Hidden Agenda Behind Free Trade Deals: “Everyone but China”

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“Free trade” is at best a misnomer, at worst an oxymoron: these trade pacts contain surprisingly little related to trade. So, what are they really about?

By Don Quijones, Spain & Mexico, editor at WOLF STREET. His blog: Raging Bull-Shit.

On Saturday, people hit the streets of Europe to protest the Transatlantic Trade and Investment Deal (TTIP), a hyper-secret, so-called “free” trade agreement that aims to bind together two of the world’s biggest markets that together represent more than 800 million consumers and 45% of global trade.

But “free trade” is at best a misnomer, at worst an oxymoron: TTIP contains surprisingly little related to trade, as Ben Beachy of the Public Citizen’s Global Trade Watch explains.

In the TPP deal (DQ: TPP stands for the Trans-Pacific Partnership, which is currently stalled in the U.S. Congress but which Obama seeks to revive during the lame duck session)… only five of 29 chapters have anything to do with what is traditionally defined as trade (i.e. customs, tariffs and other barriers to trade). [Most are] so-called “non-traditional” trade issues, which would include, for example, the right of a corporation to have a monopoly patent over some drug that it produces, a right that is fundamentally antithetical to free trade.

Indeed, what gets rarely mentioned in the debate is the fact that trade between the U.S. and Europe has never been freer, with the average tariff between the two regions already as low of 3%. Which begs the question: why the sudden need for a new, game-changing transatlantic trade agreement? Especially when you take into account that the TTIP is forecast (by a study commissioned by the European Commission, no less) to provide a paltry 0.1% boost to economic growth in Europe… over a 10-year-period – the equivalent of a rounding error!

So, if it’s not about trade, what is the TTIP really about? As I previously reported (here and here), one of the primary goals of 21st century trade deals like TTIP is to enshrine into law the corporate takeover of the political, cultural, economic, financial, agricultural, scientific, digital and public space, as well as remove any remaining barriers on the ability of multinational corporations to exploit the world’s resources – including, of course, its human resources.

But that’s just part of the story, albeit a very important one. There is also a more subtle agenda at work: namely to secure Western domination of the global economy and geopolitical landscape for the foreseeable future.

To achieve that goal, the U.S. and its allies have just one trick left up their sleeve: launching the mother of all trade wars.

EBC: “Everyone but China”

It’s no secret that the Western power complex is growing desperate, with the accelerating de-dollarization of international trade taking its toll, and the slow motion collapse of Europe’s economy. In 2012, the U.S. National Intelligence Council (NIC) presented a devastating outlook on the future of US and European power in world affairs, concluding that “by 2030, no matter the power index, developing states will overtake developed states.”

When it says “developing states,” the NIC has one particular state in mind: China. By far the biggest beneficiary of global trade in the last 30 years (most of it thanks to U.S. corporations’ offshoring of manufacturing), China has now outgrown its purpose. Even at the corporate level, China is bossing the ring, boasting the world’s three biggest public companies and five of the top 10. By contrast, Europe – officially the world’s biggest market – couldn’t muster a single spot in the top 10, with its two biggest companies, Shell and HSBC, slipping to 11th and 14th place, respectively.

Granted, there’s still a fair chance that China will fail to consolidate its ascendance, especially given the daunting economic, political, social, environmental and demographic challenges it faces. But the Asian behemoth, with its massive export market and 1.3-billion-strong internal market, represents by far the greatest threat to U.S. global dominance.

In order to counter that threat, the U.S. and its “allies” have decided, it seems, to isolate China, first from its own back yard (through the TPP and, of course, the U.S. Pentagon’s “Asian Pivot”), then from the West (through the TTIP and TISA), and ultimately from the rest. In the words of Timothy Garton Ash, a British historian, and strong advocate of global “free” trade [It’s worth noting that he’s also a board member of the European Council on Foreign Relations]:

One way of thinking about [TTIP and TPP] is to see it as the Widest West Web, though the definition of the west [as includes] Japan, Peru, Brunei and Vietnam is wide indeed. Another way to describe it is EBC: Everyone But China.

In sum, as the Dutch think tank and diplomatic academy Clingendael puts it, the new geopolitical formula would look like this: TTIP + TPP = EBC.

A New World Trade Order?

However, it’s not just China that might be excluded from the “benefits” of this new trade order. So-called “third countries” from around the world could end up losing access to both the European and North American markets. As such, the pressure on these countries – especially small ones – to sign similar such agreements with the EU or the U.S. is almost unbearable.

Take the case of Ecuador, whose left-wing government is now on the verge of signing a “free” trade deal with the EU. It also once scorned the IMF, refusing to pay a significant chunk of its national debt on the grounds that it was illegitimate.

According to President Rafael Correa, in the case of the free trade deal with the EU, his government has little choice in the matter. With its direct neighbours to the North and South (Columbia, Peru and Chile) already full-fledged members of the Pacific Alliance – a mini-Latin American Union that is widely seen as a precursor to the Trans Pacific Partnership and which already enjoys strong bilateral ties with the EU – Ecuador stood to lose a great deal of its current trade with the EU due to the preferential conditions enjoyed by its neighbours.

The EU brought to bear every pound of its diplomatic weight on negotiations. “Ecuador has no choice but to sign the agreement. Otherwise it will end up isolated,” warned the European Commission’s chief negotiator, Peter Thompson, in one of a series of diplomatic cables recently leaked to the Spanish daily El Diario. The leaks also show that the EU threatened to withdraw vital development aid from Ecuador in the event that Rafael Correa’s government refused to sign the treaty. It also demanded that Ecuador withdraw its application to join Mercosur, Latin America’s largest trade bloc.

Countries around the world face the same existential dilemma: either sign up to a trade deal that goes against their basic national interest, threatening to transfer what remains of their sovereignty into the hands of a Global Corporatocracy still dominated by North American and European companies (accounting for 1,135 of Fortune’s Global 2,000); or risk eternal isolation from two of the world’s biggest markets?

For decades now, the rulers of the West, with the U.S. in the driver’s seat, have slowly, incrementally, almost imperceptibly reconfigured the global economic landscape. Not a single one of us has been consulted along the way. As the first general secretary of the World Trade Organization, Renato Ruggiero, said in 1996, “We are no longer writing the rules of interaction among separate national economies. We are writing the constitution of a single global economy”.

That constitution of which Ruggiero speaks, and with which our leaders seek to supplant our respective national constitutions, protects the exclusive rights of only one type of citizen – the multinational corporation. And the economy it enshrines into law is an economy in which increasingly the rest of us have little or no place. By Don Quijones. An exclusive for Wolf Street.

Meet the secretive powers behind the trade negotiations that, beyond any democratic controls, attempt to rewrite US and EU laws and regulations to their liking. Read… Behind the Curtains: How The Corporatocracy Is Driving the US-EU Trade Agenda

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  1 comment for “Hidden Agenda Behind Free Trade Deals: “Everyone but China”

  1. Petunia
    Oct 15, 2014 at 9:20 am

    The TPP was written by 600 corporations in secret. Some aspects of it are said to be classified. If that doesn’t tell you everything you need to know, good luck.

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