In Washington’s partisan political climate, there are few issues with such broad bipartisan support as the Colombian Free Trade Agreement; an issue where John Kerry and Barack Obama both enthusiastically agree with George W. Bush and John Boehner. It is one of three Free Trade acts now awaiting Congressional confirmation, along with South Korea and Panama. It has been said that insanity is repeating the same action over and over and expecting a different outcome. If that is so, then, Free Trade must qualify as the height of insanity.
The North American Free Trade Act has caused economic disruptions in all of the nations involved. American industrial workers are forced to compete against Mexican wage scales. Small Mexican farmers are forced to compete against giant American agribusiness. Industrial pollution in Mexico has poisoned water supplies, driving ever more small farmers off of their lands. In Tijuana, the water treatment facility is near collapse. The city’s water treatment facility is antiquated and overwhelmed by industrial waste water that the facility was never designed to handle.
The toxic overflow is then released into the Pacific Ocean where it washes up on California’s beaches. The situation in Tijuana is illustrative of Free Trade in general. The elimination of tariffs and low environmental standards makes Tijuana a better place for huge mega corporations to manufacture and produce goods. The Korean giant Samsung manufactures television sets there and dumps toxic cleaning solvents directly into the water. They pay their workers wages below the American minimum wage and when their product is complete, it is boxed up for shipment to the United States, tariff free.
The Mexican’s are then left to deal with the pollution, and because of the low wages paid to their workers, there isn’t enough money for the citizens to build a new water treatment facility. The corporations pay little in taxes as part of their inducement to set up shop in Mexico and Mexico is forced to compete against other third world nations on wage scales alone, creating an escape proof industrial sweat shop.
Proponents of the Colombian Free Trade agreement offer that the agreement could boost U.S. gross domestic product by $2.5 billion a year. Well, that sounds all well and good doesn’t it?
Bloomberg – “Caterpillar (CAT) would be a bigger beneficiary than most. Colombia’s booming mining business has made the nation one of the top 10 export markets for the Peoria (Ill.) manufacturer of construction equipment. Removing the country’s tariffs on such goods, which range from 5 percent to 15 percent, would cut $100,000 from the $2 million price tag for Caterpillar’s D11 bulldozer. Buyers of one of the company’s behemoth trucks, which go for $2 million or more, would save $300,000 without the tariffs.”
So the actual beneficiaries would be Caterpillar and Colombia’s booming mining industry, which would receive a tax cut. The Colombian national treasury would be forced to deal with millions of dollars in lost revenue so that the booming mining industry could profit. Caterpillar would benefit by increased sales and a legislated tax advantage over Asian competitors. Wasn’t the issue here free trade?
Bloomberg –“Caterpillar wouldn’t be the only beneficiary. General Electric (GE) faces tariffs of 7 percent to 10 percent on its health-care and energy equipment sales in Colombia, and eliminating them would give GE an advantage over European competitors such as Siemens (SI), says Del Renigar, GE’s senior counsel for international policy and trade.”
We certainly wouldn’t want to deprive Colombians of GE’s medical imagining technology, but it’s that other technology GE wants to sell Colombia. Let’s see, what type of energy equipment does GE sell? Wait, don’t tell me! It’s been in all the papers recently. Right? GE wants to sell its nuclear reactors in Colombia. Besides Colombia’s two earthquake faults and its volcanoes, what other problems could there be? None for GE, because under nuclear protocols the manufacturers are held harmless once the project is completed. CEO Jeffery Immelt recently advised GE shareholders after the nuclear meltdown in Fukushima, Japan, that it wasn’t GE’s problem.
Wal-Mart is also pushing hard for this Free Trade act, as it is supplied with cut flowers and roses from Colombia. Caterpillar has taken out full page ads and begun employee letter-writing campaigns. Citibank is eager to finance these new projects. The free-trade pact also “locks in protections” for foreign investors, says Laura Lane, head of international government affairs at Citigroup. ”We also hope it will grow the market, and that will benefit Citi.” Those foreign investors she speaks of would be Americans, but the trade pact also specifically sites that no foreign distributorships or partnerships would need to be established there by guaranteeing that the profits will stay in American hands alone.
Bloomberg – “This sets the stage for enactment of all three free-trade agreements in the next few months,” Karan Bhatia, vice president in Washington for General Electric Co. (GE) and a former deputy U.S. Trade Representative, said in an e-mail, adding, “It is important to U.S. exports, to U.S. jobs, and to the credibility of the U.S. as an international trading partner.”
“Nothing is quite so telling as when they tell on themselves — government of corporation, by corporation, and for the benefit of corporation” remarked Bhatia.
Bloomberg – “This proves the United States can still lead on trade,” Tom Donohue, president of the U.S. Chamber of Commerce, the nation’s largest business lobbying group, said today in a statement.
Caterpillar Inc. (CAT), the world’s largest maker of construction equipment, has led the campaign for the Colombia and Panama agreements, saying they shouldn’t be put aside to rush through the deal the administration reworked with South Korea in December.
“Not only is Colombia one of Caterpillar’s 10 largest U.S. export markets by country, but it is also one of America’s closest allies,” Doug Oberhelman, chairman and chief executive officer of the Peoria, Illinois-based company, said today in a statement. “The agreement is also validation that Colombia is a good place to conduct business.”
So is Colombia one of our closest allies and a good place to do business? Its former President, Uribe was the former aviation minister who granted pilot licenses to Medellin drug cartel pilots. He was himself the former Mayor of Medellin and a close personal friend of Pablo Escobar.
The current President Juan Manuel Santos is a Harvard Business School graduate and former minister of the Army. That would be the same army accused of murders and abductions. In 2008 – 2009 Colombians held mass demonstrations in Bogotá against the Free Trade act but their protests where quelled by government and military intimidation.
Colombia also has a decades-long struggle with a left wing insurgency fighting for land reform and a more equitable distribution of the nation’s resources. Colombia’s economy closely resembles that of Mexico with a small ruling aristocracy and a much larger group of indigenous peasants. Like Mexico, its President is American educated, and 80 percent of its farmers live on less than fifty acres of land.
Last year in Colombia, more than fifty Union organizers were murdered and over two hundred murders are directly related to labor organizing since 2007. The Colombian military has been directly implicated in many of these murders while still under the direct command of the current President. The Colombian President has promised to assign special police detectives to investigate these murders if the Free Trade agreement is ratified. Given Colombia’s track record of labor relations, it is just more Free Trade talk, which is commonplace before ratification of these trade agreements and vacant after words.
Strange isn’t it, that this should be called a Free Trade agreement? The will of the people is ignored by politicians in both countries. Competitors are locked out and yet, there is an even more sinister aspect to this act of economic treason.
Bloomberg – “For Colombia, the deal would lock in unilateral trade privileges that are subject to renewal by Congress, providing greater certainty to investors.”
Under the constitution of the United States, tariff and trade policy is to be set by the Congress of the United States, and under these so called Free Trade agreements the Congress abrogates its responsibility to corporate whims forever.
Colombia is a nation which exports to the United States each day over 300,000 barrels of oil. That accounts for an annual American trade deficit with Colombia of between half a billion and two and a half billion dollars. This deficit is cited as yet another reason for this free trade agreement, only the trade problem is oil, and the answer is to eliminate the need for this oil. This agreement will not solve the problem — it will make the problem worse. It will not create one new job, nor will it aide one Colombian or American worker; it is just another name for a corporate tax cut.
“I’m not saying we’re all singing Kumbaya, but we’re starting to hum it.”
William Lane, Caterpillar’s chief Washington lobbyist.
Another excuse for American Capitalists to do business with a despotic right wing police state that murders its own citizens over basic civil rights. Profit über alles!
Corporate Fascism marches on.
David Glenn Cox is a staff writer for TLR and an award winning author and musician; he is the author of the novel, The Servants of Pilate.