December 18, 2009 Volume 110 Number 24

Trade justice campaign continues

About 1,800 people turned out for a Dec. 5 Portland march and rally against the World Trade Organization (WTO), just over 10 years after 50,000 protested a Seattle summit meeting of the organization.

The WTO facilitates and enforces an international legal framework of multi-party treaties. But labor unionists, environmentalists and human rights activists say the WTO elevates trade, investment and so-called “intellectual property rights” above the interests of workers, the environment, and community.

“We were flimflammed,” Oregon AFL-CIO President Tom Chamberlain told Portland rally-goers. “We were told these treaties would bring good-paying jobs and raise our living standards.”

Instead, for American workers, outsized trade deficits of $700 billion a year tell a story in which trade contributes to job losses. Some 5 million jobs have disappeared in the U.S. manufacturing sector in the last 10 years.

Mostly, the WTO exerts its influence indirectly, preventing rather than overturning action by national governments. An example is what happened when the U.S. Congress proposed the “cash for clunkers” program, in which the government would pay up to $4,500 toward the purchase of a new automobile if it was substantially more fuel-efficient than a purchaser’s existing vehicle, which would be scrapped. The program was conceived as a way to spend U.S. tax dollars to stimulate the economy during a severe recession — and increase the fuel efficiency of cars on the road. In its first version, the proposal was limited to U.S.-made cars.

But the European Union ambassador to the United States protested that the program would run afoul of WTO commitments. A key commitment nations make on joining the WTO is for their governments to treat all companies equally; foreign corporations can be treated no worse than domestic corporations. So Congress changed the bill to reimburse cars manufactured anywhere.

In the end, of the 677,081 cars sold through the program, just 38.5 percent were domestic brands. Tellingly, all 10 of the top 10 brands of “clunkers” turned in were American name plates, while just two of the top 10 vehicles purchased were. By requiring that foreign makers be treated equally, WTO rules reduced the stimulus effect the cash for clunkers program could have on the domestic economy.

But it doesn’t have to be so. In Congress, 132 representatives and seven senators have signed on to a bill called the Trade Reform, Accountability, Development, and Employment (TRADE) Act, which would require a review and renegotiation of all existing trade agreements. Oregon’s U.S. Sen. Jeff Merkley and Reps. Peter DeFazio and David Wu are among the co-sponsors of the bill.

“For far too long, we’ve allowed unfair rules to undermine our values and harm our economy,” Merkley said in a press statement. “We can begin to undo that damage and create the jobs we need by building a trade system that puts American workers on a level playing field and ensures that the other countries with whom we do business with treat their workers fairly and abide by environmental guidelines.”

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