Partisan disagreements on Capitol Hill jeopardise new trade deals

This is an interesting story in its own right, but I want to get, first, right to the choke-on-your-coffee-and-kick-the-dog (that was for fans of Australia All Over) part:

Schwab also charged that “unilaterally requiring another sovereign country to change its domestic laws” as the Democrats want “would be a fundamental break with U.S. law, policy and practice.”

That’s Ambassador Susan Schwab, US Trade Representative, pretending the Iraq war and Ambassador L Paul Bremer never existed . For Those (with apologies to Lee Falk) Who Came in Late: Bremer’s Rein of the 100 Orders included:

  • Firing several hundred state employees
  • Disbanding a standing armed force (but leaving them their weapons)
  • Privatising state-owned companies (reminder: this is all before a domestic government could say “boo”)
  • Removing all tariffs and import restrictions
  • Removing all foreign investment/ownership restrictions and granting 40-year licenses
  • Granting all reconstruction contracts to non-Iraqi enterprises
  • Dropping corporate and income taxes to 15%
  • Granting immunity from Iraqi laws to foreign consultants/firms
  • Appointing an inspector within every Iraqi Ministry with 5-year terms who can perform audits, write policies, and have full access to all offices, materials, and employees of the Ministries.

And more! They aren’t called the 100 Orders for nothing. I’m not suprised by the quote from Ambassador Schwab: Rudolph Guiliani, 9/11 fetishist and Balladeer of a Sad Candidate for President, is equally unfamiliar with how his country left Vietnam.

So…back to the story: trade. Back in May,

the administration agreed to Democratic demands to add provisions establishing labor and environmental standards in trading partner countries.

In return, the Democrats agreed to pass trade deals with Peru and Panama, and possibly South Korea and Colombia.

Now the administration is charging that the Democrats have increased their demands by insisting that the partner countries put the protections into effect before Congress acts on the deals. The administration also is concerned that the Democrats’ plan to visit Peru and Panama this summer amounts to meddling.

This is récit commun, by now: this White House likes Executive Privilege, and will fight for it at every turn, no matter how small the point. Here we see Democrats no longer taking the word of the President, or his appointed trade representatives (typically industry representatives), that everything is hunky-dory in, say (for example), the Mariana Islands. This is more movement afoot to have another crack at altering the face of the Fast-Track authority enjoyed by the President (and his predecessors).

Trade-wise, this can be good or bad. It can be good for Americans as well as Peruvians, Australians, Mexicans, Singaporeans (whomever happens to be on the other side of the trade deal), because more oversight will always dilute the power for exploitation enjoyed by the mercantilist, tecnocratic classes otherwise running all of our countries.

It can be bad because it still slows down trade deals, even killing entirely a trade deal that is better than the status quo, but poorer than an ideal – an ideal to which we could have moved slowly, but now will not reach anyway. See: Rep. John Dingell and the Energy Bill, for example.

The issue, in this case, isn’t really labour standards in Peru, South Korea and Colombia (okay, in Colombia it probably is). It is about clout, and who gets their demands met: the Democratic House or the Republican White House, and everybody is uptight about the precedent that may or may not be set (as though it will ultimately matter). A layer below that, it is about two sets of voices in Government: Protectionism vs. Liberalism. I’m fairly smash-the-IMF, and I’m basically anti-Nafta, but because of the harm it did Mexico, not the loss of American jobs, necessarily. Less trade-protectionism is always better than more, for developed countries. It comes to this:

The United States of America does not need protectionist trade laws. It has the wealth and the dynamism to adapt to a new global economy, if only it will. Pure and simple.

For me, there isn’t really a clear winner in this spat. Leaving Bush and Bush representatives in charge means more and more nasty pro-business, pro-PhRMA, etc. exploitation masquerading as ‘free’ trade agreements. Giving over to Congressional Democrats entirely means trade deals can be killed because of protectionist sentiment employed by all philosophical stripes, from Bluestocking to Big Business. But they need to have some oversight, especially with a Republican Executive that so firmly believes chicks dig paranoid secrecy (or whatever their stupid problem is), and keeps altering legislation extra-democratically for everything from trade deals to judicial appointments to bloody presidential signing statements.

Personally I’d like to see just less of a divide – rather than partisan control, co-operation, wherein Democratic Legislatures can tell Republican Executives what must be changed, and working together to do so. That will be the best thing for the long-run growth of the global economy – meaning I want the US government to grow the hell up and stop incidentally harming emerging-market economies with its churlish politicking. I won’t hold my breath, though.

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