Will Anti-Free Trade Protectionist Agreements Be Bad For US Citizens Too?

from the do-they-know-what-they're-doing? dept

Fri, Oct 28th 2011 4:28am — Glyn Moody

As we've noted, the US has been using multilateral and bilateral negotiations conducted in secret as a way to craft some very one-sided trade treaties. They seem to offer pretty raw deals to the other nations involved � and correspondingly great ones for the US copyright and pharma industries. But could they turn out to have direct negative consequences for US citizens as well?

For example, recently Techdirt reported on the pharmaceutical price-fixing scheme contained in a leaked version of the Trans Pacific Partnership agreement. The way it is framed there would seem to imply that the Federal Medicaid program's preferred drug lists would be forbidden. Whoops.

And here's a troubling clause found in the bilateral trade agreements recently signed with Colombia, Panama, and South Korea:

Another section (PDF) of the trade deal seems to recognize only a limited right by Americans to create and use computer programs of their choice.

It says: "Each party recognizes that consumers in its territory should be able to...run applications and services of their choice, subject to the needs of law enforcement."

A U.S. trade official, who did not want to be named, told CNET that the language is "hortatory" and therefore not binding--in other words, it's a recognition, not a commitment to actually do anything.

Hortatory it may be, but it's there. Who's to say that the US government won't one day use the treaty as an excuse to make it happen?

The problem is that none of these back-room treaties has had the benefit of detailed scrutiny by outside experts while they were being drawn up; as a result, they may well contain clauses with unintended consequences further down the road. That's yet another reason for much more transparency during negotiations - or for avoiding them altogether.

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Filed Under: anti-free trade, free trade agreements, protectionism

12 Comments

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anonymous, 28 Oct 2011 @ 4:38am

'transparency during negotiations'
never gonna happen. the idiots that draw up these 'agreements' dont have a damn clue what they are doing or know or care about the consequences of their actions, so do you really believe they are gonna let the people see what dumb arse holes they are? keeping everything secret until after the event not only stops any criticism while 'negotiations are on going', it also gives them 'plausible deny-ability' when it all goes crap shaped!
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Pixelation, 28 Oct 2011 @ 5:20am

Nothing new here
"They seem to offer pretty raw deals to the other nations involved "

This is nothing new for the US government, just ask native Americans about it. When our government starts honoring agreements it will be because they have no choice.
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AJ (profile), 28 Oct 2011 @ 5:34am

The US Government picks and chooses what laws/treaty's it wants to follow, depending on what suits them best at the time. The American people do basically the same thing, which is why the law won't work in the first place.
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Bill Jackson (profile), 28 Oct 2011 @ 5:51am

Free Trade
It seems obvious that free trade can only operate between equals - countries whose people are paid about the same. With China, (their wage rate is under 10% of the USA wage rate. Fast container freight has made shipping less costly and eliminated theft as a major cost factor) - free trade is self destructive. There needs to be a wage factor = an offsetting duty rate to make this play field more or less level.

As you can see, once China has all the high tech fabrication machines, and low cost labor, and cheap freight - why make anything at all in the USA, UK, Europe?
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FuzzyDuck, 28 Oct 2011 @ 6:10am

Re: Free Trade
Ah yeah, an extra duty on products from poor countries. So their wages will always have to stay low to offset that duty, right? People in poor countries must stay poor.
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AJ (profile), 28 Oct 2011 @ 6:20am

Re: Re: Free Trade
I agree. We should flood the US with cheap crap from China unhindered until we reach the point that we've sent all of our manufacturing jobs across the ocean. Then not only do we not have cheap crap anymore, we don't have jobs.... errrr... wait a minute....
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AJ (profile), 28 Oct 2011 @ 6:22am

Re: Re: Re: Free Trade
Whoops.. no edit button....

"Then not only do we not have cheap crap anymore, we don't have jobs.... errrr... wait a minute...."

Should read:

Then not only do we not have jobs anymore, we can't afford the cheap crap.... errrr... wait a minute....
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Anonymous Coward, 28 Oct 2011 @ 6:27am

One point on government purchashing of drugs through Medicaid. The government doesn't actually know how to get the lowest prices from pharma, they just made it illegal for a drug company to sell at rates lower than they do the program.

What that can mean is that it will be impossible for others to buy the product at a better rate through any means because to sell at a lower cost would be illegal.
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Hugh S. Myers, 28 Oct 2011 @ 6:29am

Consequences?
You say 'unintended consequences'---what makes you think that there is no intent waiting in the wings as it were? People who hide behind closed doors are historical not known for either their honesty or their good intentions. Expect neither here.
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freak (profile), 28 Oct 2011 @ 7:17am

Re: Free Trade
There's a competitive advantage somewhere. I'm sure there are places where transportation is an issue, (ie: alcohols. Any beer lover will tell you that beer is liquid bread, and has a good tasting shelf life of about the same), and an advantage can be had for that, I'm sure that there is a competitive advantage for a tech company specializing in one nation, & it's languages, there are things you want from trusted sources, like medicine or encryption programs, there are resources that can be mined or produced more cheaply than any other country, or at least the US can provide them more cheaply to neighbouring countries, there are services & expertise that are always in demand no matter where you go and the US can raise those, and if you guys weren't so goddamn much against robots, the electricity for those per day is much less than the slave wages of a factory of chinese employees.

Point being, the only real thing tariffs & protectionist policies do is prevent the US from selling its goods outside the country, and makes goods more expensive for the people in the US.
Whether you think we should help poorer countries or not regulate the free market, tariffs happen to go against both . . .
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A Guy (profile), 28 Oct 2011 @ 12:58pm

Good.

Chinese anti-competitive, illegal, and market fixing actions are starting to backfire. It's about time.

Free trade was always doomed anyway. It's as doomed as communism and anarchism. It's simply incompatible with normal human behavior.

Someone will always begin exhibiting cartel behavior to game the system. Once that starts, it leads to others using similar cartel behavior to counter the original group, and the whole free trade system inevitable falls apart.

I'm glad both parties in the US are finally waking up to this truth.
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FuzzyDuck, 29 Oct 2011 @ 7:40pm

Re: Re: Re: Re: Free Trade
And when people in poor countries become even poorer, more will want to immigrate to rich countries (poor immigrants are ever so welcome in rich countries /sarcasm). Also they'll have less money to buy US and European products. You know like movies, software, services, etc. That will cost jobs in rich countries too... hell we can all become poorer together. Sounds swell.

Protectionism is one of those "pretend to be doing something" policies/ideas to "protect workers" (akin to: "for the children" or "to fight terrorism"), that doesn't really do any good to protect those workers and most likely comes at a great cost to the general economy.
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