Whether there is a Korea-U.S. "Free Trade" Agreement will be decided in the streets of Seoul, not in the halls of the U.S. Congress.
When the Bush administration sat down to negotiate a trade agreement with Korea, some thought that a turn away from the failed NAFTA model of trade was just around the corner. After all, Korea had risen from Sub-Saharan income levels to the ranks of the rich country Organization for Economic Cooperation and Development club in just a few decades by rejecting the package of policies contained in NAFTA-style agreements.
Or, in other words, Korea developed and moved most of its people out of poverty through extensive state-led coordination of the economy by implementing the same policies that all now-rich countries have used to develop. An industrial base was planned and its development subsidized. Exports were promoted and imports restricted through tariffs and other barriers. Procurement policies guaranteed a strong domestic market through Buy-Korea requirements. Currency was controlled. Foreign investment was regulated to ensure benefits for the host country, not just the foreign investor. This package, which the United States also applied vis a vis Europe during the period of U.S. development, is almost entirely forbidden under the dictates of NAFTA-style pacts.
Plus, of course, President Roh Moo Hyun and his government - elected on a "populist" platform - certainly would not agree to a NAFTA template for a U.S. trade agreement. The Roh government would not possibly agree to a trade deal that would prohibit the fundamental policies that created Korean prosperity. Right?
Wrong. The Bush administration has been absolutely ideologically rigid about what model of trade agreement it will pursue. The Roh government did not have to investigate closely to know that Korean demands to keep certain farm products out or not to impose Big Pharma-demanded patent extensions that jack up medicine prices would be a non-starter with the Bush gang. Heck, the Bush administration blew up trade negotiations with South Africa because the country refused demands that it privatize various social services, and because the AIDS-stricken nation refused to sign up for the cookie-cutter NAFTA-style patent rules that would undermine South Africa's AIDS treatment program. The Bush administration has systematically taken a "it's-our-way-or-the-highway" approach on a series of trade deals that they let die rather then be flexible to negotiating partners' demands. Given that record and how the Bush administration treated South Africa, the Roh government's soothing claims to Korean civil society that a Korea-U.S. agreement would not be a NAFTA-style deal was disingenuous at best.
And, then consider the specifics of what the Bush administration has said publicly to the Korean government. The administration has repeatedly, publicly indicated that it absolutely rejects the "line in the sand" items that Koreans insisted must be and must not be in any trade deal with the United States. Yet, despite this clear U.S. government position - that yes, the agreement must include opening the rice market and no, the agreement will not include changes in U.S. anti-dumping laws - the trade talks were launched and have not proceeded through five rounds of major negotiating sessions.
Consider the rice issue, for instance. Korea's rice farmers have inspired awe worldwide for the lengths to which they will go to protect their livelihoods. When Korean farmer Lee Kyang Hae committed what in Korea is called "self immolation" (the taking of one's own life in political protest), as he did during the 2003 Cancún Ministerial of the World Trade Organization (WTO), many people began to understand the deep cultural meaning of rice farming in Korea. In many wealthy countries, where farming is often a business more than a culture or way of life, farmers and consumers alike paused to consider how Mr. Lee could have been moved to such lengths. Yet, in many developing countries, there was ready understanding: Korea may be in many ways a developed country, but a deep connection to the land and the village and the cycle of cultivation was a deep value to which they could relate.
Going into the trade negotiations, Koreans insisted that rice be totally excluded from the terms of the deal. The political and cultural basis was clear, but there was also economic logic behind the demand: rice is one of the most heavily subsidized U.S. commodities and the Bush administration has been 100 percent clear that agricultural subsidies will not be discussed in any trade agreements.
Despite this clear Korean position, the Bush administration promptly and curtly responded that, "We have informed Korea we seek access to [its] rice market."
Or consider the Korean insistence that the United States scrap its trade safeguard laws. These are the laws, called anti-dumping or surge protection or safeguard laws, that allow affected U.S. workers and businesses to petition the government for temporary protection from imports during import surges or when foreign companies are found to engage in predatory pricing practices.
Given the $800 billion U.S. trade deficit, the flood of imports into the United States that grows monthly and the related economic damage for millions of Americans, this demand was a political non-starter. The Bush administration curtly replied to this Korean request, by declaring: "To the extent these proposals could require amendments to [anti-dumping or safeguard laws], the proposals Korea is currently advancing will not be included in the final agreement."
Indeed, the Bush administration's strict ideological rigidity regarding trade agreements and congressional trade politics (and the undemocratic and fatally flawed Fast Track process that currently constrains it) dictated from day one that Korea could not get the kind of "alternative" trade agreement its leaders claim to want.
That said, if the U.S. proposal for a NAFTA-style agreement is to be buried, as it should be, then the shovel work will have to happen with Korea's vibrant civil society movements.
Yes, it is true that the recent election replaced seven senators and 30 House members who were knee-jerk supporters of NAFTA-style deals with pro-fair trade congresspeople. That change is why NAFTA-style agreements the Bush administration has signed with Colombia and Peru will have to be renegotiated to avoid being rejected by Congress. (Many suspect the administration would rather pick a political fight with the Democrats on these deals rather than demonstrate the ideological flexibility inherent in making the necessary changes.)
However, there is not a very good track record in the United States of getting Congress to oppose trade pacts with relatively rich countries that represent tantalizing markets for U.S. exporters. There was widespread opposition to NAFTA and CAFTA. These agreements with less developed countries were seen as anti-development: U.S. anti-poverty and religious groups, and representatives of indigenous people and campesino farmers from the partner countries, fought the foreseeable dumping of U.S. agribusiness commodities and destruction of access to essential services and affordable medicines. These agreements were also seen by U.S. workers and small manufacturers as the multinational corporate lobby's attempt to establish sweetheart foreign investor rules that would facilitate the off-shoring of U.S. jobs.
But pacts with Israel, Canada, Singapore and Australia (although highly problematic for their interference in domestic regulatory concerns that go beyond the reach of "trade") passed Congress by wide margins. Even many members of Congress that could be considered skeptics on trade might find it politically difficult to oppose a pact that stands to offer windfall income to well-connected exporters that have donated to congressional campaign coffers. Plus, the justice arguments about how the extreme provisions could affect residents of a rich country just do not resonate even as U.S. workers and farmers have suffered under the model. Rather, the notion is: between rich countries, let the competition ensue!
All this points to a simple truth: the way the Korea- U.S. FTA will be stopped is if grassroots political pressure in Korea makes it impossible for that democratically-elected government to agree to the U.S. NAFTA-style take-it-or-leave-it deal.
The prospects for Korean activists stopping the FTA are aided by the U.S. Fast Track calendar. The current grant of Fast Track trade negotiating authority expires on June 30, 2007. Under the rules, the Korean agreement would have to be completed and notice given to Congress of intent to sign the deal by April 1. That means that if Korean civil society can build up enough pressure over the next 10 weeks, the FTA threat will be vanquished.
Thus, the best, last chance to stop the Korea-U.S. FTA lies with Korean civil society, who can pressure their own government to walk away from the negotiating table. And the Korean diaspora can also play a role, by using their media and political connections in Korea to share information about the damage NAFTA-style pacts have inflicted on the majority of the population in the United States and in countries with whom the United States has FTAs.
For a citizenry that heroically brought democracy to Korea and boasts among the strongest unions and peasant movements in the world, stopping the Korea-U.S. FTA is an essential task if they are to protect the gains that they have made in the past.
For more information about the results of NAFTA-style U.S. trade agreements visit www.tradewatch.org.
The writers are respectively director and research director of Public Citizen’s Global Trade Watch.