Posted on 11/26/2002 6:21:19 AM PST by nypokerface
The US government is expected to announce bold new proposals to expand free trade later on Tuesday. The plan would lead to the elimination of all tariffs on industrial and consumer goods by 2015 in an attempt to jump-start global trade talks.
"A world of no trade and tariff barriers is the north star," Paul O'Neill, the US Treasury Secretary told business leaders in the UK, ahead of the official announcement.
Mr O'Neill said that world economic output would increase by $2 trillion (£1,3,00bn) if all trade barriers were removed.
"There's a very important reason to do it, the whole world will be better for it," he said.
The proposals will be put to the members of the World Trade Organisation (WTO) who are in the midst of talks aimed at lowering global trade barriers.
These talks, launched in Doha in the Gulf Arab state of Qatar one year ago, have stalled amid increasing signs of trade tension between the US and the rest of the world.
The US has imposed high tariffs on imported steel and passed legislation increasing subsidies to its farmers - both of which have angered developing countries.
Many analysts think the new proposal is designed to recapture the moral high ground, after a year in which the US commitment to free trade has come under question.
Deep cuts
However, some developing countries may have difficulties with the plans, especially in relation to their manufacturing sector.
Developing countries tend to have higher tariffs on manufacturing goods, so it will be easier for the US to meet the proposals than for poorer countries.
And the timing and speed of the cuts could pose a threat to the so-called "infant industries" in countries like Brazil and India, which have flourished behind tariff barriers.
The Brazilian car market, for example, would be thrown open to international competition.
But the US will vow to cut its high tariffs on textiles and clothing, an area of particular concern for developing countries.
Recently US manufacturers have begun lobbying for further restrictions on the import of clothing from China, despite the formal expiry of all quotas and tariffs on textile and clothing on 1 January 2005.
Poorer countries are also pressing for access to rich country markets for their agricultural products, but these are not included in the proposals.
The US, however, has already proposed the elimination of agricultural subsidies - a proposal certain to be opposed by the European Union and Japan.
Bold plan
According to press reports, the plan will include a reduction of high tariffs on non-agricultural products to a ceiling of 8% by 2010.
These would then be progressively cut to zero by 2015.
Existing tariffs of less than 5% would also be eliminated by no later than 2010.
And a parallel scheme to cut tariffs in many industrial sectors - such as chemicals, paper, wood and construction equipment - would also be tabled.
The plan parallels some of the US approaches to regional trade liberalisation.
For example, in negotiations with the Pacific Basin countries in Apec, the US hoped for the gradual elimination of all industrial trade barriers by 2015, with an earlier target for industrial countries.
Smaller developing countries may argue a delay in the full implementation of the proposals, just as they have already asked for the provisions of the trade agreement regarding intellectual property to be postponed.
Inconsistent policy?
Experts say the proposals are the boldest ever put out in the fifty year history of the post-war trading system.
They come at a time when the world trading system is under unprecedented strain - and when world trade is failing to grow for the first time in a generation.
The new boss of the World Trade Organisation has recently warned that the global trade talks may be running out of steam.
And there have been fears that the global talks would be supplanted by a series of regional and bilateral free trade deals.
The US has been pursuing regional and bilateral trade agreements in the past months, while China and Japan have both been making bilateral deals with other Asian countries.
The US has also been pushing its plans for a Free Trade Areas of the Americas, which would encompass all the countries from Alaska to Chile.
It could be why he's so gung-ho on establishing the Department of Homeland security.
Gotta be able to suppress the rebellion that'll start in our nation's ghettos when the economy goes kerput.
"Free Market Fundamentalism"????!!!!
Are you pulling my leg? So state levied Import/Export TAXES (you call them tariffs), designed merely to enhance or punish certain businesses are a conservative concept? Get real.
One need not be a globalist one world ICC supporter to believe in free markets. Sheesh.
Cmon, fox. Take Harbor Freight for example. I buy cheapcharlie tools there like oil cans for 50 cents. Do I buy real tools like impact sockets? No. I go buy expensive ones at Sears or Snap-On.
But if there's a cheap alternative where I can fill the rest of my shop with goods and make me more productive, while some union sap loses his job because he want's $37/hr to make 50c widgets, why is that a bad thing?
Exactly. Conservatives give the right to nations and people to raise barriers to protect their entrepriseses, and they give secondary treatment to priviledges such as the ability to go shoping easily.
You are entitled your beliefs, no matter how illogical they are. This is what the First Amendment is about. But Free Market Fundamentalism is not conservative - it is quite revolutionary. Freemarketeerism and Socialism are related and they feed one on another.
You are confusing this philosophic argument with pure logic. That would require an absolute truth, which is not possible to define between the continuum of conservatism and liberalism/leftist ideology.
If you are really serious, you will realize that I agree with you in the majority of your point about globalism.
All I wish to clarify is the semantic differences we have about a larger issue: conservatism.
In my mind, (As derived specifically from "The Conservative Mind" by Kirk) Conservatism is merely the respect for the traditions of the past that have brought us safely and prosperously to the present. The opposite is the arrogant adolescent liberal attitude that our ancestors were all idiots and that only today's "enlightened" minds have the wisdom to radically create some utopia that has never existed.
So, under that definition, I would agree that throughout history, taxes/tithes/tariffs have been imposed by wise governments as a restraining influence on runaway free trade. Continuing them could be considered a conservative philosophy. Radically dumping them ALL, TODAY in favor of unrestrained trade would be a liberal philosophy.
But I think with our Constitution in -competition- with other worldwide socialist/communist entities, like the EU and China, this is a cold trade war which has to be fought the way Reagan fought the USSR. When he put the US military spending complex up against their anti-freedom systems, we won, but it was a radical strategy. Now we are annexing former Soviet states into NATO. If the fruits of Ronald Reagan's policies are liberal globalism to you, then I'm afraid you can find no "conservatives" in American politics.
Meanwhile, it is possible that Bush could be successful in a radical reform that returns us to the earlier conservative landscape of free international trade that was admired by those folks at the Boston Tea Party and such.
I think it would be something like getting rid of state governments and putting all power into the federal gov't. Sound like a good idea? Think better government through granularity.
While we are at it, I would like to hear the comparative advantage kool-aid drinkers tell us if there are any industries at all where the US has a comparative advantage. Does national security ever fit into the picture? How about the general welfare of the nation? Do you seriously believe that Europe will accept the notion that we build better aircraft, so they should just deep six Airbus? Free trade is not about us, we have free trade. Free trade is about everyone else. They are not going to give up their sovereignty, so why should we?
And a final point, please show us where products are actually getting cheaper. What happened to all those cheap Japanese cars? The reality is that free trade allows compaines to drive down wages and increase profits. Not a bad idea unless you happen to be one of the many who have lost a job, or your livelihood now that you have to compete against the rest of the world for a job. If that is the kind of country you want to have then fine. Just don't bitch when the dems win seats with class-warfare rhetoric.
Romulan.
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