Korea trade deal a Loser for Iowa

By Chris Petersen wcfcourier.com The usual agribusiness interests and multinational corporations are again trying to get Iowa farmers to believe that we are just one trade agreement away from riches. This time they're selling a deal with Korea based on the North American Free Trade Agreement. It's a loser for eastern Iowa. Even the ever-overly-optimistic U.S. International Trade Commission projects the Korea deal would increase the overall U.S. trade deficit. If this is news to you, it may be because we are being treated to the same dog and pony show we saw before NAFTA. Farmers are shown a list of Korean tariff cuts on some of the crops we grow and promised this means we will sell more in Korea. But we're not shown the whole picture. The fact that these deals only help to consolidate the power of multinational corporations and Big Agribusiness at the expense of family farmers is glossed over. We need markets for our products, sure, but we have to develop these markets in a way that allows actual farmers to benefit. Under the NAFTA model, the corporations farm the farmers. Those of us who lived through NAFTA also learned that the possibility of cuts on paper translating into real export gains relies on other factors, like exchange rate manipulation. And Korea, one of only three countries our government has ever officially labeled a currency manipulator, has a record of 50 percent and 60 percent currency devaluations. Another devaluation would totally eliminate this agreement's purported tariff cut benefits and make our exports more expensive to Koreans than they are now. Yet, the Korea trade deal has no provisions to counter such cheating despite my organization, the National Farmers Union, demanding such from day one. Recall how a year after NAFTA, Mexico devalued the peso 50 percent, gutting the tariff cuts on which many farmers relied. In the first three years of NAFTA, U.S. exports to Mexico of beef and pork, projected NAFTA winners, were 13 percent and 20 percent lower, respectively, than in the three years before NAFTA. Unfortunately, that sort of damage is a likely outcome of this Korea deal too. So where does the American Farm Bureau Federation get the rosy data they are now pitching that shows massive export gains? Their study on the Korea deal only focused on gross exports. It excludes consideration of imports or the net outcome. But worse, the study arbitrarily assumes an automatic 10 percent increase in U.S. market share in Korea for every U.S. farm sector. That includes wheat, soy and cereal grains (like corn), which the USITC says would be net losers, and rice (not covered in this deal). Over a third of the "gains" their study claims come from farm sectors that the USITC projects will lose under the deal, plus rice, and they just ignore the import side altogether. Farmers aren't the only losers under the Korea deal. The USITC said the deal would increase trade deficits in most manufacturing sectors. In Iowa's first congressional district alone, there are as many as 5,107 workers in the losing sectors, with jobs at risk in metal products, motor vehicles and parts, other transportation equipment, textiles, apparel, iron-containing metals, and electronic equipment. The Korea deal also has the same NAFTA limits on imported food safety and inspection, weak labor standards and limits on regulation of banks and securities --- despite lax regulation contributing to our current economic crisis. And this deal has the crazy foreign investor privileges that empower foreign corporations to skirt our domestic courts and directly challenge our state and federal laws before United Nations and World Bank tribunals to demand compensation from our tax dollars for claimed trade pact violations. The final irony is that Gov. Terry Branstad says this deal will boost exports. He wants to spend our tax dollars to open an Iowa trade office in Korea. But the data show that U.S. exports to countries we have these NAFTA-style agreements with have grown at less than half the rate of our exports to other countries. There's plenty that can be done to boost U.S. exports and improve the economy in eastern Iowa, but this lopsided give-away trade deal with Korea isn't one. Read original article here