Deputy U.S. trade representative Karan Bahtia has told congress that it would be a bad idea to scrap the FTA agreement with South Korea.
-
English Books on Korea... and More!
-
Visit My Brother's Film Review Site
Just Say Yes
This entry was written by R. Elgin, posted on July 25, 2007 at 12:00 am, filed under Asides. Bookmark the permalink. Follow any comments here with the RSS feed for this post.
Post a comment or leave a trackback: Trackback URL.
6 Comments
Well you know, you can’t have free trade deal with a country that ‘throw trade-union leaders in jail’ (yeap, that’s a true quote).
http://www.theglobeandmail.com.....uery=korea
It’s a bad deal, as it doesn’t open Korea enough. Let it die, and try again — there’s time.
My thoughts are that it paved the way for the EU to pry this market open a little further (in areas like booze and cheese, which, let’s admit, would be great for us expats).
Although it should be called an “MTA,” as in “managed trade agreement,” it is progress. Good luck to the EU in making further progress.
Well, the FTA isn’t really “free” trade, but it’s freer trade, just like safe sex isn’t safe, it’s safer.
Anyways, in my undergrad studies I doubled in Economics and International Relations, wrote a 80 page senior honors thesis on the East Asian Economic Crisis (of 1998) and one of my International relations focus’ was in development. So I’ve looked at the issue in depth. I’ve come to the conclusion that neoclassical economic concepts that stress free trade for all nations, regardless of where they are at from a development perspective, is wrong. Economists from the states and many other western countries sometimes stick to neoclassical economics like it is religious dogma. Without knowing these countries or their unique circumstances all that well, they pound their fist in the pulpit declaring, “you need to open up your markets,” “make it a level playing field,” etc.
Why do we call neoclassical economics neoclassical? Because classical economics was heavily discredited during the Great Depression. Neoclassical is a rebranding, if you will, of classical economics. The advent of Keynesian economics told the economic establishment that they, like everyone else, needed to think outside of the box sometimes and rigid economic principles do not solve complex economic problems.
When it comes the the economies of non-Western and developing nations, there needs to be a new theory based on path dependence considerations and an apprectation of the Solow residual. Again, simple economic principles do not solve complex economic problems.
I think one of the biggest cases against free trade for a developing nation is this old NYT article about used clothes from Western countries flooding the clothing market of Africa and destroying any chance of Africa developing their own textile industry. A developed textile industry is key to establishing an industrial base and helping a nation go from light manufacturing to heavy manufacturing.
Article here: http://www.wright.edu/~tdung/T.....lothes.htm
Well, how does all this relate to Korea, the U.S. and the FTA? You know, in some respects Korea is still a developing country with a relatively new history of enjoying a descent per capita GDP. To get there, Korea is a nation that didn’t listen to a lot of advice from Western economists. They are suspicious of Western motives (as are many developing or recently developed nations).
Lastly, the FTA should not hang in the balance because of primarily just one interest group in the states (the autoworker’s unions). This is the most important trade agreement the U.S. has signed since NAFTA and affects far more people then autoworkers. To let them (and their affiliates in the Democratic party) determine the course of where this goes would be stupid and equal to any foreign policy blunder that Bush has committed.
The agreement seems to be a great deal for Korea. There is nothing in the deal that USA can not get elsewhere. Yes, Korea is a market, but there are many other emerging markets, better for the USA to walk away from a bad deal. The deal will benefit Korea and increase the US trade deficit. If the deal was bad for korea why do so many government and business people in korea promote it and many democrats in the usa oppose it.
Good grief, that old crutch again?
No, it should hang in the balance because of Korea’s capriciousness. It isn’t a trustworthy partner.