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From the Director's Desk...Free Trade Is Unfair Trade
Rev. John L. McCullough
Photo: Photo: T.Abraham/CWS
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By Rev. John L. McCullough, CEO and Executive Director, Church World Service
Church World Service has a 60-year history of working to improve social and economic conditions in order to help people live with dignity and hope. For this reason CWS believes that "free-trade" agreements (FTAs) must be evaluated on the basis of how they impact development around the world. Because Jesus taught us to love our neighbors as ourselves, our trade agreements must benefit impoverished people in developing countries, as well as ourselves.
"I will punish the altars of Bethel, and the horns of the altar shall be cut off and fall to the ground, I will smite the winter house with the summer house; and the houses of ivory shall perish, and the great houses shall come to an end,” says the Lord." Amos 3:14-15
"Let us then pursue what makes for peace and for mutual upbuilding." Romans 14:19
Amos criticized the political and economic elites for their ostentatious materialism based on imported luxuries, mistreatment of the poor and false piety. He called the nation back to a commitment to community and mutual upbuilding based on authentic worship, justice for the poor and right relationships with the land. Jesus and the apostles continued to summon people to this vision and practice of community.
The U.S. government is currently negotiating a series of "free trade" agreements (FTAs) with developing countries, expanding the global movement of goods, services and money. Congress is likely to vote on an FTA with Peru in November. Asking what builds community -- what makes for peace, what is mutually beneficial, and what helps lift up people in poverty – provides a moral lens for evaluating these agreements
Problems with process
A monumental imbalance of bargaining power places the U.S. government in a position to dominate trade negotiations with developing countries. The negotiating table is tilted when one party is economically dependent upon another or when the weaker party faces significant political or economic reprisals if it takes a stand in favor of its domestic market and the needs of its citizens.
Furthermore, negotiators primarily consider the interests of elites and large businesses, not the interests of people living in poverty, workers, small business owners, family farmers or the environment. Too often few benefits "trickle down" to ordinary people and those on the bottom disproportionately bear the costs.
At a global level, World Trade Organization (WTO) negotiators from a few key governments normally get together to horse trade, then present their conclusions to the rest of the members as a fait accompli. Moreover, many low-income countries cannot afford to have delegations of sufficient size, and they lack sufficient technical expertise to adequately represent their interests.
Problems with substance
Pending U.S. agreements with Peru and Colombia showcase the inconsistency of free trade treaties – as they are currently shaped -- with the values of community and prosperity for all. The context to keep in mind is that a majority of Peruvians and Colombians live in poverty.
People in developing countries need affordable access to essential medicines, not only for pandemic diseases like HIV/AIDS, but for a whole variety of serious health conditions. Tragically, the US Trade Representative is aggressively pursuing free trade agreements that make it more difficult for countries to produce or procure safe, generic versions of medicines that poor people can afford.
The FTAs require Peru and Colombia to lower tariffs on agricultural products. But the U.S. government subsidizes production of many U.S. agricultural commodities so that they can be sold overseas at prices that undercut local producers. Andean farmers and farm workers are worried that they will face the same fate as 1.3 million Mexican farmers who were displaced as a result of U.S. agricultural products flooding the Mexican market after NAFTA was signed.
Documented health and environmental problems caused by mining and petroleum extraction in indigenous and Afro-Colombian lands, as well as deceptive and unfair deals made by multinational corporations for use of ancestral lands are not addressed in the terms of these free trade agreements. In fact, these problems could well be exacerbated. Colombia's Minister of Agriculture, for example, has proposed to alter the Constitution in order to remove the rights of indigenous and Afro-Colombian people to land and territory in order to pave the way for investors.
Impact on the US
People in the United States are not well served by these free trade agreements either. Labor and environmental provisions are weak, which puts a downward pressure on standards here.
Free trade agreements encourage export-driven production, which ultimately benefits a relatively few U.S. agribusiness processors and exporters, and very large farms. U.S. family farmers are forced to accept unsustainably low prices for their crops. This system accelerates agricultural consolidation, further undermining U.S. family farmers.
In addition, the Andean FTAs will worsen the problems of coca production and narco-trafficking, if competition from artificially low-priced U.S. agricultural imports prevents small farmers in Peru and Colombia from earning a living producing legal crops.
We can also expect forced immigration to the U.S. to increase, if free trade continues to expand. Almost all people everywhere want to stay in their home country, but when economic conditions destroy their livelihoods, they move to where decent jobs are available. We need to view the larger immigration numbers in the context of the U.S. government's promotion of economic policies that are a critical factor in uprooting people from their homes.
Furthermore, by accelerating destruction of the myriads of plant and animal species in the rich and diverse Andean region, the FTAs will irreplaceably diminish the world's ecological resources.
What makes for community and prosperity? Not free trade agreements in their current form. Because of their detrimental impact on resource-poor people, these agreements are unjust and they will ultimately undermine U.S. security. Our security as Americans is enhanced when people everywhere are able to prosper as members of the human community, and it suffers when others are plunged into deeper poverty and despair.
Fair trade, not Free trade
International trade can be one engine of economic progress for developing countries. But the United States and developing countries alike need fair trade agreements that are genuinely shaped to meet the goals of sustainable development and poverty reduction. Such agreements should safeguard the livelihoods of American workers and family farmers. They should also fully respect the right of developing countries to promote and protect their own small-holder farmers, vulnerable workers and domestic manufacturers. Trade agreements must support -- not hinder -- governments in adopting policies to protect public health, the natural environment and to ensure that their peoples survive and flourish.
Fair trade agreements can further genuine social and economic development for our brothers and sisters around the world while preserving our own jobs here at home.
Media Contact:
Lesley Crosson, CWS/New York, 212-870-2676;
Jan Dragin, 781-925-1526;
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