Free Trade and an Emerging Revolutionary Planet
Date: Saturday, October 08 2005
Free Trade and an Emerging Revolutionary Planet
Free Trade stands for almost everything wrong on the planet. As the Free Trade noose tightens, more revolutionary activity will occur until the strangling grip is broken completely or until the despotism of obscenely wealthy and criminal oligarchs feeding off an increasingly destitute and dehumanized world population wins its final triumph.
Free Trade is a condition in which dominant industrial power (allied to overwhelming political and military power) arranges the trade of the world to its own advantage while claiming it is participating with equals in an equal exchange of goods and services.
Free Trade has always been advocated and pushed by the wealthiest nations with the highest technological efficiency. Those nations are almost always imperialist powers. An imperialist power is a giant suction pump, pulling the wealth from outside its borders into its own heartland to grow richer and richer.
In order to maintain its dominance and to keep the flow of wealth pouring into its own borders an imperial power builds huge military forces, establishes bases wherever it can, bribes leaders and sets up co-operating dictatorships. Whenever an imperial power needs a war to control markets, it starts a war.
In order to keep the flow of wealth coming, imperial powers preach the Grand Fraud: Free Trade. “Free Trade,” they say, “benefits everyone. Let us have a treaty. You give us your goods without tariff and we will give you our goods without tariff. Everyone wins.”
Except, say, when Canada has better wood and more of it, the U.S. says: “the Free Trade Treaty isn’t really a treaty; it’s a sort of loose understanding. All we need to do is negotiate away Canadian forest rights and then we can call the treaty a treaty again. In the meantime we will illegally collect five billion dollars in tariffs.”
Some countries say, “We are small and we don’t have a range of goods to trade. So it won’t work. You have twenty things to sell us. We have only one thing to sell you, say sugar, or cocoa.” That problem is especially painful when the small country has too few minerals to industrialize and can only survive - outside a simple but often workable small economy – by trading one thing only for twenty kinds of things from outside.
“Oh,” says the imperialist country, “you must practice the iron law of ‘comparative advantage’ and we will benefit equally.”
“What is that?” the smaller, weaker country asks.
“All countries do something well and efficiently, or can. If you only do well and efficiently one thing [which usually means something cheap we want for our country], then you can become a one-product producer”.
“Is that safe?” the smaller, weaker country asks.
“Why shouldn’t it be safe?”
“Well,” says the smaller, weaker country, “ to make an export market for the one product, we have to erase some others which have kept our inner economy balanced. That means if you don’t buy our one product, we fall into recession, unemployment, and chaos.”
“But that would never happen,” the imperialist country replies. “Rest assured.”
“You destroyed a government you didn’t like in Ghana by cutting off the cocoa market. You did everything you could to destroy the Cuban government by destroying the sugar market. You have created one product countries in Central America that have become so corrupt and so despotic they give the world the name “banana republics” to mean ugly, repressive, cruel, poverty stricken, and corrupt.” In addition, you destroy countries that simply want to have a slightly different system than yours, as you destroyed Chile when it decided to nationalize copper owned by U.S. interests.
The imperialist country is silent for a few minutes, thoughtful. Then it says: “You must have been listening to Communists, Marxist rebels, Islamic terrorists, or envious people who don’t understand what the idea of freely exchanged goods means”.
“Okay,” says the smaller, weaker country. “So I only grow olives for the martinis of your country…”
“Well, what if your country stops drinking martinis?”
“People use olives for everything – for olive oil, to expand the capacity of diesel fuel – everything. Don’t worry.”
Put the matter another way.
I actually had the conversation I will now recreate with the head man at the Fraser Institute in Vancouver, B.C. when Canada decided to destroy its textiles manufacturing sector to be true to the iron law of comparative advantage.
“Let us suppose,” I said to the head of the Fraser Institute, “that 200,000 people live directly and indirectly from the Canadian textiles trade. And let us suppose the Canadian government puts a tariff on foreign textiles to protect the Canadian operation, maybe even adding a little subsidy to help it flourish.”
“Yes”, said Michael Walker, head of the Fraser Institute.
“Then you collapse that Canadian system on behalf of near slave economy textile products from elsewhere. 200,000 Canadians lose their employment. You wreck their communities as well. You put most of them on some kind of government assistance, maybe for a long time at great expense – so that wealthy owners of near-slave trade textile production can sell into Canada.”
“Yes,” said Michael Walker of the Fraser Institute.
“Where’s the advantage of that?” I asked.
“You see,” he said, “Canadians can buy cheaper textiles. That’s good for the world economy. The people who lose their jobs go on some kind of public assistance until they’re retrained and re-employed.”
“At what?” I asked.
“I don’t know,” he said.
That was the end of our conversation.
So insane is the propaganda for Free Trade and the make-believe law of “comparative advantage” that ninety-six percent of academic economists in Canada believe in it. A hundred percent of Canadian government economists and one hundred and one percent of economists in the Fraser Institute and the C.D. Howe Institute, the Canadian banks, the World Bank, the U.S. government, the World Trade Organization, and the International Monetary Fund believe in it. In addition they believe in the totally asinine law of comparative advantage used to support the fraudulent concept of Free Trade which they believe in with the blind enthusiasm of religious zealots.
That is why many parts of the planet are moving, now, into revolutionary postures. They know (A) Free Trade is a big swindle, guaranteeing poverty and suffering. (B) Comparative Advantage is a lie. Period. (C) Wealthy capitalists have used the two together as a way of getting a large part of the world’s population into near slavery. (D) The only way out of this destructive entanglement is to fight a way out.
Trade agreements that construct really “fair trade” advantages mutually enjoyed by nations are completely different than the slash-and-burn “Free Trade” agreements which, in effect, are no such thing.
The lies offered as the truth have long standing in Canada. I remember being on a national TV show thirty-five years ago fighting to get Canadians hired, Canadian materials used, and Canadian texts written for Canadian education.
Debating against me was Jack Saywell, Dean of Arts at York University, Toronto. He argued that the economics textbook by economist Paul Samuelson used very widely had been “re-written” by a Canadian to suit Canada’s needs. Samuelson was one of those internationally revered economists who, in fact, provided support for the U.S. imperial push for Free Trade and for the operation of “comparative advantage”.
As a matter of fact, his text hadn’t been re-written, but that’s another matter. The point is that Samuelson’s text ruled in a very large proportion of North American universities, as did his loudly preached ideas on trade.
Now, in his nineties, Paul Samuelson has seen the light – or at least he’s seen a glimmer of light. He hasn’t seen that the imperial economics of Free Trade is a sham created to further the ambitions of his country, the U.S.A., though he realizes it isn’t what he thought it was. And he’s discovered something that’s always been plain – as plain as it was when (and long, long before) I had my conversation with Michael Walker, head of the Fraser Institute.
What he has discovered probably shows that imperial powers don’t raise “experts” to top rating for their intelligence, but because they’re dumb enough or hypnotized enough to say anything that passes for conventional wisdom in their country.
Paul Samuelson awakened one morning in his nineties to discover that when the U.S. finds it “comparatively advantageous” to make shoes and trousers (for instance) by a U.S. company paying workers 35 cents an hour in a near-slave economy, then selling those products at several hundred percent profit for their owners, the people who lost their shoe and trouser manufacturing jobs in “the developed U.S.A.” are not better off, and, in fact, in some cases are in very bad condition, indeed. Sasmuelson doesn’t attack the whole system that produces those results. He simply says the U.S. workers should be looked after.
A person has to admit that Paul Samuelson must have an IQ over 85 to have worked that much out. Maybe he is maturing in his nineties. Samuelson had another insight – a bolt of lightning striking his nonagenarian brain. “Eureka”, he said. And then he said something like: “I have just discovered that the people who - all through history – have pushed for Free Trade haven’t done it so that everyone will benefit. They have done it to gain power, to be top dog, to exploit the weak.”
It is always chastening to see a colonial country like Canada full of people who throw themselves at the feet of imperial hucksters like Samuelson, and then have to face the hucksters, in their nineties, recanting the propaganda they pushed for their imperial country.
Free Trade is a suckers’ game. Canadian government, Canadian corporation owners, Canadian economists and lawyers love it. At the last breakdown of the Softwood Lumber NAFTA hearings, one of the lawyers for Canada didn’t say, “Enough!” He said something like “Free Trade is great; we need to go on negotiating”. That’s a way of saying “a lot of us are getting rich on it. Who cares if it’s a sham”.
Ordinary Canadians care. Canadian working people care. Canadians who want an independent country care. Canadians who want our raw materials used well and economically care. Canadians who don’t want the Canadian environment destroyed care.
The more those Canadians discover the fraud perpetrated upon them by the Free Trade world, the more they will know (A) Free Trade is a swindle. (B) Comparative Advantage is a lie. Period. (C) Wealthy capitalists have used the two together as a way of grabbing most of Canada’s wealth. (D) They have been supported by the likes of Ralph Klein, Gordon Campbell, Paul Martin, and the hopeless reactionary foursome: Stephen Harper, Stockwell Day, Peter MacKay, and Preston Manning.
Knowing all those things, Canadians will come to know (as more and more people are coming to know all over the planet) that the only way out of the increasing impoverishment of national and personal life brought on by the hocus-pocus of sell-out capitalist economists is to fight a way out.
The fraud of Free Trade is creating a global revolutionary movement. That is a fact to ponder upon.