Havachat: Free, fair or foolish? The Australian-US FTA - Day 3

Havachats are week-long email dialogues between two prominent advocates on an issue of the day. To vote on the issue and make your view count, click here.

Day 1 . 2 . 3 . 4 . 5.

Doug goes first. Alan responds.

From: Doug Cameron
Sent: Tuesday, May 27, 2003 13:22
To: Alan Oxley
Subject: Accountable negotiations

Dear Alan,

It seems to me that your position is a weakening as each day passes! We now have Alan Wood, Economics editor of The Australian making the following observation on the proposed USFTA:

The one crucial test is whether it will enhance or damage what Vaile himself calls a very fragile global, regional and domestic political consensus for free markets and liberalised trade. An effective way of deciding that would be to offer the final agreement, if there is one, to the Productivity Commission or perhaps the World Trade Organisation, for independent assessment.

The reason there is a fragile consensus on free markets and liberalised trade is the secrecy, vested interests and predominance of corporate rights over social and community rights under the current free-trade regime.

I welcome the concept of an independent assessment of the proposed USFTA; however in the AMWU submission to DFAT we argue that the final assessment should be that of the Australian Parliament.

We also argue for a process of accountability, openness and transparency prior to and during the negotiating process. It is my view that the secrecy and exclusion of union and other civil society representatives on issues such as the USFTA is undemocratic and unacceptable.

The AMWU has proposed a three-stage approach backed by legislation.

Stage One

Both Houses of Parliament should determine whether to grant negotiating authority for a trade treaty.

Stage Two

Studies should be undertaken to determine the costs and benefits of any proposal that may be negotiated including:

• The effects nationally and at State/Regional level;
• The effects to be measured through social and economic audits, including the impact on various regions and industry sub sectors;
• Such studies must draw on a wide range of expertise and not just the neo-Liberal supporters of free trade;
• Such studies must assess the impact on the capacity of Australia to make future interventions for the benefit of society, the economy and the national independence.

Stage Three

Ratification of any treaty should be on an "accept or reject" basis.

A Parliamentary Trade Agreement Committee should be established with the responsibility to commission multi-disciplinary research from a wide range of sources on the consequences of various trade-treaty options.

The Committee must produce an agreed objectives statement at the commencement of any negotiations.

This approach would go some way to lifting the veil of secrecy surrounding trade negotiations.

Negotiations are taking place currently in Hawaii and the Australian public is being kept in the dark as to the issues, problems or progress in negotiations. I put this proposal forward as a constructive proposition. The AMWU is not opposed to international trade but we are opposed to the current structures, which excluded civil society and leave negotiations to the elite and those with vested interests.

Alan, you are wrong when you argue it is the overall balance of total trade and investment that matters and Australia is in good shape.

Between 1985 and 1995 ETM exports increased by 17 per cent per annum. This was a period when tariff cuts had just started and Australia had an interventionist industry policy.

Over the past seven years (1995 - 2002) ETM exports have collapsed, growing by only 6 per cent.

The ETM trade deficit has blown out from $42 billion to $70 billion and is the main factor explaining our burgeoning Current Account deficit.

Foreign direct investment in manufacturing has collapsed and unprocessed commodity exports have grown more than twice the rate of our ETM exports.

Sorry Alan, your dogma doesn't stand up to the facts. I suppose, given your "vision" on I.T. at least we will have the latest technology to count the sheep!

Doug

From: Alan Oxley
Sent: Monday, May 27, 2003 17:30
To: Doug Cameron
Subject: Benefits to developing economies

Doug,

I am glad you have reverted to the question of the global benefit of free trade and open markets. You express the classic view of the anti-globalisation movement: "Social and community rights" are more important than growth based on market economies, and free trade.

You assert that opposition to an FTA from civil society is growing in Australia. As far as I can see, those who oppose free trade are those who have opposed the FTA. It's yourself, Sharan Burrows, Malcolm Fraser, the Socialist Workers Party, Oxfam, Pat Ranald's small network of community groups, and the Greens of course. You were all there on day one and are still there.

You all had a chance to show how much public support you had when the WTO Ministerial meeting was held in Sydney last October. The rally in Hyde Park mustered about 500 - at least half were there to protest refugee policy. The media for the week was dominated with discussion about free-trade issues, and clearly the public were unconvinced by the case against. There is a very good reason why this should be: that case is heartless and selfish.

The civil society groups you refer to have the arrogance to claim they represent the interests of the world's poor. They do not.

Bahrun Mitra, the Head of the NGO Liberty Institute in New Delhi came to Sydney for the meeting and observed that none of the groups he saw on the streets in Sydney were known or active in India. Like you, they argue that poor countries must not have free trade, that the WTO must be changed so trade can be used as an instrument to force their social standards on developing countries.

You call it "Fair" trade. That is classic double speak. It was coined by US unions to block imports from poor countries, particularly garments, on the grounds it was not "fair" that garment workers in India or Bangladesh were not paid the same as US garment workers.

I was at the Doha WTO meeting late in 2001. As it wrapped up, Greenpeace, Oxfam, etc were telling the media the world's poor had been sold out, while the governments of the world's poor were inside celebrating the beginning of a negotiation to reduce global trade barriers.

This free-trade agreement will advance the case for giving countries the chance to lift themselves out of poverty. Growth is stalled in much of Asia and Latin America. The former communist countries in Eastern Europe and Central Asia, lead by Russia, all want to use free trade to lift standards of living. It is why they are queueing to join the WTO.

Prospects are bleak for the WTO negotiations because Jacques Chirac refuses to allow the EU to consider opening Europe's markets for agriculture. A free-trade agreement between Australia and the US that demonstrates how countries can work together to remove impediments to economic activity will serve to show others what can be done.

You make a deal of the question of scrutiny and transparency. Of course any agreement must be seen and judged for what it does. Those who complain that it is being done in secret are exaggerating the point. My experience with government is never to wait for them to get around to telling you. Go and find out yourself. We do. It works.

But tell me, Doug: When the agreement is finished and it offers the prospects of more jobs and security for Australian workers in the long run, are you going to tell them they are not entitled to that because self-appointed civil society groups don’t like free-market economies?

Alan

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Day 1 . 2 . 3 . 4 . 5.