Economic Woes, a Consequence of Free Trade

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 By one of my favorite writers and a very nice lady …..

Deanna Spingola

The abolition of nationalism and borders under the guise of the free trade has been the ultimate Illuminati objective since the late 1700s, notably illustrated by Aaron H. Palmer who had a law office on Wall Street in the first half of the 19th century. He catered to individuals interested in transnational business and managed their commerce and paperwork with the European bankers who advocated trade. By February 1837 when the bankers and politicians shrunk the U.S. credit market, Palmer already had a working relationship with N M Rothschild & Sons, located in the City of London. Palmer supplied the Rothschilds with an account of all the financial failures, as many as 280, in the months just before the final crash. {1}

The products of the labor of its citizens determine a nation’s prosperity. A brisk manufacturing base is essential, augmented by the service industry. Nationalists believe in reasonable tariffs that protect the nation’s industry. Free trade is detrimental to a nation’s wealth. So-called “conservatives,” those Republican “nationalists” who claim to put the U.S. first have promoted and participated, along with the Democrats, in the legislation of all of the nation’s free trade agreements. One cannot claim to cherish both sovereignty and accept free trade, through “multinational trade organizations and global financial conglomerates.” Marx, a mouthpiece minion for the elite, advocated both the income tax and free trade. He said of free trade, “it breaks up old nationalities” and eliminates the “bourgeoisie” (small businessmen). {2} Free trade functions to equalize the masses while elevating the elite and their acquiescent political devotees.

President Woodrow Wilson, advocating the elite’s agenda, promoted the League of Nations as a global forum for the settlement of territorial disputes by arbitration, along with the power of aggressive military enforcement or through less aggressive sanctions and free global trade, as elucidated in his Fourteen Points, “equality of trade” and “removal … of all economic barriers.” {3} On December 23, 1913, certain members of Congress instituted the Federal Reserve, a vital step to the ultimate globalization of currency. The elite established tax-free foundations to escape the income tax trap they set for the rest of American society. In October 1913, B’nai B’rith established the Anti-Defamation League (ADL) possibly to counter criticism of many of the individuals responsible for the Federal Reserve.

Proponents of the New World Order, the banker’s ultimate political monopoly, want the world’s citizens to abandon political and cultural nationalism in favor of internationalism. U.S. politicians, through their machinations, have rejected (in our behalf) the nationalism once espoused by Thomas Jefferson and others. Nations lose their self-sufficiency and independence through external military action and/or through the actions of corrupt political leaders. In the U.S. these are often the prominent leaders of each political party who dictate partisan policy which includes the decision to wage war. Banker-funded warfare opens a nation to free trade. After warfare, war-torn, devastated nations, no longer able to meet their own needs, must depend on other nations to supply essential needs – food, clothing and supplies to reconstruct the bombed-out infrastructure.

Swiss business journalist and author Gian Trepp said “War, a place where moneymen can gather, because money is stronger than nationalism. Even during the war the moneymen of different nations needed to keep in touch because when the war stops, you have to rebuild and you need free trade.” {4} Globalists have vilified the word “nationalist” in their battle to subtly convince us to accept world governance, a goal they hope to impose by 2025, according to their most recent 2010 publication, Global Governance 2025: At a Critical Juncture.

Our current economic woes began long before the elites installed Obama, their current presidential puppet to further implement global governance. By 1980, Dr. Mordechai E. Kreinin, Professor of Economics, along with Michael G. Plummer, an economics professor at Johns Hopkins University, evaluated the idea of North American economic integration. Kreinin, still pushing internationalism through free trade, compiled Building a Partnership, the Canada-United States Free Trade Agreement, a series of papers presented by like-minded academics during the September 1998 conference at Michigan State University. He is the past president of the International Trade and Finance Association and has advised the UN, the State Department and the Commerce Department regarding trade relations.

In accordance with the exponents of internationalism, officials began negotiating the NAFTA in 1986 when Reagan was president. NAFTA was formally signed on December 17, 1992 under President George H.W. Bush, Canadian Prime Minister Brian Mulroney and Mexican President Carlos Salinas. Bush had lost the November 1992 election and left the job of getting congressional approval of the agreement to his successor, Bill Clinton and his vice president, longtime elite internationalist, Albert Gore.

On July 18, 1993 Henry Kissinger (CFR, TC) allegedly wrote in The Los Angeles Times about NAFTA, “What Congress will have before it is not a conventional trade agreement but the architecture of a new international system…a first step toward a new world order.”

Gore approached Republican House Minority Whip (1989–1995), Newt Gingrich, just another internationalist still masquerading as a constitutionalist. He promised he could extract 132 votes for NAFTA, a treaty that author Ian Fletcher refers to as “a veritable case study in failure.” {5} Congressional bribery just for NAFTA, known as “pork barrel promises” totaled $50 billion, paid by the U.S. taxpayers. NAFTA cost the Democrats control of the House and Senate in 1994. Gingrich then became Speaker of the House in 1995. Voters automatically punish the party in power for the treasonous acts committed under their jurisdiction when in fact, congressional members of both parties act in concert. By 1997, due to NAFTA, U.S. job losses amounted to about 394,835, mostly women, Blacks and Hispanics. The figure increased to 600,000 by January 1, 1999. Wages in Mexico sank by 29%. Clinton and Gore, like typical politicians, engaged in orchestrated opposition. At the 1997 AFL-CIO Pittsburgh Convention, Clinton was pro-NAFTA, while Gore feigned an anti-NAFTA stance. This charade won the AFL-CIO’s endorsement of Gore in the 2000 elections. {6}

Mexican president Carlos Salinas de Gotari had endorsed the NAFTA concept in 1990, making it a political possibility. The Mexican public was the treaty’s most formidable obstacle as it had a history of distancing itself from its northern neighbor. U.S. labor unions were very vocal about their opposition and their intent to retaliate against all legislators who voted for the North American Free Trade Agreement (NAFTA). The House of Representatives approved NAFTA on November 17, 1993, by a vote of 234 to 200. Those who supported the treaty included 132 Republicans and 102 Democrats. It passed the Senate by a vote of 61-38. Clinton signed it into law on December 8, 1993; it went into effect on January 1, 1994. {7} NAFTA added Mexico to the prior treaty, the Canada-United States Free Trade Agreement, signed in 1988. NAFTA eliminated tariffs and the majority of non-tariff prohibitions between the three countries. Additionally, investors in the three countries were to enjoy the same treatment as domestic investors. {8}

NAFTA, promoted as a strategy to reduce US trade deficits, actually increased those deficits. In 1993, we had a $1.6 billion surplus in our trade with Mexico but by 2007, we had a $74.8 billion deficit. In 1994 we had an $8.1 billion yearly deficit with Canada, probably due to our oil importation despite our own adequate oil supply. NAFTA cost 525,000 US jobs between 1994 and 2002. Some figures state the total of jobs lost at 766,000, primarily among the non-college-educated population – the producers in the manufacturing segment. Mexico, as a US trading partner, is too poor, to be an export market for American goods. {9}

Pat Buchanan, referring to NAFTA, wrote, “Two years after NAFTA, the predictions of its opponents had all come true. The U.S. trade surplus with Mexico had vanished; a trade deficit of $15 billion had opened up. Trucks heading north out of Mexico were hauling more and more manufactured goods, while those going south carried machinery and equipment for the new factories going up, pointing to endless and deepening U.S. trade deficits. By 1997, 3,300 maquiladora factories were operating, employing 800,000 Mexican workers in jobs that not long ago would have gone to Americans.” {10}

Over 80% of the American population opposed NAFTA. Despite massive objections against Trade Agreements, both Democrats and Republicans habitually cater to the banks and corporations. George H. W. Bush (CFR, TC) and George W. Bush personally promoted NAFTA. It weakened U.S. and Canadian environmental laws and increased the misery in Mexico and ultimately, in addition to faulty currency policies and manipulations, contributed to the crash of the peso, further impoverishing the regular citizens. {11}

Promoters sold NAFTA, trade with Mexico, by promising new job creation in the U.S. Yet, research studies and historical examples in other countries provided adequate information and experience to discourage any kind of free trade with two inequitable countries. Labor-intensive manufacturers, encouraged by NAFTA, relocated to Mexico where Mexican nationals were willing to work for less. To get it passed, the Mexican government spent millions on lobbyists and public relations. U.S. capital, about $70 billion, went south with American jobs. New companies emerged in Mexico, along with debt in the form of interest for loans. There are about 90,000,000 people in Mexico, out of which 200,000 people control the entire wealth of the nation – thirty-two families.

Unfortunately, Mexico, along with many other third world countries, became victims of the economic hit men. John Perkins recently revealed their tactics in his Confessions of an Economic Hit Man. Mexico was generating about $30 billion a year towards paying the debt service or interest on its international banking cabal loans. Yet the actual cost amounted to $40-45 billion per year. Alan Greenspan, then chairman of the privately owned Federal Reserve increased the interest rates in late 1994 which deliberately “devastated the Mexican Economy.” {12} In December 1994, Mexico devalued the peso by about 40%. {13} Congress immediately approved a $40 taxpayer funded billion-dollar loan despite debt-burdened Mexico’s inability to repay it. That loan was merely a transfer from our pockets into the international bankers’ coffers. The recent bailouts and Obama’s stimulus package, disguised as assistance to the populace, is a huge transference of wealth – again from the taxpayer’s pockets into the banker’s pockets.

After NAFTA, the Clinton administration hammered through 200 additional trade agreements. The World Trade Organization (WTO) replaced the GATT. {14} The WTO opened the world to corporate predators and further diluted environmental, labor and human rights. The Bretton Woods Agreement (1945), an amendment to the Federal Reserve Act, ultimately led to the establishment of the World Bank, the International Monetary Fund, the GATT, a global economic system that managed free trade with the dollar as the world’s basic currency. The elite designed the system to ensure British and U.S. hegemony over monetary and trade issues. The Federal Reserve, a private enterprise, became master of the economic system.

The World Trade Organization (WTO) is located in Geneva, Switzerland. Congress created the WTO as “a policeman, a global free trade enforcer, and a battering ram for the trillion dollar annual world agribusiness trade.” The WTO was devised “to advance the interests of private agribusiness companies.” It is not accountable to any nation’s laws. The WTO may impose disciplinary penalties or other measure on member countries that violate their regulations. The WTO may also force countries to accept genetically modified crops. The WTO is a product of the General Agreement on Tariffs and Trade (GATT). Seventy-five GATT members and the European Communities founded the WTO on January 1, 1995 as a result of Uruguay Round of trade liberalization talks, held in del Este, Uruguay, in September 1986, and concluded in Marrakech, Morocco, in April 1994. {15}

According to Ian Fletcher, “The U.S. should seek strategic, not unconditional integration with the rest of the world economy. Economic openness, like most things in life, is valuable up to a point – but not beyond it. Fairly open trade, most of the time, is justified. Absolutely free trade, 100 percent of the time, is an extremist position and is not.” Free trade is certainly not inevitable. A former British colony, the U.S., for decades, protected their manufacturing base through protectionist tariffs. The regulation of commerce was included in the Constitution, Article I, Section 8 authorizes Congress “to regulate commerce with foreign nations,” a mandate that is in the best interests of the nation and its people. {16} Nation states are economically essential and relevant as most people, according to Fletcher, live in the country in which they were born. Consequently, their “economic fortunes depend upon the wage and consumption levels within that one society.” When trade laws, to benefit large firms, alter the economic nationalism of a nation, it impacts every resident. {17}

Free trade, as currently practiced with chronic US deficits and a plethora of cheap imports, can actually “seduce” a population into “decadent consumption.” People have abandoned the tradition of saving and frugal living. Business owners often fail to reinvest profits and instead depend on bank loans. Seemingly, individuals in their personal or business circumstances prefer to mortgage their futures in order to obtain immediate gratification. Fletcher claims that Americans are addicted to debt as evidenced by the incidence of consumer credit. America’s combined household and government debt totals 243% of GDP as opposed to China where the government discourages personal debt. At least 500 million Chinese people have a cell phone but only one million Chinese residents have a credit card. {18} China is the world’s largest mobile telephone market. {19} I visited China in 2007 and was amazed at its thriving economy, the huge building projects throughout the country, and the presence of large US-based corporations, like Motorola, in Beijing.

Robert B. Zoellick (CFR, TC, Bilderberg, PNAC), current President of the World Bank, as Under Secretary of State for Economic and Agricultural Affairs (1991-1992) helped seal the NAFTA accord with Mexico. He was also instrumental in launching the Asia Pacific Economic Cooperation forum. He was a U.S. Trade Representative (2001-2005) who attempted to fast track the Free Trade of Americas Agreement (FTAA) and negotiated the Central America Free Trade Agreement (CAFTA) in May 2004. He advised George W. Bush on foreign policy during the 2000 campaign as part of a group led by Condoleezza Rice called The Vulcans. Bush nominated Zoellick to replace Paul Wolfowitz (PNAC) as the new World Bank president. {20}

Residents flee when their nation’s economy fails, or when it is devastated by war. Illegals in the U.S. increased from three million in the 1990s to eleven million with about 55% or six million individuals from Mexico. This resulted from Mexico’s economic crisis in conjunction with George W. Bush’s so-called “guest-worker” program, possibly associated with his secretive meeting in Waco, Texas on March 23, 2005 with then Mexican President Vicente Fox and then Canadian Prime Minister Paul Martin. They met to discuss the formation of the North American Community which is, by default, a done deal. The U.S. government has been deliberately ineffective in protecting the southern border in order to create a destabilizing cultural and economic crisis in the U.S.

NAFTA Vote by Party and City, Suburb and Rural Location:
Anti NAFTA Pro NAFTA {21}

City 67.4% 32.6%
Suburb 59.6% 40.4%
Rural 52.2% 47.8%

City 22.2% 77.8%
Suburb 26.4% 73.6%
Rural 21.4% 78.6% 

Some of the same treasonous scoundrels that voted for NAFTA are currently appearing on the privately owned media busily blaming the current administration for not fixing the economy, a direct result of NAFTA. Some of those neo-cons include Newt Gingrich, John Boehner, Tom DeLay, Dick Durbin, Jeffrey Flake, Thomas Foley, John Kasich, Dick Armey, Dennis Hastert, and on the left, Nancy Pelosi. She, as Speaker of the House, pushed through the disastrous healthcare bill in the same manner. These politicians count on the fact that the US public has forgotten who voted on NAFTA and what it did. They are now blaming the bulk of the country’s economic woes on others, such as people who shouldn’t have borrowed money to buy homes (now in foreclosure) and a number of other issues – never on the fact that they imposed a treaty on the US that was deliberately designed to de-industrialize the country and cause an economic catastrophe. Neo-con Republicans continue to maintain that NAFTA was a good policy, but for who? Mexico, now a slave-wage corporate slum-burb from which desperate citizens attempt to escape is a direct result of NAFTA. Meanwhile, jobless, middle-class Americans struggle to stave-off foreclosure.   

In March 2010 Rep. Gene Taylor, a Mississippi Democrat, lead a small group of twenty-eight lawmakers who introduced legislation that would require President Obama to relinquish our participation in NAFTA, the 16-year trade agreement that began the de-industrialization of America, a process that has created the current joblessness (10 to 12%) and the economic fallout. The National Association of Manufacturers and the U.S. Chamber of Commerce, organizations that represent the elite, have always supported NAFTA. If Taylor’s legislation passes, Obama would have to give Canada and Mexico six months’ notice of the U.S. intentions to vacate the pact. {22}

In his campaign speeches Obama opposed NAFTA but now is in the process of negotiating with officials in South Korea, Panama and Colombia to implement trade pacts with those countries. In March 2010, U.S. officials also began trade negotiations with Australia, New Zealand, Singapore, Chile, Peru, Vietnam and Brunei in what would be the Asia-Pacific regional free-trade agreement. Members of the House of Representatives are supposed to vote before the end of the year whether the U.S. is to retain their membership in the World Trade Organization. {23}

Ian Fletcher says, “Free trade is inexorably bleeding our economy and preventing it from returning to true health. Nobody in the Obama administration wants to talk about the economics of free trade, because as soon as one seriously scrutinizes this doctrine, one begins to discover that free trade may be the biggest myth in American economics.” {24}

1 There is no Need for Anyone to go to America: Commercial Correspondence and Nineteenth Century Globalization from Papers found by Jessica Lepler, Assistant Professor of American History at the University of New Hampshire, during research into the 1837 financial crisis in the US.
2 The Judas Goats, the Enemy Within by Michael Collins Piper, American Free Press, Washington, DC, 2006, p. 30
3 Rockefeller Internationalism by Will Banyan, Part 1, Nexus Magazine Volume 10 – Number 3, (April-May 2003)
4 Hitler’s Secret Bankers, the Myth of Swiss Neutrality During the Holocaust by Adam LeBor, Birch Lane Press, New York, 1997, p. 73
5 Free Trade Doesn’t Work, What Should Replace It and Why by Ian Fletcher, U.S. Business & Industry Council, Washington, DC, 2010, pp. 158-159
6 Al Gore: A User’s Manual by Alexander Cockburn and Jeffrey St. Clair, Verso 2000, pp. 160-171
7 Organized Labor’s Campaign Contributions after the NAFTA Vote: Rhetoric or Retribution? by Gretchen Anne Phillips and Edward Tower, p. 3
8 NAFTA, GATT Uruguay Round, and Fast Track 1998: a Brief Legislative History, Institute for International Economics, www.iie.com, p. 1
9 Free Trade Doesn’t Work, What Should Replace It and Why by Ian Fletcher, U.S. Business & Industry Council, Washington, DC, 2010, pp. 158-159
10 The Great Betrayal: How American Sovereignty and Social Justice Are Being Sacrificed to the Gods of the Global Economy by Patrick J. Buchanan, Little, Brown, New York, p. 269
11 Al Gore: A User’s Manual by Alexander Cockburn and Jeffrey St. Clair, Verso 2000, pp. 160-171
12 Texas and Mexico, Immediate Impact of the Mexican Crisis
13 NAFTA and the Peso Collapse, Not Just a Coincidence by Robert A. Blecker, Economic Policy Institute, Briefing Paper, http://www.epinet.org/briefingpapers/1997_bp_nafta.pdf
14 Seeds of Destruction, the Hidden Agenda of Genetic Manipulation by F. William Engdahl, Global Research, Center for Research on Globalization, Montreal, Quebec, 2007, pp. 216-247
15 Ibid, p. 217
16 Free Trade Doesn’t Work, What Should Replace It and Why by Ian Fletcher, U.S. Business & Industry Council, Washington, DC, 2010, pp. 20-21. This is a book that everyone interested in so-called free trade should read.
17 Ibid, pp. 23-24, 25
18 Ibid, pp. 48-49
19 Motorola’s Cell-Phone Stumble in China, Telecom August 28, 2008, http://www.businessweek.com/magazine/content/08_36/b4098056926227.htm
20 Robert Zoellick, http://rightweb.irc-online.org/profile/1397
21 Economic Policy Institute Briefing Paper, Washington, DC, Political Arithmetic of the NAFTA Vote by Lawrence Mishel and Ruy A. Teixeira, p. 12, http://epi.3cdn.net/3d995382f3252362c7_ydm6bxl4u.pdf
22 Reuters, A small group of U.S. lawmakers unveiled legislation on Thursday to withdraw from the North American Free Trade Agreement in the latest sign of congressional disillusionment with free-trade deals, http://www.reuters.com/article/idUSTRE6233MS20100304
23 Ibid
24 Free Trade Doesn’t Work, What Should Replace It and Why by Ian Fletcher, http://www.freetradedoesntwork.com/


Archive of Deanna Spingola’s articles 

Deanna’s new book When the Power Elite Rules: A Study in Imperialism, Genocide and Emancipation


This post via The Peoples Voice 


Globalization and its Contribution to America’s Economic Catastrophe

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Posted in January 5th, 2009

by Rowan Wolf

By Richard Backus

The promoters of Globalization, in their headlong and single-minded lust for profit, have exhibited one major flaw, a complete ignorance of the basic economic principles underlying capitalism. While marginally lowering prices on products by replacing decently-paid western workers with third world workers at exploitative wages, they have killed the proverbial “goose that laid the golden egg.”

The displaced workers, those middle income western wage earners, were the backbone of world consumption. The exploited workers could not buy the products which they created. Now, as his wages are being increasingly undermined by product outsourcing and tariff policies (NAFTA, CAFTA), the previously middle class wage earner is gradually becoming unable to keep up the consumption necessary to support production. Only the rich, beneficiaries of the increased profits generated by these policies, can afford these products. They have the gold but the goose has been cooked. This article explains the phony “principles” supporting Globalization, the reasons for its “success”, and the danger that it represents.

Practically all well-known U.S. economists and policymakers have supported Globalization as if it were the Holy Grail, resulting finally in our current international economic crisis. There were two well-publicized reasons proposed to justify Globalization, and one (secret and undisclosed) which was the real reason for their wholehearted and sycophantic support. One of the former was the concept that free trade under Globalization would end trade competition among nations leading to world peace. The other was based upon an ideological concept derived from one of Ricardo’s economic theories called the Law of Comparative Advantage. This “law” was predicated upon the idea that the world as a whole would benefit when each country produced only those goods that it was most efficient in producing and leaving to other countries those products they excelled in. Both of these concepts have been proven unworkable in actual practice, but the economists and politicians have not given up on them regardless, mainly because they really were only pretexts for Globalization and whether they worked or not was immaterial. Why let reality stand in the way of a good story? The third and real reason that these “professionals” endorsed Globalization was that it was profitable for them to do so. Few writers or economists can propose anything contrary to the interests of the politically connected and be published or promoted. Only writers of inordinate prestige and integrity, such as Naomi Klein and Paul Krugman, can afford to take the risk. Naomi’s The Shock Doctrine: The Rise of Disaster Capitalism and Paul’s The Conscience of a Liberal are among the few books which dare to disclose the truth about the U.S. government’s unfair and damaging policies and practices. Conversely, the way to riches is by puffing lazy and incompetent “elites” and touting any program financially rewarding to them. Most honest economists, columnist or reporter will eventually end up poverty-stricken under these circumstances.

In dealing with the premise that world peace would be assured under free trade and Globalization, there is a claim that World War II was caused by excessive tariffs among the combatants causing a lessening of trade and friction between them. In reality, the war in Europe was contested between countries which had considerable friendly trade prior to the war. Germany and Great Britain were major trading partners. In the case of the Pacific conflict, it was not tariffs but an embargo against the Japanese established in response to their aggression against China. Tariffs took no part in the conflict. Imperialism was the culprit in the Pacific as well as in the European conflict. Today, thanks to an economic imperialism over third world countries resulting from policies forced upon them by the IMF (as directed by the U.S.), no country need attack the resource rich countries fought over in the past. For the most part, their assets are already owned by the multinationals, in the interests of the world’s shareholders. Economic Imperialism under Globalization is no less offensive and improper as Imperialism by force.

Another convenient claim, the concept that tariffs established by the U.S., the famous Smoot-Hawley in particular, were the basis of the economic collapse worldwide ultimately leading to the war, was also specious. The Fordney-McCumber Tariff (a Republican tariff) was passed in 1922 and had been in effect without problems for 7 years before the stock market’s collapse. Smoot-Hawley was just the last of a series of high-tariff law in the U.S., simply a continuation of U.S. trade policies prevalent throughout the history of the U.S. and primarily responsible for our great economic successes.

Many countries will be peace loving and friendly to the west as long as they are doing well economically. If not, they can be expected to revert to “uncooperative” competition and to acts offensive to competitor governments. What is happening in Russia today is an example. Public dissatisfaction caused by poor government policies and corruption, but blamed upon the U.S., has resulted in “unfriendly” acts by the current government. The gap between “have” and “have nots” worldwide, regardless of the causes, will tend to cause instability and aggression in many countries. The idea that Globalization will miraculously change this is pure fantasy.

The concept that the entire world will benefit from “free trade”, as derived from Ricardo’s laws, had been soundly refuted prior to the current world economic meltdown. Alan Greenspan in his paean to Globalization, greed, and the Republican Party, The Age of Turbulence, cited “well-documented evidence that competitive markets over the decades have elevated standards of living for the vast majority of Americans and much of the rest of the world”. He apparently had never seen or heard of Detroit, Bethlehem, or any of the eastern cities ruined by the loss of entire industries (textiles, shoes, electronics, steel, autos, et.al.) which had been the direct result of Globalization prior to the current economic debacle. Certainly with the economies of the entire world in disarray he would not now be able to claim this improvement in the standard of living for practically anyone, anywhere.

Ricardo’s Law of Comparative Advantage was based upon the concept that countries share production, with each concentrating on those products for which it had a relative advantage, and relinquishing to its trading partners those which they were best at. It was based upon a balanced trade with each country trading enough of its products to afford those of their trading partners. If this tradeoff was not observed, there was no problem in those days, There being little else to swap for, such as the shares of corporations, government and corporate bonds, commercial properties, and “bundled” assets (such as REITs) which are currently available, the balancing factor was invariably money. The country experiencing a sustained trade imbalance would quickly run out of money, and the trade imbalance would automatically disappear (simultaneously bankrupting the country involved). Ricardo did not even contemplate that happening in his day. No government would survive if it allowed it to happen. Trade had to be based on comparative advantage, not absolute advantage, with a balanced (equal) trade between all countries. Each had its own specialties which their trading partners had to respect. An unfortunate result of this needed “reciprocity” was the forced opening of China to the opium trade by the British in the mid 19th century. Great Britain was running out of sterling having few products to sell to China in exchange for its silk, tea, spices, etc. If citizens of the U.S. had not possessed substantial non-monetary assets, accumulated throughout the history of the U.S., the U.S. money supply would have disappeared long ago, with a corresponding drop in the American citizens’ standard of living. Today, these assets are now being sacrificed for the benefit of foreign corporations, as the trade deficit problem remains unresolved.

In dealing with the “efficiency” issue supposedly leading to such great improvements in worldwide standards of living, much of what has been claimed, such as the actual across-the-board implementation of “free trade” and its purported benefits, is fallacious or distorted. The low cost of foreign goods is not due to fair competition based upon the productive capacity of individual workers, but strictly upon worldwide wage levels determined primarily by international exchange rates. These exchange rates have been consistently manipulated by foreign governments in order to make their tradable products more competitive, a practice called “beggaring thy neighbor” in the past. This practice is a direct and significant violation of “free trade”. Japan’s spectacular economic success over the past 50 years was based upon the establishment of an undervalued Yen (established by U.S. authorities) designed to reestablish it as a powerful U.S. ally in the East. China’s devaluation of the Yuan in 1993-1994 and peg to the dollar was not contested by the U.S. government although it was obvious that it would allow China to gain (and hold) a long-term supremacy over the U.S. in most manufactures. That too was done to “pacify” China. As a side “benefit”, these devaluations were the principle initiating cause of the Asian financial crisis of 1997, ultimately resulting in drastic losses of assets by other Asian countries, and deterioration of their already exploitative wage rates. If giving up worldwide supremacy in manufacturing (and its associated world economic and political leadership) is the cost of gaining friends, the U.S. has made a splendid bargain. The folly of this policy will become painfully evident when China’s GDP (and consequent military strength) overtakes that of the U.S. (about 2028 according to recent studies).

The major consequence of Globalization and “free trade” will be a lowering of wage rates (and worker and environment standards) to an exploitative one worldwide. Exploitative wage rates are simply rates insufficient to provide workers a “living wage”, one that will not compel them to force their children to work and sufficient to provide money for their education. In Asia almost all workers have been exploited because of massive unemployed or underemployed populations in these countries. Each country has been desperately trying to employ its citizens at whatever wage rates are offered, and foreign multinationals (exploiters) have taken advantage of this.

In the interest of fairness for all workers worldwide, “equalizing” tariffs should be imposed by all countries on all imported goods which the home country itself could produce. An “equalizing” duty should be levied on all internationally-traded manufactures at a level designed to compensate for differences in worker’s wages and benefits. Those citizens unsatisfied with the quality or price of products produced locally would be free to buy foreign-made products but would have to pay duties in cases of unfair wage rate differentials. If no substantial wage differentials existed, there would be no duties. An equalization of effective worldwide labor rates was, in fact, a major feature of the Fordney-McCumber Tariff Act.

The manufacturing advantage enjoyed by current low-wage countries would be eliminated as the leaders of these countries realized that they were contributing funds to foreign governments (in the form of duties) which would not be necessary if they arranged equitable wages and benefits for their own workers. For all countries, local competition should result in the hiring of the most competent workers but at wages appropriate to any worker worldwide. Any worker anywhere, working in good faith, deserves a living wage. Anything short of this should be recognized as obscene. In addition, innovation would increase because new products developed under local competition would augment products developed abroad. The resulting income policies, coupled with fair tax policies, should eventually provide wage levels appropriate for workers worldwide.

One other consideration need hardly be mentioned but has dire consequences. Under Globalization, it will be necessary to “homogenize” the economic policies and social practices of the entire trading world, a relinquishing of sovereignty in many areas of government and society. It will require social-welfare oriented countries and conservative capitalistic ones to find common economic ground; religious and ethnic groups to agree on social policies contrary to long-held beliefs and traditions. To accomplish this will prove to be not only illusory but dangerous. How would the U.S. be better off by adopting those “international” wage policies which have left workers in the rest of the world poverty-stricken and unhealthy?

Globalization is 100 percent baloney. Globaloney, a term coined by Claire Booth Luce more than 60 years ago when it was first proposed, was baloney then, and is baloney now, only packaged in a different wrapper. Each country must be able to choose and support its own culture and be free to independently choose its own interests, pursuits, and way of life. Universal decent and fair trade practices will permit this independence and will do it without sacrificing these sovereign rights. If the U.S. government fails to face up to the consequences of its current policies of “free trade” under Globalization, we can all kiss off the “American way of life” that we have created and been so proud of.

Richard Backus, author of this article, is a free-lance journalist specializing in political economy and politics. He resides in Miami Beach , Florida and his personal website is uncensoredops.blogspot.com

Source: http://www.bestcyrano.org/avenger212/?p=546

American Company Stops Travel to Juarez

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There’s a war going on just across our border and it has made some American companies halt travel to the hot spot, Juarez, Mexico.

Working as a contractor for a company that has a contract manufacturing plant in Juarez, I got the first hand story from a friend who is in Nashville this week.

On his last trip to the plant, coming back to El Paso, he saw a decapitated body hanging from a bridge on the main route. Some from his company had already refused to travel there and upon his return and telling what he saw, a policy was implemented banning all travel to Juarez.

American manufacturing has lost thousands of jobs to the cheap labor available in Mexico. NAFTA and greed at work. Working with Mexican manufacturers often needs a hands on approach to stay on top of the quality problems and differences in work ethic.

Having been to Juarez a few times in the past, I understand the poverty and the willingness of the people there to work for a penance. Now the drug wars there have virtually destroyed any semblance of a culture that was once there.

My contacts say that the manufacturing done in Juarez could be accomplished in Texas without a loss of profit. The problems out weigh any perceived benefits.

Perhaps sending our jobs to Mexico wasn’t such a good idea after all.


Mexico’s drug violence expected to intensify in ’09

WASHINGTON – Drug-related violence in Mexico, already at unprecedented levels, is expected to escalate further this year, with targets likely to include top Mexican politicians and law enforcement agents and possibly even U.S. officials, according to diplomats and intelligence experts on both sides of the border.

CLAUDIO CRUZ/The Associated PressCoffins of six Mexican soldiers, decapitated in a gruesome, drug-related attack, were carried during their funeral last month in Chilpancingo. “

The warning underscores the difficult choices confronting President Felipe Calderón as he takes on drug cartels while weighing the implications of growing casualties in a year of midterm elections and a slowing economy.

It also reflects rising concern among U.S. officials and analysts about the deteriorating security situation, corruption among Mexico’s top crime fighters, and the vulnerability of the military to possible corruption in battling cartel gangs.

As the war against cartels escalates in 2009, so will the threats, particularly against U.S. officials and other Americans, officials, analysts and diplomats, including U.S. Ambassador Tony Garza, said in recent interviews.

“Calderón must, and will, keep the pressure on the cartels, but look, let’s not be naïve – there will be more violence, more blood, and, yes, things will get worse before they get better. That’s the nature of the battle,” Garza said. “The more pressure the cartels feel, the more they’ll lash out like cornered animals.

“Our folks know exactly how high the stakes are,” Garza said. He advised Americans traveling to Mexico to check State Department travel alerts at http://www.state.gov.

A U.S. intelligence official based along the Texas border warned that U.S. officials, American businessmen and journalists will “become targets, if they’re not already.”

“All bets are off,” the official said, speaking on condition of anonymity. “The more pressure you apply on the cartels, the bolder these thugs become.”

The official, citing information from informants and other intelligence, said attacks against Americans may include car bombs placed outside consulate offices and embassies or attacks on “specific individuals.”

The threats, the intelligence official said, are a result of “growing frustration” among cartel leaders and the internal dynamics of cartel organizations. He described the drug gangs as “transnational, with deep financial, cultural and social ties to Mexican and U.S. cities, whether Ciudad Juárez; Culiacán, Sinaloa; as well as El Paso, Houston or Dallas.”

“The cartels are playing a game of chicken,” said Armand Peschard-Sverdrup, head of Washington-based Peschard-Sverdrup & Associates, a political consulting group. “They’re testing the resolve of the Mexican government, society in general, and the U.S. government as well by targeting Americans.”

‘Failed cities’

Already, the violence is crippling regions and cities, some of them on the border with Texas. Some top U.S. officials and analysts describe these cities, including Ciudad Juárez, across the border from El Paso, as “failed cities,” in which cartels, not city or police officials, have control.

Ciudad Juárez, whose mayor and other elected officials have moved to El Paso in recent months and commute to Juárez, ended the year with more than 1,600 drug-related killings. Nationwide, more than 5,700 – criminals, soldiers, police, journalists and bystanders – were killed. That’s more than twice the estimated 2,300 slain in 2007.

Philip Heymann, a Harvard law professor and expert on terrorism, characterized the ongoing violence in Mexico as “narcoterrorism, given the tactics used,” including beheadings and efforts to silence and intimidate society through threats, gruesome videos and text messages.

“I think the situation in Mexico is very, very dangerous for everyone, including the United States,” he said. “The situation hasn’t yet registered in the mindset of Americans, but it will, especially when Americans become the target. All you need are two, three Americans killed and the issue will suddenly become important.”

more – The Dallas Morning News


Ciudad Juarez a.k.a. Hell’s waiting room

There are more secrets hidden in the deserted city of Ciudad Juarez, than there are sand crystals in the desert. This poverty-stricken city tells tales that will never be forgotten regarding the decade-long mystery of the women massacres, which began in the early ’90s and continued through 2003. To this day, more than 400 murders of young women have yet to be investigated.

Before we get into the victims’ stories, let me paint the big picture. Ciudad Juarez, Mexico resides just across the border from El Paso, Texas in the state of Chihuahua, with a population of about 1.4 million people. After the North American Free Trade Agreement passed in 1993, companies like General Electric, Alcoa and Dupont established factories (maquiladoras) in Juarez employing, by majority, women for cheap labor.

Low working class females usually reside in the outskirts of Ciudad Juarez where they live in shanty homes with no running water, electricity or telephones. They begin their journey to work by walking through dirt roads in order to catch the buses provided by the big Fortune 500 factories. Working for mere cents an hour, according to the article “Murder in Juarez: Gender, Sexual Violence and the Assembly Line,” the maquiladoras provide higher wages than in any other factories around Mexico City and it has become the hot spot for women workers.

According to an article from Business Network, writer Jessica Livingston’s investigation regarding maquiladoras connected with the deaths to the different women in Juarez, in many instances employers justify the reason for hiring women simply “because of their manual dexterity and their ability to tolerate tedious and repetitive work.” I am a woman and hate tedious and repetitive work. Not a very good argument, Fortune 500s.

Livingston’s investigation further explains that in some factories supervisors host “Senorita Maquiladora” beauty contests, and the dance clubs host “Most Daring Bra” and “Wet String” bikini contests. And apparently the buses provided by the company drops the employees at the night clubs.

How can big companies like General Electric promote this type of behavior? Livingston further explains that the lack of justice in Ciudad Juarez leads to constant cases of unresolved sexual assault and murder.

During a 10-year period, bodies of victims were found in the middle of the desert, raped and mutilated. More than 400 bodies of young women were found in the same circumstances, and by majority, were employed at a factory in Juarez. The young women had similar characteristics: tan skin, dark, long hair, slim bodies and of the young ages 12 to 19.

To this day the mothers have been fighting corruption, and investigators link the deaths with the police. Ciudad Juarez has become a battle zone between drug cartels and the police. According to different newspaper articles in the area, “anyone can get away with murder.”

Juarez, that corner of the world just south of our border, feeds on the blood of young women. The cry for help from the different mothers continues to echo throughout the dark corners of the desert.

The mothers have organized activist groups to fight off corrupt police in Juarez and get the investigations rolling, but help has not answered. They looked to the North, but the U.S. government was too busy finding weapons of mass destruction and disregarded the matter.

After all, why should we worry? The sad reality of students, myself included, is to view Mexico as only a vacation spot where we can party endlessly with cheap alcohol.

Vanessa Guerrero


Drug-related slaying in Juarez top 1,600 mark as 2008 ends

A couple of fatal stabbings and a homicide arrest were among the incidents that occurred as a bloody 2008 came to a close in Juárez.

A Chihuahua state police spokesman said official statistics for the number of homicides were still being compiled. But an unofficial tally shows that the Juárez area ended the year with a record high with more than 1,600 killings, most of them attributed to turf wars among drug cartels. more