the issue at convention time: delegates to both the Democratic National Convention (August 25-28 in Denver) and the Republican National Convention (September 1-4 in St Paul) will be treated to a "sneak peak" viewing of the latest Hollywood indie extravaganza...

Stuart Townsend's Battle in Seattle won't open for another month for the rest of us (September 19th and 26th in select cities across the country), but thanks to the folks behind the Impact Film Festival, convention delegates will get an inspiring (and timely) look-in on a rocking film set in Seattle during the WTO protests.

With a star-studded cast (Charlize Theron, Woody Harrelson, Andre-3000, Ray Liotta, Michelle Rodriguez and more), everyone will want to see the story of the 5-day uprising that forced the collapse of the WTO's 1999 Seattle ministerial. The film is sort of like Crash, following the lives of twelve characters during those historic days. Woody plays a cop – no kidding. So does Tatum Channing. Andre Henderson and Michelle Rodriquez are protestors. One of the most powerful "people's" moments in recent U.S. history never looked so beautiful.

Maybe a trip down that particular 'memory lane', to the days when more than 50,000 union members (voters!), environmentalists (also voters!), students (read: youth voters!) and more converged in Seattle to speak truth to power in the face of the world's biggest corporations - and their Washington DC pundits - will keep the politicians just a little more honest when they talk about the looming trade issues of our time?

For the rest of us, now is the time to start booking those advance tickets for the Battle in Seattle showings closer to home. The film will be opening:

  • September 19:   New York, San Francisco and Seattle (of course!)
  • September 26:   Atlanta, Boston, Chicago, Detroit, Los Angeles, Minneapolis, Sacramento and Washington, DC.                        

Groups of 25 or more receive discount tickets. To find a theater near you call 866-758-1258 or visit

To organize an event around the film's release, contact Michael Crawford at 202-546-4996 or

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The Punditocracy: Speaking for the Wretched of the Earth

For those of us who get dizzy listening to the circular logic of the paragons of Punditocracy (especially of the capital P variety), Roger Bybee's (Fairness and Accuracy in Reporting) excellent historical round-up of Fareed Zakaria's noxious views on trade and globalization issues offers a welcome breath of cold, clean facts  after some pretty serious doses of post-Doha death vertigo from the 'powers that be'...

Fareed Zakaria, now the highly influential editor of Newsweek International, author of The Post-American World, and host of Fareed Zakaria GPS, constructed a landmark of unintended irony when he regally pronounced that “the downtrodden beg to differ” with protesters of corporate globalization (Foreign Affairs, 12/13/99).

Those who demonstrated against the World Trade Organization at the famous “battle of Seattle” in 1999, he asserted, were displaying the hubris of the “rich and privileged,” who were delivering “a familiar plea for the downtrodden of the world” by challenging the WTO’s promotion of sweatshops and environmental degradation in the impoverished Third World.

In other words, Zakaria denounced the arrogance of those who presume to advocate for the world’s poor—while appointing himself, the son of a prominent Indian attorney and politician, as the poor’s spokesperson. “There’s just one problem: The downtrodden beg to differ,” Zakaria declared.

In his eyes, the Third World’s poor eagerly welcome Western investment on any terms as a vast improvement over their current misery. Microscopic wages, long hours and heartless management in sweatshops, along with befouled air and water, might seem horrific to wealthy Westerners, but are gratefully welcomed by the desperate people of nations like Mexico, China and India. “In fact, if the demonstrators’ demands were met, the effect would be to crush the hopes of much poorer Third World workers,” he declared (12/13/99)...

On globalization, Zakaria zealously denounces opponents of corporate-determined trade agreements as seeking to impose utopian rules for the global economy that are widely rejected, especially by the most wretched of the earth....

Zakaria’s “anti-democratic” and “minority” accusations invert reality in...critical ways....

A recent multinational Chicago Council/ poll (released 4/25/07) found majorities in most poor nations insisting that globalization be accompanied by global standards to prevent a “race to the bottom.”

“Strong majorities in developing nations around the world support requiring signatories of trade agreements to meet minimum labor and environmental standards,” the survey concluded, citing data from China, India, Thailand, the Philippines, Argentina and Mexico. “Nine in 10 Americans also support such protections for workers and the environment.”

Elites in Third World nations, in contrast, staunchly opposed such standards, the study noted:

The leaders of less developed nations have generally opposed including language mandating minimum standards for working conditions and environmental protections in trade deals, arguing that such rules are protectionist and would undermine their ability to compete in major markets such as Europe and the United States.

“It has often been assumed that when leaders of developing countries argue against including labor or environmental standards in trade agreements, they represent the wishes of their people,” added Steven Kull, director of WorldPublic “However, it appears that these publics would like to see the international community put pressure on their governments to raise their standards.”

These findings directly contradict Zakaria’s simplistic worldview that the free-trade agenda of America’s political and business elite reflects overwhelming public sentiment in both poorer nations and the U.S.

And, closer to home (and to the other salient topic of the day - the upcoming November polls - about which Zakaria is busy confusing the American electorate daily), Bybee reminds us of the ultimate price yet to be paid by those candidates who forget that the people actually know what's going on...

While elites across the globe support unregulated globalization, majorities in both the U.S. and poorer nations essentially seek to restructure globalization so that it benefits everyone—as signified by the flipping of 37 congressional seats in the 2006 mid-term elections from “free trade” advocates to supporters of “fair trade” (Global Trade Watch, 12/13/06)."

Gotta love it when the real elites try to carve their niches by claiming to speak for the poorest of the poor. Frantz Fanon must be spinning in his grave!

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Take this job: amazing fair trade econ opening

The Center for Economic and Policy Research is one of the few good think-tanks in town, and I don't say that just because I met my wife while working there. Their stable of full-time and associated economists and policy analysts are that rare mixture of talent and political commitment that perform an outsize role in a country/world where Thomas Friedman is seen as an expert on globalization. While they are sober and non-partisan, they are also about the only progressive public intellectuals that don't seem to rejoice in kicking advocates in the face just to sell books or make a name for themselves. Not that I have any experience with that or anything. ;)

Anyway, CEPR's hiring an international economist, and if you're a PhD economist and you like this blog, you should strongly consider applying.

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Who's saying what about the TRADE Act


The TRADE Act calls for a strategic pause on trade agreements and a long overdue comprehensive review of U.S. trade policy.  This bill also outlines a new U.S. trade strategy-one that puts a priority on the interests of working class Americans, farmers, the environment, and domestic manufacturers, not just multinational corporations.

The AFL-CIO is proud to support the TRADE Act.  It is past time to restructure U.S. trade policy to work for working families - here at home and around the world.

Change to Win:

"This legislation will finally bring an end to the disastrous trade deals that have sent millions of jobs overseas and lowered safety standards. It will set new rules for global trade that create good American jobs, improve working conditions everywhere, and make sure that the benefits of trade are shared with workers, not just corporate CEOs.

"The TRADE Act lays the foundation for creating fair trade agreements that will help working families achieve the American Dream in the 21st century economy."

National Farmers Union:

"Current trade agreements have consistently failed to live up to their promised benefits, encouraging a race to see who can produce the cheapest food and fiber regardless of production standards," NFU President Tom Buis said. "The TRADE Act defines a plan for a fair trade policy that will allow American agriculture to compete on a level playing field."

Friends of the Earth:

Friends of the Earth supports well-crafted trade policies that protect the environment and workers, enhance public health and safety, foster strong democratic institutions and improve the quality of life worldwide. Unfortunately, our world's precious natural resources face serious threats from the current free trade model. Past trade pacts, based upon the failed NAFTA/CAFTA model have not worked, and actually encourage industry to relocate in pursuit of the least stringent environmental and social standards. Trade agreements should support, rather than undermine, environmental protection. The TRADE Act encourages responsible behavior, providing a blueprint for a far better and more balanced way to conduct international trade.

Much more after the jump...

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Today's TRADE Act Presser

Although a tornado watch in DC today pushed it indoors, it didn't make a press event announcing the Brown/Michaud TRADE Act any less successful, with supporters of a new progressive trade agenda making an impressive showing. You can see our statement on the TRADE Act here or below in Todd's post, and we have more materials about this new framework on our website here (with more coming in the near future). There have already been a few stories in the media:

Here are a few photos from the event:

More will be up at our Flickr account soon.

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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.”      


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

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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.

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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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Behind the Fast Track Death

I am heading out of town for a week or so for Passover, but here's one last post before I go. Our friends from Human Rights Watch have an excellent post over at the Hill:

Congress is right to delay consideration of the US-Colombia Free Trade Agreement (FTA). What’s at stake here is a fundamental principle: that free trade should be premised on respect for human rights, especially the rights of the workers producing the goods to be traded.

Colombian workers cannot exercise their rights without fear of being killed. Just in the first three months of this year, 17 Colombian trade unionists have been assassinated—a substantial increase over the 10 killed in the same period last year.

Dan Wolfensberger writes in Roll Call:

Pelosi, however, is the first Speaker in the history of the 34-year-old statute to ask the Rules Committee (with House approval) to suspend the expedited timetable for consideration. The House handily endorsed her gambit Thursday, 224-195.

Just as it is unlikely that Congress will grant Bush his requested renewal of fast-track negotiating authority so late in his term, it is even more difficult to imagine a Democratic president even asking for it... It is also highly unlikely that the next Congress, which is likely to contain an even larger Democratic majority in both chambers, will grant whomever is president such authority. All this poses a new challenge to both branches of how to reconfigure our trade relations and processes over the next four to eight years...

The Politico gives the inside scoop on Fast Track death:

Democrats broke more than three decades of precedent by changing trade rules to suspend consideration of the deal. But they also displayed a procedural acumen that was less evident during their first, sometimes bumpy, year in power...

McGovern and other Democrats on the Rules Committee began discussing the possibility of stripping the time requirements from trade rules as early as January, members and aides said.

Those conversations were hypothetical, however, until the White House began to make noise about sending the Colombia agreement to Capitol Hill before Pelosi signed off on it. That prompted McGovern and Rules Committee Chairwoman Louise McIntosh Slaughter (D-N.Y.) to call for a meeting with the speaker.

Slaughter and McGovern oppose the trade deal for different reasons. The Massachusetts Democrat believes Colombia has not gone far enough to rectify its history of violence toward labor leaders.

Slaughter, meanwhile, opposes the measure because she believes it would deal another blow to her upstate New York district, which already suffers from the steady export of jobs.

Both opposed any maneuvering by Bush to force a vote, and both believed that stripping the time requirements was the best way to stop the president in his tracks.

And we got some feedback on a post from earlier this week on Fast Track, and just wanted to point out that Pelosi's action to cancel Fast Track virtually guarantees that the Senate will also not take action.

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Bitter fallout, murders, dodges, rules, deals

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

Following Obama's "bitter" comment, most progressives are rallying to his defense: see Sirota here, Jane Smiley here, and Katrina vanden Heuvel here. A lot of progressives I know think that Obama was just channeling Thomas Frank. I dunno, I read the comment as throwing Frank in with the Kansans, and dismissing both. After all, trade criticism was listed right along religion as a seeming opiate of the masses. It seems, however, from yesterday's news cycle that Obama did not intend to send this message. Obama now says:

“Obviously, if I worded things in a way that made people offended, I deeply regret that,” Obama said in a phone interview with the Winston-Salem Journal. “But the underlying truth of what I said remains, which is simply that people who have seen their way of life upended because of economic distress are frustrated and rightfully so.”

On the right, Bill Kristol, no NAFTA opponent, writes in the NYT on the Obama bitter remark:

Obama ascribes their anti-trade sentiment to economic frustration — as if there are no respectable arguments against more free-trade agreements. This is particularly cynical, since he himself has been making those arguments, exploiting and fanning this sentiment that he decries. Aren’t we then entitled to assume Obama’s opposition to Nafta and the Colombian trade pact is merely cynical pandering to frustrated Americans?

But mostly, all was quiet on the trade angle of Obama's remarks from the corporatists, who love to use the Guns-God-Gays wedge issues while also pushing failed trade policies.

In other news, BoRev shows video showing Hillary unwilling to answer questions about her husband's ties to Colombia.

Simon Romero writes on the union killings in Colombia, showing that Citigroup employees are among the unionists targeted for murder just this year - which has seen an uptick of killings relative to 2007:

The case of Leonidas Gómez, Ms. Gómez’s brother, is one of several examples of union officials killed in recent weeks who were involved in organizing rare protest marches last month against paramilitaries. Government investigators here said they were investigating all the recent killings but had not yet identified those responsible.

Carlos Burbano was a vice president in the hospital workers’ union of the municipality of San Vicente del Caguán in southern Colombia who disappeared March 9. His body was found four days later in a garbage dump in an area considered paramilitary territory. Mr. Burbano, who had received threats before from paramilitaries, had been stabbed multiple times and burned with acid.

Like Mr. Burbano, Mr. Gómez, a member of the Bank Workers’ Union here in Bogotá, was an outspoken critic of the paramilitaries. He had also traveled throughout Colombia to speak against the trade deal, which he expected to raise salaries of senior Citigroup executives while eroding the benefits of employees, said Luis Humberto Ortiz, a fellow union official and Citigroup employee.

Mr. Gómez, last seen at a meeting with leftist politicians on the night of March 4, was found dead in his apartment on March 8, with stab wounds and his hands tied behind his back. Missing from his apartment were his laptop computer, U.S.B memory sticks and cash from his pockets, said his sister, Ms. Gómez.

Inside U.S. Trade on Friday had some interesting dissection of what Pelosi's Fast Track move last week means. Here is my paraphrasing of their reporting:

  1. Pelosi - confirmed by Rules Cmte and House vote - removed the Fast Track timeline, as well as the provision that it is highly privileged and cannot be debated. This safeguards against the scenario where Rangel passes it out of Ways and Means Committee but Pelosi remains opposed. It also safeguards against any member of Congress calling for a vote when they want. So leadership will be in control.
  2. The Colombia FTA is still not amendable, however, and the Senate rules remain the same: once the House sends it up, the FTA has up to 15 days in Finance Committee, and up to 15 additional days for a floor vote.
  3. However, if the Senate wants, it can vote under Fast Track rules today, but then would have to formally approve it again after the House sends it up. (This happened on CAFTA, when the Senate GOP leadership just wanted to get some momentum going by passing the pact before the House, and then taking a second vote later.)
  4. Because Bush has already dropped the Colombia FTA, it will have to be voted on this Congress, or it dies. Next year, if the president wanted to resubmit it, they could, but it wouldn't automatically receive Fast Track treatment. A new Fast Track vote would have to be taken if they wanted that to apply. Ed. comment: I'm betting we see Fast Track replaced by a different system, so I wouldn't expect any new Fast Track votes.

Finally, IUT cites an April 4 letter from Rice, Paulson and various cabinet secretaries to Pelosi saying that:

In seeking to identify an agreed path forward for the Colombia FTA, the Administration’s efforts have been guided by three objectives you identified in conversations with several of us that need to be met before the Colombia FTA would have the necessary support to pass the House of Representatives. They are: (1) a strong, bipartisan vote on legislation to implement our FTA with Peru; (2) a solid Trade Adjustment Assistance (TAA) reauthorization package; and (3) progress on labor violence and impunity in Colombia. As noted above, the first objective was satisfied by the strong bipartisan votes on the Peru FTA last year. [emphasis added]

That's the first time I've seen such clear preconditions on the record. Wonder if they're true?

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Making history

The FT summed up this week's happenings on Colombia and Fast Track fairly well:

The Democratic-led House voted 224 to 195 to stop the 90-day “fast track” time-table under which most significant US free trade deals have been ratified since the 1970s...

It was the first time in the 35-year history of the “fast-track” process that a president had sought to force lawmakers to vote on a free trade deal...

Even before this week, fast track has had a rocky history and has sometimes been suspended, for example during the latter years of the Clinton administration following the passage of the North American Free Trade Agreement.

David Sirota has a great column out this week that likens Bush's Colombia tactics to a moment from Colorado's labor history:

Ninety-four years ago on April 20, America made international news when a government-sanctioned paramilitary unit murdered Colorado union organizers at a Rockefeller-owned coal mine. The Ludlow Massacre was "a story of horror unparalleled in the history of industrial warfare," wrote The New York Times in 1914 — and the abomination was not just the violence, but the way political and corporate leaders colluded on their homicidal plans to protect profits.

Sanitized history teaches that our government has since changed. Quite the contrary, as the Bush administration this week moves to legitimize the methods of Ludlow through its Colombia Free Trade Agreement...

Colombian labor leaders have begged the White House to drop the deal, saying it will undermine their struggle for human rights by validating Uribe's thug-ocracy. Nonetheless, President Bush bolstered Uribe with a pact giving corporations incentives to leave America for the corpse-strewn pastures of Colombia — a union hater's paradise.

And there was this inspiring quote from the NYT's obituary of Abe Osheroff, one of last remaining veterans of the Abraham Lincoln Brigades. It seems appropriate as we move into the next phase of the fight, which is whether Dems will actually vote FOR the agreement now that they've canceled Fast Track. Ugh.

“If you need a victory, you aren’t a fighter,” he said in 2000, “you’re an opportunist.”

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Fast Track Death - live blogging

The House is doing an hour of debate on Fast Track for Colombia. I'll try to type the basic things that people are saying, and bracket any editorial remarks.

Rep. Slaughter (D-NY): Fast Track outsources our very basic legislative responsibility. We can alter this rule, and it won't affect the FTA or the Senate's actions in any way. We're on the edge of economic ruin, now is not the appropriate time to bring up a flawed agreement. Damage to workers and Afro Colombians too significant to warrant passage of this bill. It is our preregorative to suspend Fast Track if timing necessitates it. WE ARE REESTABLISHING THE HOUSE OF REP AS CO-EQUAL TO THE PRESIDENT

Rep. David Drier (R-Calif.): I've never seen Democrats align with Hugo Chavez and FARC. We are considering the Hugo Chavez RULE. Process is substance. He's reading the Fast Track rules as evidence that it's a Democratic process. Cites number of codels as upholding democratic principles. This is an unprecedented rule change. They are making up this nonsense as they go along. Venezuela threatens not only Colombia but very idea of democracy and free markets.

Rep. Charles Rangel (D-NY): I doubt that there's anyone who has the concern for Colombia. Not only with their political problems, but also their fight against drugs. Mr. President, you forgot to consult with the Ways and Means Committee. I don't remember the last time anyone has talked about the bill, instead they only want to talk about Chavez and Castro. Suggests some kind of a trade off for urban policing technology.

Rep. Diaz Balart (R-Fla.): This day will live in infamy.

Rep. Jim McGovern (D-Mass.): I'm open minded, but I'm not a cheap date.

Rep. Jim McCrery (R-La.): This bill turns off the timeline entirely.

Rep. Doc Hastings (R-Wash.) [- voted against the Peru FTA, but now is supporting an identical deal for Colombia - where unionists are murdered.]


Rep. Peter DeFazio (D-Ore.): So this is a rule from 1974. Guess what? we were the manufacturing collosus of the world. Until today, Congress never had a spine to stand up to the president before. Today is a new beginning.

Rep. Jerry Weller (R-Ill.): [Colombia is safer that Washington, DC. Pretty rich coming from a guy married to Guatemalan death squads.]

Rep. Rahm Emanuel (D-Ill.): Talking about globalization's squeeze on middle class Americans. If people don't win, they'll turn against trade per se.

Rep. Roy Blunt (R-Mo.): We didn't have FTAs before Fast Track.

Rep. Kevin Brady (R-Texas): [Calls us chickens.]

Rep. Tom Davis (R-Va.): They call it Fast Track so that we don't have to argue about process.

Measure to kill Fast Track passed: 224-195. On the Dem side, Melissa Bean (Ill.), Dan Boren (Okla.), Allen Boyd (Fla.), Jim Cooper (Tenn.), Bud Cramer (Ala.), Henry Cuellar (Texas), Baron Hill (Ind.), Nick Lampson (Texas), Tim Mahoney (Fla.), and Jim Matheson (Utah) crossed sides. On the GOP side, Bob Aderholt (R-Ala.), Virgil Goode (R-Va.), Robin Hayes (R-N.C.), Walter Jones (R-N.C.), Ron Paul (R-Texas), and Mike Rogers (R-Ala.) crossed party lines. John Tanner (D-Tenn.) voted present. Bob Andrews (D-N.J.), Tim Bishop (D-N.Y.), John Larson (D-Conn.), Bobby Rush (D-Ill.), and Albio Sires (D-N.J.) did not vote.

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Colombia-Congress-Fast Track: What happened, What we will do, and What you should think

Statement of Public Citizen's Global Trade Watch Director Lori Wallach on Decision to Remove Fast Track Treatment from Colombia Free Trade Agreement:

We applaud House Speaker Nancy Pelosi for reasserting congressional authority over trade by removing Fast Track treatment from the Colombia Free Trade Agreement (FTA).

Ftanoes Public Citizen will apply its full resources to ensure that the Colombia Free Trade Agreement is defeated by Congress.

The United States should never have negotiated a trade agreement with Colombia, a country with a shameful record of labor leader assassinations and systematic violence against Afro-Colombian communities whose current government has been linked to deadly right wing paramilitaries.

The Colombia FTA includes the most egregious provisions of NAFTA, including extraordinary foreign investor protections that promote offshoring of U.S. jobs and expose domestic health and environmental laws to attack in foreign tribunals; and agriculture rules that will devastate hundreds of thousands of subsistence farmers in Colombia, making them poorer and undermining U.S. security interests in the region. The deal also replicates NAFTA's  limits Buy America and green procurement policies and on imported food safety and inspection requirements.

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Breaking: Pelosi to kill Fast Track on FTA with union murder capital

As we reported yesterday, Bush is proving he is better at being Nixon that even Nixon was, showing what Nixon's Fast Track process is really capable of. (In other news, Nixon's trade representative, who helped cook up Fast Track, just died.)

According to Reuters, the House will be voting tomorrow on a proposal by Pelosi to kill Fast Track's application to the Colombia FTA. Fast Track, which expired last year, would have still otherwise applied to the Colombia FTA because it was notified to Congress before the deadline.

Back in January, we predicted that Pelosi might do something like this. And many state governments and civil society groups have spent the last two years (and more!) passing resolutions for replacing Fast Track with a more democratic process. That fight is still around the corner, but both Clinton and Obama have committed to a change of course on Fast Track and our trade policy.

We'll be coming out with some kind of statement shortly.

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

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Be courageous

Our friend Glenn Hurowitz has recently written a book and founded an organization both called Democratic Courage. It's all about giving our elected officials a needed shot of backbone, and he is reading from the book this Thursday at Books a Million in DC's Dupont Circle, as well as other spots near you (stay tuned here!) Glenn has to say about trade politics, which we'll cite later.

Here is one of the better definitions of courage I've seen, courtesy of Alain Badiou:

I would retain the status of courage as a virtue—that is, not an innate disposition, but something that constructs itself, and which one constructs, in practice. Courage, then, is the virtue which manifests itself through endurance in the impossible. This is not simply a matter of a momentary encounter with the impossible: that would be heroism, not courage. Heroism has always been represented not as a virtue but as a posture: as the moment when one turns to meet the impossible face to face. The virtue of courage constructs itself through endurance within the impossible; time is its raw material. What takes courage is to operate in terms of a different durée to that imposed by the law of the world. The point we are seeking must be one that can connect to another order of time.

This type of courage becomes all the more important in long reactionary periods like the one we find ourselves in now, fairly well detailed in a recent New York Times Magazine profile of corporations' victories at the Supreme Court. (The article discusses Public Citizen at length, although not all that accurately: the underlying premise that we're losing our lawyers is wrong - there hasn't been turnover in 4 years, and we maintain an excellent win-loss ratio that is quite a bit better than the U.S.' ratio at the WTO.) As Jeff Rosen writes in his conclusion to the piece:

What about the executive branch? It seems unlikely that John McCain, if he were elected president, would push back against the court: he has already pledged to appoint “judges of the character and quality of Justices Roberts and Alito,” rather than justices more devoted to states rights, like Scalia and Thomas. As for Barack Obama and Hillary Clinton, both have sounded increasingly populist notes in an effort to attract union and blue-collar supporters, ratcheting up their attacks on corporate wealth and power, singling out the drug, oil and health-insurance industries and promising to renegotiate the North American Free Trade Agreement. But despite their rhetoric, it is not clear that either candidate would actually appoint justices any more populist than Bill Clinton’s nominees. “I would be stunned to find an anti-business appointee from either of them,” Cass Sunstein, who is a constitutional adviser to Obama, told me. “There’s not a strong interest on the part of Obama or Clinton in demonizing business, and you wouldn’t expect to see that in their Supreme Court nominees.”

Again, Badiou points out the task ahead (using terminology only acceptable in France): we are not just fighting for gains as we were in the 20th century, but literally (as in the 19th) defending the idea of social change itself.

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OK, so time to move on...

Yes, Hillary may have been for NAFTA before she was against it, but I'm pretty sure this applies to a large majority of the original NAFTA-boosters. And nevertheless, she voted for some NAFTA expansions, agreements that were almost word for word NAFTA or even worse, with Chile, Singapore, Australia, Morocco, Bahrain and Oman.

Obama has also denounced NAFTA in ads, in stump speeches and more, but he has also wavered, casting NAFTA expansion votes for the Bahrain and Oman FTAs.

So now what? We could, like many other blogs out there from which I'm gradually losing my vision from reading endless comments, speculate about how much of a liar either candidate is or how this is some plot to distract from Obama's "Wright" situation. But instead, it might just be better to move on and ask "what's next?" No, really. I mean I'm as partisan as the next DC partisan, but let's not dwell on this and instead do what progressives do, look ahead to what can happen with our economy, with human rights and with our foreign policy through changes to our trade policy.

And that's what both Obama and Clinton have proposed: substantial changes and new trade policies that address a lot of the problems that exist because of NAFTA and NAFTA-style agreements.

I encourage onlookers to NAFTA-gate and Clinton's records release to take a step back and really ask:

  1. What do they say they will do when they get to the White House? and
  2. How can I make sure they stick to what they say?

This is what economic justice advocates should be thinking about now and every day until Inauguration Day. Instead of debating minute differences and comparing past positions to new better informed trade positions, think about where we are now and what's next for our trade policy. Discuss in comments.

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

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Whack-a-mole on the wheel-and-deal

Wow. This week, I'm happy to be a blogger-researcher and not a lobbyist. Today's Inside U.S. Trade talked about the high level of wheeling and dealing that is being talked up in the halls of Congress on the trade deal with unionist murder capital Colombia. Apparently, some Democrats

"believe now they they can extract significant concessions from the White House for passing the FTA. A Democratic lobbyist said these members have made it clear the concession has to be “enormous” to offset the negative fallout from passing the Colombia FTA, and the lobbyist said their demands have been further prompted by President Bush’s rejection of programs that were a priority for Democrats, such as the State Children’s Health Insurance (SCHIP) bill."

Sources are suggesting that TAA is not enough to cut a deal, and that it looks like Bush doesn't support the better TAA bills anyway. According to Congress Now:

Moleinside_zoom3_2 "I don't think dealing with the dislocation that comes from trade gets you one additional vote for a trade deal that is flawed," said Bill Samuel, legislative director for the AFL-CIO, a fierce opponent of free trade agreements. "The problem with Colombia - overlay the economic concerns with the human rights issue, the murders, the death squads, the lack of prosecutions. TAA doesn't address any of that."

Unfortunately, Baucus and Grassley are reportedly watering down their TAA proposals as we speak, so that service workers are not covered. Other Dems are wheeling and dealing, but shooting a little higher. From IUT:

According to [a Democratic] aide, a more reasonable trade-off for the Colombia FTA could involve a second economic stimulus package focusing on the middle class, mortgage relief for home owners threatened by foreclosure due to the sub-prime mortgage crisis, increased federal funding for education and the passage of an SCHIP bill... [but] union sources also said they have been assured by the speaker’s staff that no deal is being struck that would allow the FTA to come forward.

While all this air time is getting sucked up by the Colombia FTA - a policy not yet in place - the negative impact of current policy realities like our China trade deficit is not being addressed. But that doesn't mean fair traders aren't having to play whack-a-mole on these other issues as well. According to IUT, AFL-CIO Industrial Union Council Executive Director Bob Baugh "ruled out that administration action on China would make the House leadership more inclined to let the U.S.-Colombia free trade agreement come up for a vote. “We had assurances from leadership that trying to make linkages [to advance the Colombia FTA] is a false start,” he said."

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Let's not bicker and argue about who killed who

One of the funnier Monty Python scenes is in the Holy Grail movie, when a wedding (somewhat accidentally) turns into a blood bath launched by the knight Sir Lancelot of Camelot. The key line, as wedding guest after guest is murdered, is the bride's father, who does his fatherly best to salvage the occasion:

Please! Please! This is supposed to be a happy occasion! Let's not bicker and argue about who killed who. We are here today to witness the union of two young people in the joyful bond of the holy wedlock. Unfortunately, one of them, my son Herbert, has just fallen to his death.

You can see it in this video, about 5:40 minutes in.

A little bit of this quirky logic is at work in Rahm Emanuel's latest piece for the Wall Street Journal, which tries to get people to stop arguing about NAFTA (which he rammed through Congress), and instead focus on other happy things like a new social contract. Pretty heady stuff coming from a guy who ignored the fair trade sweep that happened under his nose as DCCC chair last cycle, costing the party several pick-up seats while inadvertently winning others.

First, he pretends like the end-all of the trade debate is the core labor standards debate, which is far from true. He comes pretty close to suggesting that something like NAFTA that happened in the past (even if it was willfully executed by him and a host of other humans, much like Lancelot in the clip) should not be debated in the present. Pretty odd sentiment for a week when history is in, as the country tries to sort out who got us into the recession, and when Obama's forceful reflection on the history of racism in America is moving hearts and minds.

But more importantly, there is the suggestion that somehow we EITHER focus on the debate about a social contract, or we fight for fair trade policies. Friends, as much as we've been truly moved by the stories of manufacturing decline in our country, Public Citizen simply would not be in this fight if the issue stopped there. We have gotten involved because the very domestic social contract that we've spent decades fighting for - on auto and pharmaceutical regulation, on democratic process, on consumer safety - was threatened by a trade agenda that delved deeply into the domestic sphere, limiting our policy space on domestic issues. Rahm's four domestic suggestions are: expand education, health care, green jobs, and savings. Absolutely sign me up, but first take note that these policies are limited by the WTO and other trade deals, and (though important) will not by themselves solve the problems of our fundamental lack of balance and effective demand in the economy (which will involve balancing trade and making the world safe again for regulation).

If having to talk to people like us about this fact is annoying to Rahm and others as they promise (not the same as deliver, is it?) a new social contract, - if we're the obstacle here - there is a very easy and quick solution: rewrite the rules, and don't waste time expanding them any further. It's not that talking about them is a distraction from the "real" issues, it's that so-called "trade" is a part of a "neoliberal contract" that must be rewritten as we fight for the things we want.

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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?)

Freedom300 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!

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Day before Ohio

Our regular readers will have noticed that we have not been rounding up all the back and forth between Clinton and Obama on the NAFTA issue. Indeed, by sheer number of press hits, NAFTA is the top story in the country.

Part of the void at EOT is that I've got a pretty insane fever and am bedridden, while some of our other contributors are also out. But it's actually for a reason: there's been quite a bit more heat than light in much of the coverage, and it would be exhaustive to try to correct all the errors in the coverage and reporting, as the media grapples with a story that has been all but shut out of the mainstream debate over the last 15 years.

Take the ongoing story about the memo leaked from the Canadian government supposedly showing Obama gave a wink-wink on NAFTA. As the Cleveland Plain Dealer reported, citing one of our own:

Lori Wallach, director of Global Trade Watch, a group that is sharply critical of U.S. trade policy, said she is drawing no conclusions from the memo.

"What it means about any U.S. candidate is really hard to decipher because it's all coming through the lens of a right-wing Canadian government," she said.

Wallach said she sees no difference between the trade votes of Obama and Clinton, and thinks both have moved closer to her group's position during the campaign. "Neither of them started out as great champions of trade reform," she said.

Ohio Democratic Sen. Sherrod Brown, an outspoken opponent of U.S. trade policy who hasn't endorsed a candidate, said he regards the memo as "much ado about nothing" because it comes from a conservative Canadian government.

Brown said he doesn't see much difference on trade between Obama and Clinton despite the two campaigns' fierce fighting over the issue.

"I don't think anybody's going to vote on the difference between Hillary and Barack on trade," he said.

Or take the editorial by Jagdish Bhagwati in the Financial Times, where he lays out the neoliberal case for Obama:

Mr Obama’s main union support comes from the Service Employees International Union and the Teamsters, neither of which is protectionist: the SEIU’s membership is in the non-traded sector and, except on the issue of Mexican trucks coming into the US, Teamsters do well as trade expands. By contrast, Mrs Clinton’s support comes heavily from the AFL-CIO, which holds strong anti-trade views. This matters because the IOUs you sign during campaigns provide a straitjacket that can restrict your policy options.

Uhh, I don't know even know what these terms mean, but I do know that Change to Win was the federation that actively opposed the Peru FTA last year, and the Teamsters are one of THE most active members of the Citizens Trade Campaign, which has been extracting commitments from the candidates all throughout the race. And if you're worried about restricting your policy options, the WTO poses a much bigger threat to Hillary and Barack than do unions, as we showed in a report last week.

What we're seeing is the mainstream press and elite commentators trying to grapple with a perspective that is very common in middle America, but all but shut out from news outlets. They're getting the facts and the players wrong; they're misrepresenting the issues at stake. The fact that the Democratic primary dragged on this long - to the point where people in Wisconsin and Ohio are actually making a difference in selecting the nominee - means that fair trade issues have to be addressed. Is there a way we can make this happen every four years?

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

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What our former colonial masters think of our democracy

From an interview with European trade commissioner Peter Mandelson - formerly of New LabOUr, "new" because it's lite on the labOUr - with the Wall Street Journal:

Mr. Mandelson argues on a recent afternoon -- more so than any of the EU's 27 member states -- it is America that threatens the cause of free trade today.

"You can see it in the politics of the country," he says from his armchair in an EU office in the shadow of the Eiffel Tower. "You can see it in the Congress, you can see it in the primaries, you can see it in the town-hall meetings, you can see it in the candidates who, in order to appeal to the public, articulate these arguments" of protectionism...

"The caveat is that we're in the primary season," Mr. Mandelson observes. "That's not necessarily a position she would take into the general election, and if she did it's not necessarily one she would take into the White House if she won. But you can't ignore it.

"I've known the Clintons for over a decade, and I've always seen them as free traders. But most of the Democrat free traders seem to have taken to the hills," he laments. "I wish there was more pushback within the Democrat Party, because they know this is right, they know this is responsible, and for a long time now you've seen politicians on both sides of the aisle using trade as a wedge issue. And it's a very dangerous wedge to play with, because it's short-term, it's counterproductive, it leads you nowhere."

If there's a reason for optimism, Mr. Mandelson says, it's that "amongst the Democrat candidates, the person who's been questioning free trade most loudly and showing support for protectionism has been forced out of the race -- John Edwards. And the Republican candidate who is most strongly in favor of free trade seems to be leading the field at the moment -- John McCain."

Wow, nothing like a lecture on democracy from an unelected trade bureaucrat whose home country still has a queen to make a fair trader feel on the same side as the Clintons. In response to a previous similar intervention in our sovereign election, Rep. Barney Frank (D-Mass.) schools Petey Pete on Democracy:

European Union Trade Commissioner Peter Mandelson’s attack on Senator Hillary Clinton for her position on trade is a graphic example of why he will not succeed in his efforts to conclude a new world-wide trade treaty this year.

Senator Clinton has voiced the views of many of us, including I believe a substantial majority of Democrats and a significant number of Republicans as well, that trade should not go forward without measures that deal with the impact it has on income distribution and employment within countries. Mr. Mandelson’s dismissal of these sorts of concerns as ‘protectionist’ reinforces the view of many that the most ardent advocates of free trade treaties that ignore social and economic consequences cannot be trusted to make decisions about this important subject. It is particularly disappointing to me that Mr. Mandelson, who comes politically from the British Labor Party, would show such a lack of concern for the negative impacts that past trade treaties have had on many working people.

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Afro-Colombians reiterate opposition to Colombia FTA

Marino Córdoba, founder of the Association of Internally Displaced Afro-Colombians (AFRODES), has a nice guest blog post at The Hill entitled "Why Afro-Colombians Oppose the Colombia FTA."  The whole post is worth a read, but the juicy tidbits include:

...At the end of 2007, angered by the strong opposition of the majority of Afro-Colombian communities to the U.S.-Colombia Free Trade Agreement (FTA,) Uribe created a new Commission in Colombia that directly challenges our legal governance structure.

Cynically dubbed the Commission for the Advancement of Afro-Colombian People, it would undermine our communities’ ability to advance development strategies chosen by our people that comport with our needs and that help even the economic playing field... President George Bush and other U.S. Uribe allies, such as Rep. Gregory Meeks (D-NY), and the vast array of lobbying firms hired by the Uribe government are now trying to tout this outrageous Commission as evidence that Afro- Colombian concerns are being addressed as they push to pass the FTA.

Córdoba says that thanks to a vibrant civil society movement in the 1980s, Afro-Colombians enjoy full legal recognition of their cultural rights and collective ownership of their lands (he specifically mentions Law 70 of 1993 (PDF), a rather remarkable piece of progressive legislation that I'd encourage anyone to read).  Yet this recognition has been undermined by paramilitary organizations forcing Afro-Colombians off of their land: "Tens of thousands of us have been forced to flee... clear[ing] the way for the entry of oil palm plantations, logging operations, and mining projects advanced by allies of the Uribe Administration."

The Colombia FTA's Chapter 10 contains the same poisonous investor rights provisions as NAFTA, CAFTA and the Peru FTA.  If the FTA is implemented, these provisions will only exacerbate the situation, empowering foreign companies to engage in resource extraction made possible by the illegal and often violent forcing of Afro-Colombians off of their land — land supposedly guaranteed to them by Law 70.

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The field narrows, and advice from Feingold

This just in... Romney to pull out... On trade, Romney started out his campaign by talking about how great offshoring was, only to end up in Michigan talking about fighting for manufacturing jobs. A strange thing, democracy - when it works, it ends up changing the positions of those in power.

Even Huckabee, who as governor of Arkansas signed his state up for the procurement chapters of NAFTA-style deals, channels some of our own Holly Shulman from earlier in the week:

When President Bush agreed with House Democrats on a stimulus package centered on big tax rebates, for example, Mr. Huckabee raised the hackles of supporters of free trade by arguing that the plan in effect subsidized the Chinese manufacturers of imported consumer goods. And he argued that the money would be better spent building roads, bridges and other infrastructure projects at home, irking proponents of limited government.

In the wake of Edwards losing the race, there are now new power centers pushing on Clinton and Obama to fair trade it up. As John Nichols writes:

"Talking about experience and idealism is so much conversation for Wisconsin people," says Feingold, a three-term U.S. senator who serves with Obama and Clinton and who flirted with making a presidential run of his own this year. "We'd like to hear something about what they're going to do. It's amazing to me that this campaign has gotten as far as it has without getting down to specifics. But Wisconsin voters expect more from the candidates than the slogans." Like what?

Feingold says that the two remaining serious contenders for the nomination need to bone up on trade policy -- and its impact of real people in places like Wisconsin.

"I would urge them to be aware of the devastation that has occurred for people in the state over the past twenty years as a result of trade policies that were forced through Congress without any concern for working people in states like Wisconsin," says Feingold, who has since coming to the Senate in 1993 consistently opposed the free-trade agenda of both the Bill Clinton and George W. Bush administrations.

The campaign — especially on the Dem side — could get pretty interesting as the candidates grasp at something — anything — to differentiate between the two. Feingold's suggestion seems pretty savvy to me.

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

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Pre-Super Tuesday reflections

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

A lot of folks are offering their reflections the relative merits of the candidates (see here, here, here, and here.) I was able to share mine at San Francisco's NPR station a little earlier today.

As I see it, we should evaluate trade policy on three overlapping dimensions:

  1. Who is affected
  2. How is it made
  3. What are the "surprise" implications for non-trade policy

On the first front, I'm thinking of how our trade policy has resulted in (or not helped us avoid) a skyrocketing trade deficit, largely stagnant wages and farm prices, and the loss of millions of manufacturing jobs, hundreds of thousands of family farms, and an increasing number of service sector jobs. Nearly every candidate touches on this part of the issue - even Huckabee and Romney with their comments on manufacturing. (McCain has spoken about compensating losers through TAA.) With the exception of Ron Paul (who calls for scrapping the WTO, NAFTA, etc. directly), the whole field talks about the losses from trade policy for many people. They are largely silent on the trade-wage connections.

The second category relates to how we make trade policy. For four decades, our trade policy has been conceived under the undemocratic Fast Track mechanism, which takes away Congress' constitutional authority and responsibility to set our trade policy, and gives it to an executive branch that sets the terms and picks the partner countries and writes the deal, leaving Congress only an up or down vote. Obama has talked about replacing Fast Track, while Clinton has said she will hold off from asking for Fast Track until she reviews past agreements.

Finally, as we have long been arguing, trade policy these days is only marginally about trade. Much of the 600-page texts of the WTO and FTAs has to do with how we adopt policies domestically. Thus, a move to universal health care could be challenged as a limitation on market access for health insurance companies. Under our FTAs, investors can demand taxpayer money for public interest policies that limit their future expected profits. Obama has addressed investor-state, consumer protection, and domestic regulation. We haven't heard much from the other candidates on this dimension.

As we'll document in an upcoming report, both the Dem and GOP health care and climate change proposals could face WTO challenge. More specific responses to these and other questions can help voters can make an informed choice.

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The Colombian Corporate Agenda... from the inside

Today, at an event at the Council of the Americas, a corporate organization, I was introduced to a delegation of corporate CEOs from Colombia: David Bojanini of South American Insurance, Manuel Carvajal of the Carvajal Corp., Antonio Celia of Promigas and Francisco Diaz of the Corona Organization.

The event was introduced as a discussion of whether the "free trade agreement" would help improve Colombia, but amongst the diverse panel made up entirely of CEOs of Colombia's corporations (but from different geographic regions, perhaps? Though not even sure about that...), no one said that the FTA would be a bad idea, omitting the perspective of most civil society groups in Colombia and not leading to much of a discussion.

Each businessman outlined their commitment to improving life in Colombia. Antonio Celia said, "we provide jobs...hoping that they [workers] will be compensated with commitment and personal reward." (I'm sure most Colombians would prefer a living wage)

They also said that as opposed to Mexico pre-NAFTA, Colombia's corporations have a real sense of social responsibility and the problems were different in Mexico. (a  reminder that drugs were one of the major issues during the NAFTA debate and last I heard most of our cocaine still comes from Colombia...?)

Bojanini said that he is "very concerned about the well-being of our employees. We have deep respect for our labor unions - many of our companies have unions. We support free association." (and still the most dangerous country for unionists in the world)

After going on about all the contributions of what they admitted was not a representative sample of Colombian CEOs, Francisco Diaz strained to say, "we're trying to tie this into the FTA..."

There was also the obligatory exchange about Venezuela and Chavez (that "purveyor of false populism" Bush mentioned last night in the State of the Union). The CEOs cited that the #1 market for Colombia corporations is the U.S. and #2 is Venezuela. The businessmen also said that the private sector has no control over this and will continue to send the "wrong signal" by exporting to Venezuela, but the government can't send the "wrong signal" by rejecting the trade agreement, because the top two exporters might switch places and then the world will end!!! ahhh!! This was an especially interesting statement given the frame of this forum as about Corporate Social Responsibility, but I guess by this point they had forgotten the corporate responsibility part...

The CEOs were also excited to announce that they were adopting a few conventions of a Human Rights Code of Conduct that they had written. I would think that since they wrote it they would sign up for all of it, but apparently some of the private-sector written Human Rights Conduct just went too far in supporting human rights.

And then they assured the people around the table including a few reporters that this forum and this trip was in fact "not a PR effort." (Well, at least with only the two reporters who showed up and the arguments full of holes, it wasn't a very successful PR effort.) 

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Fun sleepover game: who would you rather have as president?

Bush didn't mention unionists' murders once on SOTU! He did draw that funny conclusion: "If we fail to pass this agreement, we will embolden the purveyors of false populism in our hemisphere." Well, it's nice to know that he believes there can be such a thing as true populism. I wonder what he could be thinking about?

As we've shown time and time again, if avoiding populism is the goal, it's best to not pass trade deals that limit development policy space. Zapatista uprising - born with NAFTA. Chavez's rise to power - born with IMF structural adjustment policies. The same is true country-by-country, across the hemisphere. If take everything away from people but their chains, they're going to have less to lose in rising up against you.

Sadly, it's not only Republicans that buy this Bush line. Democrat Greg Meeks (D-N.Y.), one of the CAFTA 15, also buys much of the same line, and is trying to get more Democratic support. Judge for yourself in this speech in Colombia whether he is up for it. In Meeks' endorsement of Uribe for the U.S. presidency, he presents us all with a major moral quandary: do we want Bush, or Uribe? It makes my head hurt something awful, like I'm reading some sort of poisonous zen koan.

Lotta nice fluff. Also no mention of union murders! If you want to get the other side of the story to the Colombia FTA - the side that does talk about the rampant murders there -  please take a moment and watch this video on the Afro-Colombian struggle there, and also this video "letter" by Chicago activists to Sens. Dick Durbin and Barack Obama.

UPDATE 2:15pm EST: RuthG leaves us a better YouTube link for the Chicago letter, and Public Citizen publishes its detailed response to Bush's state of the union!

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When will people get embarrassed about Colombia?

Nobody could accuse the Washington community of lawyers that is responsible for our trade policy of being overly concerned with social justice.

But, c'mon, give me a break. Usually when we have trade debates in this town, they center around making one-way streets into two-way streets, keeping the bicycle of trade moving forward, bashing protectionists and isolationists, engaging not retreating, etc.

Enter the debate around the Colombia FTA. Back in the 1990s, even some Clinton administration officials were cited in the Christian Science Monitor as thinking NAFTA expansion to Colombia was a bad idea - precisely because of the country's ongoing civil war and drug problem. Today, it's no secret that a majority of members of Congress and the entirety of the Democrats' base is utterly opposed to a Colombia FTA, both on the grounds that it's a NAFTA expansion and that it's the biggest unionist-murdering country in the world. In most popular discussions of the pact, this latter fact is THE talking points - people murdered. Thousands of them. With total impunity.

So when the advocates of the Colombia FTA take to the stage, they're rarely talking about bicycles or exports. Their main talking point is that UNION MURDERS HAVE GONE DOWN. Is there no shame?? Who cares if they're up or down... if you had to lead with that fact, you have a problem. In Europe, they have a whole host of social and developmental criteria before you can join the European Union. Not here. The bigger the freak social problems you have, the better.

A Republican at an event I was recently at put it bluntly: how many fewer murders do you want to see before you pass the FTA? What's the specific target? Some Dems in attendance had to respond that they would be glad to expand NAFTA to Colombia, but "more progress [on murder] needs to be made." It's like the saying about porn, I guess the Dems'll know sufficient murder reduction when they see it. Problem is, none of us'll know beforehand. Might it be time to get beyond the country-specific critique and blast the failed model instead?

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Democracy, science, class

An ongoing debate in legal theory related to trade policy is the use of the so-called "precautionary principle," variably formulated as "better safe than sorry" or "putting the burden of proof" on industry before it introduces new medicines, technologies or processes on the market.

Consumer and environmental groups tend to invoke this principle, based on the notion (however articulated) that corporations, left to their own devices and ability to sway policy outcomes, will advocate for courses of action that devalue human suffering or environmental damage in the name of making a buck. But some legal scholars don't like the precautionary principle. In The New Republic's Cass Sunstein's words:

The precautionary principle should be rejected, not because it leads in bad directions, but because it leads in no direction at all. The principle is literally paralyzing - forbidding inaction, stringent regulation, and everything in between. The reason is that in the relevant cases, every step, every inaction, creates a risk to health, the environment, or both.

Happily for Sunstein and comrades, the precautionary principle is not what prevails under our trade law. The WTO's Sanitary and Phytosanitary Standards agreement - one of 17 that the WTO maintains - reads:

Members shall ensure that any sanitary or phytosanitary measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient scientific evidence [emphasis added]

There's a lot of background on how to define what is "necessary" under international trade law, but suffice it to say that it's a lot more restrictive than how it reads here. Europe has been learning the hard way about how some of their food policies influenced by the precautionary principle have taken a beating at the WTO.

Continue reading "Democracy, science, class" »

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On art, confronting corporations and regulatory chill

I've been rocking out to some Rage Against the Machine lately. They're a band I had kinda forgotten about for much of the last decade, although like many people of my generation, they were my first exposure to a politics that went beyond the staid participation in ballot box politics that characterized many of the older folk in my life. While my hometown of Louisville was a center for "straight edge culture" much of the early 1990s, RATM had lyrics that addressed that went beyond personal politics and to the interconnections between oppression at home and abroad, and was unflinchingly committed to social change. For instance, take this lyric from 1999's "Ashes in the Fall":

Ain't it funny how the factory doors close
Round the time that the school doors close
Round the time that the doors of the jail cells
Open up to greet you like the reaper

This perspective fits very comfortably with that of HBO's "The Wire," another recent obsession at my household. Art, unlike some of the politics of the policy-making process, can make a clarion call for change that is not bogged down in wonkish qualifications on legislation, for instance. It seems that the art community is way out ahead of the broader progressive community in terms of ability to communicate a message and create a popular desire for change.

By contrast, industry holds hegemonic sway in Washington. At an event held this morning at the Ronald Reagan International Trade Center, representatives from the Bush administration, and toy and retail industries - despite a year of record outcry about imported product safety - brazenly held forth about how, in their opinion, the public and the government has little to no role in regulatory checks and balances. Corporations can do it better. Among some of the choicer quotes:

  • "While we welcome lower lead standards, they are difficult to implement in the next year. We may have already placed our Christmas orders months ahead. We will be covered this year by the same high lead standard that has protected consumers for years."
  • "We think that the recent recalls do not indict the system. On a
    strict numerical basis, we’re consistent with past years. The CPSC is
    getting more efficient… like the private sector, the public sector is
    getting better at doing more with less. The recalls of the last year
    show that the current system of self-reporting is working."
  • "We’ve heard from our supply chain that the costs of complying
    with duplicative testing – and a CBO study confirmed this – increase
    the costs to consumers by 10%. This is not a good thing for consumers."
  • "there’s no credible report of injury from lead inside the
    products… we should focus on hazards that post the biggest threat… it
    would be shame if parents were looking through their toy box while
    ignoring their window sills."
  • "Our economic viability has to do with confidence of consumers,
    with our brand integrity. There are specific complexities to sourcing
    overseas, in addition to the efficiencies and cost savings from this
    vast production capacity. The worst thing that could happen is that we
    turn inward, that we turn protectionist. The marketplace is much more
    complex than the 1950s’ model of domestic supply."

  • There were loads of other good nuggets on the ongoing attemptsby
    Congress to put together a Consumer Product Safety Commission bill,
    including slams on CPSC disclosure to the public of company
    information, on efforts to create a STOP button to block unsafe imports
    at the ports, on an increased role for state attorney generals (who are
    apparently "political people" in contrast to Bush appointee Nancy
    Nord), and the Senate for not getting permission from industry before
    writing their bill.

That industry lobbyists feel they can even getting away with suggesting that parents' safety concerns are not real, or that the industry can self-regulate, just indicate how far we've come from any sense of shared societal responsibilities and class co-existence.

But what's even more disheartening is the reaction from "the other side of the aisle." Progressives on our side are often having the debate while looking at their own feet, fixated on the legislative details while corporations rule the roost.

From inside the halls of Congress, it's even worse. Even though the import safety crisis is THE reason why there's a major CPSC debate this year, the House Energy and Commerce Committee admitted that it wouldn't be addressing the public outcry over imports in its CPSC legislation because World Trade Organization rules block them from addressing the issue.

A lawyer for the committee said that, after consulting with USTR, the Democrats could not come up with a way to increase CPSC's authority over imports, to establish a STOP button that could halt unsafe imports at the ports, or to establish that importers post a bond to cover the cost of recalls - VERY minimal reforms I might add - because 

"We were very concerned that when it came to the trade authority process, we wanted to ensure that no provisions would run afoul of the WTO’s Technical Barriers to Trade agreement ... [on the STOP button] it made us uncomfortable to halt imports under mere suspension of non-compliance. The arbitrary use of this authority might be an unwarranted barrier to trade... [and on the bonding requirement] Our committee staff looked at this issue, and we weren’t able to find a WTO-compliant method of doing this."

It's pretty rare that a policymaker is so candid about their reasons for not adopting progressive domestic legislation. As we document in our latest reports on toy and food safety, the threat from the WTO and other FTAs is real. But the answer isn't to back off of pursuing progressive legislation - the answer is to move forward with, while also renegotiating the international rules. Indeed, the total cave-in of the House on this issue in the latest bill illustrates the folly of moving along just one of the tracks. In short, we need to take away the excuse that our elected officials have for not meeting our desires.

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All these change agents, and I still can't break a 20

The growing usage of the phrase "change agent" has to be the oddest and most incongruous adaptation of radical thought into recent American political discourse. For many folks on the left, some variation of the phrase "change agent" has denoted the working class, the multitude, oppressed nationalities, etc. Overnight, everyone from Mitt Romney to Hillary Clinton assumes the mantle previously given to very large, very strategically placed groups of people.

Whatev. Here at Global Trade Watch, as we are apt to disclose, we have no preference among the self-designated change agents. What we are concerned about is how the struggle for a break from the neo-liberal policies of the past is informing or being informed by the horse race now moving on to South Carolina, Nevada, Michigan and beyond.

The good news is that many of the candidates, including last night's victor Hillary Clinton, are coming up with specific ways that they would change trade policy, as the Iowa Fair Trade Campaign documented in the letters it received from the candidates.

One of the major issues that a new president will likely have to deal with is an economic recession, and they will have to come up with ways to deal with the problem. Corporations have worked hard to ensure that constraints are put on the ability of people to democratically determine how they get themselves out of a recession. Thus, while many of the candidates banter on about international labor and environmental rights that are largely unenforceable in current trade policies, relatively short shrift has been given to the ability to break from NAFTA-WTO style policies during times of national crisis.

In last year's debate over the Peru FTA (and the 2006 debate over the Oman FTA), some attention was given to trying to come up with policies that would safeguard the ability of the U.S. government to block without FTA challenge any takeover of U.S. ports by foreign entities. The "great leap forward" given by our fearless leaders in Congress (they're like 535 little change agents!) was to insert a clause into the "revised" Peru FTA that read:

"Nothing in this Agreement shall be construed: ... to preclude a Party from applying measures that it considers necessary for the fulfillment of its obligations with respect to the maintenance or restoration of international peace or security, or the protection of its own essential security interests."

Some are claiming that this allows "full non-challengeable authority" for the U.S. to do whatever it wants if it invokes this so-called "national security" exception.

Unfortunately, the history of these clauses are a little murkier, as this law review article shows. Take the case of Argentina. In 2001-02, the country of my childhood went through an economic recession on par with the Great Depression. The government took a series of measures that it deemed necessary to insulate it's citizens from the worst aspects of the recession - a regulatory move that has made it the target of countless challenges from multinational corporations. These corporations, including Enron, have used NAFTA-like provisions in so-called bilateral investment treaties (BITs) to go after the country in foreign courts and demand billions in Argentine taxpayer dollars. Their gripe? Argentina making use of these so called "non-precluded measures" during a time of national emergency.

As the aforementioned article by William Burke-White and Andreas von Staden argues, even though the U.S. and other countries have tried to move closer to a clearly "self-judging" standard on these "non-precluded measures", the case history shows a lack of agreement among the corporate trade elite about this discretion.

When Enron sued Argentina, for instance, the corporate trade tribunalists ruled that Argentina could not decide for itself what measures it could take during an economic recession (and avoid challenge and compensation claims). But in a very similar case brought by LG and E, the tribunal ruled the exact opposite way. (See pages 106 and 4 respectively). Both these cases were brought under the U.S.-Argentina BIT, which is like the investor-state regime inserted into NAFTA-style trade agreements.

Anyone still think we're immune from what our corporations have gotten written into pacts that we're party to? Anyone who still thinks it's a good idea to offer up sovereignty to such a fickle, unelected grouplet of trade specialists? Anyone who still buys the idea that you can offer up whole swaths of the U.S. economy and regulatory structure to FTA dictates, and then hope and pray that clever exceptions will stand up when the corporate class wants to teach democratically elected leaders a lesson? (As Sirota points out, they're already in the ginger phase one of that lesson here in the U.S.)

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Bush to circumvent Congress on Colombia FTA?

Just before the break, Inside U.S. Trade reported that the Bush administration is internally debating whether to submit the Colombia FTA to Congress without the consent of the Democratic leadership. Rep. Wally Herger (R-Calif.), who is a likely candidate to be the GOP's top rep on Ways and Means once Rep. Jim McCrery (R-La.) retires this year, said the prospect "is continually being debated at the White House.”

However, Herger added that submitting the FTA to Congress in such a manner is a “last option.” It is “obviously our first choice” to make the case for the FTA and generate adequate Democratic support for the agreement to have the leadership back the submission of the implementing bill, he said.

Under fast-track rules, Congress is obligated to consider fast-track trade bills in a fixed time frame once they are formally submitted, regardless of the leadership’s position on the bills. However, no administration has yet presented a fast-track trade bill without close consultation with the leadership.

Separately, Rep. Gregory Meeks (D-N.Y.), one of the "CAFTA 15" Dems who voted for the NAFTA expansion to Central America said he will try to get some labor groups to take a “neutral” position on the Colombia FTA. And...

[Rep. Sander] Levin said that if the Administration tries to send the final implementing legislation for the Colombia FTA to Congress without a green light from House Democratic leadership, it would be “very negative” and counterproductive.

Martin Vaughan in Congress Daily had more on this possibility.

lobbyists and administration officials have discussed the option of just sending the Colombia deal up and forcing Democrats to vote on it, if congressional leaders won't take it up willingly. But Democratic aides and opponents of the deal said House leaders might also hold a secret trump card, an "emergency brake" that could short-circuit the fast-track process.

In the event that the White House sent the agreement up, House Speaker Pelosi could write a rule that would make a vote on the agreement subject to the call of the chair. Even though the trade negotiating authority has tools to prevent an agreement from being bottled up in committee, the speaker could, through such a rule change, delay a House floor vote indefinitely. But Democratic aides downplayed that scenario, saying it is unlikely that the Bush administration would risk being repudiated on the Colombia deal by sending it up without the acceptance of Democratic congressional leaders.

If Pelosi wanted, she could face down Bush if he tried to pull this stunt. Normally Fast Track requires a House vote on final passage a maximum of 60 days after the president introduces implementing legislation, with the Senate having 30 additional days to vote. This feature of Fast Track thus forces final action at the latest 90 days after implementing legislation is dropped. However, the 2002 Trade Promotion Authority 2105(c) makes clear that this requirement, as well as Fast Track’s ban on amendments and 20-hour limit on debate,

"are enacted by the Congress—

(1) as an exercise of the rulemaking power of the House of Representatives and the Senate, respectively, and as such are deemed a part of the rules of each House, respectively, and such procedures supersede other rules only to the extent that they are inconsistent with such other rules; and

(2) with the full recognition of the constitutional right of either House to change the rules (so far as relating to the procedures of that House) at any time, in the same manner, and to the same extent as any other rule of that House."

A Congressional Research Service memo makes this even clearer:

Although this [Fast Track] statute is permanent law, it has been enacted as an exercise of the rulemaking power of either House and can be changed by either House, with respect to its own procedure, at any time, in the same manner and to the same extent as any other rule of that House.

So, will Bush attempt to use Fast Track to slip the Colombia FTA past Congress? If he does, will the Dem leadership block the move by changing the rule on Fast Track? Or will the Dems fold their opposition on this NAFTA expansion before the show-down happens? Corporations are celebrating Democrats' caving in on Peru as creating momentum for Colombia FTA, after all. Stay tuned.

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Import toy safety - where's Congress?

The Democrats rode back to power last November thanks to fairly unified opposition to more NAFTA style agreements. Then, this year, with the imported toy safety crisis, there's been increased calls for overhauling of our 1970s toy safety regulatory policy, premised on a reality when most toys where made domestically.

We already know how a slim minority of the House Dems and a frightening majority of the Senate Dems caved on the first issue, by helping pass Bush's NAFTA expansion to Peru. Of those running for president, only Kucinich and Paul managed to vote right, while everyone else - including Biden, Dodd, Clinton, Hunter, McCain, and Obama - didn't manage to even show up to vote. (Additionally, Tancredo voted wrong.)

Now, it seems they're poised to cave on the second as well. Last night, just a couple of minutes before close of business, the House passed 407-0 a Consumer Product Safety Commission bill that does practically nothing on import safety. (If you want to see what "something" looks like, and why the Wall Street Journal gave us some luv and called us " a hard-liner among consumer groups",  see the recommendations at the end of our latest report and after the jump.)

As far as I know, Rep. Jan Schakowsky (D-Ill) was the only member to even acknowledge the shortcoming:

"I hope we can make this bill even stronger. Even with added resources authorized from the bill, a major improvement from the levels requested by President Bush, we could do better, particularly when it comes to monitoring imports. I support measures to add mandatory premarketing testing and other important things."

Now, the bill goes on to the Senate, where there's slightly stronger but still inadequate bill that has been reported out of the Senate Commerce Committee. As The Hill reported,

Industry lobbyists favored the House version, which some consumer groups said didn’t go far enough to protect consumers...

According to a report released Wednesday by the consumer group Public Citizen, however, neither the House measure nor the tougher Senate version will address one of the main culprits in the wave of toy recalls this year: trade policies that have driven domestic toy manufacturers to move their operations overseas.

'Nuff said. Another case unfortunately of siding with industry over meaningful solutions to the problems facing middle class Americans. (see our full recommendations after the jump.)

Not everyone is as shortsighted, however. As Sen. Bob Casey (D-Pa.) said at today's Pa. news conference on our report,

Sen. Casey is backing a bill in the U.S. Senate that would reform the Consumer Product Safety Commission. However he admits that is only part of the problem. He says changes need to be made when it comes to America’s trade policies because from steel to chocolate, Pennsylvania has been hit hard by companies moving overseas.

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

Continue reading "Import toy safety - where's Congress?" »

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Senate Dems join GOP to approve another NAFTA expansion

This is our statement:
Dec. 4, 2007

In Peru Trade Vote, Senate Democrats Break With Base, Dismiss Widespread Public Opposition to More-of-the-Same Trade Policy and Join GOP to Vote for Another Bush NAFTA Expansion Pushed by Corporations

Seven of Nine Senate Freshmen Democrats Oppose Expanding NAFTA to Peru

Statement of Lori M. Wallach, Director of Public Citizen’s Global Trade Watch Division

Although not one U.S. labor, environmental, Latino, consumer, faith or family farm group supported the Peru free trade agreement (FTA), a majority of Senate Democrats today broke with their base, dismissed widespread public opposition to more-of-the-same trade policy and joined Republicans to deliver another Bush NAFTA expansion to the large corporations pushing this deal.

The debate in the Senate contrasts with that in the House of Representatives last month. There was little focus on the Peru NAFTA expansion deal in the Senate, but in the House an intense, multi-month debate resulted in a majority of House Democrats, including 12 of 18 House committee chairs, voting against the Peru pact and signaling that it is not an acceptable model for future trade agreements.

The breakdown of this vote vividly demonstrates two phenomena: the distance between most senators and the American public on trade issues, and the depth of the American public’s negative opinion about NAFTA-style trade deals. All but two of nine Democratic freshmen senators who recently campaigned extensively in their states opposed the Peru NAFTA expansion today. Most of the Democratic presidential candidates oppose it, including Sens. Joseph Biden of Delaware and Chris Dodd of Connecticut.

In contrast to most of the Democratic presidential candidates who oppose the Peru NAFTA expansion, Sens. Hillary Clinton of New York and Barack Obama of Illinois support it. Clinton and Obama’s support for the Peru FTA – after both opposed the 2005 Central American Free Trade Agreement (CAFTA), which contained identical provisions and now campaign against NAFTA in Iowa, should make voters wonder just what sort of trade policy Clinton and Obama really support. None of the senators running for president voted today, although all four have issued public statements taking positions on the Peru pact.

Clinton’s support for the Peru FTA suggests that her recent call for “a time-out” on trade agreements apparently begins only after she votes for one more NAFTA-style agreement. The fact that Obama was the first Democratic presidential candidate to announce his support for the Peru NAFTA expansion two months ago makes his recent attacks on Clinton regarding NAFTA bizarre.

Neither Clinton nor Obama has made clear which of the objectionable NAFTA foreign investor privileges – imported food safety limits, service sector privatization and deregulation, “Buy America” bans and other provisions – would be eliminated in potential Clinton or Obama-negotiated agreements. Voters across the country who have suffered the real-life damage from NAFTA deserve to know how all this anti-NAFTA talk from Clinton and Obama would translate if either were elected president.

In key early primary states, Sen. Tom Harkin (D-Iowa) and both Iowa freshmen Democratic House members opposed the Peru NAFTA expansion, as did both New Hampshire Democratic House members.

That the Senate passed a NAFTA-style trade agreement by a wide margin is not unexpected, as even the highly controversial NAFTA had 61 in favor, including 27 Democrats, in 1994. The Morocco and Bahrain FTAs were passed by voice vote in 2004; 80 senators voted for the Australia FTA also in 2004; 83 voted for China permanent normal trade relations in 2000; the Singapore FTA in 2000 obtained 66 votes; and the Chile FTA got 65. In 2005, CAFTA, which obtained no votes from numerous prospective Democratic presidential candidates who had never before opposed a pact, was the closest Senate trade vote ever at 54-45.

The passage of the Peru FTA, which was overwhelmingly opposed in the United States and Peru, is bad foreign policy, bad domestic policy and egregiously bad politics. Both of Peru’s labor federations, its major indigenous people’s organization and its archbishop called on the U.S. Congress to oppose the deal based on the damage it is projected to cause Peru’s small farmers and environment.

The Peru NAFTA expansion replicates many of the CAFTA provisions that led most Democratic senators to oppose that pact. This includes: foreign investor privileges that create incentives for U.S. firms to move offshore and expose basic environmental, health, zoning and other laws to attack in foreign tribunals; bans on “Buy America” and anti-offshoring policies; limits on food import safety standards and inspection rates; and NAFTA-style agriculture rules that are projected to displace tens of thousands of Peru’s Andean farmers and thus increase coca production and immigration. The pact also contains terms that could subject Peru to compensation claims for reversing its unpopular Social Security privatization, the same system Democrats fought against at home.

Repeated polling shows that the American public, both Democrats and Republicans, have negative feelings about current U.S. trade policies and the effects on their lives. Democrats in 2006 gained a majority in Congress with scores of candidates winning in campaigns focused on changing the NAFTA trade model.

The message of the midterm elections was loud and clear: Voters want a new direction on trade. Congress’ public approval rating will not be helped by ignoring this call and passing another Bush NAFTA expansion.

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Liveblogging the Peru FTA Senate vote, Take II

5:13 pm: The Hill has a story that highlights Sen. Harry Reid's (D-Nev.) opposition:

Senate Majority Leader Harry Reid (D-Nev.) was one of 16 Democrats voting against the deal.

“It is very unfortunate that the Bush administration’s only policy towards Latin America has been to negotiate free trade agreements,” Reid said. He added that he “reluctantly” opposes the Peru deal because it “reflects major improvements from the previous model.”

“But I still see many holes in U.S. trade policy that need to be filled,” Reid added.

3:29 pm: Full analysis forthcoming, but the majority of leadership and freshmen opposed (minus not surprisingly Ben Cardin from Maryland and VERY surprisingly, Jim Webb of Virginia, hitherto MISTER Inequality). None of the candidates for president even voted, including Clinton, Obama and McCain, who were for; and Biden and Dodd, who were against.

2:54 PM: Passes 77-18.

1:22 pm: There is a bit of life here at the liveblog. There's an agreement to not have more debate and just come in for a vote at 2:15 pm. So we'll know within the hour.

11:42 am: Yeah, we're asleep at the wheel, sorry. Sen. Max Baucus (D-Mont.) just said "Peru is no ordinary country, and the Peru FTA is no ordinary trade agreement." Given Baucus' relentless advocacy for expanding NAFTA to additional countries in opposition to his party's base, Max Baucus is no ordinary senator.

So, we didn't miss much from the Senate debate, as it turns out, which will begin anew shortly after 10 am, and the vote is still scheduled for 2:15 pm.

A couple of things worth pointing out about yesterday's floor speeches:

  • Sen. Ken Salazar (D-Colo.), who voted right on CAFTA and wrong on the Oman FTA, argued that: "coca production, a major concern of ours with respect to Peru, has decreased dramatically, thanks in large part to the eradication, interdiction, and other efforts to develop economic opportunities for the Peruvian people." He appears to be talking about in relation to the 1990s, but as this estimate by the Department of Justice shows, "Coca cultivation in Bolivia and Peru has the potential to increase significantly and to replace some of the decreased cultivation in Colombia: Cocaine production in Bolivia and Peru is at a much lower level than in Colombia. However, illegal coca cultivation has increased to its highest level in 5 years." And as the Economist reported, social movements in Peru are mobilizing to promote even further coca cultivation.
  • In fact, trade policies are never going to substitute for a development or anti-drug policy. As the New York Times reported in 2004 on U.S. efforts to use trade policy to undermine coca production, '
    • After 55 years of packing Eastern Washington asparagus, the Del Monte Foods factory here moved operations to Peru last year, eliminating 365 jobs. The company said it could get asparagus cheaper and year-round there.

      As the global economy churns, nearly every sector has a story about American jobs landing on cheaper shores. But what happened to the American asparagus industry is rare, the farmers here say, because it became a casualty of the government's war on drugs.

      To reduce the flow of cocaine into this country by encouraging farmers in Peru to grow food instead of coca, the United States in the early 1990's started to subsidize a year-round Peruvian asparagus industry, and since then American processing plants have closed and hundreds of farmers have gone out of business.

      One result is that Americans are eating more asparagus, because it is available fresh at all times. But the growth has been in Peruvian asparagus supported by American taxpayers...

      'The irony is that they didn't plow under the coke to plant asparagus in Peru,'' said John Bakker, executive director of the Michigan Asparagus Advisory Board. ''If you look at that industry in Peru and where it's growing, it has nothing to do with coca leaf growers becoming normal farmers. Coca leaf is grown in the highlands. The asparagus is near sea level.''
  • It's not for nuttin that the Washington Office on Latin America and our office argued that the coca-trade connection is the opposite of the one Salazar argued on the floor yesterday: NAFTA-style trade policies lead to RURAL DISPLACEMENT, which means immigration or pursuit of illegal drug cultivation.
  • These and other arguments (about food safety and ag policy more generally) are made forcefully by a letter sent yesterday by family farm groups to the Senate on the Peru FTA.
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Liveblogging the Peru FTA Senate vote

5:35pm: I'm out.

5:18 pm: Sanders conceding that NAFTA has been good for some Mexicans... well, one. Carlos Slim, the world's richest man.

5:14 pm: "If you like NAFTA, you'll love the Peru FTA. Most people in America don't like NAFTA."

5:10 pm: Once you've been in DC a few years, it really is amazing how rarely you hear members talk about class and inequality in America - something that, after getting back from Chicago where my brother lives, most people in America are comfortable talking about. Sanders is not afraid of going there. Now, he's citing IIE and CEPR studies that document the inequality...

5:06 pm: Sen. Bernie Sanders (I-Vt.), fair trade champion, bringing the pain on Peru FTA, leading off with unsafe imports

5:01 pm: By way of a little advance warning, I am probably going to head home within the next hour (got stuck overnight in Chicago last night, am fighting a cold... did I mention that airport contracted illnesses skyrocketed after NAFTA??!! We need a change in this trade model!), but if people want to liveblog it post 5:30 pm or so in the comment section, you can follow the awesome display of senatorial argumentation at C-Span 2 at this link.

4:50 pm: Grassley is taking on the argument that the Peru FTA will worsen our food safety laws... we wrote a report on this. He argues that there hasn't yet been a challenge of U.S. food safety laws. This is a complex debate, but the WTO challenge of EU's food safety regime is case one that it could happen. If we ever GET some good food safety laws, you can bet this could happen to us under the WTO, NAFTA and Peru FTA laws. The Peru FTA opens up our current food safety laws - low as they are - to claims for compenstation from corporations.

4:43 pm: Okay, we don't work on Venezuela here, but the stuff that gets said about the country is ridiculous. If possible, the media misrepresentations of what goes on there rival or exceed what is said about trade policy. In particular, the proposal to have MORE elections, institute gay rights and other measures is commonly described as some sort of attempt to abolish democracy. Well, that measure was voted down democratically today, and the government is respecting the result. For more on that situation, check out an insightful and funny blog at www.BoRev.Net. A more academic take is here. Nevetheless, as we argue here, the best way to avoid more Chavez's - if that's the goal - is to avoid contributing to economic misery and displacement abroad. Last time I checked, that's how populism succeeds...

4:40 pm: Grassley admits that the FTA will lock-in policies in Peru that current neo-liberal governments passed but which future governments will be bound to.

4:29 pm: Grassley cites the USITC report as justification for passing the Peru FTA. Keep in mind that this report, the official U.S. government assessment, shows our global trade deficit will increase with the Peru FTA.

4:26 pm: Despite the fact that you can't make an economic argument in favor, Grassley and Sen. Bill Nelson (D-Fla.) try to by saying Peruvians will buy tons of our exports.

4:23 pm: Grassley admits that there is no economic justification for the Peru FTA, and it's all geopolitical. But iIn the words of Archbishop Pedro Barreto, the President of the Episcopal Commission for Social Action of the Catholic Church in Peru, “We are certain that the trade agreement will increase the cultivation of coca, which brings along with it a series of negative consequences including drug
trafficking, terrorism and violence.”

4:22 pm: My feed went out for a while. Apologies. Sen. Chuck Grassley (R-Iowa), ranking member of the Finance Committee, endorsing the Peru FTA as expected.

3:49 pm: Dorgan: Despite new labor rights, neither Bush nor the Chamber plan on enforcing them or want them to be enforced, as evidenced by their rejection last year of the proposal by then-Peruvian president Toledo to include ILO conventions themselves in the core text of the agreement. The Jordan FTA shows that paper labor rights are not enough...

3:46 pm: Dorgan: "This agreement will not harm the economic interests of the United States. I don't argue that. But it's an extension of a failed model."

3:40 pm: Dorgan reminding people of the radical, demogoguery of the claim that there is a connection between a net trade deficit and job loss in tradable sectors... sadly, this is still not widely conceded by the pro-NAFTA side, despite hundreds of years of economic theory.

3:30 pm: Sen. Byron Dorgan (D-N.D.) speaking about Bush's NAFTA expansion to Peru, and called for benchmarks in FTAs so that trade balance is maintained, job creation in tradable sectors prioritized...

3:19 pm: Debate is beginning. Vote will happen at 2:15 pm tomorrow.

We'll be liveblogging the Peru FTA Senate vote, momentarily.

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And from numerology to astrology. What's your sign and what does it mean for Peru NAFTA?

The Washington Post actually has a useful resource! A congressional vote breakdown by astrological sign! Who knew?

Here's the Peru NAFTA expansion breakdown:

Astrological signYesNoNot Voting
Aquarius28 8 1
Aries19 10 1
Cancer30 17 2
Capricorn23 10 0
Gemini38 10 3
Leo21 14 1
Libra25 12 2
Pisces13 10 0
Sagittarius22 6 3
Scorpio20 12 1
Taurus15 11 0
Virgo31 12 2
Total285 132 16

So with some very sophisticated calculations (ignored non-votes, found percentage per sign opposing), it looks like Pisces are the most fair trade inclined with 43% of Pisces voting against the Peru NAFTA expansion.

This is not surprising since according to, Pisces "urge to relieve suffering in others is as strong as the life force and it is the single most important element of her nature to understand."

And which sign are the biggest NAFTA supporters? Gemini has it with only 20% of Gemini House members opposing the Peru deal.

Also not surprising. According to, Gemini "is dual-natured, elusive, complex and contradictory. On the one hand it produces the virtue of versatility, and on the other the vices of two-facedness and flightiness." This about sums it up. Many of those who voted for the Peru NAFTA expansion did so despite earlier statements condemning the overreaching investor protections, NAFTA's agricultural rules and other NAFTA provisions that appear exactly as they did in NAFTA in the Peru agreement.

So in the future, when we ask what your sign is, what we mean is are you more likely a NAFTA supporter or a fair trader?

NOTE: Senate tally not yet in. Will of course revise this important report after the Senate vote, which is likely to happen the second week of December.

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On the political divan

Late November is the time of year when we try to digest the food we've been shoveling in our traps for days, and also try to make some sense of the goings-on of the year. But the Washington Post had a story that is not helping my physical and psychological recovery any. There's a lot of scary stuff in there about how politics happens in this town (together with Rahm's questionable dating advice), but there are some quotes of note within (my emphases):

So this spring the Democrats, in concert with union leaders such as Sweeney, crafted a long list of requirements for any trade deal with the administration. The list included requiring other nations to "adopt, maintain and enforce basic international labor standards in their domestic laws and practices" and to implement and enforce multilateral environmental agreements; ensuring that foreign investors do not enjoy greater investment protections than U.S. citizens; and providing guarantees of access to affordable prescription drugs...

"We were able, thank God, to take yes for an answer," said Democratic Caucus Chairman Rahm Emanuel (Ill.), a member of the Ways and Means Committee.

Sweeney was meeting with foreign labor leaders in Berlin when the deal was struck on May 10, but both Rangel and Pelosi called to inform him of the news. At about midnight Berlin time, Sweeney spoke to the speaker on the phone. "This is a historic agreement," he told her.

But moments later, as Pelosi walked into the Speaker's Dining Room to hold a news conference with Schwab and Treasury Secretary Henry M. Paulson Jr., she found herself facing hostile Democrats. A handful of lawmakers opposed to the trade pact with Peru -- including several Democratic freshmen who had campaigned on the issue -- had squeezed themselves into the tiny room on the Capitol's first floor and stared stony-faced at the speaker.

"We're not against trade. We just want a trade system that works," said Rep. Betty Sutton (D-Ohio), a former labor lawyer who listened skeptically as the bipartisan group outlined its achievement.

Many of Sweeney's fellow union leaders delivered even harsher assessments of the new trade accord. Change to Win, the six-million member federation that now ranks as the AFL-CIO's main rival, issued a news release on May 25 saying that the agreement "does not represent the basis for the type of new U.S. trade policy that this nation desperately needs."

Even some leaders of the AFL-CIO's own affiliates rejected the agreement, saying they do not trust President Bush with the enforcement of its labor provisions...

It is a dilemma that leaves Rep. Xavier Becerra (D-Calif.), a Ways and Means Committee member, wondering whether, in incorporating provisions on environmental and labor standards in the deal, his party has proven that it can deliver benefits to the working men and women who helped return it to power.

"Trade has to be sold as something that's good for us. This deal goes partway towards addressing that. Whether it goes all the way . . .," the congressman said, his voice trailing off.

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No slippage here, keep walking

Corporate and political elites have been trying to expand the WTO unsuccessfully for over a decade. One of the main components of their plan is to subject the U.S. higher education sector to WTO coverage, something that would be very bad from the perspective of domestic policy innovation. See here for more. But in the wake of the Bush lovefest on the NAFTA expansion to Peru, it seems that there might be some more rumors of slippage on the slippery slopes, ranging from more Fast Track for Bush to actually considering expanding the WTO. From today's Congress Daily PM:

U.S. Trade Representative Schwab said "there is every reason to expect" that a Doha agreement on world trade can occur before President Bush leaves office, according to a transcript of remarks she made Monday in Singapore. She also said Democratic congressional leaders have indicated a willingness to move ahead on presidential trade negotiating authority if negotiators come up with a framework for a Doha deal...

A spokesman for Speaker Pelosi said Democrats would "want to see what agreement is negotiated," but did not rule out action on trade negotiating authority if the Doha deal is good enough to appease Democrats. A spokesman for Senate Finance Chairman Baucus said that if a Doha deal is negotiated, Baucus will confer with Schwab, House Ways and Means Chairman Rangel and others "to determine the appropriate next steps." the aide said.

No indication yet on how real any of this is, or if just bluster on all sides. We'll stay tuned...

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Musing on strategic pauses and the non-slippery slopes...

We heard a lot over the last year from a lot of clever Washingtonians about how if we just stopped "squawking" about the NAFTA expansion to Peru and gave Dems a pass to vote for this one, then we would avoid the "much scarier and totally different" NAFTA expansions to big, huge, giant, monstruous countries like Colombia and South Korea.

As the argument seemed to go, "principle?! who needs principles, especially when your policy stance is so easy to understand! First, spend 25% more on labor monitoring, but lower your auto tariffs by a formula equal to the logarithim of the increased labor spending, and then multiply that by the number fewer of murdered workers in non-tradable sectors over the number of increased cut flower imports. Then, while covering your eyes with a Made in China American flag blindfold, throw a dart on a spinning Made in Mexico globe, and the small country 36 degrees due west is the country where it is OK to have a NAFTA-style trade agreement."

Huh? What? As we argued previously, "what determines the effects of a trade agreement is not mainly the economic size of the country involved but instead the scope of the extraordinary corporate rights established under the agreement - rights that undermine U.S. domestic and foreign policy goals." josh Holland and David Sirota argue something similar here. Peru and Panama may not be huge, but they're big enough for a lot of corporations to think it was very important to extend NAFTA to them. I guess you don't need too much space to set up Halliburton Peru and then use the FTA's corporate rights to undermine Peruvian and U.S. laws. Or whatev' you want to do.

And if matters of principle don't get your blood racing and hips shaking, then the political argument alone should be compelling. Let's say that 20% of members of Congress are firmly with fair traders on principle, while 30% are firmly against. (As it turns out, these are the percentages of House members that vote fair trade at least 80% and 0% of the time, respectively). That leaves about 218 members - of 50% of the House - that are picking and choosing their positions on fair trade depending on the bill, and are looking to outside pressure groups to define where the lines in the sand are. Elected officials don't necessarily have a long memory, but long enough to know that a model for one country should be just as good/bad for any other country. Or let's just say, I would love to be in on the lobby meeting where someone tries to convince a member otherwise. Like Twister, expect with tainted Peruvian ceviche and Colombian murderers on the red and blue dots.

In any case, the so-called Peru-passage-for-Korea-opposition deal that clever Washingtonians were so confident about appears to be fraying apart, as America's Ways and Means chairman announces from the SquawkBox. Check out this video at about 5:54 minutes in, or read this transcript and reporting from the Bureau of National Affairs:

Rep. Charles B. Rangel (D-N.Y.) said Nov. 16 he is optimistic that Congress will consider the pending U.S. free trade agreements with Colombia, Panama, and South Korea next year but cautioned that it is still not a sure bet. Rangel, who chairs the House Ways and Means Committee, said that problems remain with all three agreements that will need to be resolved.

He said that the agreement with Colombia would not be approved if it were brought before Congress for a vote today, calling the situation in the country "pretty heavy in terms of the violence against a whole lot of teachers and labor leaders." "We just don't have the votes," Rangel said.

With respect to Panama, Rangel said that the fate of the pending FTA with that Central American nation may be in the hands of the State Department, following the election this fall as president of the National Assembly of a Panamanian legislator under indictment in the United States for the murder of an American soldier. Rangel called the legislator--Pedro Miguel Gonazalez-Pinzon--"a big elephant in the living how we handle that may be up to the State Department."...

Rangel, speaking in an interview on CNBC's "Squawk Box," said that, with respect to the FTA with South Korea, it is "being negotiated by the Executive Branch [which] is trying to get some relief for our beef exports."

But in the end, he said, he is optimistic that Congress will take up all three agreements next year, which some observers, however, have argued may be impossible because it will a presidential election year. "I'm optimistic [that] next year we'll take a look at all of these things," Rangel said, "and maybe the situation might change."

This makes sense. After all, once you've forced tons of members of the caucus to vote for a flawed trade deal with one country, why would anyone think twice about voting for the exact same trade deal with another country? I'm not necessarily a member of the USTR fan club, but I think the fine team over there could probably bring some pressure to bear to reshuffle some Panamanian officials, Colombian statistical methods on assassinations, and Korean tariffs.  Maybe that would be enough of a template for a new trade policy for some observers, but I don't think that such little tweaks are what really make the difference when we're facing a massive bleeding of high-paying jobs ever further up the skill and income ladder.

D4507fn1 And that brings me to my last and final musing of the day, on the argument for a "strategic pause" on trade. Jeff Faux from EPI has been raising this notion for a long time, and it must be a pretty powerful idea because presidential candidates are feeling the need to echo it, and from what I've read and heard, the Corporate Powers That Be within Dem circles are very scared of it.

Continue reading "Musing on strategic pauses and the non-slippery slopes..." »

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