Date: Fri, 23 May 1997 23:12:26 PST
Subject: Re: M-I: Free trade and protectionism
From: farmelantj-AT-juno.com (James Farmelant)


Both Joao Paulo Monteiro and Hugh Rodwell might want to take
a look at the new summer issue of *Science & Society* which has
an article: "NAFTA and Sovereignty" by Esmail Hossein-zadeh which
covers some of the issues that interest Joao and Hugh.  The
author finds NAFTA to represent a stage in the evolution of
capital-state collaboration which seeks to facilitate the 
needs of international capital.  The author stresses that while
NAFTA was presented to the public as promoting "free trade"
that in fact was not its main concern.  Free trade in the
conventional sense of reducing tariff barriers was already
accomplished under GATT which Mexico had joined back in
1986.  Rather NAFTA was mainly concerned with reducing non-
tariff barriers to trade and investment such as those that arise
from local, state, or national control of wages, health and safety,
or environmental standards or from legislation designed to
promote social justice.  In other words NAFTA is primarily
concerned with enforcing deregulation and with promulgating
sanctions on governmental bodies so they will not interfere with
the mobility of capital.

The author cites as an example of what NAFTA's impact on democratic
sovereignty is likely to be by citing the attempt in 1990 by             
                         Ontario's then New Democratic provincial government to                                         legislate a no-fault
government-run automobile insurance                                   
program like the ones that already existed
in Manitoba, Saskatchewan, and British Columbia.  This attempt was
squelched after provincial insurance companies commissioned a report
showing that under the U.S.-Canada Free Trade Agreement                  
                       the provincial government would be required to 
compensate the insurance companies for business that would be
lost under the proposed legislation.  NAFTA  too requires that
corporations be"... compensated for what they would not earned
but could have or should have earned.  Workers, on the other
hand, are not compensated for the most vital thing they have
actually lost: their jobs, hence their livelihoods." 

The  author describes a number of other features of NAFTA 
including prohibitions on government regulation of any investment or
financial service that is related to trade. This has the effect of
sharply 
restricting attempts by national governments to influence
foreign investment.  Also, no preference can be given to local
or national companies over foreign ones.  NAFTA has extensive
sections on "trade-related intellectual property rights" which
effectively
grant transnational corporations a monopoly  over most sources of
scientific knowledge and technological progress - ironically in          
                            the name of free trade and competition.  

The author goes on to analyze the campaign that organized
labor launched against NAFTA.  On his opinion the unions made
the fatal mistake of framing their case against NAFTA in protectionist
terms rather than in terms of fighting to make labor costs in the 
U.S., Canada, and Mexico comparable so as to undercut corporate
blackmail. (Like Marx the author believes that working class as a whole
has no particular stake in the classic free trade/protectionist debate).
Organized labor's "buy American" campaign heightened 
international labor competition, failed to challenge the primacy of
national capital, held labor hostage to capital's exigencies, and
gave ammunition to NAFTA's supporters who could point out that
loss of jobs in import-related industries would be balanced out by       
                       job gains in export industries.  

Also, the author believes that the anti-NAFTA campaign exaggerated
the role of competition from cheaper Mexican labor as a source of
unemployment thereby diverting attention from the major, systemic
source of unemployment under capitalism which is  the systemic
tendency to replace labor with machines.  The author instead suggests
that NAFTA, GATT, and the World Trade Organization should
be viewed as representing a new stage in the development of
capitalism in which markets are being consolidated on the 
international level.  Therefore, labor organizations to cope with these
developments by establishing international solidarity.

                           James F.                                      
                                                                         
                                           Thu, 15 May 1997 21:15:01
+0200 Hugh Rodwell <m-14970-AT-mailbox.swipnet.se> writes:
>Joao Paulo M wrote:
>
>>ERRATUM:
>>
>>The MAI (Multilateral Agreement on Investment) is, of course, not 
>being
>>cooked on the World Trade Organization but on the OECD (Organization 
>for
>>the Economic Cooperation and Development). It is not about free trade
>>but about its complement, the free flow of capital.
>>The two are part of the same global movement. If you accept Marx's
>>arguments against proteccionism, I don't see how can you avoid
>>swallowing MAI. But that is, of course, no excuse for lack of rigour.
>
>Now, if Joao rereads Marx and Engels on Free Trade in 1847, around the 
>time
>Marx was publishing the Poverty of Philosophy against Proudhon, he 
>will
>find that they are wishing a pox on both their houses -- what Marx 
>says,
>very very clearly, is that *neither* free trade *nor* protectionism 
>are in
>the interests of the working class, they are both purely bourgeois
>concerns. His arguments against protectionism are not against its 
>effects
>on workers but *against its utopianism* given the dynamically 
>international
>character of capitalism in the long run. Sometimes a given group of 
>workers
>will benefit from protectionist policies, sometimes from free trade
>policies, but this benefit is local and temporary and not a benefit 
>for the
>working class as a whole, in fact more often than not it'll prove to 
>be a
>benefit that's a perfect pretext for splitting the class on the basis 
>of
>some narrow material interest or other.
>
>For wage-slaves to get worked up about the choice of local or foreign
>exploiter is just a symptom of the fact that the bourgeoisie is still
>setting the political agenda for the working class. Our agenda is
>socialism, the removal of bourgeois exploitation as a whole, local and
>foreign. To realize our agenda we must stop fighting the battles of 
>the
>bourgeoisie for it. This in fact is what is meant by class-independent
>politics -- recognizing the interests of the working class and 
>fighting to
>make them the interests of society as a whole, the way the interests 
>of
>society as a whole today are the interests of the bourgeoisie.
>
>The Collected Works vol 6 has the relevant articles,  on p 92, p 274  
>and p
>279:
>
>Engels, "Protective Tariffs or Free Trade System"
>Engels, "The Economic Congress" (includes an account of Marx's speech 
>for
>the Brussels Congress).
>Marx,  "The Protectionists, the Free Traders and the Working Class"
>
>Cheers,
>
>Hugh
>
>
>
>
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