LAT: Trade Tension May Be Rising: Could Threaten Global Liberalization

[DeepModem Mom]

Trade Tension May Be Rising
Increasing support for barriers could threaten global liberalization, economists fear.

By Evelyn Iritani, Times Staff Writer


Growing protectionist sentiments in this country, which have escalated tensions between the United States and some of its key trading partners, are threatening to stall the global movement toward freer trade.

That in turn could provoke trade wars that would slow global economic growth and penalize American consumers through higher prices for a wide variety of goods, including clothing and television sets, some economists fear.

Signs of growing trade tensions are appearing almost daily, with the United States as the focal point....

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Opponents of...free trade initiatives say their opposition stems mostly from wanting to ensure a level playing field or to protect worker rights. But free trade supporters fear that a retreat by the leading champion of free-market capitalism will open the door for an escalation in tit-for-tat measures that will ignite inflation and spook financial markets.

"If the U.S. really starts playing hardball, does that tip the balance and do other countries start taking similar measures in the middle of a global slowdown in growth?" asked Jason Kindopp, an analyst with Eurasia Group, an international consulting firm....


http://www.latimes.com/business/la-fi-protect6jun06,0,2375464.story?coll=la-home-business

[Dover]

1. Good post...thanks!

U.S. and other nations have a lot of work to do to make 'free markets' work equitably for all nations...including their workers. NAFTA, while perhaps a step in the right direction, is riddled with problems that should have been fleshed out prior to it's release into law. So it is not surprising that CAFTA is getting a second look. What's the friggin rush, anyhow? By taking our time now, we can save ourselves all kinds of problems down the road. We are talking about nothing less than designing a global "constitution" of sorts. Let's treat it with the appropriate regard and sanctity that the Founding Fathers would have.
We need level heads, patience and a structure that has the flexibility to work for a long time. In short we need some multi-national "founding fathers" to carefully map this out. The WTO has not accomplished that so far, so perhaps we need a new global entity to handle it or we need to think about a more holistic approach to designing the bigger picture that would include trade as a subtext.
There needs to be a place at this table for not only input by corporate interests, per se, but also for the voice of the workers, the needs of our environment, etc. This is where things have gotten so out of balance. So if the playing field is leveled, then businesses should be able to compete while also providing for their workers, the environment, the communities they affect, etc. without being at a disadvantage. Do corporations really WANT a level playing field?


More from that article:

Economists warn that a trade war with China would wreak havoc in the U.S. economy, since that nation is a leading supplier for retailers such as Wal-Mart Stores Inc., Target Corp. and Home Depot Inc. and one of the fastest-growing markets for U.S. high-technology and service firms.

If Congress were to move forward with tariffs on Chinese goods, it would raise costs for U.S. importers and consumers and could trigger retaliation by China against U.S. products, such as airplanes and wheat, economists warn. That could push up prices, fueling inflation.

"Trade protectionism can lead to some very ugly outcomes," said Tobias Levkovich, U.S. equity strategist for Citigroup Smith Barney, who predicts that "cooler heads will prevail."

But with the U.S. trade deficit topping $618 billion last year, trade has become an increasingly contentious battleground on Capitol Hill, where fierce partisanship has made it difficult for moderates to cross party lines on controversial issues.

Analysts said the Democratic Party had grown more skeptical of trade in recent years as globalization accelerated the loss of American jobs, particularly in heavily unionized sectors such as manufacturing. Even moderate, pro-trade Democrats have lined up against the proposed Central American Free Trade Agreement, saying it doesn't have strong enough protections for workers.

Democratic critics of U.S. trade policy, many of whom supported NAFTA and the creation of the WTO, say the protectionist label is unfair. They say they are only trying to ensure that U.S. firms get a fair shake, that countries such as China play by the rules and that the rush to open new markets doesn't lead to labor exploitation or environmental abuse.

"We don't believe that you have to give up everything in the interest of free trade," said Maryland Rep. Benjamin L. Cardin, the top Democrat on the House Ways and Means Committee

[lovuian]

2. Its about time someone figured out Americans are getting screwed

Corporations in their greed are waking up that its not just a one way street a few countries are fighting back!!!

[idlisambar]

3. If only it were so

There is a subtle shift in attitudes among the general public, but in the power centers the move toward global liberalization remains virtually unchallenged. The problem is that no one alternative worldview has not gathered enough support to mount a capable challenge to the prevailing one.