Korea-US Free Trade Agreement - Costs Us Jobs, Makes The Rich Richer

By Jim Goodman, Common Dreams

While the Boston Globe indicated NAFTA was bad for U.S. jobs and the environment, the San Francisco Chronicle noted that under NAFTA multinational corporations had been able to cut labor costs and increase their profits. KORUS will be no different: bad for workers, good for corporate profits. The U.S. International Trade Commission estimates that under KORUS, the U.S. trade deficit would, again, increase and U.S. jobs would, again, be lost.

"We have to seek new markets aggressively, just as our competitors are. If America sits on the sidelines while other nations sign trade deals, we lose the chance to create jobs on our shores”. President Barack Obama, State of the Union Address January 27, 2010

The Korea-US Free Trade Agreement (KORUS) is precisely what President Obama is promoting. The arguments and the promises are pitched again, over and over and over, ad nauseum -- Free Trade Agreements (FTAs) will produce more and better jobs for U.S. workers, better markets and more profit for U.S. farmers.

The underlying assumption of job creation through FTAs is false. Current trade policy has not created more U.S. jobs; it has, according to the AFL-CIO, cost the U.S. 6 million jobs since 1998. Understanding that fact is not rocket science. Current trade policy has accelerated offshoring of U.S. jobs and it has, in effect, allowed multinational corporations to opt out of environmental protection and fair labor standards.

Considering our long history of FTAs, [North American Free Trade Agreement (NAFTA) 1994, the World Trade Agreement (WTO) 1995 and the Central American Free Trade Agreement (CAFTA) 2005], shouldn't the prosperity for workers and farmers be kicking in pretty soon? Why those 6 million jobs lost, why a the continuing food crisis, why the world economic death spiral?

Prior to NAFTA, 1990-1994 our trade deficit with Canada averaged $8.1 billion; by 2006 it was $71 billion. In 1993 we had a $1.6 billion trade surplus with Mexico; by 2010 we were $61.6 billion in the red. Given economic factors unrelated to NAFTA, both positive and negative, the Congressional Budget Office estimates that under NAFTA the U.S. gross domestic product increased a few hundredths of one percent. Wow.

So, while profits will be realized, the benefit to society is a question of one's perspective. While workers are laid off, farmers gain nothing and the poor sink deeper into destitution, corporate power and profit will keep growing. Who really benefits when, for example, General Electric made $14 billion in profit in 2010 yet paid no taxes?

GE is one example, but the parallels are pointedly exact, whether it is GE, Wal-Mart, Nestle, Kraft, Cargill or any of a host of agribusiness corporations. They profit, they do not pay their fair share of taxes and they happily exploit labor standards and environmental protection.

Agriculture could be the biggest winner when KORUS is approved. U.S. agricultural interests stand to gain billions in earnings and undoubtedly they will. Farmers, however, are not international traders, the real profit in agriculture is made in the corporate boardroom and we don't have a seat there. Perhaps the stronger point is that most farmers worldwide produce food to be consumed locally, not commodities for international trade, they stand to be victims of corporate “dumping” rather than to benefit by trade.

Farmers' marketing options are limited, workers' bargaining power is limited and the poor have no power. Trickle down economics did not work when Ronald Reagan made it popular. It does not work now and it never will.

Like Mexican and Central American farmers under NAFTA and CAFTA, Korean farmers will, perhaps, suffer the most. They stand to loose their land, their culture and their dignity-- again.

Farmers and workers should not be forced into dependence on trickle down economics, content with the crumbs that fall off the corporate banquet table.

If the argument in favor of KORUS is increased corporate profit, fine. Call it that. But it is a perverse misrepresentation to imply that U.S. farmers and workers will profit, because we have not and we never will. We do not have the power the lawyers or off-shore banks that the multi-national corporations use to push their agenda and profit from our labor.

Increased profit through free trade? Yes, that will happen. Clearly there is profit to be made through the implementation of FTAs, but the profit will be made by the multi-national corporations who actually move product around the world. As tariff barriers are removed, the world will indeed be their oyster and Shakespeare could be quoted as their guiding light,* “*/*Why then the world's mine oyster/Which I with sword will open.”*

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