Barack Obama heralded negotiations to begin next month on a U.S.-European Union (EU) trade deal as leading to a pact that would “support hundreds of thousands of jobs on both sides of the ocean.”
Obama might have had Detroit in mind. With a jobless rate of 27 per cent, Spain alone needs millions of new jobs.
Trade between America and the EU now amounts to about $1 trillion, a small fraction of a U.S.-EU economy of roughly $30 trillion. To be worth the effort, the budding trade talks would have to yield an agreement that triples or quadruples U.S.-EU trade — a most unlikely outcome.
Like all summit hosts, British Prime Minister David Cameron is eager to have history made at his fête. He describes a U.S.-EU trade pact as possibly “the biggest bilateral trade deal in history ... a deal that will have a greater impact than all the other trade deals on the table put together.”
The table is indeed groaning under the weight of no fewer than three hugely ambitious planned trade deals.
Of longest standing is CETA, the comprehensive Canada-European Union Trade Agreement, which Stephen Harper exuberantly described in a U.K. parliamentary address last week as a “monumental” step that could boost two-way trade by 20 per cent. Over what period of time the PM didn’t say. Since left to its own devices, trade would grow anyway, the absence of a timeline makes the boast meaningless.
A one-fifth gain in Canada-EU trade would actually be a modest step. Canada’s utter reliance on the U.S. export market — a consequence of tradition, proximity, common language and other favourable factors — makes Canada’s goal of diversifying its export markets laudable but stubbornly difficult.
One has to suppress a chuckle at the insistence of José Manuel Barroso, president of the European Commission, that “we intend to make rapid progress” in a U.S.-EU trade deal, whose architects have been instructed to complete their work in a mere two years.
The comparatively straightforward CETA talks, between the world’s largest and 12th-largest economies, have dragged on for four years. Talks between the evenly matched colossi of America and the EU won’t get serious until the European debt and recession crises have run their course. That is to say, only after a retired president Obama has accepted a directorship at Google Inc. The Trans-Pacific Partnership (TPP) is likely doomed in an increasingly protectionist U.S. Congress, which took five years to sign off on trade pacts with such minor economies as Colombia and Panama.
Conspicuous at the latest G8 conclave is the same elitism that imposed a common-currency union on 17 European nations, stripping them of monetary controls to ease the suffering from Europe’s Great Recession.
In the aftermath of the Canadian trade deals with the U.S. and Mexico, and the half-century experiment of the world’s most significant trade block in the EU, the elite has yet to acknowledge the three-decade pay freeze for North America’s middle class, the off-shoring of jobs to low-wage jurisdictions, and rising income inequality in the industrialized countries.
Protesters against the TPP are already on the march, disrupting events held by Japanese PM Shinzo Abe. A clutch of top Democrats in Congress have complained to Obama that Japan’s inclusion in the TPP talks rewards “Japan’s significant, long-standing, and persistent economic barriers put in place to block our (U.S.) exports.”
Consumer critics have surfaced in both Canada and the U.S. to warn of trade-pact provisions by which private corporations are granted powers to sue governments over what they deem unfair policies, in effect dictating government policy in their own interests.
French culturecrats successfully pressured Paris to boycott the U.S.-EU talks until France was assured that Hollywood would not further colonize European markets — as it thoroughly has Canada — with televised competitions among Louisianans to see who can ingest the most number of roaches. Heck, a sizeable contingent of Cameron’s fellow governing Tory MPs is publicly calling for a referendum by which Britons could opt out of the EU. That would make the CETA and U.S.-EU trade negations moot.
For now, at least, globalization appears to have peaked. It might even be in retreat. A crippled global banking system that long spearheaded globalization is repairing its balance sheet rather than lending worldwide.
A moribund World Trade Organization, with its strict rules for lowering trade barriers, has given way to regional deals like those noted above, which typically lack binding provisions and enforcement.
And migration, another critically important factor in global integration, is now inhibited as anti-immigrant sentiments find political expression even in the affluent Scandinavian countries
Over-promising and under-delivering is a hallmark of G8 summits. You wonder if even the guests of honour at these shindigs believe what they’re saying.
Original Article
Source: thestar.com
Author: David Olive
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