NAFTA & CAFTA -- Not in America's interest

Once upon a time, before 9/11 opened our eyes to the dangers of unwatched borders, and before watching what North American “free trade” has accomplished, pro and con, the Oklahomilst was a supporter of loosening the restraints of all international trade. We're afraid we can’t say that any longer.

It’s not easy to make this change in position, but we've come to the conclusion that, however much we like fresh vegetables from Mexico in the dead of winter, it is not benefit enough to compensate for what has happened with American jobs, domestic farm produce prices, and the increased traffic across the southern border that has encouraged millions of “visitors” who have no intention of leaving.

It is true that consumers benefit from largely unrestricted free trade. It is also true that we Americans are largely a nation of consumers now, and so the drain on our budgets is lessened as we experience the influx of food and consumer goods that are grown or built elsewhere for less cost. This has helped to mask the inflationary aspects of our economy, such as rising energy costs and the mushrooming cost of housing. Which leads us to the question, is masking our economic pain a good thing in the long run? There are other questions as well. Just as there is no free lunch, no perpetual motion machine and all actions have consequences, what are the long term consequences of NAFTA and now CAFTA?

Here are a few points that come quickly to mind:

If Americans buy goods made for less from outside the United States, that means that in order to be competitive the same domestically produced goods must be re-priced (lower), or not sold at all. If they do not sell, the businesses or (in the case of some farm items) individuals will probably quit producing. No profit, no motive. If they sell at lesser profits, the incentive will be to cut production costs. The easiest production cost to cut is labor, either in the form of lost jobs or reduced wages, sometimes both.

Now the question: Can anyone seriously believe that NAFTA has had no effect on jobs, as some of the NAFTA supporters would like for us to think? Would CAFTA-DR, the Central American Free Trade Agreement (plus the Dominican Republic) have no negative effects on our economy?

Supporters defend NAFTA by saying that economic benefits flow both directions. In other words, there are goods produced in the United States which are now being sold in Canada and Mexico that have generated additional jobs and revenues. We’d like some hard numbers, please! Absent the evidence, we find it hard to believe that the average poorly paid Mexican citizen constitutes a viable market force for our Hummers, our HDTV screens, and our cell phone services.

Now the supporters of CAFTA-DR (the same folks who brought us NAFTA) are worried that American “special interests” will sink the vote in the House of Representatives. Granted there are special interests like the Sugar Lobby that are working hard to scuttle the agreement, but there is a great deal more opposition than the special interests. There are a lot of people like the Oklahomilist who are worried about the impact on regular folks. People with jobs and ordinary lives. People who pay rent and mortgages, taxes and live as best they can, too often beyond their long-term means.

Sure the Big Idea People of corporate America love free trade. Business of necessity gravitates to the maximum allowable profit, but business people can sometimes have such a love of money that they forget to examine their actions based on the common good. Is it good for America that we increasingly do not manufacture our goods or grow our own food?

The supports of CAFTA-DR are now waving the flag of national defense. Deroy Murdoch, writing in The National Review, quotes Defense Sec. Donald Rumsfeld as warning that Congress turning down CAFTA will demonstrate to Latin America that the U.S. is not a reliable trading partner. Others claim that Castro of Cuba and Chavez of Venezuela, the two socialists flirting with China, are against CAFTA, thus why would any American join them?

A couple of sample quotes from Murdoch's column gives you a good taste of the tenor of the debate. It is not whether CAFTA is good for America, but whether we can afford to be seen as protecting our domestic interests (along with the automatic assumption that CAFTA “must be” in our national interest. Period.).

“If Washington cannot get something as simple as CAFTA passed, then its credibility on the big issues — like agricultural subsidies at the World Trade Organization — will suffer,” says Ian Vasquez, Director of the Cato Institute Project on Global Economic Liberty.

“If CAFTA is rejected,” John Murphy predicts, “governments from Beijing to Brussels will see that the United States is embracing protectionist rhetoric over its own economic well-being.”

This is disingenuous and dangerous nonsense. Why should Americans worry foremost over whether international leaders, especially the oligarchic World Trade Organization, see us in a positive light? If our “credibility” is so fragile, especially after our expeditionary war in Iraq, then perhaps we ought to rethink our international associations.

Furthermore, this tendency of the Bush Administration to wave the flag and shout “Be patriotic!” every time they run into a roadblock among the citizenry is getting old. Not everything is a national defense crisis. Like the boy who cried “Wolf!” the national defense card is played too often. They are trying to shame us out of asking tough questions, out of thinking things through. Instead of convincing us with examples and logic, we are merely being warned that greater issues are at stake than we can understand. In essence, we are told to shut up and be good citizens of the Empire.

But isn’t it just possible that the other economic powers of the world would like to see the United States humbled economically through a series of moves that levels the playing field between its neighbors so much that our high standard of living for most of the populace is reduced? Are not the same people who supposedly want us to enlarge the free trade zones the same people who decry America as the world’s foremost polluter and energy guzzler? Do they not already see us as crazy cowboy moralists who still go to church on Sunday in respectable numbers? What better way to take the opposition down a few pegs than to encourage us to give away every competitive advantage we have ever had? Since when did it become wrong to look first to protecting your own citizens?

We hear a great deal about “fair trade” but notice that the treaties are entitled “free trade.” The former embodies the idea that commerce is conducted equitably among more or less equal trading partners. The latter, free trade, simply means that there are no barriers and no consideration given to the economic differentials. Thus we have car parts being made in Mexico by workers making a fraction of the hourly wage of those laid off workers in Detroit or St. Louis who were being paid $20 an hour (with benefits). The company that builds the cars continues to market them to American citizens at about the same price, but its profits are enhanced because the components are now cheaper. This is very good news for stockholders, but it is salt in the wound for the former worker, now flipping burgers in the “service sector” at $5.50 an hour.

For too many Americans today it is not difficult to dismiss the plight of that one worker as long as the living is easy, the job provides health care coverage, and momma continues to work (at least until the kids are out of school). In other words, as long as I’ve got mine, I don’t much give a damn about whether you’ve got yours. This calloused self-centeredness might make it easier to sleep at night in our post-industrial society, but it says little about our ability to re-meld and rebuild as a society should the current order break down.

And break down it will, sooner or later. The illogic of a great nation placing itself in thrall to other nations through “free” trade (not “fair” trade) is too great to sustain itself. Nothing lasts forever and the day will come when Americans will say, “We need steel. Who around here makes it?” The answer will be: “Nobody. We quit making American steel years ago. Nobody even knows how it’s done now.” Somebody will ask, “I’m tired of a diet of potatoes. Where’s the beef?” and another will answer, “When the last corporate beef producer bit the dust, they sold every last animal to the Chinese at auction.” Some enterprising young man will say, “I found a practically new truck hidden in the wreckage of the old factory. All I need is some gas and oil to run it.” And someone will say, “Ain’t it a shame that all the refineries were torn down for scrap metal, and anyone who had knowledge of exploration and refining is either dead or went to work for foreigners. Not gonna be any oil or gas any time soon.”

Far-fetched? In 1928 not an American in a thousand could foresee that in two years time an economic upheaval would occur that would render more than a quarter of all American workers as unemployed, that banks would fail, that many companies would cease to exist, their stocks worthless. America survived the Great Depression largely because a) Americans were still largely agrarian, b) Americans publicly professed an ethic of concern for others, and lived it, and c) World War II came along and reset the economic engine through deadly necessity.

That decade would witness a slow recovery and a great migration of people -- due to economics and weather -- to where work (and life) was promised. Their misery today is unimaginable to us. We would suggest reading Steinbeck’s “Grapes of Wrath.” Take it from a descendant of one of those Okies who stuck it out: it was far worse than even this excellent book reveals.

After you have read (or re-read) the book, ask yourself whether your conservative principles outweigh your social responsibility to seek the truth and speak it clearly. Big business, a necessary component of a good society, is not always a good citizen in that society. Corporate interests, while necessary to the operation of a free economy, should not be in charge of defining the common good or the moral imperative of an entire people. If we allow them to be in charge of these things, individuals and families will inevitably suffer.

Thus it has always been.