Fwd: Free Trade? Someone always has to pay - Business Week (fwd)

This isn't big news to most folks on the list.  But it's well-written --
the source is interesting...

dave smith
sociology, uc-irvine

>
>---------- Forwarded message ----------
>Date: Mon, 07 May 2001 14:40:46 -0700
>From: Sid Shniad <shniad@sfu.ca>
>Subject: Free Trade? Someone always has to pay - Business Week
>
>Business
>Week                                                           May 2, 2001
>
>Free Trade? Someone always has to pay
>
>         From Seattle's riots to the Quebec protests, not even the
>         thickest cloud of tear gas can obscure the truth that
>         globalism hurts workers
>
>       By B. Kite
>
>       From Seattle's riots to the Quebec protests, not even the thickest
>cloud of tear gas can obscure the truth that globalism hurts workers
>       To hear the punditry tell it, the protesters who turned out in Quebec a
>few weeks ago and, more recently, at the International Monetary Fund
>meeting in Washington on Apr. 28-29, are largely irrelevant to the debate
>over free trade. A serious force for change? Not this ragtag bunch.
>Among the experts, the protesters were seen as either unrealistic "flat
>earthers" (according to The New York Times's Thomas Friedman) or, at
>best, sadly misguided (those toward the left end of this narrow spectrum
>of opinion take the opportunity to trot out memories of their own ancient
>activism in the '60s).
>       And you can feel the contempt of most national leaders. "It's very
>easy to protest when you have a job, when you have food on the table,
>like those protesters have," said Mexican President Vicente Fox at the
>Quebec summit. Almost makes you wonder why the working poor in the
>maquiladoras didn't book a flight to Canada for the weekend.
>       TV reporters, meanwhile, now know what motivates the globophobic
>crowd -- they come to smash things and party. This, if true, really ought to
>set off alarm bells, because it means America has raised a generation of
>masochists who view getting beaten and tear-gassed as just what they
>need to spice up their revels.
>
>WRONG ISSUES. Young people get a pretty rough deal from these aged
>experts. Not long ago, the same pundits were wringing their hands over
>the perceived apathy of a generation of slackers (cue, again, the '60s
>flashbacks). Now that a significant segment of modern youth is again
>demonstrating passionate concern about something -- well, the problem
>is they just keep picking the wrong issues. Protesting against human-
>rights abuses, job loss, environmental depredation, giving corporations
>the ability to rewrite laws? Those crazy kids will never learn.
>       Much has been made of the so-called "democracy clause" in the
>latest Hemispheric Free Trade Zone proposal circulated in Quebec. But
>you have to wonder: If the document is, in fact, the celebration of freedom
>and democracy that the signatories claim, why did they feel the need to
>take such stringent and undemocratic steps as building a giant fence to
>keep protestors away from the event? Yes, I remember the violence at
>the World Trade Organization meeting in Seattle. But what about keeping
>the trade document hidden from the public and most elected lawmakers
>(while making it available to 500 business leaders) until the very last
>minute?
>       It isn't democratic, but it is strategic. Truth is, once people find
>out
>what's in these trade pacts, they tend not to like them very much. Clinton
>tried to do the same thing with the global Multilateral Agreement on
>Investment (MAI), keeping it secret even from Congress. When a copy of
>that agreement leaked onto the Internet, Clinton, with the lovable
>roguishness that has endeared him to liberals across the country, pointed
>to the surreptitious posting as proof the document was available for public
>scrutiny.
>
>BACKLASH. The MAI went down in flames, and the same fate may await
>the FTAA. There's a backlash that has been building ever since the
>passage of the North American Free Trade Agreement, because "free
>trade" can carry a high price for a lot of people. According to a report from
>economist Robert Scott of the labor-backed Economic Policy Institute,
>NAFTA has eliminated some 766,000 job opportunities in the U.S. --
>primarily for manufacturing workers without college educations. Contrary
>to what the American promoters of NAFTA promised U.S. workers, the
>agreement didn't result in an increased trade surplus with Mexico. Quite
>the reverse.
>       "As manufacturing jobs disappeared, some workers were downscaled
>to lower-paying, less-secure services jobs," Scott writes. "Within
>manufacturing, the threat of employers to move production to Mexico
>proved a powerful weapon for undercutting workers' bargaining power."
>http://www.epinet.org/briefingpapers/nafta01
>       But that's just the bitter pill American workers will have to swallow
>to
>help Mexico's poor, right? (Amazing how open to socialist arguments
>industry leaders are, as long as it isn't their income being redistributed.)
>Well, according to the EPI study, Mexican wages have decreased 27%
>since NAFTA, while hourly income from labor is down 40%.
>
>FUEL FOR THE FIRE. And it isn't only factory workers who feel the
>impact. Corporations now have the legal means to try to rewrite
>troublesome laws. To take just one example, under NAFTA's Chapter 11
>rules, Ethyl Corp. sued Canada for its ban on toxic gasoline additive
>MMT, claiming the ban expropriated its business by denying the company
>the profits it expected to earn from sales in the country. Ethyl won, forcing
>Canada to pay the company $13 million and lift the environmental
>regulation. It's cases such as this that make people suspicious of free
>trade.
>       According to true believers, we should all eventually gain from the
>"creative destruction" inherent in free trade. Exporting production allows
>for cheaper manufacture of goods, while jobs are created in new labor
>markets. People in consuming countries get goods at lower prices
>because they are produced more efficiently. Wages in developing nations
>rise. Eventually, everybody wins. And, as the Clinton Administration
>assured us before the passage of NAFTA, free trade creates jobs in the
>U.S. -- 200,000 per year, they claimed. So there might be some
>temporary dislocations in the workforce, but, in the words of the old saw,
>you can't make an omelet without breaking eggs.
>       As George Orwell pointed out when confronted with this argument,
>you should immediately ask to see the omelet. The Mexican people don't
>seem to be getting much of a bite, since in addition to falling wages, the
>number of people living in "severe poverty" (surviving on less than $2 a
>day) has grown by 4 million since NAFTA began, according to a January,
>2001, report <http://www.ips-dc.org> by Sarah Anderson of the Institute
>for Policy Studies.
>
>POINTLESS SURVEYS. In the U.S., we can at least see egg on the face
>of the U.S. Commerce Dept. Several years ago, it canceled its biannual
>surveys of American companies intended to document NAFTA-related job
>creation because the results were so piddling -- fewer than 1,500 jobs
>could be attributed to the treaty.
>       But for the signatories, the prospect of this hemisphere of liberty is
>just too grand to resist. According to Argentina President Fernando de la
>Rua, "The next summit...will not require walls to keep out those who come
>to protest. But there will be space for those who have come to applaud
>when we work for the benefit and progress of all people."
>       Perhaps they'll take a travel tip from the WTO, which is holding its
>next meeting in the emirate of Qatar, which, coincidentally, has no
>troublesome rules protecting freedom of assembly. They won't even have
>to build a big fence.