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It
takes one bizarre fiction to understand another. Flannery
O'Connor's 1952 novel "Wise Blood"
is full of insight into its not so distant relation
"Free Trade", adapted by Robert Zoellick.
Hazel Motes, O'Connor's would-be nihilist protagonist,
preaches a "Church without Christ" with
all the zealous fervour of Zoellick's devotion to
"Free Trade" without free trade. Lurking
in the the novel is Zoellick's real doppelganger,
Asa Hawkes, the fake-blind preacher who cons people
into parting with their money, believing he blinded
himself for his faith.
Like
Hawkes, Zoellick is a superb and practised faith-based
con-man. Preaching free trade, he trails a long history
of private business interests in predatory multinational
corporations like Vivendi, Enron, Goldman Sachs, Alliance
Capital and SAID Holdings, the Bermuda-based South
African patent and copyright security specialists.
His outlook melds seamlessly into the Bush regime's
deliberate confusion of the wishes of their rule-bending
plutocrat buddies with the interests of the United
States people.
Never
mind the evangelism, feel the Clausewitz
Zoellick's
pronouncements deserve attention. Like the other mercenary
fanatics surrounding George W. Bush, his evangelism
is one of arrogant candour. A member of Bush's Cabinet
with the rank of Ambassador, he assumed office as
13th U.S. Trade Representative on February 7, 2001,
unanimously confirmed by the Senate. In fact, as Bush's
principal trade policy adviser and chief trade negotiator,
he puts big business first and the United States people
last.
In
the early 1990s, Zoellick worked as an economics undersecretary
for George Bush the Elder and led negotiations for
the State Department in the North American Free Trade
Agreement (NAFTA). During the 1997-1998 academic year,
he was the Olin Professor of National Security at
the U.S. Naval Academy. This interest in security
is natural for a man who sees aggressive trade negotiation
as the furtherance of war aims by other means.
The
unvarying tenet in Zoellick's creed is the manifest
US destiny to dominate world trade. A multilateral
approach incorporating US pre-eminence seemed possible
in the early 1990s during the Uruguay Round of trade
talks when poorer developing countries were less able
to defend their interests. The 2001 Doha meeting showed
the limitations of that approach from the point of
view of the US.
This
year's failure of the Cancun talks has probably nailed
down the coffin lid on any serious US commitment to
making the World Trade Organization work, so long
as the Bush regime occupies the White House. Ahead
of the Cancun debacle, Zoellick was clear that the
United States would go ahead with bilateral and regional
free trade agreements regardless, if the WTO talks
collapsed. Saying, "We're not stopping. We're
moving with the countries that are willing to go,"
[1] Zoellick committed to negotiating global
preferential trade deals for the US on a bilateral
or regional basis.
US
trade strategy after Cancun
Congressional
approval for a Trade Promotion Authority (TPA) made
that strategy possible.But the TPA was only secured
at the price of concessions to domestic trade interests,
like steel and agriculture, creating inherent contradictions
for foreign free trade deals. Nonetheless, through
other legislation like the Caribbean Basin Trade Partnership
Act, the Andean Trade Preference Act and the African
Growth and Opportunity Act (AGOA), Bush hopes to tie
the US to foreign trade agreements that benefit his
corporate power base.
Bilateral
deals mean that the wider complications involved in
multilateral negotiations through the WTO can be either
sidelined and forgotten or else prioritized, as needs
dictate. For example, environmental concerns can be
entirely left out, while telecommunications and financial
services can be brought centre stage. Bilateral deals
also allow the integration of political and security
matters enabling the US to bully weaker countries
into following its foreign policy needs for the sake
of potentially beneficial trade.
In
a widely reported speech in May this year to the Institute
for International Economics, Zoellick said, "The
U.S. seeks cooperation - or better - on foreign policy
and security...Given that the U.S. has international
interests beyond trade, why not try to urge people
to support our overall policies? Negotiating a free-trade
agreement with the U.S. is not something one has a
right to - it's a privilege." This callow brand
of intimidation and bribery is nothing new. The Reagan
administration used PL480 agricultural aid and other
concessions to bribe and cajole Honduras into serving
as a military base for illegal terrorist aggression
against Nicaragua throughout the 1980s.
Zoellick
tries to put a benevolent gloss on the strategy, alluding
to the not so altruistic Marshall program in post
World War Two Europe, "American trade policies
are connected to our broader economic, political and
security aims. This intellectual integration may confound
some trade scholars, but it follows in the footsteps
of reconstruction after 1945." [2]
But the consistent nitty gritty of the US "free
trade" message is "do what we want - or
else..."
Imposing
the "Free trade" catechism
Many
components in these deals are damaging to the target
countries. Investor-State and expropriation provisions
allow US firms to sue a government for money they
might potentially have made but for local law. The
Harken Energy company recently tried that in the US
against Costa Rica to the tune of US$57bn, even without
such a bilateral trade framework. For the moment,
they have had to backtrack and negotiate a settlement
directly with the Costa Rican government. Should Costa
Rica sign up to the Central American Free Trade agreement,
the country will certainly lose such cases in the
future.
Clauses
on capital controls render a country helpless to regulate
damaging large scale speculative currency transactions.
Other clauses force countries to treat giant international
companies on exactly the same terms as small local
ones. National economic and social planning is curtailed
through clauses restricting performance criteria such
as non-discriminatory employment codes or environmental
protection and worker health and safety measures.
[3]
When
brow beating evangelism fails, Zoellick can call on
his US government colleagues to elicit appropriate
measures from the ever cooperative IMF and World Bank
to help reluctant converts see the light and speak
in "free trade" tongues. Under Bush, "free
trade" has been carried the world over by Zoellick
and his apostles. In 2000 Jordan became the first
Arab country to sign a deal with the US. Similar agreements
have been reached recently with Singapore and Chile.
A deal with Morocco is in the offing. Bahrain is next
in line. Occupied Iraq is another obvious candidate.
When
things need spelling out, Zoellick is very clear.
With China, he urges "to keep U.S. markets open,
we need a two-way street to try to expand U.S. exports
to China and operate in fair, transparent ways."
His comments on patent and copyright are especially
interesting, "You need some prosecutions and
(to) put some people away...If it just becomes a fine
or a cost of doing business, then you're not going
to be able to stop intellectual property piracy."
It is interesting to note these remarks on criminal
prosecution come from one of fraudulent Enron's most
influential former paid advisers.[4]
In
Africa, Zoellick waves a threat for would-be beneficiaries
of the African Growth and Opportunity Act (AGOA).
This preferential deal allows some 6000 items from
eligible African countries to enter the US duty free.
Zoellick observes, "While that is a good start
in terms of development it runs certain risks because
when Congress passes a piece of preferential legislation
like AGOA, it means Congress can also change it."
Zoellick and his propagandists neglect to mention
that most of those 6000 products will have to be manufactured
using US supplied materials. AGOA expires in 2008.[5]
Free
trade is a very blunt instrument in Zoellick's hands.
In July this year his officials pulled the rug out
from under visiting Egyptian trade delegates. Zoellick`s
acolytes told them the US was suspending moves towards
free trade talks with Egypt in response to Cairo's
refusal to support the US against Europe on genetically
modified foods. Earlier at a World Economic Forum
meeting in Jordan on 23 June, Zoellick said: "We
see glimmers of light [in Egypt] but I'm not going
to sugar-coat it for people. Egypt has some work to
do." Putting the boot in, he added, "We
know Egypt is the traditional heart of the Arab world,
but this isn't going to be handed to them just because
it is a big and important country."[6]
Galileo
would recognise the deal
The
Zoellick doctrine of universal "free trade"
without free trade brooks no heresy and has no time
for genuine science. In March this year Zoellick announced
he was building a "coalition" - funny how
they keep cropping up - to force the EU to lift its
moratorium on GM foods and biotech products. Zoellick
told the Senate Finance Committee March 5. "I
don't want this to be just the U.S. versus EU."
[7]
At
a May 13th press briefing on the matter he claimed
the EU moratorium was stalling biotechnology development
and blocking its "benefits", especially
in developing countries. "In places where food
is scarce or climates can be harsh, increased agricultural
productivity through biotechnology can spell the difference
between life and death, between health and disease,
for millions of the world's poorest people."
Through the crocodile tears and against available
scientific evidence Zoellick argues that biotechnology
increases crop yields but still miraculously benefits
the environment. Unfortunately for him, results of
scrupulously conducted recent British field trials
tell a different story.[8]
In
the US, writer Mark Schapiro has followed transgenic
crops from their beginnings. He writes, "Monsanto
alone poured at least a billion dollars into biotech
research, according to NPR technology correspondent
Daniel Charles in his book Lords of the Harvest, "before
it had a single genetically engineered plant to sell."
Other companies--DuPont, Dow, Aventis and Syngenta--spent
billions more on research and on a seed-company buying
spree that lasted well into the 1990s. The stakes
for these companies are huge."[9]
Zoellick works to benefit giant US agri-business biotech
companies while ruthlessly pursuing policies that
impoverish millions of African farmers.
Massive
Ordnance Air Burst hypocrisy
Prior
to the 2001 Doha trade summit, Zoellick said, "Given
America's relative openness, we can only maintain
domestic support for trade if we retain strong, effective
laws against unfair practices. ... So we will continue
to insist that any consideration of WTO rules focus
on getting the practices of others up to U.S. standards
so that American businesses and workers can compete
on a level playing field." [10]
This hypocrisy is so enormous it can only be meant
to inspire shock and awe.
To
take just one example, in 2001 the US subsidised its
cotton producers by a total of around US$1bn more
than the world market value of their crop. As Kevin
Watkins of Oxfam has noted, African cotton producers
"lost some $200m in 2001 as a direct consequence
of American farm subsidies. To put this figure in
context, it dwarfs the amount that governments in
the region receive in the form of US aid or debt relief
under the Heavily Indebted Poor Countries (HIPC) Initiative."
[11] And still in 2002 the US
increased farm subsisidies by 10% compared to 2001.
Watkins
also notes that import taxes accruing to the US from
impoverished Bangladesh are generally the same or
greater than those collected from wealthy France because
the US tariff regime favours its European trading
partners over poorer developing countries. This puts
much needed context around another of Zoellick's disingenuous
claims, that average US tariffs are the lowest among
the OECD rich country world elite. That is true only
because the US can afford to club and mug defenceless
poorer nations, but is forced to trade more fairly
with the stronger economies of its major trading partners
like the EU.
Costa
Rica takes the brunt
Costa
Rica is the latest Latin American recipient of the
Zoellick treatment. Telecommunications, electricity
and insurance are all state monopolies in Costa Rica.
They represent desirable acquisitions for Zoellick's
friends in big multinational companies like Vivendi.
But Costa Rica has a long tradition of defending the
country's patrimony. President Pacheco, probably against
his own inclinations but under relentless pressure
from local political rivals, has held out against
US pressure to privatize public companies.
Unable
to prise open telecoms in Costa Rica, Zoellick shifted
to rifling other targets, "I know it is a sensitive
issue, but we are going to have to find a way to deal
with the issue in some fashion." [12]
Pacheco is insisting for now that Costa Rica will
stay outside CAFTA rather than privatize its major
public companies.
With
substantial funding from US backed organizations like
the US-Costa Rica Foundation, the pro-"free trade"
Costa Rican elite, typified by Nobel Prize winner
Oscar Arias, are doing their best to push for Costa
Rica to sign the Central American Free Trade Agreement.
But political opposition across the spectrum is strong.
The main objections are to the secrecy of the negotiations
under conditions imposed by the United States and
Zoellick's team's insistence on a fixed timetable.
Calling for a slow down and more transparent negotiations,
one opposition group has the slogan, "Another
Costa Rica is possible. Another world is possible."
Sick
of being kept in the dark, Costa Rican legislators
are demanding to review the negotiated texts before
the talks are completed and they find themselves presented
with a fait accompli. "We are the ones who are
going to have to approve this treaty and we want to
be responsible starting now by learning what the texts
say. We still don't know what has been negotiated
thus far." [13]
This
gives the lie to Zoellick's claim that, "We value
public input, which we will seek to take into consideration".[14]
Like the rest of the Bush ideologues, Zoellick despises
anyone who disagrees with him. But he can turn on
the mechanical, cynical language of "transparency"
almost as well as his EU counterpart Pascal Lamy.
The US continues working relentlessy on completing
a continent wide free trade agreement in Latin America
by 2005.
Telecoms
tall tales and downright fraud
Glib
lies come easily to Zoellick and his team, whether
they are blagging biotechnology or puffing privatised
telecoms. They know very well phone charges for users
in Nicaragua and El Salvador have soared since privatization.
In Nicaragua, where half of the former state monopoly
remains to be sold, controversy surrounds the holding
company of the monopoly's residuary body, Uretel,
in the run up to the final sell off.
Dodgy
book keeping seems to have stripped out benefits that
should have gone to the government. Mysterious losses
have been alleged of up to US$9m. Equally mysteriously,
the book value of the company's capital equipment
seems to have fallen by US$16m. Telecom workers union
leaders fear manoeuvres to lower the value of the
company prior to the sale so as to increase profits
for the eventual buyers.
After
the sale, the true value of the company will no doubt
be revealed as a stupendous transformation thanks
to the miracle-working free market. But union leaders
reckon the company has made US$50m since privatization
and about half of that is owed to the State. The company
has yet to render accounts to the residuary body since
the company was part-privatized in 2000.[15]
In
El Salvador, people are further down the privatization
road and regret the turn they took. El Salvador's
Antel telecoms company and CAESS energy distribution
company have already been privatized with other state
firms being made ready. Phone charges are up to three
times those in Costa Rica.
Apostles
of free trade insist privatization invariably increases
efficiency and lowers costs. Generally, the opposite
happens. Utility charges rise and efficiency falls
as infrastructure investment declines, while shareholders
get their dividend and corporate managers pull inflated
salaries.
Currently
in El Salvador a basic residential telephone costs
274% of the cost in Costa Rica. The cost per call
by minute is 43% dearer in El Salvador for normal
rate calls. In Costa Rica the state monopoly charges
by the second whereas in El Salvador the charge is
rounded up to the next minute.[16]
The
thing to remember about most of these bilateral and
regional "free trade" deals is that they
are not primarily trade deals. They are primarily
political deals using economic crow bars and hammers
to break countries open for powerful US investment
and political interests while apparently talking about
trade. Zoellick's membership of the Precursor investment
research group is a clue as to why the private investment
emphasis is always pre-eminent in these deals, invariably
to the detriment of the public interest.[17]
Breaking
eggs for the globalized corporate omelette
The
deals are not just bad for their foreign victims,
they are bad for ordinary people in the US. They will
encourage even further a low wage service economy
in the US while the corporate elite make their fortunes
even more vast than they are already by investing
in weak economies overseas. In the past those investments
were enforced and protected using US military muscle,
as in Latin America throughout the last century.
In
the new millenium, trying to extend and consolidate
US global reach, Zoellick is using trade more intricately
than ever to underpin US foreign strategy in a cost-effective
way through bilateral and regional deals. The deals
are characterised by secrecy, intense political pressure
and fierce resistance to attempts at addressing local
concerns that may limit the rewards for US corporate
investors, especially in relation to health and safety
and to the environment.
The
zealot Hazel Motes may be the public negotiating persona
of Robert Zoellick. But Zoellick is neither blind
nor crazy. He simply has no interest in the massive
human cost, whether in the United States or abroad,
of his lucrative global evangelical mission on behalf
of corporate monopoly capitalism.
1. Zoellick wants WTO deal by 2005.
CNN.com September 4, 2003.
2. 'Unleashing the trade winds', The Economist,
December 5, 2002. Quoted in "Freeing trade
or trading in trade?" K. Subramanian. Financial
Daily (from THE HINDU publications group) Dec
24, 2002
3. "Property (Rights) is Theft" Gabriela
Bocagrande, Texas Observer, 8/17/2001
4."Trade official says U.S. needs `fair opportunity'
to export to China" By Tim Johnson, Knight
Ridder Newspapers Oct 27, 2003
5. "USTR Zoellick Says Free Trade is About
Freedom, Holds Johhannesburg Press Conference"
By Charles W. Corey, Washington File Correspondent.
Thursday 21 February 2002 (usinfo.state.gov). Note
from Toni Solo (to say this is the US version of
the Soviet Union's run Pravda would be unfair
to Pravda)
6. AL-AHRAM On line, 3-9 July 2003 Issue
No. 645
7. "U.S. Seeks Partners for WTO Challenge to
EU Biotech Moratorium", By Berta Gomez
Washington File Staff Writer March 5, 2003, U.S.
Department of State's Bureau of International Information
Programs
8."GM crops fail key trials amid environment
fears. Two out of three strains 'should not be grown'
Paul Brown, environment correspondent, Guardian.
October 2, 2003
9."Sowing disaster?" Mark Schapiro. The
Nation. October 2002.
10. "WTO-USTR Says Other Nations Must 'Compromise'
Or WTO Meeting in Doha Could End in Failure",
International Trade Daily, October 31, 2001
11. "Trade hypocrisy: the problem with Robert
Zoellick" Kevin Watkins, 20-12-2002
www.opendemocracy.net
12. "Markets Must Open, U.S. Warns" by
Tim Rogers and Fabián Borges, Tico Times,
October 7, 2003
13. Congresswoman Aida Faingenzicht, of the ruling
Social Christian Unity Party. Quoted in Tico
Times, San José, Costa Rica, October
31, 2003
14. "U.S. To Pursue Number of Objectives at
November FTAA Meeting in Quito" 15 October
2002 Washington File, Office of International Information
Programs, U.S. Department of State.
15. El Nuevo Diario, Managua Nicaragua 23
October 2003 & 28 October 2003
16. "Cuzcatlecos alertan a los ticos: Salvadoreños
pagan hasta 300% más que en Costa Rica por
servicios telefónicos" by Alonso Gómez
Vargas, 22 October 2003, www.rebelion.org
17. January 8th Press release. www.precursorgroup.com
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