Skip to comments.Let's get real in trade talks
Posted on 07/29/2006 4:45:54 AM PDT by A. Pole
The current round of trade talks was launched in 2001 at Doha, Qatar, an authoritarian location conveniently off- limits to protesters.
The trade agenda has been set by business elites who would impose one economic model on the world -- the model of laissez-faire. This model rejects more than a century of Western history, during which democracies have relied on government regulation and social investment to temper the instability and income extremes of a pure market economy. The elite model would also coerce Third World countries to give up their successful development strategies, in which government helps local business develop new technologies and markets, and fledgling economies are sheltered from foreign speculation.
To the extent that Third World countries have already given in to US pressures, results have often been disastrous. East Asia's economic meltdown of 1998 was largely caused by too abrupt an opening of local financial markets. Speculative capital poured in, overheating local economies; then, when the winds shifted, it poured right out, sinking economies that were otherwise sound. Much the same thing happened to Mexico.
Current trade rules make it too easy for global business to deny workers in both poor and rich countries the fair fruits of their labors, despite rising productivity. US multinationals outsource in search of cheaper labor. China runs a huge trade surplus, in part by denying its workers fundamental rights and decent wages. This puts downward pressure on wages in the United States, Europe, even Mexico.
It embarrasses free-trade ideologues that the most successful emerging economies like Japan, Korea, and more recently Brazil, India, and China, have generated their own domestic savings and entrepreneurs, and have not relied much on foreign investors. This has both produced high rates of growth, and insulated them from imported instability.
(Excerpt) Read more at boston.com ...
"Free" trade bump
When did all the Big Goverment Socialists inflitrate Free Republic? This is pure neo Marixist class warfare propaganda.
Only problem for the Marixst. Those businesses are subjected to the "government regulation and social investment to temper the instability and income extremes" imposed over the last century. There is NO ethical or moral reason for any new super national orgnanization to impose their neo Marxist dogma for them. The framework is all ready their and this article a complete waste of time and bandwith.
This is rubbish.
if you don't want to join the WTO,
It's Robert Kuttner so one understands the agenda, but this is still bizarre. The most successful emerging economies, most especially the "Asian tigers," have relied precisely on export oriented growth strategies. They are the textbook examples of the power of trade liberalization to rapidly lift huge numbers of people out of poverty. The process isn't always easy and countries can take painful detours, but the basic strategy has been vindicated time and again.
Kuttner knows all this, but he's in bash-international-capital mode so he's decided to ignore it. I can understand how people who compartmentalize this severely can function day to day -- get to the grocery store, perform a rote job, walk and chew gum at the same time, etc. But I don't understand how they can write things that they know to be untrue.
But then, the almost entire leadership of the Democratic Party gets up every morning and goes out to lie about major issues, so such people obviously exist. But I still don't understand how they can do it.
How does that contradict "It embarrasses free-trade ideologues that the most successful emerging economies like Japan, Korea, and more recently Brazil, India, and China, have generated their own domestic savings and entrepreneurs, and have not relied much on foreign investors"?
We have very little foreign investment in the U.S. other than they're buying our bonds.
That will be news to Toyota, Honda, or hundreds of other foreign based multinationals that operate here. I'm too lazy to go hunting for the statistics right now, but foreign equity investment in the U.S. is very large.
Granted, the Chinese, Korean, or Indian equity stake is still relatively small, although the Chinese are reported to be sniffing around trying to buy in. This is a stage of development thing. As their economies mature, their better companies will grow into true multinationals.
I draw the opposite conclusion. Free trade has been a boon to the people in the Third World raising their standard of living, both in terms of supply and job opportunities. The people that free trade has hurt is the overpaid, unionized, American manufacturing workers. That is the true source of the leftist gripes with the free trade, they couldn't give a rats behind about the Third World. Free trade really does take from the rich and give to the poor, in this case the rich happen to be American workers.
Who is overpaid when it costs on average $500,000 to buy a home in this country?
"Get real" means get real in the November vote. Out all those who voted for phony 'free trade' deals for trade lobbyists. These trade deals resulted in our exporting both factories and dollars. We lose the jobs and the deficit money comes back to buy our Government bonds. It's lose - lose.
Trade means 'we buy from you' and 'you buy from us'.
Yes, Get Real - vote them out.
Then Mexico must be the exception. Free trade has devastated Mexican farmers without creating new jobs in numbers sufficient to employ them, so faced with starvation, they head north.
Correct me if I'm wrong, but Foreign Direct Investment does not include purchase of U.S. government debt instruments.
In 2004, total accumulated foreign direct investment (FDI) in the United States was $1.5 trillion on a historical cost basis, or some $2.7 trillion at todays market value. This represents approximately 10% of the total current market value of all publicly traded firms. Total outlays to acquire or establish U.S. businesses were $96 billion in 2004 alone. This includes both funding from foreign parents or from existing U.S. affiliates.More data here, at the U.S. Bureau of Economic Analysis.
Source: U.S. Department of State
Please see my #13 above.
The trade deficit will continue to be what it is until American entrepreneurs have the same access to foreign (particularly Asian) markets as they do to ours.
The American economy is set up to benefit the domestic consumer and gives him the greatest benefits possible, not the domestic producer whom it penalizes for making products here.
Sounds like we need more trade agreements, not less. South Korea is a good start.
strike "less," insert "fewer." (I hate it when I do that).
So long as there is a bilateral opening of markets I see these agreements as a positive too.
The problem is that for the past 30 years most trade agreements have been made for political reasons with more State Department influence than economic reasons. These left barriers to US based businesses while opening our markets with the obvious results.
I know you're usually wrong, but this time, you've outdone yourself.
The national median existing single-family home price was $215,900 in the third quarter, up 14.7 percent from the third quarter of 2004 when the median price was $188,200. The median is a typical market price where half of the homes sold for more and half sold for less.
- About a third of FDI in the U.S. is held in the manufacturing sector.
- Some 14% of FDI is invested in the financial services sector.
- Asian and Pacific FDI holdings in the U.S. manufacturing sector amounted to 12.3% in 2004.
- European firms account for 70% of direct investment in the U.S. The UK is the largest single foreign investor in the U.S., with some $252 billion invested (16% of the total stock of foreign direct investment in the U.S.)
- Asia and the Pacific firms had the next highest level of investment in the U.S., at approximately $219 billion (14% of U.S. investment).
- Japanese investors account for 12% of foreign direct investment in the U.S., and rank second to the UK. The Netherlands, followed closely by Germany and then France, hold the next biggest positions.
- Direct investment from Latin American investors totals some $86 billion; while large absolutely, this is 5.6% of total foreign investment in the U.S.
- Investment in the U.S. from Africa and the Middle East is less than $10 billion, only 0.6% of the total foreign investment in the U.S.
Specific CountriesSource: Bureau of Economic Analysis (BEA), Department of Commerce. Unless otherwise stated, all figures are on a historical cost basis as of 2004. New BEA 2005 break-out figures should be available during the latter half of CY-2006.
- Six European countries -- France, Germany, Luxembourg (a financial center), the Netherlands, Switzerland and the UK each hold U.S. investments worth over $100 billion dollars.
- The UK's $252 billion investment represents almost a fourth of total European investment in the United States. Japan accounts for 80% of investment from the Asia-Pacific region, reaching around $177 billion.
- Chinese direct investment in the U.S. is minimal, and does not register on the Department of Commerce data release. That should change with the 2005 Lenovo acquisition of IBMs Personal Computing Division. Hong Kong investment in the U.S. totals $1.8 billion.
- Taiwan investment in the U.S. was about $3.2 billion in 2004.
- Israel is the largest investor from the Middle East, with some $4.1 billion in investments. Kuwait follows with $1.2 billion.
- FDI from South America in the U.S. was greatest from Panama, with $11 billion in U.S. investments, probably because Panama is a financial hub.
- Mexico is the second largest Latin American investor, with some $7.9 billion invested. Venezuela is third, with $5.5 billion. Brazil accounts for some $1.3 billion.
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