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04/27/2000

Trade, Part I

Time to begin to tackle a tough issue...trade. I have written
extensively on the issue of globalization in my Week in Review
columns. My very broad opinion is that, of course, we should
have free trade across the globe. At the same time, I am
continuously miffed at the hypocritical policy statements
emanating from our government. And both Republicans and
Democrats are to blame. When I hear our legislators talk of
helping the world''s poor in one breath and then, with the next,
refusing to pass legislation that would eliminate tariffs on textiles
from Africa (clothing that our own manufacturers no longer
produce) which would have a real positive impact on the welfare
of perhaps millions in Africa, I throw up my arms...or just plain
throw up.

And before I really get into the issue, let me touch on a topic that
also makes me sick, that of the self-styled "anarchists" who find
their way to places like Seattle and Washington. Or, as
columnist Thomas Friedman labels them (when combined with
protectionist trade unions and anti-free-trade extremists), "The
Coalition to Keep the World''s Poor People Poor."

Not to get off on a rant here but I was watching a clip of the
recent action in Washington, D.C. when I saw a kid, who clearly
hadn''t washed in a month or so, kick over a couple of
newsstands. My immediate reaction upon seeing this was what a
way to ruin the poor guy who gets up at the crack of dawn (after
three hours sleep because he holds another job) to fill those
stands. You and I know what an incredibly tough time his boss
would probably give him. The distraught laborer must have feared
for his job. It''s this wanton destruction perpetrated by the vast
unscrubbed that pisses me off. They aren''t deserving of any
forum. Better yet, put them in a maximum security prison with
"Bubba."

Now then, where were we? Let''s start off by listing some of the
major issues that those who protest against globalization are
concerned about:

Sweatshops, food security, the environment, human rights and
labor standards, debt cancellation, AIDS, abject poverty, an end
to meddling in 3rd world economies.

At the same time, the main authoritarian targets are the
International Monetary Fund (IMF), the World Bank, the World
Trade Organization (WTO), and the U.S. government. All are
seen by the protesters as tools of the large multi-national
corporations which, in one form or another, are supposedly lining
each others pockets.

Some of the issues that are being put on the table are highly
legitimate ones. Nigeria''s new democratically elected President
Obasanjo correctly said the following.

"Never has the world witnessed such massive disparities in
international social and economic activities."

Obasanjo argues that the WTO has to allow access for poor-
country exports to rich-country markets (my personal issue as
well), but he also understands that poor countries have to look
within before they can criticize the West. Or, as Business Week
columnist Pete Engardio wrote recently, "(It''s) tough to
eliminate entrenched poverty in countries that lack private
investment, clean government and civil society."

So, let''s look at some opinions on how to deal with the
inequalities in the world as well as how the dialogue itself needs
to proceed. Following are excerpts from President Clinton''s
speech to the WTO in Seattle last December.

"No one in this room can seriously argue that the world would
have been a better place today if our forbears over the last 50
years had not done their work to bring us closer together.
Whatever the problems that exist in whatever countries
represented here, whatever the legitimacy of any of the criticism
against us, this is a stronger, more prosperous world because we
have worked to expand the frontiers of cooperation and reduce
the barriers to trade among people

"When people are working together for common prosperity in a
rule-based system, they have big incentives to lay the differences
down and join hands to work together. So if we just make those
two points to our critics, I think it''s very important.

"No. 1, the world is a better place than it would have been had
we not had the last 50 years of increasing economic cooperation
for trade and investment. And No. 2, the world of the future will
be a safer place if we continue to work together in a rule-based
system that offers enormous incentives for people to find ways to
cooperate and to give up their old hatreds and their impulses to
violence and war.

"Now having said that, we now have to say, ''What next?'' I think
we have to acknowledge a responsibility, particularly those of us
in the wealthier countries, to make sure that we are working
harder to see that the benefits of the global economy are more
widely shared among and within countries, that it truly works for
ordinary people who are doing the work for the rest of us.

"I think we also have to make sure that the rules make sense and
that we''re continuing to make progress, notwithstanding the
domestic political difficulties that every country will face. We
all benefit when the rules are clear and fair. I think that means
we have to cut tariffs further on manufactured goods and set
equally ambitious goals for services. I think we should extend
our moratorium on e-commerce. I think we should treat
agriculture as we treat other sectors of the economy."

Now the above is typical political BS and could have been
uttered by both sides of the political aisle. It''s important,
however, to have it on the table so folks like me can make hay of
it. Of course, it always looks good on paper, it''s what is then put
into practice that matters and, as I mentioned earlier, our
politicians talk a good game and then can''t get themselves to
approve a small measure like eliminating textile tariffs on
African nations.

Well, how about a dissenting opinion? Herewith some remarks
from Henry Kissinger in response to the Seattle disaster.

"The collapse of the WTO conference in Seattle amid chaos in
the streets was worse than a diplomatic fiasco; it spelled a missed
opportunity. President Clinton could have used the occasion to
put forward a farsighted program for dealing with what portends
to be one of the gravest challenges of the new century: the huge
gap between the sophistication of the dominant economic model,
called globalization, and traditional political thinking still based
on the nation-state.

"Globalization has encouraged an explosion of wealth and
technology never approximated in any historical epoch. Such
rapid change challenges prevailing social and cultural patterns.
Markets generate growth but also dislocations. While these
dislocations are arguably the engine of ultimately greater well-
being, political leaders are obliged to deal with their
consequences here and now. A sense of political unease is
inevitable, especially in the developing world - a feeling of being
at the mercy of forces neither the individual nor the government
can influence any longer."

This last statement of Dr. Kissinger''s is our jumping-off point for
next week.

Brian Trumbore




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Hot Spots

04/27/2000

Trade, Part I

Time to begin to tackle a tough issue...trade. I have written
extensively on the issue of globalization in my Week in Review
columns. My very broad opinion is that, of course, we should
have free trade across the globe. At the same time, I am
continuously miffed at the hypocritical policy statements
emanating from our government. And both Republicans and
Democrats are to blame. When I hear our legislators talk of
helping the world''s poor in one breath and then, with the next,
refusing to pass legislation that would eliminate tariffs on textiles
from Africa (clothing that our own manufacturers no longer
produce) which would have a real positive impact on the welfare
of perhaps millions in Africa, I throw up my arms...or just plain
throw up.

And before I really get into the issue, let me touch on a topic that
also makes me sick, that of the self-styled "anarchists" who find
their way to places like Seattle and Washington. Or, as
columnist Thomas Friedman labels them (when combined with
protectionist trade unions and anti-free-trade extremists), "The
Coalition to Keep the World''s Poor People Poor."

Not to get off on a rant here but I was watching a clip of the
recent action in Washington, D.C. when I saw a kid, who clearly
hadn''t washed in a month or so, kick over a couple of
newsstands. My immediate reaction upon seeing this was what a
way to ruin the poor guy who gets up at the crack of dawn (after
three hours sleep because he holds another job) to fill those
stands. You and I know what an incredibly tough time his boss
would probably give him. The distraught laborer must have feared
for his job. It''s this wanton destruction perpetrated by the vast
unscrubbed that pisses me off. They aren''t deserving of any
forum. Better yet, put them in a maximum security prison with
"Bubba."

Now then, where were we? Let''s start off by listing some of the
major issues that those who protest against globalization are
concerned about:

Sweatshops, food security, the environment, human rights and
labor standards, debt cancellation, AIDS, abject poverty, an end
to meddling in 3rd world economies.

At the same time, the main authoritarian targets are the
International Monetary Fund (IMF), the World Bank, the World
Trade Organization (WTO), and the U.S. government. All are
seen by the protesters as tools of the large multi-national
corporations which, in one form or another, are supposedly lining
each others pockets.

Some of the issues that are being put on the table are highly
legitimate ones. Nigeria''s new democratically elected President
Obasanjo correctly said the following.

"Never has the world witnessed such massive disparities in
international social and economic activities."

Obasanjo argues that the WTO has to allow access for poor-
country exports to rich-country markets (my personal issue as
well), but he also understands that poor countries have to look
within before they can criticize the West. Or, as Business Week
columnist Pete Engardio wrote recently, "(It''s) tough to
eliminate entrenched poverty in countries that lack private
investment, clean government and civil society."

So, let''s look at some opinions on how to deal with the
inequalities in the world as well as how the dialogue itself needs
to proceed. Following are excerpts from President Clinton''s
speech to the WTO in Seattle last December.

"No one in this room can seriously argue that the world would
have been a better place today if our forbears over the last 50
years had not done their work to bring us closer together.
Whatever the problems that exist in whatever countries
represented here, whatever the legitimacy of any of the criticism
against us, this is a stronger, more prosperous world because we
have worked to expand the frontiers of cooperation and reduce
the barriers to trade among people

"When people are working together for common prosperity in a
rule-based system, they have big incentives to lay the differences
down and join hands to work together. So if we just make those
two points to our critics, I think it''s very important.

"No. 1, the world is a better place than it would have been had
we not had the last 50 years of increasing economic cooperation
for trade and investment. And No. 2, the world of the future will
be a safer place if we continue to work together in a rule-based
system that offers enormous incentives for people to find ways to
cooperate and to give up their old hatreds and their impulses to
violence and war.

"Now having said that, we now have to say, ''What next?'' I think
we have to acknowledge a responsibility, particularly those of us
in the wealthier countries, to make sure that we are working
harder to see that the benefits of the global economy are more
widely shared among and within countries, that it truly works for
ordinary people who are doing the work for the rest of us.

"I think we also have to make sure that the rules make sense and
that we''re continuing to make progress, notwithstanding the
domestic political difficulties that every country will face. We
all benefit when the rules are clear and fair. I think that means
we have to cut tariffs further on manufactured goods and set
equally ambitious goals for services. I think we should extend
our moratorium on e-commerce. I think we should treat
agriculture as we treat other sectors of the economy."

Now the above is typical political BS and could have been
uttered by both sides of the political aisle. It''s important,
however, to have it on the table so folks like me can make hay of
it. Of course, it always looks good on paper, it''s what is then put
into practice that matters and, as I mentioned earlier, our
politicians talk a good game and then can''t get themselves to
approve a small measure like eliminating textile tariffs on
African nations.

Well, how about a dissenting opinion? Herewith some remarks
from Henry Kissinger in response to the Seattle disaster.

"The collapse of the WTO conference in Seattle amid chaos in
the streets was worse than a diplomatic fiasco; it spelled a missed
opportunity. President Clinton could have used the occasion to
put forward a farsighted program for dealing with what portends
to be one of the gravest challenges of the new century: the huge
gap between the sophistication of the dominant economic model,
called globalization, and traditional political thinking still based
on the nation-state.

"Globalization has encouraged an explosion of wealth and
technology never approximated in any historical epoch. Such
rapid change challenges prevailing social and cultural patterns.
Markets generate growth but also dislocations. While these
dislocations are arguably the engine of ultimately greater well-
being, political leaders are obliged to deal with their
consequences here and now. A sense of political unease is
inevitable, especially in the developing world - a feeling of being
at the mercy of forces neither the individual nor the government
can influence any longer."

This last statement of Dr. Kissinger''s is our jumping-off point for
next week.

Brian Trumbore