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Jonathan Tasini

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"Free Trade": The Capitulation Continues, Middle Class Weeps

Posted: 02/10/11 12:21 PM ET

If you share the belief that the greatest economic challenge we face is stopping the stupefying global class warfare underway, then, we have to be quite clear about the tools that support the attack against decent living standards for people and a fair sharing of the wealth. So-called "free trade" is right up there on the list of very bad policies -- at least if you believe in a middle class. But, the march goes on to ram through these clunkers, with the White House leading the charge.

The administration will pick up its efforts to get three so-called "free trade" deals through Congress this year:

The Obama administration on Wednesday pledged to "immediately intensify" talks with Colombia and Panama on two free trade agreements with the aim of submitting the accords to Congress by the end of the year.

The United States trade representative, Ron Kirk, who made the commitment at a House hearing, also said the administration would submit a revised free trade agreement with South Korea to Congress "in the next few weeks."

In fairness, this movement should not be a surprise. No one can accuse the president of an about-face or misleading his supporters. As a candidate for office and as president, he has said, sadly, that he is a committed "free trader". So, it is not that he is abandoning promises -- he simply is, in my opinion, wrong. But, he is very much keeping his promises: to the vast array of corporate interests who have supported him from the outset. Hiring Bill Daley as White House chief-of-staff sealed the deal: Daley was Bill Clinton's point person for the selling of NAFTA in 1993 -- and I use the word "selling" because Daley used the U.S. Treasury to buy Congressional votes by promising a variety of projects (If you want an in-depth investigative look at that sorry story, I highly recommend the Center for Public Integrity's "The Trading Game: Inside Lobbying for the North American Free Trade Agreement")

But, these agreements are a disaster for the future of decent wages and prosperity -- not just in this country but around the world.

We can have a reasoned debate about this. But, to do so, I would submit that we need to get away from the false, tired debate and marketing phrases that pit "free trade" versus "protectionism". There is no such thing as "free trade" -- it has probably never existed in the form envisioned by David Ricardo.

Certainly, today, so-called "free trade" is in fact very much managed trade. I urge people to read, as I have, so-called "free trade" deals -- they are densely-packed huge volumes of text that set out protections for capital and investment (particularly, intellectual property and patents).

And no one I know opposing these disastrous, middle-class killing trade deals is against trade. They are not "protectionists" -- they are people who want trade based not on corporate rights but on trade that creates a floor for wages around the world and boosts community standards, not tries to make a buck on the undercutting of standards.

One of the smoke-and-mirror tactics we will read a lot about is the "get-tough" position the Administration will take on enforcement.

But, enforcement is a complete sham, designed simply to convince people to support a disastrous trade policy.

In February 2008, I posed a challenge to then-candidates Hillary Clinton and Barack Obama who were both pledging to renegotiate NAFTA in order to enhance enforcement of labor and environmental enforcement. History is important: the labor and environmental provisions were added on to NAFTA because that was the only way to buy a handful of Democratic votes to ram through the agreement.

NAFTA enforcement was supposed to have been under the purview of the Commission for Labor Cooperation (CLC). The CLC was supposed to be funded, partly by the U.S., via a $2 million-a year appropriation, which would have meant that, over the period between 1993 and 2005, the CLC would have had $22 million from the U.S.

But, as Public Citizen found:

In another example of the gap between promised authorizations and actual funds appropriated to such programs, the CLC has only been granted $7.2 million of the $22 million it was authorized to receive from the United States as of 2005, or less than a third of the promised amount.

The game was rigged from the beginning. But, for argument's sake, let's say the CLC got the full $22 million? Would that have been sufficient?

I like to use this analogy. In the U.S., we have accepted, under Democratic and Republican Administrations alike, that injury, illness and death in the workplace are a cost of living in the wonders of the "free market". We make a show of enforcement -- the same show that was proposed for NAFTA enforcement -- but the truth is that the system embraced, in a bipartisan way, does very little to ensure a safe workplace.

Here's what the AFL-CIO found in its 2007 report:

At its current staffing and inspection levels, it would take federal OSHA 133 years to inspect each workplace under its jurisdiction just once. In seven states (Florida, Delaware, Mississippi, Louisiana, Georgia, Maryland, and South Dakota), it would take more than 150 years for OSHA to pay a single visit to each workplace. In 18 states, it would take between 100 and 149 years to visit each workplace once. Inspection frequency is better in states with OSHA-approved plans, yet still far from satisfactory. In these states, it would now take the state OSHA's a combined 62 years to inspect each worksite under state jurisdiction once.

The current level of federal and state OSHA inspectors provides one inspector for every 63,670 workers. This compares to a benchmark of one labor inspector for every 10,000 workers recommended by the International Labor Organization for industrialized countries. In the states of Arkansas, Florida, Delaware, Nebraska, Georgia, Illinois, Louisiana, Mississippi and Texas, the ratio of inspectors to employees is greater than 1/100,000 workers.

When the AFL-CIO issued its first report "Death on the Job: The Toll of Neglect" in 1992, federal OSHA could inspect workplaces under its jurisdiction once every 84 years, compared to once every 133 years at the present time. Since the passage of the OSHAct, the number of workplaces and number of workers under OSHA's jurisdiction has more than doubled, while at the same time the number of OSHA staff and OSHA inspectors has been reduced. In 1975, federal OSHA had a total of 2,405 staff (inspectors and all other OSHA staff) responsible for the safety and health of 67.8 million workers at more than 3.9 million establishments. In 2005, there were 2,208 federal OSHA staff responsible for the safety and health of more than 131.5 million workers at 8.5 million workplaces.

The 2008 OSHA budget proposed $490 million. Yes, that was a Bush budget. But, even in Democratic Administrations, OSHA has always been underfunded given the task described above. The 2010 Obama budget proposed a $559 million -- a significant increase but still inadequate.

So, think about that for a moment: we have an entirely inadequate system in this country just to watch over safety and health in the workplace, funded at a miniscule level of several hundred million dollars -- and, yet, we even more ludicrously proposed, in the past, to oversee labor rights enforcement over three countries (the U.S., Mexico and Canada) at a laughingly pathetic and criminal level of a couple of million bucks?

Why would anyone now believe that enforcement in South Korea, Colombia or Peru be any different?

The fact is enforcement is a farce. It was a farce created to buy a few votes to jam NAFTA through a Democratic Congress. It was a farce concocted by a Democratic president and his Labor secretary (Robert Reich), who were both full-throated champions of NAFTA and so-called "free trade".

But, here is a larger point: there is no enforcement that can work. Ever.

The problem is not enforcement of NAFTA-like agreements.

It is NAFTA-style trade itself and its very conception and framework. Labor and environmental rights are slapped on as add-ons to deals that are sideshows to the meat of these agreements -- protecting capital and investors' rights. We cannot "fix" NAFTA-style trade deals unless we destroy the fundamental motivation behind them -- lower wages and a careful obliteration of every reasonable regulation to protect individuals.

We are being played. People against people. Worker against worker. Community against community.