Latin American Dopers: Are you for or against FTAA?

[BrainGlutton]

Posted by Ale:

As to what this particular Uruguayan thinks, the FTAA should not be implemented until the matter of the USA subsides is settled once and for all; it´s totally unfair not only for an economic point of view but also for a moral standpoint… looks accusingly to the right and that goes to Europe too, just to show that I´m even handed.

Posted by Rashak Mani:

I venture he is talking of agricultural subsidies… which the europeans take even further than the US.

Well, I don’t see how the question of agricultural subsidies ever could be settled “once and for all,” in the U.S. or any other country! Unless there was some fundamental change in the technology and economics of farming that allowed most or all farms to run at a profit, all the time, regardless of market prices for their products, and made the question of subsidies irrelevant.

[mamm]

*Originally posted by esquimalt *
**One more question out of curiosity. In YHO what was the US Empires finiest hour? **

esquimalt, IMHO the US empire finest hour was Clinton’s administration. Pujant US economy, foreign policies that effectively helped other countries (and, as a side effect, lowered a lot of the “hate America” feeling across the world), etc. The US was much better then than in any other time in history.

[esquimalt]

Mamm

But during the Clinton years US had a pretty good trade surplus with Brazil. Since Bush, US has had a rapidly growing trade deficit with Brazil. Isn’t this a better foreign policy for Brazil? If a democrat is elected the next president I think you can expect the trade balances to go the other way.

If our empire is built on foreign policy this decline won’t last too long because it changes every 4 - 8 years.

[mamm]

esquimalt, the US’ surplus (regarding Brazil) during Clinton years can be explained mostly by an internal factor of Brazil: the Brazilian government was actively manipulating (lowering) the dollar value here in Brazil (for a number of economical reasons).

During that period, the dollar was almost on par (1:1 ratio) with the “real” (our currency here). So, Brazilian companies didn’t have all that incentive to export to the US as they have today (with an 2.85:1 real/dollar ratio).

Today’s situation, with the market freely determining the dollar value here (as it should be), we have a more representative picture of what Brazil/US trade really can be.

[Rashak_Mani]

Just to “correct” somethings mamm said about FTAA/ALCA discussion in Brazil. Ideology is pending heavily in the issue for sure… and some of the loudest anti-FTAA are heavily biased to the US. This shouting is overwhelming the voices of people who oppose the current state of the FTAA for good and balanced reasons. Its not black and white division he put…

So even if we do have a surplus of commerce with the US why should we accept something that sets unbalanced new rules ? Negotiations of the FTAA should be beneficial to all parties involved... the way the FTAA is now... its bad for Brazil and too good for the US. Therefore the shouting about "imperialism". Plus the fact that the mexican economy is not seen as having benefitted much from NAFTA. Their economy is supposedely unbalanced and directed only at supplying the US giant. (if this is true or not... its another matter).

The US does have a tradition of making certain products a bit harder to enter the market... plus those orange and steel tariffs Bush established. Bush is not seen as a free market fan.

In the end it hard for any open commerce agreement. The pitfalls are more easily seen than the benefits. So “inertia” towards rejecting FTAA is “natural”. While making bad deals with much stronger countries seems less so. FTAA covers certain areas that influence Government too.

[esquimalt]

The US is going through what people are calling a “Jobless recovery” of the economy. Some of this is probably due to the tech bubble that burst in the late 90’s but I have also heard many people talk about the trade imbalance as a major factor. I believe it is around 400 billion $. I think this will be an issue next year in the elections with stronger calls for tougher trade agreements especially from the Democrats. The labor unions are more likely to be for decreased imports.

Rashak - I know you are no fan or GWB but Clinton also imposed tarrifs on steel from Brazil & Japan in 1990.

Those certain areas that influence government like labor policies and the environment are proposals by the Democrats.

http://www.csis.org/americas/pubs/weintraubnewsletters010100.html

Republicans are in bed with the big corporations that do not want import restrictions.

[mamm]

Rashak, I agree with you 100% that the subject is not black & white. There are a lot of grey areas (as everything in life, BTW). I was just trying to resume the subject in two or three paragraphs (unsuccessfully, as it seems).

But what is certainly true is that Brazil’s groups of negotiators (Itamaraty) is heavily divided between those that want to negotiate a better Alca and those that don’t want Brazil to adhere to Alca in any number, shape or form. Unfortunately, this second groups is not just a novelty; they are numerous and they have people in key positions.

[Ale]

*Originally posted by BrainGlutton *
**Let’s try to stay on-topic. Would FTAA/ALCA be good or bad for the people of Latin America?

Posted by Ale:
quote:

As to what this particular Uruguayan thinks, the FTAA should not be implemented until the matter of the USA subsides is settled once and for all; it´s totally unfair not only for an economic point of view but also for a moral standpoint… looks accusingly to the right and that goes to Europe too, just to show that I´m even handed.

---

What particular USA subsidies are you talking about? And what’s Europe got to do with it? **

For example COTTON SUBSIDIES

Armed with roughly $3.4 billion in subsidy checks, U.S. farmers last year harvested a record crop of 9.74 billion pounds of cotton , aggravating a U.S. glut and pushing prices far below the break-even price of most growers around the world. This year, U.S. cotton farmers are expecting to pocket even more, thanks to the $118 billion, six-year farm bill signed by President Bush in May.
Delta cotton farmers could grow corn, soybeans and wheat much more cheaply, but switching would render much of their investment worthless. “I can only run cotton through my cotton picker,” says Ed Hester, leaning on the hood of his Chevy pickup truck as a crop duster circles on the horizon.

And there is little incentive for the 71-year-old Mr. Hester to change. His 4,200-acre farm in Benoit, Miss., received roughly $400,000 in subsidies last year. “Cotton is still king in my book,” says Mr. Hester.

In the Niger River Delta, Mr. Sangare gasps at tales of the wealth of fellow cotton growers on the other side of the world. “I don’t know if we will be able to afford a new plow blade this year,” he says, chewing on a tree root, which serves as a toothbrush.

Or RICE SUBSIDIES hurting the South American producers forced to sell at artificially lowered prices.

For example

According to this measure, rice is the most heavily subsidized crop, receiving 5 percent of U.S. subsidies but contributing only 0.7 percent of the value of U.S. agricultural production. Cotton is next, with a 13 percent share of subsidies and a 2 percent share of value.

(for some reason I can´t open the PDF with the figures in that article)

Regarding the unfairness of subsidized (I spelled that right? ) .LINK

The farmers of the developing countries cannot compete with those of the US because their governments do not have the capacity to provide subsidies to nullify the incidence of fixed costs. Free trade is unfree because the US farmer has to bear only the variable costs while the farmer of a developing country has to bear both variable and fixed costs. The US strategy is to agree to phase out Amber Box subsidies. But by continuing to provide huge Blue and Green Box subsidies it can still dominate the world food markets and make the developing countries dependent for their food requirements on the US.

As to what does Europe has to do with it, I don´t think there´s collusion here,my point was that Europe agricultural subsidies are high too

[Sergio]

Since we are talking about subsidies, I remember having seen an interview with a South American politician (I think he was Peruvian) some years ago, about the erradication of the culture of coca in his country and its substitution for another culture. According to him, if a farmer plants corn or beans he will not be able to sell it in the international market, since the subsidies of the richer nations makes his product uncompetitive.
So he plants coca, for which no rich country subsidizes its producers.
Don’t ask me to cite! I have seen it on TV many years ago, but it makes a lot of sense.

[Rashak_Mani]

… plus there is huge demand for cocaine in America… so supply kicks in to cover that huge snorting demand.

Its hypocritical to fight the drug war in south america before trying it back home. Especially since the US is prosperous enough to support such high numbers of cocaine users.