So, it looks like the Doha round, after 7 years, has failed. As anyone paying even a slight bit of attention anticipated, it did so because Americans and Europeans don’t want to allow other countries to protect their farmers and internal food markets from subsidized competition by the West, nor is Europe or the US willing to reduce subsidies in any meaningful way.
To which I say "who cares?" The world doesn’t have free trade, it has very heavily managed trade which has been sold as free trade. When China has spent 10% of GDP on keeping the Yuan undervalued (otherwise known as an export subsidy); when the US and Europe have huge subsidies for agriculture; when the US dollar during various years has been kept afloat primarily by government interventions; when the Japanese were giving away money for nothing for most of the past decade; when various strategic industries like aircraft are massively subsidized—well, I can’t get all that excited about "free trade", because, well, we don’t have it.
What we got instead was managed trade, where various countries were forced to open their markets in specific goods, as enforced by various transnational organizations like the WTO and the IMF. Even more than that we got free capital flows, which have almost nothing to do with free trade and in fact, according to Ricardo, make it impossible to get most of the benefits of classic free trade.
And we got a lot of rent-seeking, especially in intellectual property, where the US tried to force everyone else to pay for US IP in software, entertainment and drugs. Millions of people have died to keep Pharma’s bottom line producing, courtesy of "free trade".
Meanwhile forcing countries to open their borders to cheap, heavily subsidized western food produced through mechanized agriculture destroyed the livelihood of hundreds of millions of small and subsistence farmers, turned entire nations which used to produce enough food to feed themselves into food importers and helped create the massive slums which ring almost every 3rd world country. They helped lead to the rise of Islamic fundamentalism in many countries, since folks who are poor and have no hope for the future tend to decide they’re at least going to have a good afterlife. And, in badly damaging Mexican agriculture and pushing food prices higher and higher (even before the ethanol stupidity) they were one of the main causes of the immigration influx to the US.
Free Trade’s one of those things that’s real good in principle, but what passes for "free trade" in the real world doesn’t have much to do with the platonic ideal of free trade, or even a rough and ready equivalent. What the world has is free movement of money and extremely heavily managed trade which is open in some industries and places, but rarely free in the sense of the terms of trade being set primarily by market forces.
So I’ve got no real problem with seeing Doha die. Even if they had managed to overcome Western resistance to allowing other countries to feed themselves and not drive poor and subsistence farmers off the land, I doubt the overall package would have done more good than harm.
Free trade—it’d be lovely, but it’s not what’s being offered. We have managed trade, we’ve had managed trade for a long time, and that isn’t going to change. So instead of pretending we live in some free trade world that keeps getting more free, it’s time to start discussing the real options. Free trade isn’t on the table, no matter how much people keep saying the words.
Related posts:
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- FDL Book Salon Welcomes George Soros, The Crash of 2008 and What It Means
- From Beef to Banks, Negotiating with Corrupt Businesses Undermines Enforcement, Harms People
- Money Vs. People
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nor should there EVER be such a thing as “FREE TRADE”!
we MUST insure a FAIR trade deal, NOT a “FREE trade” deal
when we are paying our laborers fair wage, where we can put healthy food on the table for a family, have health insurance enough to fix our kids arm when it breaks or cure our wife of cancer if she falls ill, when we make enough to educate our young through the college years, have a vacation and a savings so we can retire without having to work until we die
when we don’t allow slave and child labor, WE MUST tarriff countries that do not provide for their laborers in equal fasion
and if a country does not allow for collective bargaining, those products also MUST carry a tarriff
the very concept of money is a regulation and there can NEVER be “free trade”, there MUST be regualtion
I forgot to add a few items which make for “unfair” trade and tarrifs must always be included;
when a country does not force it’s industry to clean up their own crap, when they dump their cancer in my kids air and their toxic waste in my wife’s water, that product MUST carry a tarriff so THEY can pay the bills they incur, NOT us
I think everyone gets the idea, there MUST always be regulation, the very concept of ownership is a regulation, courts to enforce contracts are regulations, copywrite and patents are regulations, there cannot possibly be trade without regulation
That’s all right Monsanto/Cargill will get them in the end. Sad
jo6pac
perris you sound like you’re against the uncle milton freidman plan on the worth of the worker.
can’t wait to read what BoBo , MoDo and HoJoe have to say about Doho
more evidence that i’m not a sensible person…. i think it’s a pretty big deal, and a good thing that this round has failed to force developing countries to give up their demand for protections from agricultural import surges.
although raj patel (on democracy now! this morning) thinks that after elections in india (and for that matter, here) there will be moves back towards the usa pro-corporate position.
I know this is true, but I’d love to see a solid study that lays out the numbers in brutally honest fashion, drug by drug and nation by nation.
The closest I’ve seen is some work on getting AIDS drugs to the Third World, when a couple of countries threatened to declare a national emergency and give legal protection to domestic companies that would take over production of certain AIDS drugs and thus violate some of Big Pharma’s patents, unless Big Pharma reduced their prices to something manageable.
Wonder of wonder, the prices came down. Even more stunningly, no pharmaceutical companies died as a result.
Who could have anticipated . . .
i’d love to see ian host stiglitz for a book salon on his 2005 book, Fair Trade for All. maybe even as a double bill with his 2003 book, Globalization and its Discontents. is there are rule that all the books have to be new publications?
We do not have free trade so we should focus on the costs to Americans of not having free trade vs other systems. The cost of Socialized Health care vs our current system. The cost of farm subsidies on tax payers etc.
Also the incidental cost like what is the cost of not insuring everybody when sick people go to work and spread disease rather than take a paid day off to see a Dr?
What is the cost of corn being grown for cows rather than letting cattle just eat prairie grass? Corn makes factory farms possible in small spaces where cows stand in their own poo which means more disease and of course more antibiotics.
Which means deadlier antibiotic resistant e coli. To bad we don’t have socialized medicine.
One fast food worker who ate a bad burger yesterday feels sick but can’t afford to take a sick day from work forgets to wipe his hands and suddenly we have an epidemic.
The general idea of the book salons, as I understand them, is twofold: (a) to give support to little-known progressive authors with important things to say, who don’t have big media tours lined up for them, and (b) to give interesting books some publicity and push in the progressive blogosphere.
I don’t know that there’s a rule that says “all Book Salons are about new books,” but judging from the Book Salon book in the right hand column, you can ask Bev about it directly this Sunday.
And even if the regular Saturday and Sunday book salons are kept to “new books,” the idea of having Ian host a chat with Stiglitz could be a great thread during a regular weekday time.
New Ian post upstairs
Ian;
“Managed” is such a nice, innocuous, and value-neutral term, one just knows it’s going to have a great personality.
And, since its reality is emphatically denied and semantically evaded, even (and especially) by most of your colleagues, why not simply refer to trade as “manipulated”?
Of course, were such a term to gain ‘traction’, then the powers-that-be would have to insist that they’ve absolutely no choice (perhaps claiming that a certain ‘hand’, though ‘unseen’, was and is behind it all), and then, of necessity, they shall have to explain that they were and are doing such things only for the greater good, for the Homeland and Mom and Dad, the kids and all of their pets like little Dick and Jane’s cute little dog, named Spot.
Ian, you are a most excellent teacher, a very wise person and a credit to your profession, which is in dire need of such …
test
Test?
Erk!
Nobody said anything about a ‘test’.
What subject?
When?
Where?
Why?
Geez, LS, this is creepy, like one of those dreadful ‘high-school’ nightmares.
You know the one …?
Ian, this was a very needed thread! Maybe you could re-introduce it when posts aren’t going up so fast? Pretty please, Mod Gods and Mother? :)
It’s not your kid’s water or your wife’s water. It’s everyone’s water including the bandits who pollute it. That’s the insanity and I mean that literally. Why is someone so invested in accumulating money, he is willing to kill everyone including himself in pursuit of it?
It kind of died, probably because of the title. Should have made it something like “Millions of Farmers Saved by Trade Talks Collapse”