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On January 6, 2004, Senator Charles Schumer and I challenged the erroneous idea that jobs offshoring was free trade in a New York Times op-ed. Our article so astounded economists that within a few days Schumer and I were summoned to a Brookings Institution conference in Washington, DC, to explain our heresy. In the nationally televised conference, I declared that the consequence of jobs offshoring would be that the US would be a Third World country in 20 years.

That was 11 years ago, and the US is on course to descend to Third World status before the remaining nine years of my prediction have expired.

The evidence is everywhere. In September the US Bureau of the Census released its report on US household income by quintile. Every quintile, as well as the top 5%, has experienced a decline in real household income since their peaks. The bottom quintile (lower 20 percent) has had a 17.1% decline in real income from the 1999 peak (from $14,092 to $11,676). The 4th quintile has had a 10.8% fall in real income since 2000 (from $34,863 to $31,087). The middle quintile has had a 6.9% decline in real income since 2000 (from $58,058 to $54,041). The 2nd quintile has had a 2.8% fall in real income since 2007 (from $90,331 to $87,834). The top quintile has had a decline in real income since 2006 of 1.7% (from $197,466 to $194,053). The top 5% has experienced a 4.8% reduction in real income since 2006 (from $349,215 to $332,347). Only the top One Percent or less (mainly the 0.1%) has experienced growth in income and wealth.

The Census Bureau uses official measures of inflation to arrive at real income. These measures are understated. If more accurate measures of inflation are used (such as those available from shadowstats.com), the declines in real household income are larger and have been declining for a longer period. Some measures show real median annual household income below levels of the late 1960s and early 1970s.

…click on the above link to read the rest of the article…

No More ‘Free Trade’ Treaties: It’s Time For Genuine Free Trade

October 18, 2015

No More ‘Free Trade’ Treaties: It’s Time For Genuine Free Trade

This article, by Ferghane Azihari and Louis Rouanet, originated here: https://mises.org/library/no-more-free-trade-treaties-its-time-genuine-free-trade

It is erroneous to believe that free traders have been historically in favor of free trade agreements between governments. Paradoxically, the opposite is true. Curiously, many laissez-faire advocates fall into the government-made trap by supporting “free-trade” treaties. However, as Vilfredo Pareto stated in the article “Traités de commerce of the Nouveau Dictionnaire d’Economie Politique” (1901):

If we accept free trade, treatises of commerce have no reason to exist as a goal. There is no need to have them since what they are meant to fix does not exist anymore, each nation letting come and go freely any commodity at its borders. This was the doctrine of J.B. Say and of all the French economic school until Michel Chevalier. It is the exact model Léon Say recently adopted. It was also the doctrine of the English economic school until Cobden. Cobden, by taking the responsibility of the 1860 treaty between France and England, moved closer to the revival of the odious policy of the treaties of reciprocity, and came close to forgetting the doctrine of political economy for which he had been, in the first part of his life, the intransigent advocate.1

In 1859, the French liberal economist Michel Chevalier went to see Richard Cobden to propose a free trade treaty between France and England. For sure, this treaty, enacted in 1860, was a temporary success for free traders. What is less known however, is that at first, Cobden, in accordance with the free trade doctrine, refused to negotiate or sign any “free trade” treaty. His argument was that free trade should be unilateral, that it consists not in treaties but in complete freedom in international trade, regardless of where products come from.

– See more at: http://www.cobdencentre.org/2015/10/no-more-free-trade-treaties-its-time-for-genuine-free-trade/#sthash.6G4lReoA.dpuf

The TPP is Supply Management

October 18, 2015

The TPP is Supply Management

Despite the talk from the establishment about how the Trans-Pacific Partnership (TPP) is about global free trade – and therefore Canadian cows, chickens and cars can no longer be protected by supply management – the reality is, is that the TPP is supply management.

It’s supply management on an international level so executive bureaucrats, politicians and crony-capitalists can create rules to further solidify their statist-social order.

Meanwhile, there is rampant supply management in the domestic economy where you and I are burden by thousands of government regulations that determine what kind of, how much of, and how soon we can provide goods and services to each other.

It’s not supply management strictly in the sense that the Canadian dairy industry is considered supply management. But the definition of words don’t seem to really matter for the TPP architects.

The TPP is a perfect example of Orwellian newspeak where “free trade” means two different concepts (managed statist-trade and actual free-market trade) and thus narrows the range of thought, or as Tom Woods would say, “the range of allowable opinion.”

For if the TPP is identified with free trade, no one will seriously ask whether staying out of the TPP will result in a lack of free trade. Of course gettin’ involved with the TPP will mean free trade! derr!!

But if the TPP was truly about free trade, then it would allow all individuals to homestead, contract and exchange without being inundated with tariffs, duties, levies, or other arbitrary restrictions on the movement of people, goods and services.

Real free trade doesn’t require a treaty, nor secrecy where citizens must rely on WikiLeaks for information.

Politicians seem to serving themselves but not in the way we’d like ’em to.

They sign international treaties with each other that award special interests in the short-term instead of policies that promote everyone’s prosperity in the long-run.

This isn’t going to end well for them.

This is How the Trade Pact Escalates the Currency War

October 8, 2015

This is How the Trade Pact Escalates the Currency War

When negotiators from 12 nations and hundreds of lobbyists from around the world, after years of horse-trading, agreed on a “trade deal” on Monday – a deal that remains secret except for the sections that have been leaked – President Obama gushed that it “reflects America’s values.”

The Trans-Pacific Partnership (TPP) pries open markets for American goods and services and impose rules on our trading partners that give “our workers the fair shot at success they deserve,” he said.

Similar praise ricocheted around the Pacific from Prime Minister Stephen Harper in Canada, and from politicians and heads of state in Australia, New Zealand, Japan, and the other participating countries. China isn’t part of the deal, but what the heck.

The free trade deal isn’t actually about “free trade.” Many provisions that have been leaked deal with reshuffling the power structure between corporations and democratic states at the expense of citizens and taxpayers.

So now this thing has to be ratified in the 12 countries involved. There might be one or the other hiccup – for example, Hillary Clinton has just come out against it to gain points in her battle to the presidency. “As of today, I am not in favor of what I have learned about it,” she told PBS, thus flip-flopping beautifully from when she, as Secretary of State, had backed the deal.

Despite these potential hiccups, delays, flip-flops, and re-flip-flops, I expect it to get ratified eventually by all 12 countries. Too many deep pockets have lined up behind it to let some elected politician screw it up.

Alas, there remains a little problem: does it really promote exports, which is what they all claim it does, or is that just hype?

That’s the question Krishen Rangasamy, Senior Economist at Economics and Strategy, National Bank Financial, in Canada asked in a note – and then provided the answer: um, no.

…click on the above link to read the rest of the article…

The Trans-Pacific Partnership: Permanently Locking In The Obama Agenda For 40 Percent Of The Global Economy

October 6, 2015

The Trans-Pacific Partnership: Permanently Locking In The Obama Agenda For 40 Percent Of The Global Economy

We have just witnessed one of the most significant steps toward a one world economic system that we have ever seen. Negotiations for the Trans-Pacific Partnership have been completed, and if approved it will create the largest trading bloc on the planet. But this is not just a trade agreement. In this treaty, Barack Obama has thrown in all sorts of things that he never would have been able to get through Congress otherwise. And once this treaty is approved, it will be exceedingly difficult to ever make changes to it. So essentially what is happening is that the Obama agenda is being permanently locked in for 40 percent of the global economy.

The United States, Canada, Japan, Mexico, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam all intend to sign on to this insidious plan. Collectively, these nations have a total population of about 800 million people and a combined GDP of approximately 28 trillion dollars.

Of course Barack Obama is assuring all of us that this treaty is going to be wonderful for everyone…

In hailing the agreement, Obama said, “Congress and the American people will have months to read every word” before he signs the deal that he described as a win for all sides.

“If we can get this agreement to my desk, then we can help our businesses sell more Made in America goods and services around the world, and we can help more American workers compete and win,” Obama said.

Sadly, just like with every other “free trade” agreement that the U.S. has entered into since World War II, the exact opposite is what will actually happen. Our trade deficit will get even larger, and we will see even more jobs and even more businesses go overseas.

…click on the above link to read the rest of the article…

The Trans-Pacific Free-Trade Charade

October 3, 2015

The Trans-Pacific Free-Trade Charade

As negotiators and ministers from the United States and 11 other Pacific Rim countries meet in Atlanta in an effort to finalize the details of the sweeping new Trans-Pacific Partnership (TPP), some sober analysis is warranted. The biggest regional trade and investment agreement in history is not what it seems.

You will hear much about the importance of the TPP for “free trade.” The reality is that this is an agreement to manage its members’ trade and investment relations – and to do so on behalf of each country’s most powerful business lobbies. Make no mistake: It is evident from the main outstanding issues, over which negotiators are still haggling, that the TPP is not about “free” trade.

New Zealand has threatened to walk away from the agreement over the way Canada and the US manage trade in dairy products. Australia is not happy with how the US and Mexico manage trade in sugar. And the US is not happy with how Japan manages trade in rice. These industries are backed by significant voting blocs in their respective countries. And they represent just the tip of the iceberg in terms of how the TPP would advance an agenda that actually runs counter to free trade.

For starters, consider what the agreement would do to expand intellectual property rights for big pharmaceutical companies, as we learned from leaked versions of the negotiating text. Economic research clearly shows the argument that such intellectual property rights promote research to be weak at best. In fact, there is evidence to the contrary: When the Supreme Court invalidated Myriad’s patent on the BRCA gene, it led to a burst of innovation that resulted in better tests at lower costs. Indeed, provisions in the TPP would restrain open competition and raise prices for consumers in the US and around the world – anathema to free trade.

Read more at https://www.project-syndicate.org/commentary/trans-pacific-partnership-charade-by-joseph-e–stiglitz-and-adam-s–hersh-2015-10#J3RyoruABgKITiZc.99

An ‘Austrian’ Economist’s Advice For Greece and the EU

July 18, 2015

An ‘Austrian’ Economist’s Advice For Greece and the EU

For months, now, the mass media and the financial markets have anxiously watched and waited to see the outcome of a war of words, accusations, and threats that have been fought between Greece and its Eurozone and European Union partners.

Over several decades Greek governments accumulated a fiscally unmanageable debt and have been unwilling to introduce any meaningful, long-term economic and budgetary reforms to get the country’s political-economic house in order.

Greece’s Euro and EU partners have warned that Greece may be formally or informally expelled from the common currency and, perhaps, from the economic union if the terms for a new series of loans based on domestic Greek reforms and some debt restructuring cannot be agreed upon.

However, in the whirlwind of often sensational and uncertain daily new events, it is sometimes useful and even necessary to step back and try to take a look at the wider context of things in which those current events are occurring.

Greek and European Union Crisis is the Result of Collectivism

The fiscal and other economic policy problems that are plaguing Greece are simply the highly magnified and intensified problems that are affecting many of the other European nations

Many of them have accumulated large national debts that press upon the fiscal capacities of their taxpayers. They all have highly regulated markets and restricted labor markets. They all have aging populations expecting generous government-funded pensions as the years go by. They all have costly welfare state “entitlement” programs that must be financed through taxes and deficit financing.

They also share a generally anti-capitalistic mentality. Intellectuals, politicians, many in the electorates, and most certainly the national and EU bureaucrats neither understand nor advocate the classical liberal ideal of truly free markets or the wider political philosophy of individualism and individual rights to life, liberty, and honestly acquired property.

– See more at: http://www.cobdencentre.org/2015/07/an-austrian-economists-advice-for-greece-and-the-eu/#sthash.Eg4lkJYV.dpuf

“Free Trade” Run Amok: Canada Challenges U.S. Laws Reining In Banks

May 14, 2015

“Free Trade” Run Amok: Canada Challenges U.S. Laws Reining In Banks

We noted in 2013 that the Trans Pacific Partnership (TPP) would let big banks run amok, and wouldincrease the cost of consumer loans.

Ellen Brown asked last month:

Under the TPP, could the US government be sued and be held liable if it decided to stop issuing Treasury debt and financed deficit spending in some other way (perhaps by quantitative easing or by issuing trillion dollar coins)? Why not, since some private companies would lose profits as a result?

Under the TPP or the TTIP (the Transatlantic Trade and Investment Partnership under negotiation with the European Union), would the Federal Reserve be sued if it failed to bail out banks that were too big to fail?

[U]nder the Netherlands-Czech trade agreement, the Czech Republic was sued in an investor-state dispute for failing to bail out an insolvent bank in which the complainant had an interest. The investor company was awarded $236 million in the dispute settlement. What might the damages be, asks Firestone, if the Fed decided to let the Bank of America fail, and a Saudi-based investment company decided to sue?

Michael Snyder noted:

[TPP] would give Wall Street banks much more freedom to trade risky derivatives ….

We’ve all been proven right …

Specifically, Reuters reports today that Canada is trying to stop enforcement of America’s law prohibiting big banks from engaging in risky “prop trading” for the banks’ own gambling profit on Canadian debt:

The U.S. ban on its banks doing proprietary trading of Canadian debt likely violates an international agreement between the nations, Canadian Finance Minister Joe Oliver said on Wednesday, urging American lawmakers to adjust the so-called Volcker Rule.

…click on the above link to read the rest of the article…

As the Senate Prepares to Vote on “Fast Track,” Here’s a Quick Primer on the Dangers of the TPP

May 13, 2015

As the Senate Prepares to Vote on “Fast Track,” Here’s a Quick Primer on the Dangers of the TPP

The United States is in the final stages of negotiating the Trans-Pacific Partnership (TPP), a massive free-trade agreement with Mexico, Canada, Japan, Singapore and seven other countries. Who will benefit from the TPP? American workers? Consumers? Small businesses? Taxpayers? Or the biggest multinational corporations in the world?

One strong hint is buried in the fine print of the closely guarded draft. The provision, an increasingly common feature of trade agreements, is called “Investor-State Dispute Settlement,” or ISDS. The name may sound mild, but don’t be fooled. Agreeing to ISDS in this enormous new treaty would tilt the playing field in the United States further in favor of big multinational corporations. Worse, it would undermine U.S. sovereignty.

ISDS would allow foreign companies to challenge U.S. laws – and potentially to pick up huge payouts from taxpayers – without ever stepping foot in a U.S. court. Here’s how it would work. Imagine that the United States bans a toxic chemical that is often added to gasoline because of its health and environmental consequences. If a foreign company that makes the toxic chemical opposes the law, it would normally have to challenge it in a U.S. court. But with ISDS, the company could skip the U.S. courts and go before an international panel of arbitrators. If the company won, the ruling couldn’t be challenged in U.S. courts, and the arbitration panel could require American taxpayers to cough up millions – and even billions – of dollars in damages.

If that seems shocking, buckle your seat belt. ISDS could lead to gigantic fines, but it wouldn’t employ independent judges. Instead, highly paid corporate lawyers would go back and forth between representing corporations one day and sitting in judgment the next. Maybe that makes sense in an arbitration between two corporations, but not in cases between corporations and governments. If you’re a lawyer looking to maintain or attract high-paying corporate clients, how likely are you to rule against those corporations when it’s your turn in the judge’s seat?

– From Sen. Elizabeth Warren’s Washington Post Op-Ed: The Trans-Pacific Partnership Clause Everyone Should Oppose

Trying to learn about the Trans-Pacific Partnership, or TPP, is like trying to walk through a minefield. The only information we really have is courtesy of leaks, and those snippets are definitely not encouraging.

…click on the above link to read the rest of the article…

Free Trade is Plutocratic Propaganda

May 10, 2015

Free Trade is Plutocratic Propaganda

With the looming Trans-Pacific Partnership dominating the headlines, now is a good time to revisit an old scam called “free trade.”

In 2003, Kevin Flanagan was an information technology employee at Bank of America. They told him he was being replaced with foreign labor, and he was ordered to train his replacement. After he completed his assignment, he was laid off. Then he went to the parking lot and shot himself.

That’s “free trade.”

Like The Ministry of Truth in George Orwell’s 1984, sometimes, the most effective way to lie is to use the most innocent words. No word is more susceptible to propaganda-leveraging than “freedom.” Attach that word to any concept, and all of a sudden, it’s unassailable. That’s exactly what happened with “free trade.”

Proponents of free trade will often use the simplest analogies to convey their point, as if you were retarded. The reason they have to resort to such caveman illustrations is because free trade does not exist in the real world. There is no such thing as equality of bargaining power. If someone has ten million dollars and you have zero dollars, anything above zero is an “improvement” in your situation. The free trade economists will say this person with zero dollars is “free” to work for $1 per hour, and they will do so because it improves their situation. This is what “freedom” means to free trade economists.

…click on the above link to read the rest of the article…

‘Greater Public Scrutiny’ Needed of Secret US-EU Trade Negotiations, MPs Warn

March 26, 2015

‘Greater Public Scrutiny’ Needed of Secret US-EU Trade Negotiations, MPs Warn

The debate over the controversial Transatlantic Trade and Investment Partnership (TTIP) continues to suffer from a lack of transparency, warns a reportby the UK Business, Innovation and Skills (BIS) Committee.

The secretive nature of the negotiations between the European Union and the United States on this major free trade deal has resulted in an “oversimplification and misrepresentation of arguments on both sides” the Committee concludes.

Adrian Bailey, Chair of the BIS Committee said: “More detail needs to be made available to allow greater public scrutiny of this extensive trade agreement.”

The report argues that “Everyone involved in the debate on TTIP—campaigners, lobbyists, theUK Government and the European Commission—must ensure that an evidence-based approach is at the heart of any TTIP debate.”

“Unfortunately, in the absence of that detail or undertakings that negotiating texts will be made public, the debate on the trade agreement has become polarised.”

Environmental Risks

The high degree of secrecy means it is impossible to monitor or evaluate what issues are being taken into account the report explains. This echoes concerns previously raised by MPsabout whether or not environmental risks are being taken into consideration.

…click on the above link to read the rest of the article…

Food democracy South and North: from food sovereignty to transition initiatives

March 18, 2015

Food democracy South and North: from food sovereignty to transition initiatives

When the idea of food sovereignty emerged twenty years ago, from the mobilisation of campesinos in Costa Rica and from the protest marches of small farmers in the Indian state of Karnataka, it had one important lesson to teach us: policies in the areas of food and agriculture should not be taken hostage to the exigencies of international trade. This idea was central to the establishment in 1993 of the Via Campesina, which was soon to grow into the largest transnational social movement in existence, now spanning 164 local and national organizations in more than 70 countries across Asia, Africa, Europe, and the Americas, and representing an estimated 200 million farmers.

As an antidote to the globalization of food markets, food sovereignty was very much a product of its times. The Uruguay round of trade negotiations launched in 1986 was nearing its conclusion, and at the request of major developing countries, agriculture had been placed at the centre of the table of the big bargain to be struck: food, it was becoming clear, was set to become the next frontier of the great mill of commodification, and farmers from the world over were asked to compete against one another — and let the least competitive disappear.

Food sovereignty was, first and foremost, a story of solidarity against adversity, of cooperation against competition. The trade negotiators wanted their farmers to compete: instead, rallying behind the new slogan, they decided to unite. A strange ballet of words occurred: those talking about trade « liberalization » were condemning farmers to new forms of pressure and coercion from the global marketplace and from the large agrifood companies that dominate it, while those speaking of food « sovereignty » meant in fact the opposite of food wars — they meant alliances across national borders.

…click on the above link to read the rest of the article…

Canada Is Trading Away Its Environmental Rights

January 28, 2015

Canada Is Trading Away Its Environmental Rights

In 1997, Canada restricted import and transfer of the gasoline additive MMT because it was a suspected neurotoxin that had already been banned in Europe. Ethyl Corp., the U.S. multinational that supplied the chemical, sued the government for $350 million under the North American Free Trade Agreement and won! Canada was forced to repeal the ban, apologize to the company and pay an out-of-court settlement of US$13 million.

The free trade agreement between Canada, the U.S. and Mexico was never designed to raise labour and environmental standards to the highest level. In fact, NAFTA and other trade agreements Canada has signed — including the recent Foreign Investment Promotion and Protection Agreement with China — often take labour standards to the lowest denominator while increasing environmental risk. The agreements are more about facilitating corporate flexibility and profit than creating good working conditions and protecting the air, water, land and diverse ecosystems that keep us alive and healthy.

Canada’s environment appears to be taking the brunt of NAFTA-enabled corporate attacks. And when NAFTA environmental-protection provisions do kick in, the government often rejects them.

According to a study by the Canadian Centre for Policy Alternatives, more than 70 per cent of NAFTA claims since 2005 have been against Canada, with nine active cases totalling $6 billion outstanding. These challenge “a wide range of government measures that allegedly interfere with the expected profitability of foreign investments,” including the Quebec government’s moratorium on hydraulic fracturing, or fracking.

…click on the above link to read the rest of the article…

Here’s Why the Trans-Pacific Partnership Agreement Is Just Plain Wrong

January 9, 2015

Here’s Why the Trans-Pacific Partnership Agreement Is Just Plain Wrong

Republicans who now run Congress say they want to cooperate with President Obama, and point to the administration’s Trans-Pacific Partnership, or TPP, as the model. The only problem is the TPP would be a disaster.

If you haven’t heard much about the TPP, that’s part of the problem right there. It would be the largest trade deal in history — involving countries stretching from Chile to Japan, representing 792 million people and accounting for 40 percent of the world economy – yet it’s been devised in secret.

Lobbyists from America’s biggest corporations and Wall Street’s biggest banks have been involved but not the American public. That’s a recipe for fatter profits and bigger paychecks at the top, but not a good deal for most of us, or even for most of the rest of the world.

First some background. We used to think about trade policy as a choice between “free trade” and “protectionism.” Free trade meant opening our borders to products made elsewhere. Protectionism meant putting up tariffs and quotas to keep them out.

In the decades after World War II, America chose free trade. The idea was that each country would specialize in goods it produced best and at least cost. That way, living standards would rise here and abroad. New jobs would be created to take the place of jobs that were lost. And communism would be contained.

…click on the above link to read the rest of the article…

Global finance and the privatization of rural livelihoods | ROAR Magazine

November 1, 2014

Global finance and the privatization of rural livelihoods | ROAR Magazine.

A big piece of news for food politics enthusiasts this summer was India’s veto over a proposed agreement — to be concluded within the legal framework of the World Trade Organization — on ‘trade facilitation measures’. The agreement was meant to regulate a number of sensitive issues, mostly related to customs infrastructure and procedures, which are liable to affect trade between WTO members. As it often happens with international agreements, however, exceptions and exemptions are as important as the rules being agreed. In Bali, which is where the ‘trade facilitation’ negotiations were happening, the bone of contention happened to be India’s request for a permanent exemption from further trade liberalization of its public stockpiling and distribution system for food staples.

In fact, the centerpiece of India’s food security infrastructure is the Food Corporation of India (FCI). This is a public body, established in 1964, that acts like a hybrid between a marketing board, a food bank and a subsidy scheme. It stockpiles grains and other food staples (which it buys at controlled prices that give farmers some protection against fluctuations). It then uses this reserve to distribute grains at times when market prices become too high, both as a way to bring those prices down (this is what a marketing board does) as well as to ensure access to essential dietary staples (the ‘food bank’ aspect of the FCI). In other words, the FCI is like a public insurance mechanism against the fluctuation of food prices. The issue in Bali, then, was whether India should be allowed to ‘keep’ the FCI indefinitely, or whether it should gradually phase it out, in order to leave free reign to private actors.

…click on the above link to read the rest of the article…

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