Albion Monitor /Commentary

Free Trade For Me And Thee

by Ted Rall

The Clintonistas and their corporate allies know that free trade has been bad for U.S. workers
NEW YORK -- Remember NAFTA and GATT? As we enter the fifth year of our Brave New World Order, the results haven't exactly been stellar.

Pat Buchanan's and Ross Perot's dire predictions of an exodus of American manufacturing jobs, gutted environmental standards and depressed wages have turned out to be dead on target. The Fed is fighting off deflation (!) for the first time since the '30s.

And while the Clinton Recovery has generated hundreds of thousands of new jobs crunching code in Silicon Valley, those aren't gigs that people laid off by emigrating factories are qualified to fill. The Clintonistas and their corporate allies know that free trade has been bad for U.S. workers, which is why they're keeping mum about the results.

The question here is: What the hell does our social security system have to do with Canada's?
The leftist side of the pro-free trade argument, as you may recall through a five-year haze of bad TV, was that workers in other countries would soon begin to enjoy rising wages and a cleaner environment.

In fact, corporations have set up shop exclusively in depressing little dictatorships like Mexico and Indonesia, where collective bargaining and governmental concern for anything other than the next payoff are nonexistent. Mexican factories continue to spew toxic filth into tributaries of a Rio Grande lined with squalid shacks housing their underpaid employees.

Clinton promised us that NAFTA could be repealed if it didn't work out, but in fact he's spending what time he has left before Tailgate (so far, my favorite term for the Monica Lewinsky scandal) consumes him once and for all quietly expanding the agreement. Last month, he spend a week in Santiago at the Summit of the Americas in an effort to revive his push for "fast-track" powers that would allow him to sign treaties without consulting Congress.

If granted, Clinton would first apply fast-track to add Chile to NAFTA. Furthermore, the erosion of national sovereignty over which free trade opponents fretted in 1992 is occurring without a squawk from the nation's editorial pages, the vast majority of which supported the president on NAFTA and GATT.

The latest manifestation of the Clinton plan to replace the untidy mess of national borders with an efficient Greater Americas Co-Prosperity Sphere governed by international corporate interests comes in the form of a new report by the Society of Actuaries branch of the American Association for the Advancement of Science.

The report, titled "Social Security in NAFTA Countries: What If People Stop Dying?" and co-sponsored by the social security administrations of Canada, Mexico and the United States, worries that reduced mortality rates will require higher taxes.

The question here is: What the hell does our social security system have to do with Canada's? I've seen this kind of thing before. The only logical conclusion is that a merger is imminent.

The very same CEOs who sing the siren song of laissez-faire wouldn't know what to do if real competition were ever permitted to prosper
Free trade is unpopular in the hinterlands west of Arlington, Va., but public opinion counts less and less in a country where political alienation isn't so much about apathy as common sense. Washington doesn't give a damn about what we think, and for the most part we've all accepted that. Nevertheless, the legitimacy of the free trade argument endures, backed by the limitless advertising budget of multinationals and the Clintonites.

Like both communism and capitalism, there's nothing wrong with free trade as an idea. Removing tariffs on imports allows you to buy a superior foreign product if a cheaper domestic one isn't available; it increases consumer selection and ultimately expands demand for goods, which is theoretically good for everyone. Certain varieties of international trade even enhance understanding between cultures, such as the importation of music and films.

The trouble is, free trade as it's currently promoted is only free for corporate interests. Employers can move their facilities to Kazakhstan if that's where labor can be had for the least possible salaries, but workers from other countries can't move to Kazakhstan. After all, we still have those pesky immigration requirements, not to mention the language barrier.

So the balance between labor and management tips all the way over to the management side of the seesaw. Workers back in the United States are pressured to accept lower wages in order to compete with their Kazakh counterparts. The thing is, you can rent a pretty decent apartment for $80 a month in Kazakhstan.

Even worse, the very same CEOs who sing the siren song of laissez-faire wouldn't know what to do if real competition were ever permitted to prosper. Case in point: American taxpayers involuntarily subsidize the enormous expense of shipping goods made overseas for sale here through business tax breaks.

Nike, the current poster boy for lousy working conditions abroad, might not find it as profitable to make its sneakers in Indonesia if it wasn't for those tax deductions.

Finally, the winner-takes-all tendency toward monopoly in unregulated capitalism causes the spoils of international trade to devolve to a few huge companies with the resources to locate abroad at the expense of their smaller counterparts.

Moreover, as the Japanese proved by dumping cars on the American market at less than their cost of manufacture during the '80s, big corporations can drive those with shallower pockets out of business by temporarily operating at a loss. No, the only thing free about free trade is the name.

Shipping expenses would be charged at their actual cost
For free trade to work both efficiently and fairly, all international borders would have to be thrown open, people allowed to travel anywhere and everywhere for free whenever they wanted, and a unified global economic system established that provided for a universal minimum wage and uniform environmental regulations.

Shipping expenses would be charged at their actual cost, a single currency would be used by everyone on Earth, and a global central government would protect the interests of small businesses against predatory pricing.

If we lived in that kind of world, very few businesses would find that it made much sense to make stuff tens of thousands of miles away from their point of sale. The only imports would be items that simply couldn't be made or found at home -- which is, after all, what international trade is really for. Unfortunately, the only function of "free trade" in its current manifestation is to exploit wage and regulatory differentials across borders. Capital is free as a bird, while labor remains shackled.

Most Americans intuitively comprehend that the opportunities afforded by a global economy in an information age are not inherently incompatible with basic protections of domestic industries. They don't understand why the world's richest and most militarily powerful nation would want to voluntarily dismantle its economy by financially eviscerating the consumers who drive it. And they certainly don't believe that their salvation lies in selling American-made T-shirts to the Kazakhs.

It's unfortunate that the boardroom barons who really run the country aren't as smart.

Ted Rall, a New York-based cartoonist and columnist, is accepting bids for translations of his upcoming book "Revenge of the Latchkey Kids."

Comments? Send a letter to the editor.

Albion Monitor March 31, 1998 (

All Rights Reserved.

Contact for permission to reproduce.

Front Page