Here They Come: More Free Trade Deals

http://www.reuters.com/article/idUSTRE6A270720101103

Does anyone recall the electorate clamoring for more trade deals before the election?  No.  That’s not what the Republicans have been sent to Congress to do.  Wasn’t it all about creating jobs and cutting spending?  Nevertheless, here they come.  (See the above-linked Reuters article.)

Although President Obama welched on his promise to scrap NAFTA and has failed to respond to Mexican tariffs, Japanese dumping and China’s currency manipulation, give him credit for at least tabling any new free trade deals.  But all that is over now.  Republicans are already licking their chops at the prospect of moving forward the free trade deal with South Korea.  More will soon follow. 

The stated goal is to “open new markets to U.S. exports.”  But has anyone ever seen a trade deal that didn’t begin with the U.S. first opening its market to those nations’ imports?  And can anyone recall the U.S. ever following through to assure that U.S. exports get fair treatment?  Do people understand that the terms of free trade deals are dictated by the World Trade Organization and are stacked against the U.S., enforcing protectionism in favor of most nations while banning such practices by the U.S.?  Do they understand that, even if the playing field is level, disparities in population density and per capita consumption make trade with overpopulated nations a sure-fire loser? 

No, they don’t understand such things, but they do understand that, for whatever reason, our manufacturing jobs have been lost to such trade deals and they want it stopped.  No one sent Republicans to Congress to go back to their old ways of cutting lopsided trade deals as payback to their corporate benefactors.  If this is the mandate they think they’ve been given, they’re sorely mistaken.

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11 Responses to Here They Come: More Free Trade Deals

  1. hungry4food says:

    Now the Volatility Game really begins …….

  2. hungry4food says:

    I heard this Morning on CNBC Squawk Box the Fed is Planning as high as 5 Trillion . Plus They said its all flowing out of the USA into Interest Paying accounts , and that a Currency War is Imminent with suppliers of durables ; OPEC NATIONS CALLING FOR NEW WORLD ORDER http://ning.it/9C8HT1 . They are part of the BRIC which these Allies are trading supplies with each other without the dollar as their trade currency now , and they have no need for dollars any longer , thats why the FED is printing the debt purchasing program . I say the Equities and commodities goes down as fast as its going up .
    And Iran through OPEC made a deal with China to supply them their Oil with No dollar trade involved , only exchanging the Manufactured durables in exchange for the oil . The mold is cast for a collapse of the dollar and I don’t think it will be very Long
    http://ning.it/cxurAL

    The increase in commodities is the dollar value lose of 25 % . This will bring about the Rejection of the dollar as reserve currency very soon by OPEC and BRIC nations .
    We need to consider a END of the FED , and Stop this program because either way we are going to see the USA isolated from world supply of durables from trade nations when they start to reject the dollar .

    HR 833 bill http://ning.it/bI5P9y

    • Pete Murphy says:

      I don’t agree with your last sentence. Exporting nations are utterly dependent on the U.S. market. Without us, they would collapse into abject poverty. No way will they ever isolate themselves. Nor will they let the value of the dollar erode their U.S. market share. They’ll simply “eat” any losses caused by a falling dollar. I do agree that we’ll see increases in the prices of imported commodities.

      • hungry4food says:

        I disagree we are running on Phony inflated market values and the BRIC are in control of the Large majority of raw materials and manufacturing in the world now so they are going to push for a change to the reserve currency or isolate from sending the amount of goods to the US markets very soon , I say right after the first of the year when Iran takes control of OPEC .

      • hungry4food says:

        those exporting nations you are talking about for the most part make up the BRIC and OPEC , and are wanting to see the USA crash , don’t think for a minute they care about a Economic system of any kind , they played the game only to gain control of it to then use it against us to take us down , they will now create that experience , like you said while they are eating their loss in US holdings they will see the destruction of the dollar and with it the US /wall street crash that this time cannot be propped up with a bailout of the international structure to sustain the global economic system , and so we will see a nationalization of the US economic system , shortly after the first of the year when Iran takes control of OPEC and announces the rejection of the dollar , this will start the domino of Other BRIC and OPEC nations following the same rejection . This Fed QE2 is the signal that collapse is near , because they have lost these Foreign Nations willingness to invest in what NOW they are BUYING …..

      • hungry4food says:

        so Pete say you are a BRIC nation, you control the majority of resources and manufacturing , can have a satisfying trade relationship between your allies in the BRIC and OPEC nations without taking on any dollars from a Market thats burdened with the debt of 100 to 1 ratio GDP , are you telling me you see that as a Risk worth taking to take a currency that the paper its being printed on isn’t even worth the ink shipping cost it takes to Import that resource supply to print the worthless currency with ???

      • Pete Murphy says:

        First of all, the BRIC nations (Brazil, Russia, India and China) hardly “control the majority of resources.” The latter two are seriously deficient in resources. None of them even show up on the radar as major sources of resources for the U.S. (America’s largest source of imported oil is Canada.) OPEC is all about making money. Iran won’t change OPEC’s desire to sell the U.S. as much oil as possible. And if a rising price of oil starts to put a crimp in demand, then OPEC will lower the price.

        And, as I said, overpopulated nations like China, Japan, Germany and others are so utterly dependent on exports to the U.S. that they can’t afford to do anything that would harm the U.S. economy.

        Regarding the dollar, yes, it’s falling in value. But it’s not “worthless.” If it is, then send me all you have left and I’ll dispose of it for you.

  3. Robert says:

    Pete,
    In a continuation of the article you linked, I saw Congressman Boehner on Television today talking about wanting to push more free trade agreements. I immediately sent off an email demanding an end to our policy of “free trade” I will contact his office tomorrow and give his assistant a little friendly advice from a fellow Republican. These policies have got to stop immediately.

  4. hungry4food says:

    I heard Donald Trump tell Greta yesterday the Trade Policy is not working , because we have allowed China to keep their floating currency rate fixed in the same price for the entire term of the trade agreement and this manipulates the cost to manufacture which is a unfair trade policy because of the amount of production thats shifted to ASIA , china being the of the manufacturing , it should have drove the price of their yuan way higher in value if they were floating it freely fairly , and so it created the Giant Sucking sound Ross Perot told us about that would happen if we started this trade agreement the way it was designed with no way to negotiate the policy of the WTO with only a One vote policy for the USA out of 140 plus membership of the WTO .

    • Pete Murphy says:

      Right, but even so, change in currency valuation won’t have much effect on the trade imbalances. They’re driven by population density disparities, not currency valuations. I’ll soon be posting the results of my study of currency valuation vs. trade imbalances. To give you a preview – there’s no relationship.

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