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“Free” Trade: Undermining Defense, Sovereignty, and the American Job Market
Nothing To Do with Either Freedom or Trade
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A powerful conglomerate consisting of Wall Street moguls, multi-national corporate elites, and political insiders — the one percent cabal as some call them — are mounting an assault on the American economy, endangering national defense, and subverting U.S. sovereignty. Their weaponry includes so-called “free trade” treaties like the North American Free Trade Agreement (NAFTA) — the godfather of subsequent deals — and the establishment of regulatory agencies such as the World Trade Organization (WTO) and the General Agreement on Tariffs and Trade (GATT).

That’s a mouthful of allegations, but let me address each charge. First, the once percent cabal.

Paul Craig Roberts was the Assistant Treasury Secretary in Ronald Reagan’s cabinet. He’s written eight books and his articles appear in leading publications like The New York Times, BusinessWeek, and the Wall Street Journal. He knows his stuff. Roberts concisely defines the power elites:

“The U.S. now resembles an oligarchy of private interests. The most powerful ones are Wall Street, AIPAC (the American Israel Public Affairs Committee), the military/security complex, the oil industry, agri-business, insurance and pharmaceuticals. These private interests control economic and foreign policy, write the legislation that Congress passes and the President signs, and have achieved the monopolization of the U.S. economy by large-scale commercial organizations. As far as I can tell, traditional conservatives scarcely exist in the U.S. today. They have been eliminated by the neoconservatives, essentially militarists committed to U.S. world hegemony.”

Now let’s get to the real deal of “free trade” vs. American sovereignty.

Free trade treaties have nothing to do with free or fair trade: they are managed commerce arrangements. The NAFTA pact (January 1st marked its 20th birthday) had over a thousand pages of fine print — it was filled with favors and exceptions for special interests, while imposing obligations and restrictions on the beleaguered American manufacturing sector. Free trade deals pose a threat to national sovereignty by ceding trading controls and accountability to such international agencies as the World Trade Organization. Pundit Patrick Buchanan has noted, “The WTO elevates trade to the highest good. It is trade uber alles. Trade trumps the environment. Trade trumps human rights. It trumps the security of countries. It trumps the sovereignty of countries. It should never have been created.”

The fine print contained in the investment chapters of free trade deals grant foreign corporations property rights that are nonexistent under U.S. constitutional law. These rights enable corporations to drag the U.S. before international tribunals, and to seek money to compensate for the costs of complying with “free trade” regulations (an oxymoron) that protect their self interests. During the debate over the Korea free trade pact, the International Brotherhood of Teamsters President Jim Hoffa issued this statement: “One of the real dangers of this deal is that it gives South Korean multinationals new rights to challenge U.S. laws. Why should a foreign company or investor have more power in this country than our own small businesses?”

When this writer interviewed Ian Fletcher, author of Free Trade Doesn’t Work: What Should Replace it and Why, he referenced the recent Korea free trade deal as an example of how international courts can overrule U.S. jurisdictions: “Korean corporations can take any dispute with federal or state laws, regulations, or rules to the WTO. There are over a two hundred corporate affiliates of Korean firms in the U.S. that can obtain these new rights under the free trade agreement to challenge local, state and national laws.”

Congressmen Ron Paul (R-TX) and Walter Jones (R-NC) wrote a letter to their House colleagues stating: “Free trade theorists such as Adam Smith and David Ricardo must be rolling in their graves to see pacts like President Obama’s Korea Agreement called ‘free trade.’ It includes endless pages of rules and regulations enforced by foreign tribunals. This act is a sneaky form of international preemption, undermining the critical checks and balances and freedoms established by the U.S. Constitution’s reservation of many rights to the people or state governments.”

An example of how free trade pacts can widen national security cracks in foreign policy can be found in the recent deal with South Korea as well. The Associated Press called the Korea Free Trade Agreement (KFTA) “the largest U.S. trade deal since the 1994 North American Free Trade Agreement.” As usual, the mammoth 1,000-plus page Korea deal micro-manages U.S. trade from the age of cows to the size of auto engines.

Yet when the Korean free trade pact came under scrutiny, this shocking news came to light: U.S. tax dollars will actually flow into North Korea via its Kaesong Industrial Complex — a “free trade” haven for sweatshops where South Korean firms employ some 44,000 North Koreans for wages of about 38 cents an hour (their autoworker counterparts in South Korea earn $23.30 an hour). North Korean-manufactured automobile parts can be built into South Korean cars sold in the U.S. The KFTA deal allows up to 65% of these auto parts to be purchased from North Korea — then shipped here duty-free (see the Huffington Post article, “Korea Trade Agreement Would Subsidize North Korea Government,” for details).

Although N. Gregory Mankiw, chairman of President George W. Bush’s Council of Economic Advisors thinks that “outsourcing is just a new way of doing international trade,” the National Defense Magazine has observed, “Politicians and labor unions demand that the Defense Department buy American when, in fact, the reliance on foreign suppliers has increased sharply in the last decade and is likely to do so even more in the future … The use of foreign suppliers and concern about the decline of the U.S. defense industrial base has been on the radar among some for years.”

Uncle Sam just can’t learn new tricks. Now we’re negotiating the Trans-Pacific Partnership (TPP) – a deal that sets rules on non-trade issues such as food safety, internet freedom, medicine costs, financial regulation, and the environment. TPP binding regulations would require the U.S., Australia, Brunei, Canada, Chile, Japan, Malaysia, and other Asian nations to conform their domestic policies to its rules. This time, incredibly, it is being cobbled together in secret: 600 corporate “trade advisors” are withholding the text from Members of Congress, governors, state legislators, the press, and the public. In an appearance on the Bill Moyers program, Dean Baker, co-director of the Center for Economic and Policy Research stated, “This really is a deal that’s being negotiated by corporations for corporations and any benefit it provides to the bulk of the population of this country will be purely incidental.” Yves Smith, an investment banking expert who runs the Naked Capitalism blog added: “There would be no reason to keep it so secret if it was in the interest of the public.”

William Greider, author of Secrets of the Temple: How the Federal Reserve Runs the Country and One World Ready or Not: The Manic Logic of Global Capitalism, sums up the free trade scam this way: “The great, unreported story in globalization is about power, not ideology. It’s about how finance and business regularly, continuously insert their own self-interested deals and exceptions into rules and agreements that are then announced to the public as ‘free trade.’”


Peter B. Gemma has been published in a variety of venues including USA Today (where more than 100 of his commentaries have appeared), Military History, the, The Washington Examiner, and the

• Category: Economics, Foreign Policy • Tags: Free Trade 
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  1. Mike says: • Website

    I wish we could put this piece into the hands of every member of Congress. Seems every group has the right to defend its interests these days except the Middle Class.

  2. Anonymous • Disclaimer says: • Website


    People from; the left, right, and center, cry out, “Take Back America.”

    The only way to take back our country is to do as our forefathers did in 1776, start a revolution against the powers that be.

    We don’t want a violent revolution but we the people of America must revolt if we want to take back our government from the two party, Democrat-Republican oligarchy, now in power.

    Imagine a government controlled not by political parties controlled by special interest and Wall Street but by parties controlled by the people and Main Street. The government might start representing the American people instead of the people at Goldman Sacks, Bank of America and, Koch Industries.

    Imagine what would happen if all conservatives supported the Constitution Party, all progressives supported the Green Party and all libertarians supported the Libertarian Party. We would have three major parties in the United States, the Democrat and Republican parties would no longer dominate the American political system and we would have some honest debate on the issues facing the American people. We would have no one party majority rule or two party divided government, one the the three parties would always command the balance of power to break any gridlock.

    We no longer live under a government by the consent of the governed but an oligarchy ruled by corporate interest and other big money contributors.

    The first words of our constitution read, “We the People of the United States,” not we the corporations and elites of the United States. Clearly the founding fathers intended ours to be a government, of, by and for the people.

    The time has come to say, “No More,”

    The founding fathers did leave, we the people, the power to take back our government and the ultimate weapon to peacefully do so, with the ballot not the bullet. We do have a vote in the governance of our republic.

    The Democrats tell the progressives, “don’t support the Green Party, you will divide the vote of the Democrat Party.”

    The Republicans tell the conservatives and libertarians, “don’t support the Constitution Party or the Libertarian Party, you will divide the vote of the Republican Party.”

    And the true conservatives, libertarians and progressives fall for this argument and we end up with a Democrat-Republican Party dictatorship controlling our government, not in the interest of, we the people, but in the interest of those who pay for their campaigns.

    Stop doing the same thing over and over again and expecting a different result.

    Divide and conquer.

    Yes, supporting the Constitution, Green and Libertarian parties divides the Democrat and Republican parties and that’s a good thing. Supporting the Democrat and Republican parties over and over again is insanity. Divide the Democrat and Republican parties and then divide them again until they are no more.

    The Democrats and Republicans no longer represent the American people and therefore must be replaced. End the two party dictatorship and take back America. Under no circumstances support political parties that don’t represent, “We the people.” Don’t give aid and comfort to the Democrats and Republicans. Don’t collaborate with the parties who our corrupting our political system.

    Revolt and take back America.

    Let the Second American Revolution begin.

    Bob Haran,
    Constitution Party of Arizona.

    I have no copyright of this, anyone can use it, improve it or take credit for it, my only request is that they do it, it is the only way I know to peacefully take back America.

  3. Anonymous • Disclaimer says:

    As for the lawyers, they will always be filing lawsuits, it is what they do. As for international trade, the more the better. Anything we can do to eliminate barriers to trade will make all our lives better.

  4. @ Benji

    “Anything we can do to eliminate barriers to trade will make all our lives better.”

    Are you familiar with the concept of labor arbitrage? If so, don’t know why you think that. There are certainly powerful arguments for free trade but the notion that it will “make all our lives better” is not one of them.

  5. The same globalists that want ‘Free Trade’ also want open borders, and an endless supply of cheap compliant labor that has no connections to the nation state and will be more easily duped and led.

  6. […] 2014/01/23: UNZ: “Free” Trade: Undermining Defense, Sovereignty, and the American Job Ma… […]

  7. Anonymous • Disclaimer says: • Website

    “Free” Trade: Undermining Defense, Sovereignty, and the American Job Market – The Unz Review

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