Tag Archives: trade

“Free Trade” and the Consequences of Neoliberal Globalization.

Thanks to the office of Senator Elizabeth Warren for documenting some of the blatant failures of U.S. trade policy in recent decades. Forming an appreciation for the history of this issue is necessary when attempting to understand the present dismal state of U.S. trade with the rest of the world.

President Obama may tout the new Trans-Pacific Partnership (TPP) as a different kind of trade deal, but experts were quick to dub it “NAFTA on steroids.” The disturbing fact that the adminstration is fighting to negotiate the massive agreement in secret, using so-called “fast-track” authority, is indicative of a certain contempt for democracy among some American elites. If the TTP is as good a deal as Obama says, why not open it up to public scrutiny and debate?

It is absolutely vital that working class populations on the Asian and American sides of the Pacific unite against the radical expansion of corporate power that is the TPP. They must educate themselves and mobilize politically in order to compel their governments to reject the agreement. Only by fundamentally transforming our trade priorities -by eliminating transnational monopolies, protecting national and food sovereignty in developing countries and empowering local economies and labor rights internationally- can we create a sustainable and more just global economy.

View Warren’s report here: http://big.assets.huffingtonpost.com/WarrenReport.pdf



House GOP Attempts to Abort U.S.-Cuba Normalization 

Congressional opponents of President Obama’s new Cuba policy have finally initiated a legislative effort to counteract the recent thaw in relations between America and Cuba. On Tuesday, a contingent of Republican hardliners in the U.S. House of Representatives introduced a provision into an upcoming House Department of Transportation appropriations bill that prohibits government spending on the promotion of travel from the U.S. to Cuba.

The measure specifically bars the American government from using public funds to facilitate any air transportation from the U.S. to Cuba that would land on or pass through property confiscated by the Cuban government. In addition, the provision restricts the ability of the U.S. government to issue operating certificates and licenses to any maritime vessels that have recently docked within seven miles of property appropriated by the Castro regime. If ultimately enacted, these limitations would severely limit any regular travel and trade between the U.S. and Cuba.

“U.S. law prohibits tourism in Cuba, and U.S. law also allows for those whose properties were confiscated by the Castro regime to sue those who use, or benefit from using, those confiscated properties,” Florida congressman Mario Diaz-Balart, a vocal critic of President Obama’s efforts to normalize U.S.-Cuban relations, explained in an attempt to justify the new regulations that he personally introduced into the transportation bill. “Despite these clear provisions in U.S. law, the Obama administration has expanded travel to Cuba and turned a blind eye to the property claims of Americans.”

Prior to the 1959 Cuban revolution that toppled the government of the U.S.-backed dictator Fulgencio Batista, 85 percent of Cuba’s arable land was owned by American multinationals and investors -holdings that would be worth $2.8 billion today. After seizing power, Fidel Castro’s revolutionary government unveiled a land reform program that would’ve redistributed that land among Cuba’s landless peasants. The plan promised to monetarily compensate the American parties involved for their losses. When the Eisenhower administration balked at this initiative, severing the U.S.’s commercial ties with Cuba and launching a long-term covert campaign to overthrow the new Cuban government in the months after the revolution, Castro abandoned the reform plan and simply confiscated and nationalized the properties in question. The Castro regime also seized the private businesses of countless native Cubans in the wake of the revolution.

The poison pill that Republican lawmakers attached to the House transportation bill on Tuesday is expected to face stiff opposition from congressional supporters of President Obama’s new policy of Cuban détente. If the bill is passed as is however, the president may be compelled to step in and utilize his veto power to block the legislation. This would be controversial as the the larger transportation bill in question is considered urgent must-pass legislation by many. Still, it’s unlikely that the president will sit back silently while a clique of hardliners in the House attempt to effectively nullify several of the changes his administration has made to U.S.-Cuba travel and trade regulations since December. Certainly any future efforts at normalization would be sabotaged if the new restrictive measures were allowed to be implemented.                


Push for Increased U.S.-Cuba Agricultural Trade Intensifies 

Earlier this week, an agricultural delegation from the U.S. arrived in Cuba in search of potential business partners there. The trip occurred after several months of hard lobbying by American agribusiness urging the U.S. government to lift its longstanding trade embargo on the island nation. Though most of the embargo remains in place and can only be fully lifted through action by the Republican-controlled Congress, American farming interests are hopeful that that will soon change and are currently laying the groundwork for the future exploitation of Cuba’s $2 billion food-import market.

Besides emissaries from private agricultural conglomerates, the 95 member delegation included representatives from a variety state farm bureaus and a number of state officials. To add weight to the mission, several former agricultural secretaries, along with Georganne Nixon -the wife of Missouri Governor Jay Nixon-, joined the coalition.

The chairwoman of the delegation, a Cargill executive named Devry Boughner Vorwerk, told reporters, “The message we hope will get back to Washington is that we are a unifying voice that would like to see Congress act in 2015 and end the embargo.”

While the U.S. government did create a humanitarian exemption to the embargo in 2000 that formally permitted the sale of American food products in Cuba, a ban on Cuban credit persists and seriously undermines agricultural, and other, trade between the U.S. and the Caribbean country. According to estimates by the U.S.-Cuba Trade and Economic Council, U.S. food sales to Cuba fell to $291 million last year, a drop of more than $400 million from a 2008 peak.

“We understand our competitors are here — Argentina, Brazil, the Europeans — and our hands are being tied behind our backs by our own government,” Vorwerk lamented.

Predictably absent from the delegation’s proclamations was any mention of the potentially harmful impact that increased agricultural trade would likely have on the Cuban agricultural sector -a significant source of employment in that country. A number of developing countries that have entered into trade agreements with the U.S. in the past have seen their domestic agricultural sectors and food sovereignty decimated by subsequent tidal waves of cheap imported American foodstuffs. It is unclear why Cuba’s experience would be any different.

These, and other, concerns were similarly out of sight when the State House Agriculture Finance Committee in Minnesota voted on Tuesday to begin Cuban trade promotion efforts. The resulting bipartisan bill allocates $100,000 of the state’s budget for the promotion of exports to Cuba. The bill still needs to pass Minnesota’s other legislative bodies to go into effect, but there is already widespread support for it.  

“I would like to see us get down there first and expand the markets,” a Democratic Minnesota representative told reporters after the vote. 

Lucrative opportunities for Minnesotan agricultural interests are central to the state’s push for increased trade. 

“It’s not a question of if Cuba is going to be a big market,” Cliff Kaehler -the son of a Minnesotan cattle rancher who visited Cuba during a 2002 trade mission- explained, “but how are we going to capitalize?”



U.S.-Cuba Trade: a Trojan Horse?

In an interview with the Tampa Bay Times this week, U.S. Secretary of Agriculture Tom Vilsack discussed some of the lucrative opportunities for American business offered by the recent easing of relations between the U.S. and Cuban governments. Naturally, Vilsack is primarily interested in promoting the sale of American agricultural and food products to the Cuban population.

Vilsack argued that American agribusiness would profit greatly from the lifting of the U.S.’s longstanding trade embargo on Cuba; he specifically said of Cuba, “It’s 11 million people, a $1.7 billion market, and we really ought to be dominating that market.”

The secretary tellingly spent less time detailing the impact such a development could have on the Cuban population. Although trade with the U.S. would presumably give Cuban consumers access to relatively cheap, mass-produced American food products, it may also make it all but impossible for many rural Cubans to afford those new foodstuffs -or anything else for that matter- by undermining the Cuban agricultural sector.

Historically, after other underdeveloped and mostly rural countries ratified “free trade” agreements with the U.S., their previously thriving agricultural sectors were unable to compete with highly subsidized American agribusiness and deteriorated as a result. The implementation of the North American Free Trade Act (NAFTA) in 1994, for example, drove some two million rural Mexicans from their farms after it introduced cheap American corn into the Mexican food market. In Haiti, 50 percent of the food supply is now imported -mostly from the U.S. and often in the form of humanitarian aid- thanks to a series of harmful trade deals signed in the late 1990s that decimated rice production there. Both Mexico and Haiti -along with a number of other underdeveloped rural countries in the global south- saw sharp spikes in their unemployment rates and steep declines in the average incomes of their populations after signing “free trade” deals with the U.S.

If past is pretext, Cuba will be similarly negatively impacted by any trade deal that subjects its relatively insulated and highly regulated food market to cheap American agricultural products. In fact, several factors make Cuba especially vulnerable in this regard. While agriculture accounts for only around four percent of Cuba’s gross domestic product (GDP), it employs roughly a fifth of the country’s population. Any large-scale shocks to the Cuban agricultural sector could seriously endanger the Cuban government’s ability to continue to guarantee the employment of those farmers. In addition, rice and poultry -two staples of Cuban farming- would be specifically endangered by trade with the U.S. as both of these products are mass-produced quite cheaply by American agribusiness. The Cuban government should consider these realities -as well as the experiences of other nations that have undertaken trade with the U.S.- when negotiating any future agreements with their northern neighbor.

For the most part, the lifting of the U.S. trade embargo on Cuba would be highly beneficial to the Cuban people. In the area of agricultural trade however, this does not appear to be the case.

Source(s): 1) Jeff Harrington “Agriculture secretary says Cuba trade could grow by hundreds of millions” Tampa Bay Times (January 29, 2015): accessed January 31, 2015 http://www.tampabay.com/news/business/agriculture/agriculture-secretary-says-cuba-trade-could-grow-by-hundreds-of-millions/2215620
2) Britannica Kids accessed January 31, 2015 http://kids.britannica.com/comptons/article-229038/Cuba
3) Laura Carlsen “Under Nafta, Mexico Suffered, and the United States Felt Its Pain” The New York Times (November 23, 2013): accessed January 31, 2015 http://www.nytimes.com/roomfordebate/2013/11/24/what-weve-learned-from-nafta/under-nafta-mexico-suffered-and-the-united-states-felt-its-pain
4) Julie Lévesque “Haiti, Five Years After the Earthquake: Fraudulent Reconstruction Under Military Occupation” GlobalResearch (January 12, 2015): accessed January 31, 2015 http://www.globalresearch.ca/haiti-5-years-after-the-earthquake-fraudulent-reconstruction-under-military-occupation/5424139