If you thought President Obama's expressions of sympathy for the Occupy Wall Street movement meant he was suddenly going to stand up for "the 99%," think again. Obama has just submitted to Congress the Chamber of Commerce-backed Colombia, Panama, and Korea Free Trade Agreements. And now, thanks to maneuvering by Obama and his business-friendly Chief of Staff William Daley and U.S. Trade Representative Ron Kirk, they're on an accelerated schedule in Congress. According to a report in The Hill, they will be voted on Wednesday, where they're expected to pass.
Obama's move is a brazen display of contempt for the Occupy Wall Street movement's calls for jobs, economic, and environmental justice as well as human rights. These trade agreements achieve a rare trifecta of progressive punching: it's hard to imagine a single initiative that at one time could so infuriate anti-corporate activists, labor unions, and environmentalists at the very moment that these disparate movements are finally finding solidarity and support in the streets.
For starters, while properly negotiated trade agreements could help boost U.S. exports and economic fairness, these specific agreements plain and simple cost jobs.
The Korea FTA alone will add a net $13.9 billion to our annual trade deficit with South Korea and cost 159,000 jobs, according to a study by the Economic Policy Institute. That's a giant anvil of unemployment around the neck of the economy: when we do start to dig out of the recession, it will take that much more growth just to get back to where we are today.
If you like bailouts, you'll love Obama's FTA's. They represent the globalization of disaster capitalism. Now, instead of just being on the hook to guarantee Wall Street firms if they make bad investments, the U.S. government will be responsible for bailing out foreign companies too.
"Investor protection provisions" in the agreements actually give foreign companies the right to challenge U.S. labor and environmental laws if they deem them to be somehow costing them money. The United States then has the delightful option of changing its law or paying millions or billions in compensation to foreign companies... just for obeying our laws like American companies do.
Previous free trade agreements have included similar provisions, and governments have already shelled out $350 million, with billions more pending in cases affecting the United States. Critics, such as Public Citizen's Todd Tucker, believe that the investor provisions in these free trade deals are even worse, and the bailouts for foreign companies could reach the billions. In addition to the monetary cost, these provisions have a chilling effect on legislation: before changing our laws, we'll now not only have to assess the effect not only on our own economy and environment, but have to consider the cost to overseas operations of foreign companies as well.
We've had experience with this type of provision in previous trade deals, and it's not pretty: just this past month, the World Trade Organization issued a ruling that says notorious Mexican fishing operations must be given "dolphin-safe" labels on their tuna fish -- even though these operations routinely kill dolphins (Mexico's fleet actually seeks out dolphins to cast their nets knowing that they frequently swim near tuna). Just so it's clear, the United States isn't banning import of dolphin-dangerous tuna -- we just insist that tuna fish labeled "dolphin-safe" doesn't actually involve killing dolphins. Crazy.
Congress is also being asked to give Colombia preferential trade treatment even though scores of Colombian labor organizers, Afro-Colombians, and human rights activists are murdered every year for trying to boost wages or just hang onto their land (palm oil operations are aggressively cutting down rainforest currently occupied by Afro-Colombians and indigenous people to expand their plantations).
The deal would allow companies that want to sell their goods in the United States to pay zero tariff even as they set up manufacturing in a country where they can hire armed gangs to intimidate or even kill workers who advocate for better working conditions or a union. This is an open invitation to companies to shift jobs overseas to countries where they can operate with impunity. It's so bad that Colombian trade unions oppose the deal along with their U.S. counterparts.
The Panama deal rounds out the greed train with its own investor provisions. The country is one of the most notorious offshore tax havens. Under the agreement, investors will be able to challenge U.S. efforts to crack down on this type of tax shelter -- a huge sop to the very Wall Street financial institutions that are the direct target of the Occupy movement.
As bad as the trade deals are, they could have at least represented a strategic opportunity to pass the President's jobs bill, which is supported by many of the same groups that bitterly oppose the free trade agreements. Obama could cut a deal with Republicans: he only submits the trade agreements on condition that Republicans pass the jobs package, thus compensating for at least some of the employment losses expected to occur under the trade deals.
Of course, that's not going to happen. Obama's not exactly the guy you want walking into a car dealership with you. As I wrote in a tragic-accurate 2007 article about his failure to bargain as a senator on the Peru trade agreement that forecast his inability to haggle his way out of a paper bag of debt ceiling, Obama is "the world's worst negotiator."
Obama also seems to have a highly evolved capacity to divide his own party in two: while a majority are expected to oppose the deals, the pro-trade New Democrat caucus is expected to back it, giving Republicans and the White House the votes they need to force the agreements through.
Obama's decision to push the trade agreements now represents a political gamble. He seems to think that criticizing ATM fees and other clear abuses may be enough to distract protesters long enough from the fact that in the corridors of power he's pushing one of Wall Street's top priorities. At a minimum, the White House wants to jam the trade agreements through Congress before the Occupy Wall Street movement grows to a size at which politicians get chary of defying their calls for economic and environmental justice.
It's an old game -- whether it works or not is probably the first real test for a movement on the cusp of transforming a tremendous national outpouring into something more than just well-deserved rage.
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