WTO, COOL, TPP – The Alphabet Soup of the Loss of National Sovereignty


By Gilles Stockton

gilles_stockton_2If you were not concerned about our loss of national sovereignty before, you should be now, following the World Trade Organization (WTO) recent ruling against the Country of Origin Labeling (COOL). Although the WTO acknowledges that the United States has the right to label, and even though Canada has their own version of COOL, the WTO cites a very minor excuse to deny American consumers from knowing the origin of their meat. The labeling requirement, which has already been amended to satisfy the WTO, simply shows where that particular cut of meat was born, raised, and slaughtered. If the steer was born in Canada, raised in Canada, and slaughtered in the United States, the label so indicates. If, however, the animal in question was born, raised, and slaughtered in the United States this is what the label states. Meat from cattle, sheep, hogs, and chickens that originate from Canada, Mexico, and the United States are treated exactly same, yet WTO finds that this is discriminatory towards Canadian and Mexican producers because of the costs associated with keeping the information on the origin of each animal. In this information technology age where firms keep track of every little nut and bolt in their inventory, keeping track of a 1200 pound steer is considered by WTO to be too expensive.

Country of Origin Labeling has of course been an issue favored by family farmers and ranchers and ninety percent of consumers. After considerable effort by family agriculture and consumer groups, the law was first passed in 2002. This opened up twelve years of intensive warfare with the meat packing cartel who tried every tactic open to them to block implementation. Family farmers and ranchers have distrusted the trade agreements from the very beginning, seeing them as vehicles to increase imports of a wide range of agricultural products – particularly beef. The meat packing cartel, of course, wants the unhindered ability to source product anywhere in the world. The less information they are required to share with the consumer the better they can price that product – hence the fight, the appeal to the WTO, and this latest WTO ruling that our COOL requirement is unacceptable.

The issue goes far beyond the labeling of meat. This WTO ruling shows the extent that we have traded away our democratic rights as American citizens in entering “trade at any cost” agreements. The North American Free Trade Agreement (NAFTA) was not the first trade agreement but it was the biggest and the template for subsequent agreements. After 20 years of NAFTA the results are in and although the agreement has been good to trans-national corporations, the impacts on the American, Canadian, and Mexican middle and working classes have been primarily negative.

Back in 1994, when NAFTA was ratified by Congress among a manure truck load of extravagant promises, only family farmers/ranchers, labor unions, and environmentalists were skeptical. Each of course, for very different reasons. The forces who steamrollered the trade agreements through Congress systematically marginalized this opposition, ridiculing them as “anti-free trade.” Both Democratic and Republican Administrations have been totally bi-partisan in negotiating and signing agreements that have transferred our democratic rights as citizens of the United States to trans-national corporations and the WTO.

Labor unions saw early on that the trade agreements were all about gutting hard won labor rights. After 20 years of outsourcing our manufacturing industries, the incomes of working and middle class Americans have fallen. Millions of Americans are now trapped in jobs that pay less than a living wage, with no health, vacation, and retirement benefits. The rest, who are lucky enough to still have what can be considered a good job, work harder for less and their retirement options have been severely cut. The pundits on TV and the radio seem puzzled why the recovery from the 2008 “Great Recession” has been no tepid. There is no mystery, outsourcing and a trade deficit running at 40 to 50 billion dollars per month has taken its inevitable toll on the American middle and working classes.

A hot button political issue that is also all about WTO and globalization is the Keystone Pipeline. This pipeline is to run from Canada, through Montana, South Dakota, Nebraska and ultimately to Texas. Once the President signs off on the project, which he most probably will after the elections, a foreign corporation will have the right to condemn land belonging to taxpaying Americans, in order to transport crude oil to refineries in Texas. This is important to the oil cartel because from Texas, the domestic market for the gasoline and diesel can be played off against the world market, resulting in higher fuel prices for everybody.
The media and the politicians never cast it in those terms. Instead, they point the finger at so-called “extreme” environmentalist for denying Americans good jobs. Building a pipeline may create good –temporary – jobs but the project will leave the risks of pipeline ruptures on the backs of poorly compensated land owners and whoever or whatever might be downstream. At this point in our national circumstances, we need the oil and having this country energy independent from the Middle East is a very good thing. But from this consumer of gasoline’s point of view, the sensible thing would be to build refineries in Canada, Montana, and North Dakota where we will have permanent good jobs and cheaper fuel. However, the trade agreements, take precedence over what is good for people so that will never happen because thanks to NAFTA and the WTO, foreign oil companies have more rights than American landowners.

Something that is never talked about is how the trade agreements and WTO treat taxes. Most countries, excepting the US, fund their public infrastructure and services through a Value Added Tax (VAT) which is a type of national sales tax. Depending upon the country, the VAT runs somewhere between fifteen and twenty percent of the retail value of the item. Under the WTO regulations, the VAT can be deducted from exports and added to imports. The US does not have a VAT but instead uses a system of local sales and property taxes which under the WTO rules cannot be rebated on exports or added to imports. This makes US manufacturing non-competitive on both our own domestic market and globally. Meanwhile the rich have been successful in having their tax obligations reduced and the corporations which they own are allowed to offshore their profits. The tax burden, therefore, has inevitably shifted downward to the local level where ordinary people cannot avoid paying more in sales and property taxes. The result is that our infrastructure is collapsing and our communities and schools are underfunded.

The forces of globalization never sleep and never stop in their quest to free themselves completely from constraints imposed by democratic aspirations and nation states. The Trans Pacific Partnership (TPP) will be the biggest trade agreement ever and it is ready for ratification. Chances are that soon after the elections, the TPP will be put forward on a “fast-track.” No debate allowed, and no opportunity for citizens to comprehend what is in the agreement. The beneficiaries – the transnational corporations – already know because they were welcomed behind the closed doors of the negotiations. We can be pretty sure that labor and environmental rights have been further eroded and that, once again, American family agriculture has been sacrificed to the global market. We have a new crop of Congressmen and Senators who are joining the left-over duds of the last Congress and they all will soon be asked to vote for the TTP. Will they support national sovereignty and the American people or the transnational corporations?

Gilles Stockton
Stockton Ranch
Grass Range, Montana