Skip to comments.U.S.-Korea free trade pact takes effect amid controversy
Posted on 03/15/2012 4:30:47 AM PDT by 1rudeboy
WASHINGTON (Reuters) - A long-delayed U.S.-South Korea free trade agreement (FTA) that has stirred controversy in both countries took effect on Thursday, although the opposition in Seoul has vowed to renegotiate it if it wins elections this year.
The deal between the world's top economy and Asia's fourth largest will boost trade by billions of dollars and create tens of thousands of jobs, the two sides say, making it one the biggest deals of its kind.
The pact, which was signed in 2007 and finally approved by both countries in late 2011, immediately eliminates 80 percent of South Korea's duties on U.S. manufactured goods and nearly two-thirds of its duties on U.S. farm products.
In Seoul, shoppers felt the immediate impact, with bottles of Californian wine and citrus fruit flying off the supermarket shelves at up to a 20 percent off less than before.
South Korea is the United States' seventh-largest trading partner and has an economy valued at $1 trillion dollars. The pact's tariff cuts are expected to boost U.S. exports to Korea by $10 billion to $11 billion, helping to support 70,000 jobs.
The agreement mostly negotiated by the administration of former U.S. President George W. Bush and former South Korean President Roh Moo-hyun also opens up more of South Korea's large services market to U.S. companies and has new protections for exporters, investors, and intellectual property rights holders.
(Excerpt) Read more at chicagotribune.com ...
Well, hey! All those other “free” trade pacts worked out great for us, so why not? /s
Damn Thatcher and Reagan and the horses they rode in on!
We are the free traders in a (mostly) managed trade world.
We’ve signed FTA’s with what, twenty countries? We mostly manage our trade as well.
Correct, but only because we've traded trade deficits for employment and manufacturing deficits. By allowing our manufacturing base to move to Mexico and other "free trade" countries, we now have less to export, lower-paying jobs relative to inflation, and fewer jobs to boot. Hurray for us!
Think China or Russia or India would ever sign a "free" trade agreement with us? Not very likely. A strong nation is one that actually grows, raises mines and makes products. That is real GDP, not fake numbers on a ledger.
Incorrect. Increasing trade deficits are correlated with an expanding economy. That’s just the way it is . . . you can claim that the correlation is not causal, but you cannot claim the opposite of the truth.
Opposite of truth? Here's the truth:
Free trade agreements have changed our economy from one in which a major portion of GDP was from actual production (mining, raising livestock, growing crops, manufacturing), to one in which most of our GDP is derived from financial and other services, plus government spending, with much lower REAL production.
Free trade agreements are a form of wealth distribution but between nations where the commodity being traded is human labor. We want cheap goods, so we export our jobs to comparatively low-wage-paying nations, then import their products with low or no tariffs.
Bottom line is that every free trade agreement we've signed has resulted in lower actual production in the US and fewer jobs in all sectors of production industry. We get a gain in service jobs in return. We've also gotten tons and tons of imported labor and a major illegal alien problem which exploded after NAFTA was passed.
Why is Germany the strongest economy in the Euro-zone? To quote Merckel when she was asked by Britain's PM why Germany's economy was so strong: "Because we still MAKE things."
The truth is that production of goods makes for a strong economy. Destroy your actual and real production and you will eventually destroy the country.
We produce more services and we spend more via government PER CAPITA. We produce far less real product PER CAPITA. As a result, we export less and import more.
All we need is a few more "free" trade agreements and soon we won't produce anything at all. "Made in America" is going the way of the Dodo.
Question for you: Would you say John McCain was correct when he told an audience during his campaign in 2008 that "those jobs aren't coming back?"
Do you believe that free trade agreements are treaties between nations as defined by the constitution?
So, in other words, 80% of a baseball is better than 50% of a basketball . . . when complaining about size.
Because it’s worked so well with Communist China.
Is that a trick question? LOL
What about communists? Did the S. Koreans turn red when I wasn’t looking?
I prefer your condemnation to your suckin' sympathy.
Baby, good for nuthin' is good enough for me.
Our GDP is now supported primarily by government spending, consumer spending and the ratio of investment by industry has very nearly flipped from nearly 7:3 goods to services, to 3.5:6.5 goods to services - almost a complete reversal.
Service products depend heavily on a healthy financial system to provide jobs. The world financial system is a mess.
But EVERYONE needs goods. Look at every country on the planet with a relatively healthy economy in this recession and you'll see their GDP is based first on production of goods, not services.
Furthermore, government spending is now a huge portion of our GDP. This is why they spend. If they didn't, we'd be seeing negative growth. Four quarters of that spells the "D" word and government is deathly afraid of that word.
I love FR econ threads. I learn so much: small is larger than large, increasing price increases demand, the government loans me money to buy stuff . . . and that is all in the past week.
Of course it is. LOL.
These are treaties by any definition used by the Founders and by our constitution. So are bilateral fair trade agreements, which is what I favor over the two to ten thousand page behemoths we call "free" trade agreements.
Treaties require not just a simple Senate majority; they need a 75% vote.
Now look at the votes for NAFTA, CAFTA, etc.
What's wrong with this picture?
This is what we get by allowing our government to play word games. They are called "agreements" for a reason and that's to bypass constitutional due process. Oh, but even suggest we're going to change these "agreements" and the other parties start screaming about "broken treaties."
What about as a percentage of GDP? During our heyday compared to now?
Obfuscation and ridicule are tools used by liberals when they've lost an argument. Please don't stoop to that level. It does not become you.
Congress has the plenary authority to regulate trade with foreign nations, according to the Constitution. It therefore has the authority to approve trade agreements in any fashion it so chooses.
Alsop works to support my argument.
Bottom line is we have traded making things for service jobs. To keep GDP high in a recession, we now have no choice but to boost GDP through government spending as demand for services falls during a recession compared to a demand for goods.
It's either that or admit we're actually in a depression with negative quarterly GDP growth.
And I'll note your selective "outrage"--ad hominem attacks are only permissible by those with whom you agree, eh?
An actual written document which defines a trade relationship with another country is a treaty. Go back and look at the pre-free trade era. Those bilateral trade agreements were approved by a 75% vote in the Senate because they had titles like the US-Japan Trade Treaty.
The first boondoggle was NAFTA. perhaps you are too young to remember the outcry over the vote on that and whether it was legitimate. Clinton and his cohorts rammed it through.
Yet when GW Bush was for pushing Mexican trucking on us, he called NAFTA a treaty which couldn't be violated (paraphrasing but he did use the word "treaty.).
And who gives a hoot what word Bush used? Remember, "smaller" is "larger," right?
And I'll note your selective "outrage"--ad hominem attacks are only permissible by those with whom you agree, eh?"
You have yet to show how free trade agreements benefit the USA. I've been trying to show how they hurt us. You started the sarcasm. I merely parried with my own.
Now come on, show us how NAFTA is helping us today. Can you hear the "giant sucking sound?" No? That's because as McCain said" Those jobs are gone and they aren't coming back."
Tell us how losing 65% of our manufacturing base is a fantastic thing, with more jobs leaving - Korea Bound Baby!
Am I a bit of a nationalist? H*ll yes!
Now you are redefining "start." Did you forget your comment #3 already?
If I feel like "showing" something, I might . . . maybe when you stop making crap up.
Alsop works to support my argument.
Bottom line is we have traded making things for service jobs.
That's true. Still doesn't answer my question.
If they are locked out of the US market they might.
I advocate for trading freely (no import duties, currency schemes, etc) with nations that will do the same, and cutting out the rest.
Whoops. Not quite correct but close. Reagan was in favor of a North American common market and reduced tariffs - BETWEEN CANADA AND THE US! Mexico was not a part and parcel and Reagan would have disagreed with that. In 1988, we had the Canada-U.S. Free Trade Agreement, NOT NAFTA.
GHW Bush was the NAFTA freak who brought Mexico in and that was so he could reward all his big-business buddies with cheap labor. NAFTA cancelled the US-Canada Agreement.
That is a pipe dream. We are growing more irrelevant every day we keep spending more than we take in.
If we locked out China and/or India, our store shelves would be bare.
If it's true, you've answered your question.
Government spending, consumer spending, and service industry combined now accounts for a large portion of our GDP. Production of goods is now a wedge in the GDP pie chart.
However poorly we do it.
Most of our massive trade deficits are with a relatively few Asian (read China) nations, with whom we have no direct FTA.
How large a wedge now? How large a wedge in the past? Why no answer?
You have another solution you'd care to offer?
Not only was NAFTA Reagan’s idea, he envisioned a larger FTAA. He also jump-started the Uruguay Round, which led to the creation of the WTO. Whoops, yourself.
I get it. You're a history revisionist. Reagan did an agreement with Canada. Reagan was not in office when this was ditched for NAFTA, during GHW Bush's admin.
But sorry, I don't play with revisionists. See ya.
Please follow the whole thread before commenting on something I wrote as if a quote of mine was a stand-alone statement.
Wouldn’t want a fact to pop up and hit you. LOL!
Since I was a young man when Reagan signed the US-Canada agreement and remember it well, and since I was involved in politics when GHW Bush was arguing to create a new agreement which included Mexico called NAFTA, and since Reagan wasn't in office during discussions of NAFTA, and since NAFTA was signed into law under Clinton when Reagan had Alzheimer's.
Why don't you get back to me when actual facts are posted. Better yet, quote a source showing Reagan supported adding Mexico to the agreement.
Until then, why bother?
I'll get right on that. As soon as you post the percentages you failed to provide previously. Good luck!
Otherwise, I have neither the time nor interest in reading everything you write.
Reagan was in favor of a North American common market and reduced tariffs - BETWEEN CANADA AND THE US! Mexico was not a part and parcel and Reagan would have disagreed with that.so lets take a look at his own words, shall we?
This year, we have it within our power to take a major step toward a growing global economy and an expanding cycle of prosperity that reaches to all the free nations of this Earth. I'm speaking of the historic Free Trade Agreement negotiated between our country and Canada. And I can also tell you that we're determined to expand this concept, south as well as north. Next month I will be traveling to Mexico where trade matters will be of foremost concern.So the only question remaining is, are you ignorant of this subject, or are you the one doing the Stalin-esque revising of history?
Ronald Reagan, State of the Union Address, January 25, 1988.
My money is on ignorant. Shame on you that you tried to pull a fast one. There are conservatives on this website.
I took care of it, but only because it pisses me off to see Ronald Reagan treated so badly.