Wednesday, March 23, 2016

It's Time We Had a Grown-Up Conversation About Free Trade

If there's one thing we've learned about globalization and free trade agreements it's that they never seem to end. Wrap one up and somebody's already writing a new one.

Actually we've learned a lot of things about these free trade deals, free market fundamentalism and globalization but almost never from the people who enact them in our names.

When it comes to Canada and the Trans Pacific Partnership, the TPP, the best argument I've heard for it is that we'll be worse off if we don't sign up. It may be bad but it'll be worse if we reject it. Sounds like what you might hear when the enemy tanks are pulled up at the town hall steps.

Think back to January, 1988 when the leaders of Canada and the United States signed the Free Trade Agreement. Then along came the deal that added Mexico, NAFTA. Since then there have been free trade agreements between Canada and Israel, Chile, Costa Rica, Peru, the European Free Trade Association, Colombia, Jordan, Panama, Honduras and Korea.  Deals concluded but not yet in effect are, of course, TPP, the EU treaty or CETA and a FTA with Ukraine. There are others in negotiation. I suppose you could break them down into "Big Bloc" and "Small Bloc" deals.

These free trade agreements didn't spawn globalization or neoliberalism but they helped entrench both. Neoliberalism and globalism, however, were never more than economic ideologies, call them economic religions if you like, almost entirely faith-based. The point is made out convincingly and at length by John Ralston Saul in his 2005 book, "The End of Globalism," in which the author contends that, even back then, globalism was dead only no one received the obituary.

So, if it's dead, why is it still going on? Why do we continue to cling to it? Why haven't we adopted a different economic system more suited to the needs of our people? There is a reason for that.

As Robert Reich points out, the free trade regime was initially intended to increase economic activity within the signatory nations. It was supposed to provide more work, more jobs, better wages. At first it seemed that it did but not for long. The promised trends reversed. Less work, outsourced jobs, lower wages.

Why did we stay with the free trade regime when it stopped working for us? Well, sad to say, we kept going down the globalism route because free trade still worked, not for the many but for the very powerful few - the transnational corporations, the richest of the rich, the 1%. The supposed "trickle down" prosperity turned into a "trickle up" fleecing, transferring the wealth of the once robust middle class to a very small, super rich elite that had captured not just economic but political power.

It was all secured by a "bought and paid for" American Congress, a shamelessly corporate Supreme Court and an obedient Executive Branch, collectively known as the developed world's Head Office. For smaller countries like Canada it was a matter of "go along to get along" which, boiled down, is essentially the argument for why we must succumb to the Trans Pacific Partnership. We must go along to get along.

Even The New York Times gets it:

..Perhaps most important, the new evidence from trade suggests American policy makers cannot continue to impose all the pain on the nation’s blue-collar workers if they are not going to provide a stronger safety net.

That might have been justified if the distributional costs of trade were indeed small and short-lived. But now that we know they are big and persistent, it looks unconscionable.

One of the best part of John Ralston Saul's book is his description of how Malaysia and then New Zealand slipped the bonds of globalization and not only survived all the feared consequences but actually thrived.  Malaysia defied the IMF and the World Bank who said, in the now standard gangster fashion, "obey, or else." It turned out that was a hollow threat, the same hollow threat that we cow to in deals such as the TPP.

One of the reasons that most of us were so complacent about globalism and free market capitalism is that we thought this regime was much too complex for our simple minds to properly grasp. A big part of that was because the people signing these deals in our name have never - not ever - made an effort to bring us into the discussion, to explain themselves and seek our informed consent. The proles don't get a say.

It's about time that changed. The TPP is a great place to start. It's imperative and this time we need answers from the government of the day. 


Hugh said...

A big part of GHG emissions is from transport.

So shipping products by air or ocean will have to be reduced, if GHG emissions are to be reduced.

This conflicts with the trade deals which are supposedly about reducing barriers to trade.

The Mound of Sound said...

I think GHG emissions are well down the list of concerns about neoliberalism, free trade, free market fundamentalism and globalization, Hugh.

Anonymous said...

It's like that special advisory council Morneau has just set up to advise him. Chaired by the head of an accounting firm and made up of more corporate and academic lot of corporate establishment shillers than can be believed, all supposedly working for a mere buck a year, it's a nightmare dressed up in finery.

These new cabinet ministers like Freeland and certainly JT seem to have zero idea about things like ISDS, let alone the takeover by global corporate powers that free trade implies. In the case of Freeland, given her supposed background, I merely adjudge her grossly incompetent and not up-to-date.

As for the equally uninformed civil servants advising cabinet ministers, I say the same. From foreign policy advice to these free trade deals, I think they're not keeping up with their homework. They offer Grade 5 level position papers from what I've seen. It's not acceptable.

Swanning around with sunny ways does not excuse incompetence. So I most definitely agree, we need a grown up discussion on these free trade deals. I see NZ has been dragged into the TPP debacle, though. Dear oh dear. What a mess. Follow the money.


The Mound of Sound said...

I too worry about who is bending Trudeau's ear on these and other critical matters. Brings to mind those old Brit sit-coms Yes Minister/Yes Prime Minister.