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Jewish World Review April 19, 2001 / 26 Nissan, 5761

Kevin Roderick

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Consumer Reports

The United States of the Americas? -- THE United States of the Americas?

Covering 34 nations from the Arctic to Argentina, the Free Trade Area of the Americas pact could make NAFTA seem provincial.

Perched above the St. Lawrence River and protected by stone battlements, historic Quebec historically has looked the part of an impenetrable fortress. Now, just to be sure, a new steel fence - 10 feet high and anchored in concrete - has been erected around the old walled city, right in time for this week's Summit of the Americas.

Vivid memories of 1999's "Battle in Seattle" haunt the hosts of the summit, a gathering of the Western Hemisphere's democratic heads of state, including President Bush on his second foray out of the country.

The precautions - Canada's largest peacetime security operation - are due as much to the focus of the summit, which begins Friday, as to its powerful attendees.

At the top of the agenda is the creation of the Free Trade Area of the Americas (FTAA), a massive expansion of the NAFTA free-trade zone. It's a topic that promises to create the biggest clash between advocates and opponents of globalization since the World Trade Organization meetings reduced downtown Seattle to a militarized zone 16 months ago.

The proposed FTAA is NAFTA on steroids - a mondo version of the 1993 agreement that christened a new era of less-restrictive trade among the U.S., Canada and Mexico. It would extend from the Arctic to the tip of Argentina, covering 34 nations and 800 million people with a combined gross domestic product exceeding $17 trillion.

That's a lot of new export markets and cheap labor for U.S companies to utilize, so it's no surprise that Cisco Systems, Ernst & Young and other corporations signed on as summit sponsors and will get coveted access to lobby the participants at private social events.

Outside the city fence, labor unions and activists of all stripes will stage daily protests, contending FTAA would give corporations the power to exploit low-paid workers as never before. It also would let them challenge national laws in secretive tribunals, a clause critics say threatens rain forests and other imperiled environments. (Last week, opponents won a minor victory when trade ministers agreed to publish the draft of the FTAA agreement after the summit.)

The idea for an American-hemisphere trade zone began during the presidential term of Bush's father, and the younger Bush strongly favors the pact. But he lacks "fast track" authority - in which Congress yields its right to vet specific parts of a trade agreement and gets only one vote, yes or no, on the entire agreement - and it's not clear he will get it.

Democrats are sympathetic to union complaints that NAFTA has hurt U.S. workers as American companies have looked to Mexico for cheaper labor, and some House Republicans balk at dropping barriers that protect industries like textiles and agriculture. Without fast-track status, each point of the trade agreement would be subject to congressional approval, a scenario Bush hopes to avoid.

Free-trade advocates consider NAFTA a great success. In just eight years Mexico has become the second most important trade partner of the United States, and new President Vicente Fox, the hemisphere's rising star, pins his hopes for Mexico on future free trade and foreign investment.

But critics argue NAFTA hardly promotes an equal exchange. While U.S. companies seek out cheap labor abroad, they are also outbidding other countries for highly skilled workers. Some 1,000 Canadians work at Cisco's San Jose, Calif., campus.

"The people we're losing tend to be the best and the brightest,'' complains Jason Clemens of the Fraser Institute, a Vancouver think tank.

It's not just the labor pool that is being changed. Many people worry about the effects of globalism on national identities and even traditional social services. Under NAFTA, for instance, United Parcel Service has filed a claim challenging the existence of Canada's national postal service, saying it represents unfair competition.

Kevin Roderick writes for The Industry Standard. Comment by clicking here.


© 2001, SHNS