Dave's ESL Cafe's Student Discussion Forums

[Thom]

The trade talks have come and gone and whilst the new grouping of China/India/Brazil did not make the waves that were predicted, this round of talks has already produced a US climbdown on generic drugs. A sign we hope that the winds of change are blowing for the economic neo-imperialists just as they did for the political imperialists almost fifty years ago.

Previously, the governments of G8 nations (particularly as always the USA) have used their power over developing nations to further the big business interests to which they are beholden. Finally, the balance of power is starting to shift and long may it last.

If China, India, Brazil and other rapidly developing nations can contimue to work together then they can use their new-found power to overturn decades of crippling trade rules thst have made milions for western businessen at the cost of poverty for billions in the developing world.

Having won the fight to put lives before profit and legalise generic drugs, the next step must be an attack on farming subsidies. The neo-liberal governemts of the west particularly the US and Britain have long espoused free trade, calling for an end to protective tariffs and subsidies, but despite forcing these rules on developing countries they have continued to protect their own industries with subsidies and so billions of poverty stricken farmers find that the price of their crops has fallen so low due to grain, milk and butter mountains of the EU that they are no longer able to make a living.

Politicaly, I fear a resurgent China and I doubt that it's growing power will act as a restraint on the neo-cons in the white house but if the flipside of a developing cold war accross the pacific is a better quality of life for he majority of the world's population then I find it hard not to smile at the thought. All power to the Chinese.
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[Diana]

That's interesting. But don't you think that the US companies have something to do with the growth in business in China and India? I've read a few articles which is causing great concern among the American people about big businesses being outsourced in the country. It seems that many American business (especially businesses in computers and other high technical jobs) are now leaving the US and going to places such as China and India due to the low costs. Many Americans are now concern that the job markets, which many unemployed Americans need, are being created outside of the US as American businesses move to low cost areas in China and India.

http://www.pbs.org/now/politics/jobflight.html

[Corey]

[Thom]

Yes, I'm from the UK and I live in a farming area so I know plenty of people doing very well off of the subsidies. However, just because I live in the UK and EU doesnt mean that I support all of their actions. It is logical to call individual citizens to account for their governments actions if they live in a democracy (i.e. the people direct policy) but when the British government goes to war against the wishes of over 70% of the population, (and the Spanish and Italians against the wishes of close to 90% of their populations) then I think it becomes possible to question how democratic Britain and the EU really are. Did I get any say in whether my peers were sent to Iraq? No. Do I have any say on EU trade policy? No. I vote, but nobody listens.

As for Chinese Communists and Indian socialists, both nations are signed up members of the WTO and unlike the US and EU countries, they have legislated in line with it's neo-liberal policies. I know from personal experience that whilst China may be politicaly communist, it's economic policies are resolutely neo-liberal capitalist with falling trade barriers and rapid privatisation. As Diana pointed out, there is increasing multinational investment in these two countries and this year, China has become the single greatest recipient of international investment as multinationals look to exploit the disposable income of it's growing middle class.

The European CAP is a fifty year old policy which no longer makes economic sense even for Europe's economy. People in the UK moan about the tax burden imposed by EU membership and a lot of them do not realise that over half of the EU's budget is spent on these farm subsidies. It costs EU taxpayers 1.5 billion euros a day just to store all the excess food we are producing. The only reason it is not scrapped is that in key EU states (particularly France), the support of farmers who are such great benificiaries of the subsidies is crucial to election success. Chirac recently blocked a move led by Blair to reform the CAP precisely because he needs the farmers' support to stay in power.

What then happens has a far worse impact than boosting my taxes. The grain, milk etc is dumped on third world markets and as any half competant economist will tell you, a massive increase in supply reduces prices. What this means is that farmers in the third world find that the price they get for their crops has fallen through the floor and they can no longer support themselves and their families.

I have seen this myself when I lived in China and friends of mine have noticed the same phenomenon in sub-saharan africa and central america. First the familiess sons and then more and more of it's members move to the city in order to make some money and support the others. But even in rapidly industrialising countries like China (Shenzhen in my case) there are nothing like enough jobs. The farmers I mentioned become beggers in the street, their sons the men who mug you in broad daylight and their daughters the prostitutes visible on the streets of every city I visited. All live in squalid conditions, often in shanty towns or on the street.

The tradegy of their situation aside, what makes my blood boil is the pure hypocricy. Big business interests based in G8 nations, through their control of the IMF, force developing countries to abide by trade rules which prohibit subsidies and protective tariffs. The G8 countries (particularly the EU) maintain their protective tariffs and subsidies in spite the fact that trade rules they have written ban them. Bush may sound off regularly about Free trade but he boosted protective tariffs on steel and maintains agricultural subsidies. The sooner developing nations have the power to challenge this double standard the better.

Before I sign off, here's a quick quote from Oxfam's most recent report on Fair Trade. Bear in mind that these tariff costs come on top of the damage from subsidies:

[pugachevV]

Why should obelix not answer?
Presumably because he's an educated man and knows socialist claptrap when he sees it?
I think Tom, you should not read the Guardian when you've been to the pub.

[wing]

Well, as a matter of fact the blood brothers would not like to do as they are supposed to based on free trade agreements.
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[Corey]

Well Thom,

It looks like we are closer in opinion than I though. There is little question that agro-subsidies are harmful to consumers and producers. Without knowing the exact stats I would say that many staple foods are severely underpriced for farmers, while consumers in closed countries as mentioned generally heavy price - I'm thinking of Zimbabwe here.

China and India may be open now but there are still many third-world countries where agro-protection makes life expensive.
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[Thom]

I was joking about Obelix. Just making the point that we never agree on anything. Much like you and I pug.

As for socialist claptrap, maybe it's you spending too much time in the pub pugachev. Free trade is pure capitalism, nothing less. It's what the WTO, the IMF, and at least publically, the U S of A all advocate. The maintaining of subsidies and protective tariffs is at best Keynesian (and thus seventy years out of date) at worst neo-socialist. And we all know how fantastically well socialist economic policies work. I think not.

I thought you were an educated (if somewhat m