(IPS) – In a major victory for U.S.-based multinational corporations, President Barack Obama has submitted controversial and long- pending “free-trade” agreements (FTAs) between the U.S. and South Korea, Colombia, and Panama for rapid approval by Congress.
The pacts, which were originally negotiated by the George W. Bush administration, are being billed by both Obama and the Republican leadership as major job creators in the U.S., despite the fact that most U.S. unions oppose them.
“The series of trade agreements I am submitting to Congress today will make it easier for American companies to sell their products in South Korea, Colombia, and Panama and provide a major boost to our exports,” Obama said in a statement Monday when they were sent to Capitol Hill. “These agreements will support tens of thousands of jobs across the country for workers making products stamped with three proud words: Made in America.”
But the AFL-CIO, the country’s largest trade union federation denounced the bills as based on “flawed models of that past that make CEOs richer and ship our jobs away”.
“According to the Economic Policy Institute, the Korea trade deal would destroy 159,000 US jobs,” the AFL-CIO said Tuesday. “Colombia continues to be the most dangerous place in the world for trade unionists where 51 trade unionists were assassinated last year and 22 so far this year. And Panama, which routinely tramples workers’ rights, is a known haven for tax dodgers and money launderers.”
Other critics charged that Obama’s decision to seek Congressional approval of the three accords marked the latest betrayal of his 2008 campaign promises.
“At a time of nine-percent unemployment and broad public opposition to more NAFTA-style trade agreements, it’s a fairly shocking shift away from the president’s job-creation message to suddenly call on Congress to pass three old Bush trade deals that the federal government’s own studies say will increase the U.S. trade deficit,” said Lori Wallach, director of Public Citizen’s Global Trade Watch.
All three FTAs were negotiated by the Bush administration in 2006 but were never submitted to Congress due to strong opposition by Democrats who won majorities in both houses in the November elections that year.
To make them more attractive to key Democrats, Obama re-negotiated some provisions in each pact. On the South Korean pact, the most important of the three accords by far, he persuaded Seoul to agree to give the U.S. more time to phase out its tariffs on Korean car imports. That change earned it the critical support of the United Auto Workers (UAW) and lawmakers close to the union.
On Colombia, which has recently signed FTAs with the European Union (EU) and Canada, the administration negotiated a side accord, the so- called “Labour Action Plan” which requires Bogota to take a series of steps to bolster labour rights and the protection of union leaders.
On the Panamanian FTA, Congressional concerns on tax transparency issues were addressed by the ratification by the country’s National Assembly of a new Tax Information and Exchange Agreement with the U.S. In addition, the replacement of the Assembly’s former speaker, Pedro Miguel Gonzalez, a suspect in the fatal ambush of two U.S. soldiers in 1992, removed a major concern by U.S. lawmakers.
In order to secure enough Democratic support, the Obama administration also tied renewal of Trade Adjustment Assistance (TAA), a long-standing programme designed to help workers who lose their jobs to foreign competition train or relocate for new jobs, to his administration’s submission of the three FTAs.
TAA was strongly opposed by most Republicans, especially in the House of Representatives where “Tea Party” Republicans are strongest. But, in order to move the three FTAs, House Republican leaders agreed Monday that they would send the TAA to the floor “in tandem” with the trade accords. TAA had been separately approved by the Democrat- controlled Senate last month.
Both the administration and business leaders are pressing for swift passage, which could come as soon as next week, on the eve of the state visit here of South Korean President Lee Myung-bak.
The FTAs’ advance marks a major victory for big U.S. businesses with multinational interests. A recent study by the U.S. Chamber of Commerce, perhaps the biggest booster of the FTAs, warned that the U.S. would lose nearly 400,000 jobs and 40 billion dollars in export sales if the agreements were not passed.
It warned that other nations were racing to conclude their own trade deals with the three countries and cited a U.S. government report that noted that the deal with South Korea, called KORUS, alone would boost U.S. gross domestic product by 12 billion dollars and generate nearly 11 billion dollars in U.S. merchandise exports.
“America is finally getting back in the game,” said U.S. Chamber of Commerce President Thomas J. Donohue, who will host Lee at a luncheon next week. “As I promised nearly a year ago, the chamber will pull out all of the stops to get the votes in Congress, where the agreements already enjoy bipartisan support.”
But sceptics say that the enthusiasm and rosy estimates of both the administration and the chamber are misleading and that, like the widely unpopular NAFTA, the chief beneficiaries of these new agreements are more likely to be multinational corporations than workers.
“As with any such agreement, there will be winners and losers,” according to John Feffer, a Korea specialist at the Institute of Policy Studies. “The problem is that most of the winners are the wealthier players, namely major U.S. and South Korean manufacturers and financial institutions. The losers will be U.S. workers, Korean farmers, probably the environment in both countries.”
As to the Colombian FTA, the Washington Office on Latin America (WOLA), a human rights group, sent a letter to all lawmakers Tuesday, urging a no vote on the accord and noting that 23 trade unionists have been killed this year, many of them since the adoption of the Action Plan in April.
It also noted that “human rights violations against Afro-descendants are rampant in Buenaventura, the largest port on Colombia’s Pacific Coast.”
WOLA’s critique was echoed on the House floor by Massachusetts Rep. James McGovern of Massachusetts, who travelled to Colombia at the end of August.
“(N)othing I saw in Colombia indicated things have changed for the better on the ground for Colombia’s workers,” he said, calling for Congress to put that FTA aside pending “concrete improvements in labour rights and security for Colombia’s workers”.