by Matthew Chavez
Daily Lobo columnist
On Nov. 8, the U.S. House of Representatives passed a bill that, if ratified in the Senate, will remove trade and investment obstacles between the U.S. and Peru. The bill's supporters laud it as a new labor - and environment - friendly free-trade model that enjoys bipartisan support. Its opponents denounce it as an assault on Peru's sovereignty, environment and workers. I spoke with David Edeli, field director for Public Citizen's Global Trade Watch, for insight into the consequences of a U.S.-Peru free-trade agreement (FTA).
Daily Lobo: More than half of House Democrats voted against the bill. Does this party split signal a renewed Democratic skepticism about free trade or an emerging bipartisan consensus?
David Edeli: It's unusual for the party leadership of the majority to advance policies that are more popular with the other party. Since a majority of Democrats voted against it, there's an undeniable takeaway - at least in Washington - that the Democratic leadership is not justified in continuing to bring up trade votes under this model
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What's surprising is that the Democratic leadership even suggested having a vote on the expansion of NAFTA in the first place, considering they gained so many seats in the 2006 elections with candidates talking about fair trade and the need for change on the approach to trade policy. What's perhaps more surprising, though not new, is that the Republican Party would be so unanimous in voting for these free-trade agreements even though recent polling suggests a majority of Republican voters are skeptical of the NAFTA model of free trade.
DL: Democratic Congressman Sander Levin lauded the agreement as marking a new era in U.S. trade policy in which labor and environmental protections are treated with paramount concern. Conversely, Oxfam International stated that the Peru FTA would "institutionalize an uneven playing field between the U.S. and Peru" and allow "massive dumping of (U.S.) subsidized farm products" on the Peruvian agriculture market, which provides nearly one-third of all Peruvian employment. How do you view the document's reforms?
DE: It's true that the standards that (Democrats) negotiated to be included in the agreement are stronger than any that have come before, but they're still fatally flawed. Two major Peruvian labor federations came out in opposition to the free-trade agreement. In terms of the environmental provisions, the major concern of U.S. environmental groups since NAFTA has been the inclusion of a chapter in these trade agreements called the "investment chapter" that gives multinational corporations the right to sue governments in international arbitration tribunals over governmental actions that might inhibit the future profits of the corporations. Those investment provisions were not removed from the Peru FTA.
Meanwhile, corporations have a new power with this trade agreement - to sue governments over national, domestic laws and policies, which are the determining factors in what happens with the environment in these countries. That's why the major federation of indigenous peoples who live in the Peruvian Amazon region urged the U.S. Congress to vote no. The NAFTA model of free trade was written by and for lobbyists for corporations and includes hundreds of pages of what is essentially international law requiring the deregulation of almost every sector of the economy and government services.
DL: James Roberts of the Heritage Foundation warned that failure to pass the Peru FTA would open the door to Venezuelan President Hugo Chavez "and other populist demagogues as they pursue their damaging and aggressive economic and political assault" on American interests in Latin America. How do you view this
narrative?
DE: On its merits, that argument is erroneous. Every serious economist agrees that this trade agreement, because of the agricultural provisions, are going to drive down the incomes of the poorest farmers who number in the millions in these countries and are the hotbed of radical movements. The point has been made by experts such as former chief economist of the World Bank Joseph Stiglitz and the Catholic archbishop in Peru, who comes from the highlands, that there is no question that these trade agreements are going to lead to an increase in narcotics, drug trafficking and violence, which has long been the No. 1 U.S. foreign policy priority in the region. The reason Hugo Chavez is in power in Venezuela is because the Venezuelan government implemented trade liberalization reforms for 25 years before the corruption and inequality led people to elect someone like Chavez.
DL: How have New Mexico lawmakers scored on the Peru FTA?
DE: Congressman Tom Udall voted against the Peru FTA. (Reps. Steve) Pierce and Heather Wilson voted for it. Given how close he is to the oil industry, I'd be surprised if Sen. (Pete) Domenici voted against the Peru FTA. However, Sen. (Jeff) Bingaman voted in favor of the Peru FTA in committee in early October. However, some of the senators who voted for the agreement in committee are considering voting against it when it comes to the floor the week of Dec. 3.
Matthew Chavez is a political science major with a focus on international relations and a minor in Middle East Studies.
