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The Democrats 'Free Trade' Divide
"Free trade" has produced some of the most contentious political debates of our times. In a famous April 2000 article in the New Republic, economist Joseph Stiglitz argued, "Economic policy is today perhaps the most important part of America's interaction with the rest of the world. And yet the culture of international economic policy in the world's most powerful democracy is not democratic." During the Bush years, economic policy received far less attention in political discussion than before; the use of military force took center stage. However, the trade and development debate went on, and it continues to affect fundamental questions of global poverty, inequality, and opportunity. Under a new Democratic administration-or under a Republican administration that demotes the neocons in favor of the more traditional, realist foreign policy establishment-it is likely that economic policy will again become the most important part of America's interaction with the world. And it is likely that it will remain profoundly undemocratic.
The injustices of neoliberal trade policy and the hypocrisy of U.S. stances in international negotiations have produced an upheaval in multilateral institutions like the WTO, and this has helped to transform the debate about the global economy. But trade is also an important domestic issue. Today, trade policy plays an important role in the battle for the soul of the Democratic Party.
One of the major accomplishments of the Clinton administration was to move to the fore of the Party a faction led by the centrist, corporate-friendly Democratic Leadership Council. Working with pro-"free trade" Republicans, Clinton and the DLC made passing the North American Free Trade agreement (NAFTA) in 1993 and approving U.S. entry into the World Trade Organization (WTO) in 1994 into bipartisan crusades. The coalition in favor of corporate globalization was always tenuous, however. In recent years, especially as the Bush administration implemented an increasing belligerent foreign policy, the "free trade" coalition has frayed.
Shifting Center of Gravity
The center of gravity around trade issues has been slowly shifting in the Democratic Party throughout the Bush years, as candidates have found that popular disaffection with "free trade" deals can be a potent political force. As a result, trade debates have grown increasingly contentious. The Bush administration's need to resort to desperate measures in order to pass CAFTA in 2005-and the fact that it squeaked through Congress with the smallest possible, 217-to-215 majority-reflected the conflict.
When the Democrats swept the November 2006 elections and regained control of Congress, many of the victorious campaigns featured prominent pledges to oppose pro-corporate trade policy. In an excellent post-election analysis, Public Citizen's Global Trade Watch documented a major defeat for the "free trade" coalition. Its report tracked seven senate races and 28 House contests in which "fair trade" advocates ousted "free trade" incumbents or won open seats previously held by advocates of neoliberal deals. In contrast, no fair trade incumbents were unseated.
Whether the wave of revulsion against corporation globalization will propel a lasting change in Democratic policy-making will depend largely on figures like Representative Charlie Rangel (D-NY), House speaker Nancy Pelosi (D-CA), and Max Baucus, the Montana Democrat who became chair of the Senate Finance Committee. These political chiefs certainly do not represent the fair trade activists at the base of their party. In late 2006, President Bush visited Vietnam the week before Thanksgiving, and he hoped to bring with him news of Congressional approval of Permanent Normal Trade Relations with that country. This measure that would have served as a stepping stone to a free trade deal and an endorsement of Vietnam's entry into the WTO. It didn't happen. The bill failed to secure the two-thirds majority it needed to pass, with many emboldened Democrats rallying to defeat it. The New York Times declared that the vote, which was supposed to be an easy victory, instead signaled "a deep disappointment and embarrassment for the White House."
It may prove a temporary setback, however. Both Pelosi and Rangel voted in favor of the Vietnam trade legislation, and promoters of the measure would like to see it resurrected. In May 2007, Democratic leaders announced that they had brokered a deal with the White House to resume the bipartisan push for "free trade" agreements, ostensibly with stronger labor and environmental provisions attached. True to form, the deal was negotiated in secret, without input from environmental, labor, or public interest groups-or even participation from the majority of Democratic lawmakers who view the "free trade" agenda with suspicion. What the agreement will mean in practice, and whether opposition lawmakers and the citizens who put them into office will accept the Bush-Rangel deal, is still being determined.
Congress passed a trade deal with Peru in late 2007 over the opposition of labor and environmental groups, and discord has flared up once again over a possible agreement with Colombia, although election year politics make its passage unlikely.
The Costs of 'Free Trade' At Home
Debates over international trade and development policy can often seem distant to most people. Yet the battle within the Democratic Party shows that these issues matter a great deal to Americans as well as citizens overseas. Under the market fundamentalist policies of neoliberalism, the international economy has been managed for the benefit of a very narrow slice of the population. It has placed the U.S. Treasury and the International Monetary Fund in positions as economic overseers on a global plantation. This type of domination goes against the values of all those who decry sweatshop economics abroad.
It also has costs at home. The interests of Wall Street are not the same as our national interests or the interests of working people. As successive administrations in Washington have enforced a type of market fundamentalism in foreign affairs, they have too often pursued a parallel set of policies domestically. Since the days of Ronald Reagan, Americans, too, have been locked into the trickle-down economics of the "golden straightjacket," which has been a lot more golden for billionaire families like Thomas Friedman's than it has for typical citizens. For some, like those left behind after Hurricane Katrina--when a stripped-down government did little to help those in New Orleans who could not afford to evacuate themselves-the results have been tragic.
Sadly, neoliberal economics are not the exclusive purview of Republicans. Indeed, given the Bush administration's international recklessness, an increasing number of corporate elites are turning to the Democrats to implement their economic agenda. In a front-page story entitled, "GOP Is Losing Grip On Core Business Vote," The Wall Street Journal reported in October 2007 that the party could be facing a brand crisis as "[s]ome business leaders are drifting away from the party because of the war in Iraq, the growing federal debt and a conservative social agenda they don't share." Their defections will only increase tensions within the Democratic Party.
The ongoing battle in Washington has made clear that many centrist Democrats who denounce Bush's imperial globalization would be all too eager to return to Clinton's pro-corporate vision for the global economy if given the chance. But it also indicates that their position may not be as politically viable as it once was. A decade and a half after NAFTA moved the trade debate to the fore of political discussion, the broken promises of "free trade" agreements are making neoliberalism's "clouds of gold" ever harder to sell.
The majority of Americans have reason to cry foul at such deals and to pressure their leaders to enact a truly democratic economic agenda. Citizen demands for good jobs, for full employment, and for investment in the public good go hand in hand with the call for fair trade and economic human rights throughout the world.
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18 Comments so far
Show AllLargely forgotten in the free trade debate is the tremendous environmental cost of shipping goods long distances. Things that can be made and bought locally should be. Trade should be reserved for natural resources and specialty crops (e.g. coffee), not t-shirts and athletic shoes made in sweatshops.
Superb article, Mark. Clarification that those of us out here in the netherland have long needed. Thank you.
If you watch politics for awhile, you'll find there are some issues where both parties positions switch every time there is a change in who's in power. The constant is that the party in power always takes one position, and the party out of power always takes the opposite. When the Democrats and Republicans change positions of power, they also change positions to maintain this. This issue has been one of these.
Its very easy for the party out of power to use rhetoric around this issue in their campaigns. But, what we've seen is that since money rules American politics, the party in power always does what the money wants.
So, the Dems might be sniping at this while out of power. But don't expect anything to change when they are in power. If you doubt that, note closely that there is no movement at all by the Dems in Congress to repeal the WTO.
Columbian President Uribe chastised Obama for NOT supporting the Columbian free trade bill, but not Clinton who supposedly has the same position.
Why? Because he knows she's lying, TO US, not to him.
capitalism is NOT democratic- why are we surprised that governments and institutions embracing this religion are not democratic as well? the guiding institutions of the american nation are the corporation, the military and religion- top down deciders all. small wonder we act as we do. . .
It's not enough to be pessimistic and defeatist. It takes hard work, but so what? We need to engage in changing our culture. IF we can work together, slowly, we can persuade people to give up on these dangerous policies. One of the first things we can do is challenge the two-party duopoly by voting for alternatives. We must actively support & reward media that reports accurately and outside of the box. It's not enough to complain; we must be the agents of change.
dont worry, when you all lose your jobs to slave labor in third world countries, because BLACKWATER is hiring enforcers to work in those same countries to keep the slaves in line....of course, you will have to settle for$3/hr and all the peasants you can rape.
The whole premise of NAFTA, supposedly, was that median incomes in all three countries would rise at a faster rate. It hasn't happened.
Another assumption was that income disparities within each country would lessen. In fact, exactly the opposite has occurred.
Any surpise, then, as to why Republicans think that free trade agreements are such wonderful things?
This article shines an all the brighter light on Obama's vague assertions that he is a critique of ne-classical liberal economics. But Obama's idea of fair trade is to make it more fair for the US!
I think that the politicians who supported NAFTA and the WTO had a fair idea of its real consequences. They had to know that the system is set up to benefit corporations, banks and speculators who, in order to profit, use the above organizations dismantle the public sector infrastructures of the the countries that sign these "free trade agreements." Regular people are never the winners here or abroad and lose whatever control they had over their employment and natural resources. Privatization of everything in sight and government backed private thugs and killers to quash any dissent or real labor movements.
I have to agree with sorefeets that the neo-liberal global economy is infinitely UNdemocratic and with Ceecee_em that, until we really start working toward local (democratic) economies, we will be caught in the web of the corporate spinners.
Free Trade and WTO = Genocide. The WTO and NAFTA must die.
http://www.larouchepub.com/other/2008/3517kill_wto.html
"The following is an accounting of the crimes of the WTO-era, and of actions by agencies and figures leading up to it. What is evident, is that the conditions for the vulnerability of millions of people to hunger and now famine, were masterminded by networks with the intent to subvert nations and cause depopulation. The capstone of the whole downgrading process was the biofuels craze, with Al Gore as the top biofool, campaigning to "save the planet." Not his own man, Gore is just the pathetic puppet of the neo-British Empire crowd, intent on subverting the system of nation-states itself, now that the financial system is crumbling.
The WTO crime record can be best understood by looking back to the decades and locations where policies to promote agro-industrial production once were in effect—from the 1930s anti-Depression farm programs in the United States, to the food self-sufficiency programs of India, undertaken after its independence from the British Empire in 1947. But then, over the decades, a series of policy downshifts undercut the goal and the gains made, and decreased the volume of available food. Former high-productivity farm regions were depopulated, from the High Plains of North America, to Europe, Australia, and South America. Now one-seventh of the world's population lacks enough to eat. Against this backdrop, the story of the WTO is one of crimes against humanity, and not an academic "economics" debate.
How to stop the WTO? Nullify it. Withdraw membership. Suspend its codicils, and also those of its multilateral clones, such as NAFTA, CAFTA, and all the rest. There is no way to make any of this so-called "free" (rigged) trade fair or useful. In the face of today's food emergency, recall what the core WTO liturgy is: Nations must not keep food reserves, because this would be trade-distorting. Nations must not attempt to be food self-sufficient, because this would deny their citizens the "right to access the world market." Nations must not support their own farmers, because this harms farmers elsewhere. Nations must not use tariffs, because this denies right-of-access to your citizens by foreign producers. And so on and on. The consequences of this are genocidal, so don't debate it. Cancel it."
Does anyone think that the Democratic Party doesn't support "free trade" uber alles? OK, maybe five or so Dems oppose it.
Unfortunately, the majority of voting Democrats don't even understand the problem with sacrificing trade, labor and environmental laws to treaties drawn up by corporate lawyers.
I'm glad to hear in this article that some opposition has been effective, causing the Dems to go underground with their nefarious free trade plans. The problem is that people keep voting for these Democratic leaders who betray their constituents.
Stop voting for Democrats and Republicans, please. Say "No" to plutocracy.
Free trade can be summed up in one word: exploitation. Well, in the US, maybe 2 words: exportation (of jobs), and exploitation. Through 'free' trade mainly the richest of the rich have profited, and everyone else has lost. Some might say China has gained, but has anyone seen what industrialization is doing to their environment? 'nuff said.
ceecee_em April 24th, 2008 12:36 pm
"Largely forgotten in the free trade debate is the tremendous environmental cost of shipping goods long distances. Things that can be made and bought locally should be. Trade should be reserved for natural resources and specialty crops (e.g. coffee), not t-shirts and athletic shoes made in sweatshops."
Well said. And I agree with Rich Griffin, "It's not enough to complain; we must be the agents of change."
Change comes about when we question the status quo, then act on our own to move things in the direction we want to go. Not only in the political arena, but more importantly in our personal habits and actions. We can rant all we want about the lack of political will, but only we can supply the personal will.
The Democratic and Republican parties are corporate owned. Are we?
When someone says that they want to reopen NAFTA, you have to be very careful to listen to their rhetoric. Do they say exactly what they figure needs to be changed or are they vague in the details.
Obama says that we should alter the agreement to put in worker and environmental protections.
Clinton says that she wants to remove all "trade barriers" (whatever that means) and open up the border.
Usually the SPP is looked at as an add on to NAFTA - but make sure that it is not what the candidate means when it talks about modifying NAFTA:
Time to renegotiate NAFTA, not expand it
>by Peter Julian, Marcy Kaptur and Yeidckol Polevnsky
Launched in 2005 by the three NAFTA countries, the SPP was billed as an initiative to "develop new avenues of cooperation that will make our open societies safer and more secure, our businesses more competitive, and our economies more resilient." That sounds good, but after three years and four summits it has become increasingly clear that the SPP is an attempt to expand the reach of NAFTA using stealth to circumvent the debate our three democracies demand.
Under the SPP, these heads of state - advised solely by a body of 35 elite corporate CEOs - have committed Mexico, Canada and the U.S. to a series of regulations, rule changes and other executive decrees that are not subject to the scrutiny and oversight of the three countries' nationally elected legislative bodies. The SPP affects over 300 areas of government responsibility, from energy production and environmental protection to national security and public health.
http://rabble.ca/news_full_story.shtml?x=70313
This whole thing was preplanned between the three of them:
Re-opening NAFTA would benefit Canada: Harper
Prime Minister Stephen Harper said Tuesday that re-opening NAFTA would actually help the Canadian economy, because Canada is the biggest supplier of oil and gas to the United States.
http://www.ctv.ca/servlet/ArticleNews/story/CTVNews/20080422/cusm_summit_080422/20080422/
Business leaders to urge public support of NAFTA
Top business leaders from Canada, the United States and Mexico will urge their governments to publicize their support of NAFTA, in an effort to counter calls by the Democratic presidential candidates to review the deal.
Tom D'Aquino, president of the Canadian Council of Chief Executives, said the three governments should do more than just refute critics of the North American Free Trade Agreement.
"(I want to see) strong affirmation of NAFTA, an agreement we should make it work even better, and the fact we should defend it publicly," he told CTV News.
http://www.ctv.ca/servlet/ArticleNews/story/CTVNews/20080419/nafta_summit_080419/20080419/
"Under the market fundamentalist policies of neoliberalism, the international economy has been managed for the benefit of a very narrow slice of the population."
Yes - the recent Bear Stearns bailout is a perfect example...... of, by and for the wealthy.
"It has placed the U.S. Treasury and the International Monetary Fund in positions as economic overseers on a global plantation."
Yes - they're essentially the money pimps of the 21st Century economic slave trade.
There is no "free market" and there is no "democracy"!
this guy is one of top writers on the web
yes, ITZ me again,
actually i will use CAFTA to import some food into El Salvador, desperately needed lower cost meat, however of course subsidized by USA taxpayer money, we have the last laugh
fuck you idiot gringos
LOVE it payback cocksukers for the war in El Salvador paid for by bullshit military countractors,[soon to be crab bait all]
Viva Thomas Jefferson, a guy Mr Engler quotes a bit
however as Colombia is one of my fav countries, the people are unreal!! exceleete and they do NOT want this trade thingy
this trade is just for the dope dealers like Bush, Uribe, Saca of course, Dyncorp, KBR etc bring in THEIR dope, along with coca cola of course the largest still legal importer of coca leaves
only ignorant obese losers drink that crap.
anyway
this never needs to go into effect as it is wanted by that felon traitor Bush, actually his Dad,Mom and cronies want it, and still make the rules
Jr is just a evil drink, as Sr Chavez touts
and along with Bilary, I am sure they wanted it, as much $$ as they made in the Mena years
Barry Seal was a cool guy, rest in Peace
www.fairtradefish.org. for REAL facts and data and LINKS to pertinent sites
for 'the people' such as HEMP needs to be grown in all Latin countries yesterday.....
Viva El Frente
Buddha Blesses