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What will trade policy under Obama look like?
By Michael Cebon | November 6, 2008
Yesterday was a truly momentous day not just for the US, but for the world. The Bush presidency has been such a shocking experience for people in just about every country, that anything else has got to be better. But Obama has been inspiring because of his ability to convince people that he will be a real change-president, that he will use the presidency to promote justice within and without the US.
While his win in unequivically momentous and undeniably positive for Americans – and African Americans in particular – the question is whether his commitment for social justice extend past the borders of the US, and if so, does it extend to questions of globalisation and global trade?
Well, by the looks of it – unfortunately – probably not. From the Obama website it seems that Obama will maintain the Bush & Clinton administrations’ commitment to promoting free trade, with a number of (important) qualifiers:
Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets to support good American jobs. They will use trade agreements to spread good labor and environmental standards around the world and stand firm against agreements like the Central American Free Trade Agreement that fail to live up to those important benchmarks. Obama and Biden will also pressure the World Trade Organization to enforce trade agreements and stop countries from continuing unfair government subsidies to foreign exporters and nontariff barriers on U.S. exports.
As well, Obama promises to “fix NAFTA so that it works for American workers.” (No mention of its impacts for Mexican workers, or anyone else for that matter.)
The problem with these positions is that, as Stephen Byers, Former British Trade and Industry Secretary wrote in 2003, “I was wrong about free trade. I was wrong. Free market trade policies hurt the poor”. As I noted in a post last week, Bill Clinton has now also admitted that “We blew it. We were wrong to believe that food is like some other product in international trade.”
If free trade policies themselves hurt the poor, can we really imagine that adding labour and environmental standards on to them is really going to make them instruments of social or environmental justice? If it looks like a duck…
Topics: US Trade Policy | 2 Comments »
November 6th, 2008 at 3:44 pm
[...] What will trade policy under Obama look like? They will use trade agreements to spread good labor and environmental standards around the world and stand firm against agreements like the Central American Free Trade Agreement that fail to live up to those important benchmarks. … [...]
November 17th, 2008 at 8:57 pm
In a belated response to this blog and that noting that Obama’s appointment of Rahm Emanual to be his chief-of-staff and other signs are not encouraging for trade, I agree that the Obama campaign website, as well as the campaign itself and events since the election, have not indicated a significant departure from current US trade policy. There has also been little indication of any real understanding or at least acknowledgement of the neoliberal ideology that underpins global trade. Spreading good labor and environmental standards around the world means little unless there is both the willingness and, more importantly, the capability to enforce such standards. Academics view the labour provisions in the Australia-US Free Trade Agreement, for example, as essentially unenforceable; the Department of Foreign Affairs and Trade presents them as a non-binding commitment of both parties to the labour principles of the International Labor Organization, which, of course, has no authority to enforce those principles.
The campaign website statement that Obama and Biden will pressure the World Trade Organization to enforce trade agreements and stop countries from continuing unfair government subsidies to foreign exporters and nontariff barriers on US exports was convenient populist rhetoric that ignored the fact that the US has long been one of the world’s biggest, if not the worst, culprits in engaging in a host of unfair trade practices, including massive government subsidies and nontariff barriers on foreign exports, which have massively hurt developing countries that have been pressured into opening their own markets with disastrous results. Obama’s campaign speeches certainly indicated a willingness to continue American unfair trade practices, including continued protectionism for the large agri-business operations that thrive on taxpayer support. The stated aim to ‘fix NAFTA so that it works for American workers’ is also, as you indicate, a one-sided view that ignores the devastating impact of NAFTA on Mexican workers.
The stated policy aims to end tax breaks for companies that move their operations overseas and to reward companies that maintain or increase the number of full-time workers in the US relative to their foreign operations sound great, but skirt the realities of global trade, which chiefly entails the exchange of goods, services, capital and labour within and between often extraordinarily powerful transnational corporations that use trade as merely one facet of complex and highly fluid global production and distribution processes that enable firms to minimise labour and other costs, and that have a tremendous policy influence on both poor and wealthy countries to protect their interests. Even the non-mainstream media fail to truly understand and highlight these realities in a way that moves the public discourses past outdated and meaningless debates about ‘open markets’ versus ‘protectionism’ or even ‘free trade’ versus ‘fair trade’. Unquestionably, however, until American workers understand that their rights cannot be protected in isolation from the rights of workers around the world, trade policy under the Obama administration is not likely to be profoundly different – although I would love to be proved profoundly wrong.
Despite receiving criticism for not even venturing onto the sidelines of the G20 gathering, Obama’s aloofness seems politically astute in light of the typical hot air generated, particularly regarding trade, with little substance likely forthcoming.