The reality of fair trade

[Zapatista_Revolucion]

Fair Trade agreements are commonly thought of as a way to improve conditions of workers in third world countries, many believe them to be 'fair' trade.

Yet as with any capitalist scheme, there is always an alternative aim.

With NAFTA (the North American Fair Trade Agreement) being my strongpoint, i shall focus on this.

I'm sure the word fair trade still confuses many of you, still triggers images of happy workers and prosperous wealth for all. Wrong, with the implementation of NAFTA, largely over Latin America, Peasants who had until now resisted the capitalist system as much as possible, were bound into a workforce we belived had always existed, you see, western governments are not willing to throw their valuable trade into any country, they have to ensure they're getting something in return, something better to fuel the growth of the market.

And so the fair trade agreements were seen as a way to create a workforce in countries such as Mexico for the use of Multi-National government-sponsoring companies from the MEDC (More Economically Developed Countries) In exchange for US trade, Mexico wqould provide the US with a cheap workforce to export goods to America, this in theory is not morally reprehensible, it is in actuality improving the conditions of the Mexican's to an extent, the problem arises when we see how binding the agreements are, should any force (Zapatistas for example) seek to gain power and in the interests of the proletariat seek to end this agreement, US trade would immediately stop, throwing Mexico straight back into the dark ages. The same is true of the French agreements with Africa, should the continent mine it's many resources which could provide MASS wealth, they shall be forced to slash the price for France or lose much needed trade in other areas.

Fair Trade, is nothing else than a system to spread the capitalist theory and fuel it's growth for the minority.

[Publius]

So let me get this straight: If Mexico elects Zapitatistas, who are anti-capitalistic and would doubtlessly cut off all 'free-trade' with American corporations, America will cut-off trade with them?

What's the problem?

I thought this was 'super-exploitation'? Obviously it should be ended as soon as possible, right?

The simple fact is, if the Zapatistas were elected, they would restrict trade anyway, as a matter of ideology.

What's the contention?

[вор в законе]

The simple fact is, if the Zapatistas were elected, they would restrict trade anyway, as a matter of ideology.

If you think that the Socialists are againts trade my young padawan then you are completely illiterate of ''marxist'' political theory.

[Zapatista_Revolucion]

The fact of the matter is these countries RELY on US trade, yes hopefully it will in future be restricted but whilst seeking to become an MEDC country it can never be cut off entirely, with America pushing fair trade on everyone it allows no freedom within the world trade and will result in complete us domination of the area.

[Publius]

If you think that the Socialists are againts trade my young padawan then you are completely illiterate of ''marxist'' political theory.

Against 'trade' itself? No.

Against 'trade' such as NAFTA? Certainly.

I'm not an arch-authority on the Zapatista's, but if they're anything like socialists anywhere else, they're protectionist and are keen on trade barriers.

Why I was reading a few articles on RedStar's site where he advocates that very prescription. Absurd, I know.

[Publius]

The fact of the matter is these countries RELY on US trade, yes hopefully it will in future be restricted but whilst seeking to become an MEDC country it can never be cut off entirely, with America pushing fair trade on everyone it allows no freedom within the world trade and will result in complete us domination of the area.

So than what do you propose be done?

[redstar2000]

Originally posted by Publius
Why I was reading a few articles on RedStar's site where he advocates that very prescription.

The problem is how to develop modern capitalism in a pre-capitalist or semi-capitalist country when the world market is already dominated by modern capitalist countries.

The clear answer is extensive protectionism for the fledging industries of the semi-capitalist country until they are strong enough to effectively compete with the already developed countries.

It's what countries like Japan, South Korea, and Taiwan did. It's what Russia and China did (only they called it "socialism"). And it's what the United States did back in the 19th century to break the hegemony of British imperialism.

If you wait for foreign direct investment to "develop" your country, you'll wait forever. Look at Africa! :(

FDI in undeveloped countries is interested in "a quick profit" and a safe departure. It's barely one step above outright "loot & plunder". Profits are almost never re-invested in the subject country and a modern infra-structure is built only to facilitate the rapid extraction of mineral wealth.

The investing corporation is often larger than the entire GDP of the subject country; making the price of local politicians a matter of petty cash...further facilitating the un-taxed repatriation of profits.

Countries like Nigeria or Angola have produced enough mineral wealth that they should be at least as advanced as Portugal or Poland by now...instead, most of the people there are barely into the middle ages!

What happened to all the money? :o

Most of it went and is still going to foreign capitalists and the balance was and is still being stolen by local politicians.

Places like that will never develop modern capitalism until they expel the foreign corporations, hang all their corrupt politicians, and use their profits from mineral extraction to build up a modern infra-structure and a modern economy.

It might take a while for that to happen...but "a while" is better than never.

http://www.websmileys.com/sm/cool/123.gif

[Publius]

The problem is how to develop modern capitalism in a pre-capitalist or semi-capitalist country when the world market is already dominated by modern capitalist countries.

The clear answer is extensive protectionism for the fledging industries of the semi-capitalist country until they are strong enough to effectively compete with the already developed countries.

I would say that's a very narrow view of what actually happend.

I'm not denying that protecionism helped their industries grow, but I would hardly call it 'extremist'.

What allowed this Asian countries to grow was their tarrif policy working in concert with their investment policy.

They got foreign money to use to grow their economy.

Tarrifs, without sufficient investment, are useless and actually detrimintal.



It's what countries like Japan, South Korea, and Taiwan did. It's what Russia and China did (only they called it "socialism"). And it's what the United States did back in the 19th century to break the hegemony of British imperialism.

But 'capitalist' countries kept their tarrifs low to moderate (And since all capitalist countries had tarrifs around the same rates, their effects could be said to be counterbalancing) and were not resistant to open trade.

That's the key.

You protect a few vital industries but you don't shut out foreigner investments.

I read a fabulous book on this very subject entitled The Commanding Heights: The Battle for the World Economy.

I'm not sure how you'd take it, as it's rather 'neo-liberal' in its views, but it accurately details why these countries grew.

This passage is espescially good:
Chief among the common threads was a resolute choice to grow the domeestic economy by harnessing it to exports--and thus committing to the rigors of international competition. Yet while the countries of the region have "competed out," they have slo "pretected in"--insulating their domestic econnomies, to one degree or another, from foreign compeitition. THe entire edifice was built, to varying degrees, on regulation or coercion, in policical as well as economic life.



If you wait for foreign direct investment to "develop" your country, you'll wait forever. Look at Africa! :(

Yes, look at Africa's insanely high tarrif rates. Look at what dependency theory and 'African Socialism' did to Africa.

Africans didn't want Western investment for a number of yeas. It was 'colonialism'.

For example: Ghana, and its turn to socialism: "Capitalism is too complicated a system for a newly independant nation"

Sounds a little like what you were saying?

Would you consider yourself a dependency theorist?



FDI in undeveloped countries is interested in "a quick profit" and a safe departure. It's barely one step above outright "loot & plunder". Profits are almost never re-invested in the subject country and a modern infra-structure is built only to facilitate the rapid extraction of mineral wealth.

Not if what they're seeking is cheap labor.

Africa could have real investment if it had a labor force to speak of.

It doesn't.



The investing corporation is often larger than the entire GDP of the subject country; making the price of local politicians a matter of petty cash...further facilitating the un-taxed repatriation of profits.

Well, depending on the country, it may be utterly impossible to do business without bribes.

Look at Hernando de Soto's book The Mystery of Capital for an excellent discussion on this topic.



Countries like Nigeria or Angola have produced enough mineral wealth that they should be at least as advanced as Portugal or Poland by now...instead, most of the people there are barely into the middle ages!

They have no native industry, no talented labor force, no decent governance.

Foreign investment is the least of their problems.



What happened to all the money? :o

Most of it went and is still going to foreign capitalists and the balance was and is still being stolen by local politicians.

This is correct.

But the remedy isn't 'erect tarrifs'. Those will just be exploited by the cronies as well.



Places like that will never develop modern capitalism until they expel the foreign corporations, hang all their corrupt politicians, and use their profits from mineral extraction to build up a modern infra-structure and a modern economy.

Where are they going to get the money to do this once they expell the foreign money? Will it into existence?

Why not just do what the Asian countries did and use the foreign wealth, via competent, GOOD, goverance and economic policy.



It might take a while for that to happen...but "a while" is better than never.

They tried it in the 60s, the 70s and the 80s. It didn't work then and it won't work now.

[Tungsten]

Pubilus

Yes, look at Africa's insanely high tarrif rates. Look at what dependency theory and 'African Socialism' did to Africa.
Also: who's going to be stupid enough to invest in countries where military coup d'etats are a monthly occurence and where land/property seizure policies like the ones in Zimbabwe are common.

[cormacobear]

I've never heard it called "fair Trade" , NAFTA styands for North American FREE Trade Agreement.

Fair Trade is an effort by leftist networks to build shops in urban centers where products from third world countries can be bought with the specific assurance that the producer received their fair commission.

Engels was all for free trade believing ending the tariffs would speed up the working classes global identity. If free trade agreements included reasonable deadlines for both countries to reach high standards with regaurd to wages, working hours, Safety and conditions, they would be slower in changing the flow of trade but would have a far less detrimental effect on both societies involved. But that is unlikely to ever occur since the real purpose of "Free Trade Agreements is to lower working conditions and labour costs, without changing the direction of the flow of profits.

[redstar2000]

Originally posted by The Commanding Heights+--> (The Commanding Heights)Chief among the common threads was a resolute choice to grow the domestic economy by harnessing it to exports--and thus committing to the rigors of international competition. Yet while the countries of the region have "competed out," they have also "protected in"--insulating their domestic economies, to one degree or another, from foreign competition. The entire edifice was built, to varying degrees, on regulation or coercion, in political as well as economic life.[/b]

I don't have a big problem with this...the question is "when and how" to enter the world market. If you enter as a supplier of cheap mineral resources exploited by foreign corporations, you're just going to get fucked...that is, remain in the mire forever.

If you nationalize those resources and extract them yourself and if you use your profits to build roads and schools and all the fundamental things required for a modern economy, then you can deal with foreign corporations on a much more equal level. FDI arrives on your terms, not theirs.

I agree with the author's emphasis on coercion and regulation...it almost universally accompanies the rise of modern capitalism. Napoleon III in France, the Prussian despotism in Germany, and, for that matter, Stalin and Mao. Even "democratic" England denied the vote to most working people during its period of initial industrialization. South Korea and Taiwan were despotisms...as was Japan before World War II.

The U.S. may be the only historical example of modern capitalism developing without the "scaffolding" of despotism.

This may have been due to a "sorting effect"...that is, a huge number of immigrants from Europe who came here to make a "better life" for themselves and their families.

I think it's been suggested elsewhere that immigrants are an economic "plus" for the destination country...because they tend to be more purposeful and energetic than the "stay-at-homes". Even possibly "more intelligent"...though that's a more controversial proposition.

Africa has had plenty of despotisms...but none that were motivated to actually develop their economies (other than as bribe-generating devices). It's almost as if the main lesson that Africa learned from the colonial period is that "power = the opportunity to steal".

I don't think, by the way, that you should take any of the rhetoric about "African socialism" seriously at all. They had no Leninism or Stalinism or Maoism...otherwise they'd be developed.

And while African politicians did sometimes exclude foreign investment, they readily yielded to the seductions of the World Bank and the International Monetary Fund...contracting enormous loans to "build infrastructure".

Usually modern airports. :lol:

Most of the money was probably spent on weaponry, palaces for the rulers, and, at best, perhaps a rudimentary power system for the capital city.


Originally posted by [email protected]
Not if what they're seeking is cheap labor.

It's certainly possible that Africa could be "the next sweatshop frontier" as wages rise in the Asian region.

But that would require a serious despotism more concerned with economic development than with stealing...and that does not seem to be on the horizon there.

Africa needs "Maoism" or something like it...to stop the fratricidal bullshit and get things moving.

Or, possibly, a South African "empire" that would stomp on all the ethnic competitions for loot and plunder and impose some kind of coherent plan for the economic development of sub-Saharan Africa.

But South Africa itself seems to be still predominately neo-colonial...its mineral wealth is still in the hands of old British capitalists.

As much as I extol the usefulness of historical materialism, even that marvelous tool seems inadequate in the face of "what's going to happen" in Africa.


Tungsten
Also: who's going to be stupid enough to invest in countries where military coup d'etats are a monthly occurrence and where land/property seizure policies like the ones in Zimbabwe are common?

Curiously enough, the Chinese capitalists have expressed interest in both east and west Africa. Thus far, they've limited their inquiries to the possibility of purchasing or leasing potential oil tracts.

But it might be that the Chinese -- being a younger and more vigorous capitalist class than ours -- are willing to "take risks" that our ruling class is no longer capable of.

Watch and see if the Chinese build an actual working factory in some sub-Saharan African country...then we'll have a better idea of what's going to happen there.

http://www.websmileys.com/sm/cool/123.gif

[Amusing Scrotum]

Originally posted by [email protected] 19 2006, 05:53 PM
The U.S. may be the only historical example of modern capitalism developing without the "scaffolding" of despotism.

The strike-breaking was pretty legendary though.

Plus, Modern Capitalism in America developed under segregation and I thought voting rights were restricted just as much as in Britain?

[ComradeOm]

Originally posted by [email protected] 19 2006, 04:40 PM
Also: who's going to be stupid enough to invest in countries where military coup d'etats are a monthly occurence and where land/property seizure policies like the ones in Zimbabwe are common.
Western capitalists have been investing in Africa for centuries. Who do you think bankrolled most of those coups during the last century? Sponsor the right colonel and suddenly you have access to a nation worth of raw materials.

[Publius]

I don't have a big problem with this...the question is "when and how" to enter the world market. If you enter as a supplier of cheap mineral resources exploited by foreign corporations, you're just going to get fucked...that is, remain in the mire forever.

If you nationalize those resources and extract them yourself and if you use your profits to build roads and schools and all the fundamental things required for a modern economy, then you can deal with foreign corporations on a much more equal level. FDI arrives on your terms, not theirs.

I agree with the author's emphasis on coercion and regulation...it almost universally accompanies the rise of modern capitalism. Napoleon III in France, the Prussian despotism in Germany, and, for that matter, Stalin and Mao. Even "democratic" England denied the vote to most working people during its period of initial industrialization. South Korea and Taiwan were despotisms...as was Japan before World War II.

The U.S. may be the only historical example of modern capitalism developing without the "scaffolding" of despotism.

This may have been due to a "sorting effect"...that is, a huge number of immigrants from Europe who came here to make a "better life" for themselves and their families.

I think it's been suggested elsewhere that immigrants are an economic "plus" for the destination country...because they tend to be more purposeful and energetic than the "stay-at-homes". Even possibly "more intelligent"...though that's a more controversial proposition.

Africa has had plenty of despotisms...but none that were motivated to actually develop their economies (other than as bribe-generating devices). It's almost as if the main lesson that Africa learned from the colonial period is that "power = the opportunity to steal".

I don't think, by the way, that you should take any of the rhetoric about "African socialism" seriously at all. They had no Leninism or Stalinism or Maoism...otherwise they'd be developed.

They had a little 'Leninism' and a little more 'Cronyism'.



And while African politicians did sometimes exclude foreign investment, they readily yielded to the seductions of the World Bank and the International Monetary Fund...contracting enormous loans to "build infrastructure".

Usually modern airports. :lol:

Corruption is very difficult to account for.


It's certainly possible that Africa could be "the next sweatshop frontier" as wages rise in the Asian region.

But that would require a serious despotism more concerned with economic development than with stealing...and that does not seem to be on the horizon there.

Africa needs "Maoism" or something like it...to stop the fratricidal bullshit and get things moving.

'Maoism' eh?

I guess Africa could use a A Great Leap Forward, couldn't it?



Or, possibly, a South African "empire" that would stomp on all the ethnic competitions for loot and plunder and impose some kind of coherent plan for the economic development of sub-Saharan Africa.

Either that or just kill them all and steal their shit.



But South Africa itself seems to be still predominately neo-colonial...its mineral wealth is still in the hands of old British capitalists.

As much as I extol the usefulness of historical materialism, even that marvelous tool seems inadequate in the face of "what's going to happen" in Africa.


Most of the money was probably spent on weaponry, palaces for the rulers, and, at best, perhaps a rudimentary power system for the capital city.

Pretty much.