CAFTA vs. global trade liberalisation.
Yesterday, the Wall Street Journal repeated the storyline about CAFTA's potential effect on giving new momentum to the stalled trade talks in Geneva, where the WTO's Doha "development" round drags on toward what looks like what will be an unhappy conclusion in 2006. The Journal complained that the closeness and partisanship of the CAFTA vote put the damper on the deal's potentially stirring effect on the WTO-ites:
Congressional approval of a trade pact with six small Central American countries nudged forward the Bush administration's free-trade agenda. But the close vote and bitter fight underscored anxiety about the pace of globalization and clouded prospects for approval of future deals.
The 217-215 House approval of the Central American Free Trade Agreement early yesterday was a clear relief to proponents of continuing the post-World War II trend toward lower trade barriers.
"If we had not moved forward on Cafta, it would have undermined the U.S. position, which has been to lead the fight for globalization," said Calman Cohen, president of the business-backed Emergency Committee for American Trade.
Matt Yglesias pointed out recently that this is a fairly standard conservative line: sure, CAFTA was a porky deal, but blocking it would have been worse because of the message that would send on free trade and on the US's ability to lead the world toward the low-tarriff utopia in which agricultural products flow across poor country borders heading West, and leaving prosperity in their wake. The world's last respectable conservatives at The Economist editorialized as much a couple of weeks ago.
In fact, of course, CAFTA's passage on Wednesday night did nothing to create trade liberalization enthusiasm in Geneva where talks sputtered to yet another stalemate on Friday, to be resumed in Hong Kong in December. Contrary to what the Wall Street Journal says, CAFTA's failure to get the free trade juices flowing probably doesn't have that much to do with the narrowness of the vote in the House. It might, however, have a lot to do with this sort of thing:
It was just before midnight on Wednesday when Representative Robin Hayes capitulated.
Mr. Hayes, a Republican whose district in North Carolina has lost thousands of textile jobs in the last four years, had defied President Bush and House Republican leaders by voting against the Central American Free Trade Agreement, or Cafta.
But the House speaker, J. Dennis Hastert, told him they needed his vote anyway. If he switched from "nay" to "aye," Mr. Hayes recounted, Mr. Hastert promised to push for whatever steps he felt were necessary to restrict imports of Chinese clothing, which has been flooding into the United States in recent months.
...Mr. Hastert "said to me, 'If you vote with me, we'll do everything we need to do in your district to help with jobs,' " Mr. Hayes recalled.
or:
The last-minute negotiations for Republican votes resembled the wheeling and dealing on a car lot. Republicans who were opposed or undecided were courted during hurried meetings in Capitol hallways, on the House floor and at the White House. GOP leaders told their rank and file that if they wanted anything, now was the time to ask, lawmakers said, and members took advantage of the opportunity by requesting such things as fundraising appearances by Cheney and the restoration of money the White House has tried to cut from agriculture programs. Lawmakers also said many of the favors bestowed in exchange for votes will be tucked into the huge energy and highway bills that Congress is scheduled to pass this week before leaving for the August recess.
or:
The enormity of Bush's 2005 agenda suggests that his proposal to cut farm subsidies is nothing more than a ploy to demonstrate his supposed seriousness about halving the deficit by proposing cuts he knows won't pass, thus allowing him to blame the legislative branch for skyrocketing spending.
--The New Republic's editors, February 21, 2005
...After two months of fierce resistance from farmers and Congress, the Bush administration has dropped an effort to cut government payments to farmers.
--Associated Press, April 13, 2005
The major reason the Doha round isn't going forward is because, since about 2001, and especially at the Cancun negociations in 2003, the poorest countries (including Chad, Benin and Burkina Faso) have collectively decided not to take it anymore: "it" being the West's continued refusal to do anything about the US's subsudies to production of cotton, sugar and a whole host of textile goods, and the EU's subsudies to production and export of beef, dairy and sugar (though, in Europe's defence, the 2003 Common Agricultural Policy reforms were a damn site better than the US' 2002 Farm Bill). Together, these allow Western agricultural producers to charge prices on the global market near or below developing nation production costs and thereby gobble up market share, despite relative rich country inefficiency in growing things like cotton (here's a good factsheet on the stakes). The developing nations have sworn to stall talks on politically easier types of liberalization, say in services and textiles, until they get some movement on agriculture.
But globalization goes on apace. And one of its "inconveniences" is that increasing numbers of people all over the world, including the trade representatives and even large segments of the voting public in developing nations, can simply pick up a foreign newspaper or go online to the website of any mainstream Western media source to have a look at how the US really views the quest to free up trade, and what it really prioritizes in its trade agreements, and how really likely it is to take on its farming lobby. That is, it gets harder and harder to get away with being blatantly hypocritical on the global scene.
Guiltily, I admit I've been a sucker in the past for the "can't take a free trade setback" arguments for CAFTA (and, less guiltily, also to the argument that since the real impact is going to be on the Central American signatories to the pact and not on US citizens who will at most see a tiny decrease in the price of sugar and a relatively tiny loss of jobs to additional outsourcing, the US Congress should have honoured the wishes of the countries whose elected governments support and in some cases had overwhelmingly ratified the deal.) But it was still an unncessarily terrible piece of legislation and its giveaways not only to Big Pharma on generics and patent law (which would have been reason enough for me to overcome my qualms above and vote "no", just) but also to those wavering GOP congressmen who want to keep their private sheltered industries (textiles, sugar, cotton) nice & safe give the lie to the Adminstration's supposed global leadership role on trade liberalization.
If anything, CAFTA is more likely to increase global cynicism among denizens of developing countries who don't trust the West to treat them fairly than it is to give the cause of trade liberalization any kind of lift. That's more true today than ever. All any English speaker anywhere has to do is log on to the Washington Post's web page and do a bit of reading.
Congressional approval of a trade pact with six small Central American countries nudged forward the Bush administration's free-trade agenda. But the close vote and bitter fight underscored anxiety about the pace of globalization and clouded prospects for approval of future deals.
The 217-215 House approval of the Central American Free Trade Agreement early yesterday was a clear relief to proponents of continuing the post-World War II trend toward lower trade barriers.
"If we had not moved forward on Cafta, it would have undermined the U.S. position, which has been to lead the fight for globalization," said Calman Cohen, president of the business-backed Emergency Committee for American Trade.
Matt Yglesias pointed out recently that this is a fairly standard conservative line: sure, CAFTA was a porky deal, but blocking it would have been worse because of the message that would send on free trade and on the US's ability to lead the world toward the low-tarriff utopia in which agricultural products flow across poor country borders heading West, and leaving prosperity in their wake. The world's last respectable conservatives at The Economist editorialized as much a couple of weeks ago.
In fact, of course, CAFTA's passage on Wednesday night did nothing to create trade liberalization enthusiasm in Geneva where talks sputtered to yet another stalemate on Friday, to be resumed in Hong Kong in December. Contrary to what the Wall Street Journal says, CAFTA's failure to get the free trade juices flowing probably doesn't have that much to do with the narrowness of the vote in the House. It might, however, have a lot to do with this sort of thing:
It was just before midnight on Wednesday when Representative Robin Hayes capitulated.
Mr. Hayes, a Republican whose district in North Carolina has lost thousands of textile jobs in the last four years, had defied President Bush and House Republican leaders by voting against the Central American Free Trade Agreement, or Cafta.
But the House speaker, J. Dennis Hastert, told him they needed his vote anyway. If he switched from "nay" to "aye," Mr. Hayes recounted, Mr. Hastert promised to push for whatever steps he felt were necessary to restrict imports of Chinese clothing, which has been flooding into the United States in recent months.
...Mr. Hastert "said to me, 'If you vote with me, we'll do everything we need to do in your district to help with jobs,' " Mr. Hayes recalled.
or:
The last-minute negotiations for Republican votes resembled the wheeling and dealing on a car lot. Republicans who were opposed or undecided were courted during hurried meetings in Capitol hallways, on the House floor and at the White House. GOP leaders told their rank and file that if they wanted anything, now was the time to ask, lawmakers said, and members took advantage of the opportunity by requesting such things as fundraising appearances by Cheney and the restoration of money the White House has tried to cut from agriculture programs. Lawmakers also said many of the favors bestowed in exchange for votes will be tucked into the huge energy and highway bills that Congress is scheduled to pass this week before leaving for the August recess.
or:
The enormity of Bush's 2005 agenda suggests that his proposal to cut farm subsidies is nothing more than a ploy to demonstrate his supposed seriousness about halving the deficit by proposing cuts he knows won't pass, thus allowing him to blame the legislative branch for skyrocketing spending.
--The New Republic's editors, February 21, 2005
...After two months of fierce resistance from farmers and Congress, the Bush administration has dropped an effort to cut government payments to farmers.
--Associated Press, April 13, 2005
The major reason the Doha round isn't going forward is because, since about 2001, and especially at the Cancun negociations in 2003, the poorest countries (including Chad, Benin and Burkina Faso) have collectively decided not to take it anymore: "it" being the West's continued refusal to do anything about the US's subsudies to production of cotton, sugar and a whole host of textile goods, and the EU's subsudies to production and export of beef, dairy and sugar (though, in Europe's defence, the 2003 Common Agricultural Policy reforms were a damn site better than the US' 2002 Farm Bill). Together, these allow Western agricultural producers to charge prices on the global market near or below developing nation production costs and thereby gobble up market share, despite relative rich country inefficiency in growing things like cotton (here's a good factsheet on the stakes). The developing nations have sworn to stall talks on politically easier types of liberalization, say in services and textiles, until they get some movement on agriculture.
But globalization goes on apace. And one of its "inconveniences" is that increasing numbers of people all over the world, including the trade representatives and even large segments of the voting public in developing nations, can simply pick up a foreign newspaper or go online to the website of any mainstream Western media source to have a look at how the US really views the quest to free up trade, and what it really prioritizes in its trade agreements, and how really likely it is to take on its farming lobby. That is, it gets harder and harder to get away with being blatantly hypocritical on the global scene.
Guiltily, I admit I've been a sucker in the past for the "can't take a free trade setback" arguments for CAFTA (and, less guiltily, also to the argument that since the real impact is going to be on the Central American signatories to the pact and not on US citizens who will at most see a tiny decrease in the price of sugar and a relatively tiny loss of jobs to additional outsourcing, the US Congress should have honoured the wishes of the countries whose elected governments support and in some cases had overwhelmingly ratified the deal.) But it was still an unncessarily terrible piece of legislation and its giveaways not only to Big Pharma on generics and patent law (which would have been reason enough for me to overcome my qualms above and vote "no", just) but also to those wavering GOP congressmen who want to keep their private sheltered industries (textiles, sugar, cotton) nice & safe give the lie to the Adminstration's supposed global leadership role on trade liberalization.
If anything, CAFTA is more likely to increase global cynicism among denizens of developing countries who don't trust the West to treat them fairly than it is to give the cause of trade liberalization any kind of lift. That's more true today than ever. All any English speaker anywhere has to do is log on to the Washington Post's web page and do a bit of reading.
0 Comments:
Post a Comment
<< Home