Jul 25, 2013 - Issue 526

BlackCommentator.com: Workers... Don’t Expect Much From U.S.-Europe: “Free Trade” Deal - Solidarity America - By John Funiciello - BC Columnist

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There is no end of the attempts to make the whole world a “free trade zone,” by both governments and the transnational corporations that are the primary beneficiaries of such deals, no matter the countries involved.

Usually, they are disasters for the workers in the countries involved, going back to one of the early ones of the modern era, the North American Free Trade Agreement (NAFTA), which was a pact among the three countries on the continent, Canada, the U.S., and Mexico.

In a very short time after President Clinton pushed it through 20 years ago, Canada lost about 500,000 jobs to the low-wage country to its south, the U.S. If the U.S. had suffered the same ratio of job loss from NAFTA, it would have lost about 5 million jobs. Mexico was made vulnerable to the industrialized, subsidized, and corporatized American agriculture, so when huge agribusiness corporations dumped goods on the Mexican market, it put peasant and other small farmers out of business. The dumping of chickens in huge quantities near their sell-by date caused large losses of small farms; they just could not compete with the subsidized and automated chicken factories of the U.S.

For sure, the same people who pushed for the free trade agreements were mostly the same people who complained the loudest about the flow of undocumented immigrants to the north bank of the Rio Grande. If your means of making a living in Mexico were snuffed out by the unfair competition because of NAFTA, would you go up north to find any kind of work to support your family? Most people would.

Without much discussion, let alone debate, the free trade agreements sailed through with one country and another, one after the other, and the people did not have a clue what was happening. They did know one thing: for about 40 years, Corporate America was allowed to empty the country of its economic lifeblood by moving manufacturing and industry “offshore,” where there were profits to be made on the backs of workers in other countries, where there wasn’t even a pretense of workers’ rights, labor standards, or environmental regulation. In the U.S., there is a pretense of fostering such things.

When confronted with “free trade,” the people did not know what it meant for their own lives. They knew that they had hemorrhaged good jobs and that factories and shops were closed at an alarming rate and that there was no end in sight. The new obstacles to a decent life, free trade agreements, were not any more understood by the people than capital flight, but the politicians and the corporations reassured them that “free trade” would be a win-win for everyone.

It hasn’t quite worked out that way and the working class and the middle class did not participate much in the securing of the trade agreements, although there were some who were engaged in protests against the false hope of “free trade,” and those protests and other activities made for strange bedfellows. There were trade unionists and environmentalists, young students and old leftists, along with human rights and worker rights activists, economists and academics. While at least some of the people were alarmed about “free trade” and were taking some action, most of the people stayed home.

It wasn’t just the people who didn’t understand or care to know. Politicians of every stripe were absent from this discussion. It was as if they were fooled by the rhetoric and propaganda emanating from the White House and legislative leaders in Washington. The state-level politicians, those who supposedly are closest to the people, were no better at discerning what was happening to jobs, the tax base of the country, or to the entire working class and middle class. As a group, they did not seem to care.

Part of the reason, of course, was that sometime during the past half-century, the trade policies in the U.S. somehow morphed from “treaties” to “agreements,” which meant that they could be negotiated by the Executive Branch, by itself, then presented as done deals to the Congress to either vote them up or down. Treaties, on the other hand, were constitutional things of the Congress, where, presumably, they would be debated by the people’s representatives in the open and subject to discussion and debate by the people, themselves. Today, there is very little heard about such “agreements,” until they are presented to Congress and sometimes to the people (not always, because much of what we know about such agreements are conveyed to us by the mass press, which does not do the job we gave it).

Consequently, the U.S. economy is in the state that it is in and a large proportion of the country does not know why, does not have a clue. There are U.S. “free trade” agreements with countries in various parts of the globe, not unlike the U.S. military, which has about 730 bases in scores of countries. You would not be wrong if you saw a connection between the two.

Trade agreements promoted by Corporate America and slavishly pursued by politicians in power have resulted in the stores of the U.S. being stocked with an endless variety of goods that are made in every country but America. Try to find something that is made by American workers on American soil (no fair citing production of the likes of the slave-like sweatshops of American Samoa). It will be difficult. In a country in which the bulk of the gross domestic product is a function of retail purchases, this has been a bad omen for the future of the economy. The “free trade” policies of the nation have resulted in few exports of goods and the import of most of what we use and a lot of that is junk that ends up in a landfill near you.

“Free trade” benefits the rich, the corporations, and the politicians that do the bidding of the corporatists. Everything is free in “free trade” (the financing, tax subsidies for companies that flee the country, materiel, diplomatic services, the military for protection of assets, the free flow of money among the trading partners, and lots of other elements), except for one thing. Workers are not free to choose which country among the trading partners in which to work to earn their living. It cannot be “free trade,” if the workers are not free to make that choice.

Lest we forget that there are some things the U.S. exports throughout the world: arms, weapons systems, airplanes and missiles, and other such weapons of mass destruction, as well as bad television programming and mediocre movies. These things do somewhat reduce the U.S. balance of trade, usually not for a good purpose.

All of the “free trade” agreements of recent decades are not likely to have raised one family out of poverty or secured needed treatment for a childhood cancer, but they have produced untold riches for the top 1 percent or 2 percent of the population. Now, we are told that a U.S.-European Union trade agreement will be a great benefit, but some economists strongly disagree.

Using the most optimistic estimates of the proponents of this agreement, Dean Baker, macroeconomic economist and director of the Center for Economic and Policy Research, has written that the projections of growth are so small that they don’t pass the “laugh test.” In fact, he said that the object is not to tout the growth in trade, as much as reducing barriers in areas not directly connected to the profit through trade.

Writing in The Guardian (U.K.) earlier this month, Baker said: “For example, several countries in Europe and many state and county governments in the United States impose restrictions that make fracking difficult or impossible. In their dream agreement, the oil and gas industries will have a set of minimal restrictions on fracking. The deal will then define anything more stringent as a restraint on trade subject to penalties.” What company could ask for more? Fracking is the term for hydrofracturing deep underground rock formations by injecting a toxic chemical mix under high pressure to release natural gas and oil from the shattered rock.

In poorer countries, developing countries, some of their people have welcomed “free trade,” because they believed that investments would be made in their country’s roads, bridges, water systems, and electric generating and distribution capacity. In some cases this has happened, but only on a limited basis. Although the U.S. and European countries, as well as the Japanese have been doing that for a long time, China is moving into that arena. However in Africa, leaders are concerned. Initially, China’s trade contact was rather benign, in that it spent money on roads and other necessary structures of developed countries. Now, however, according to a recent Reuters report, 85 percent of China’s exports from Africa are raw materials, such as minerals and oil. Taking materials out of the continent for processing eliminates the development of well-paying jobs that African workers could do, thus boosting their local economies.

Even though the Chinese have provided benefits to the nations of Africa (they have overtaken the U.S. as Africa’s primary trading partner), without the demands, such as a move toward democracy or human rights, that other nations routinely make, their trade policies are beginning to worry some leaders. African countries also are concerned that China’s consumer goods are filling the shelves of stores that could be produced by African workers.

According to a Reuters report this month: “Beijing has provided much-needed capital to a continent starved of investment. The China Import-Export Bank is the continent’s largest creditor and Beijing has promised $20 billion more in loans over the next three years. But Beijing’s money comes with its own strings: it must be spent on Chinese goods or Chinese-built infrastructure. And Chinese firms often source their supplies and workers back home.”

If that sounds familiar, it should. The U.S. has done the same thing, requiring that food aid be purchased from the U.S. and carried on U.S.-flagged ships, all the while claiming “America feeds the world.” In actuality, the food aid largely benefits agribusiness corporations and leaves peasants and indigenous farmers unable to compete in the marketplace.

Whether the “free trade” agreements are negotiated in the open (rarely today) or negotiated behind closed doors (as is usually the case), it is always the people at the bottom of the economy who pay the price. They either lose their jobs and the ability to make a living or they lose their land and forests to richer nations that covet their capacity to grow food or use their natural resources. Either way, the people lose.

The only way for trade agreements or treaties to be truly free is for workers to be free to choose the country in which they wish to work, and subsidies for travel should be borne by the trading partners, just as they subsidize the corporations that have come to rule at home and abroad.

BlackCommentator.com Columnist, John Funiciello, is a long-time former newspaper reporter and labor organizer, who lives in the Mohawk Valley of New York State. In addition to labor work, he is organizing family farmers as they struggle to stay on the land under enormous pressure from factory food producers and land developers. Click here to contact Mr. Funiciello.

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