Free Trade Bill Hurts All But Corporations

by Mark Weisbrot

The legislation, which some see as a warm-up act for the battle over trade with China, combines two controversial bills that have been held up for years: the Orwellian-named "African Growth and Opportunity Act" and the Enhanced Caribbean Basin Initiative.

The combined package retains almost all of the offensive material that public interest groups have fought against. In exchange for increased access to U.S. markets, countries in sub-Saharan Africa and the Caribbean and Central America would cede more power and privileges to foreign corporations and organizations like the International Monetary Fund.

At the same time, every attempt to make the new trade benefits "trickle down" to the poor and working people of Africa and the Caribbean was defeated. The right to organize unions, or human rights in general, will not be protected or advanced by this law.

"By their deeds ye shall know them." When the international spotlight was on the protesters in the streets of Seattle last December, President Clinton said he was for a new kind of trade agreement: one that included enforceable labor rights. We can now see how sincere that commitment was, as his Administration lobbies to make HR 434 into law while no one is looking.

Once again, American workers at the lower rungs of the pay scale are being asked to sacrifice their jobs and wages on the altar of "free trade," so that the poorer countries of the world might pursue an economic development strategy that offers little hope for the vast majority of their own populations. Over the last 25 years, we have lost more than a million jobs in textiles and apparel. At the same time, the median wage in the United States has not risen -- in other words, the majority of the American labor force has been literally excluded from sharing in the gains from economic growth for a quarter-century.

This is the natural and inevitable result of negotiating NAFTA-like trade agreements that create new rights and benefits for corporations, while providing nothing for labor.

No one can say that there was no alternative to this bill. Last year Congressman Jesse Jackson, Jr. put forth a bill that expanded Africa's access to US markets, while also including labor rights and genuine debt relief. The latter is especially important for sub-Saharan Africa, which loses about a quarter of its export earnings to never-ending foreign debt service. Despite having more Democratic co-sponsors than the current legislation, his bill never even got a hearing.

In the Senate, an effort was also made to protect Africa, where 23 million people are infected with the AIDS virus, from the predatory practices of pharmaceutical companies and their advocates here. An amendment sponsored by California Senator Diane Feinstein and Wisconsin Senator Russ Feingold would stop our government from bringing economic and political pressure against countries that try to make anti-AIDS drugs more cheaply available to their citizens, so long as the countries' measures did not violate WTO rules. Until the end of last year, the Clinton administration leaned hard on South Africa not to use local manufacture or "parallel importing" -- importing outside of the drug companies' authorized channels -- to make these life-saving drugs more available to the millions of South Africans who have AIDS or are HIV-positive.

The Feinstein amendment has been removed from the final version of the bill. It appears that our political leaders are not prepared to abandon protectionism -- yes, that's what it is, in strictly economic terms -- so long as it is the $80 billion monopoly profits of pharmaceutical companies that are being protected from the competition of free international markets. And as if there weren't enough special interest pieces tacked on -- for companies like Fruit of the Loom in the Caribbean -- Congress added a special "banana rider" for Chiquita, whose chief Carl Lindner is cashing in on his family's huge political campaign contributions. This little gem would increase the power of retaliatory tariffs for WTO decisions, like the one that gave Chiquita the right to wipe out tens of thousands of small banana farmers in the Caribbean and Africa.

Senator Feinstein and others have threatened a filibuster in the Senate. Given the way this bill has been rammed through the House, with Members not even seeing the bill until the debate was under way, it's a reasonable response. If ever such tactics were called for, this would be the time.