The end of the multifiber aggreement of the early 1970s certainly precipitated the proverbial race to the bottom feared by labor movements all over the world and the communities they support. At stake is jobs and wage levels. Since 1979 between 5 and 6 milliion manufacturing jobs have been lost in the US due to trade aggreements like NAFTA, FTAA, and now CAFTA which is only the more updated version of a host of bilateral free trade initiatives dating back to the Reagan Administration such as the Caribbean Basin Initiative and the General System of Preferences renegotiations giving the Caribbean and Latin America greater access to US markets for primary commodities like coffee, sugar, and other agricultural products which are purchased by large, monopsonistic processers and marketers very cheaply who inflate the final market price, or from sectors of the local economy long dominated by a few US transnational corporations. Even then the issue wasn’t free trade and getting the third world more permanent market share in the US and a steady flow of foreign exchange, but privelaging US direct foreign investment! It is the same thing today with WTO structured agreements that globalize local economies and cost jobs and incomes in both the first and third world while only enriching the TNCs who invest in the low wage areas. The problem with the textile industry is the severe cost competition between factories for the brands and the international buyers who don’t really engage in price competition in the same market. There is high end and low end and many designers sell clothing articals for very high prices that cost pennies to manufacture! The quota system which once guaranteed a certain export market to many countries and their investors is now obsolete for a new global system that is increasingly concentrating things like clothing manufacturing in fewer and fewer countries. An increasing amount of clothing manufacturing is in China where TNCs will now benefit from the collapse of the old MFA. Those whose finished clothing investment is in Latin America hope to gain from the new CAFTA agreement which contains none of the labor standards protection provisions of the old trade agreements. Globalization has changed world trade basing it on restructured, more concentrated investment patterns which are reflected in new trade aggreements (and the cancelling of old ones) that advantage the largest TNCs. The big lobbyists for such new aggreements are the Business Roundtable, the National Association of Manufacturers, and other organizations that represent America’s largest direct foreign investors.
Posted by cabdriverinchicago on Jul 28, 2005 at 12:28 PM
How about an approach Free Trade that optimizes the welfare of working people?
James Kroeger explains the only approach to Trade Policy that would optimize the welfare of Americans who work for a living in <a href=“http://www.taxwisdom.org/trade_policy_jobs.htm:>On Job Losses & Trade Policy</a>.</p>
<p>Some excerpts:</p>
<p>”>trengthen its currency</i> in the foreign exchange market in order to improve its citizens’ purchasing power in the global marketplace. When that happens, foreign goods & services become cheaper while the prices of domestically produced products remain the same. But there are more benefits to be enjoyed than simply an increase in global purchasing power. Currency appreciation provides a country with the same essential benefit that productive efficiency improvements provide. Human resources are freed up that can then be used to produce other things of value. The problem with free trade is not that it eliminates jobs; firm investments in machinery do the same thing. Economists understand that this is a net benefit to society if those who are thrown out of work are re-employed in other productive activities. The problem is that elected officials do not seize the opportunity that unemployment gives them to increase the production of Public Wealth.”
“Those who worry about the unemployment caused by free trade do so simply because most members of the world
Posted by Linette on Aug 1, 2005 at 9:40 AM
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The end of the multifiber aggreement of the early 1970s certainly precipitated the proverbial race to the bottom feared by labor movements all over the world and the communities they support. At stake is jobs and wage levels. Since 1979 between 5 and 6 milliion manufacturing jobs have been lost in the US due to trade aggreements like NAFTA, FTAA, and now CAFTA which is only the more updated version of a host of bilateral free trade initiatives dating back to the Reagan Administration such as the Caribbean Basin Initiative and the General System of Preferences renegotiations giving the Caribbean and Latin America greater access to US markets for primary commodities like coffee, sugar, and other agricultural products which are purchased by large, monopsonistic processers and marketers very cheaply who inflate the final market price, or from sectors of the local economy long dominated by a few US transnational corporations. Even then the issue wasn’t free trade and getting the third world more permanent market share in the US and a steady flow of foreign exchange, but privelaging US direct foreign investment! It is the same thing today with WTO structured agreements that globalize local economies and cost jobs and incomes in both the first and third world while only enriching the TNCs who invest in the low wage areas. The problem with the textile industry is the severe cost competition between factories for the brands and the international buyers who don’t really engage in price competition in the same market. There is high end and low end and many designers sell clothing articals for very high prices that cost pennies to manufacture! The quota system which once guaranteed a certain export market to many countries and their investors is now obsolete for a new global system that is increasingly concentrating things like clothing manufacturing in fewer and fewer countries. An increasing amount of clothing manufacturing is in China where TNCs will now benefit from the collapse of the old MFA. Those whose finished clothing investment is in Latin America hope to gain from the new CAFTA agreement which contains none of the labor standards protection provisions of the old trade agreements. Globalization has changed world trade basing it on restructured, more concentrated investment patterns which are reflected in new trade aggreements (and the cancelling of old ones) that advantage the largest TNCs. The big lobbyists for such new aggreements are the Business Roundtable, the National Association of Manufacturers, and other organizations that represent America’s largest direct foreign investors.
How about an approach Free Trade that optimizes the welfare of working people?
James Kroeger explains the only approach to Trade Policy that would optimize the welfare of Americans who work for a living in <a href=“http://www.taxwisdom.org/trade_policy_jobs.htm:>On Job Losses & Trade Policy</a>.</p>
<p>Some excerpts:</p>
<p>”>trengthen its currency</i> in the foreign exchange market in order to improve its citizens’ purchasing power in the global marketplace. When that happens, foreign goods & services become cheaper while the prices of domestically produced products remain the same. But there are more benefits to be enjoyed than simply an increase in global purchasing power. Currency appreciation provides a country with the same essential benefit that productive efficiency improvements provide. Human resources are freed up that can then be used to produce other things of value. The problem with free trade is not that it eliminates jobs; firm investments in machinery do the same thing. Economists understand that this is a net benefit to society if those who are thrown out of work are re-employed in other productive activities. The problem is that elected officials do not seize the opportunity that unemployment gives them to increase the production of Public Wealth.”
“Those who worry about the unemployment caused by free trade do so simply because most members of the world
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