Report back by Allen Hines
The investor protection clause in the Korean-US Free Trade Agreement (KORUS) – now pending in Congress – could be the biggest boon for big business since the North American Free Trade Agreement (NAFTA) and could clear the way for similar agreements with Colombia and Panama.
On June 26, President Barack Obama said he would take steps toward ratifying the Korean agreement, which the Bush administration negotiated in 2007. The agreement is set to increase exports and jobs in certain sectors of the US economy. At the same time, however, imports will also increase and the US trade deficit with Korea will grow.
Arthur Stamoulis from the Oregon Fair Trade Campaign, hosting a panel discussion on KORUS on Oct. 7, cited estimates that the FTA could double the trade deficit and eliminate over 800,000 US jobs.
The discussion featured David Delk, a trade activist, Portland State University professor Barbara Dudley and Mitch Besser, an unemployed software engineer.
Delk spoke about the investor protection agreements in KORUS and past FTAs. The investor protection agreement under the Central American FTA has allowed the mining company Pacific Rim to sue the government of El Salvador over environmental laws the company claims inhibit its ability to make adequate profits.
The mine in question in the suit, located along the country’s major river, is just one of 29 sites in El Salvador operated by Pacific Rim.
Investor protection allows multinational corporations to challenge the sovereignty of states. Enacting laws to promote the livability of the planet could be beholden to profit margins.
But Barbara Dudley pointed out that investor protection could go beyond environmental degradation. The General Agreement on Trade and Tariffs (GATT) has expanded to include services, including financial services.
The current financial collapse is the result of deregulation of the US financial market. Now, there have been calls for oversight. FTAs, though, could give signatories excuses not to regulate, possibly leading to further financial meltdowns.
Mitch Besser spoke next, sharing his experience of having his job outsourced to China.
KORUS, like all other FTAs, is a horrible, potentially disastrous idea. But there has been resistance to its ratification. The Korean teachers’ union has led a 10-day strike that prompted the entire cabinet, which advises the president, to offer their resignations.
Stamoulis from the Oregon Fair Trade Campaign said that if opposition in the United States can hold off Congressional approval of the agreement, it may be dead in the water by June 2011, the start of presidential election season.
He urged members of the audience to contact Sen. Ron Wyden, who chairs
the subcommittee on International Trade, Customs and Global Competitiveness.
Free trade agreements with Colombia and Panama are next in line for ratification.