Why many of the previous free trade agreements do not correspond to the conditions of the common good

by Ewald Wetekamp

About peace …

The state is a partnership of convenience. Internal and external security is its supreme goal. That is why the citizens of states with a democratic constitution have agreed on transferring the enforcement of their rights, including the application of armed force, to the state. This is therefore furnished with the monopoly of violence. Accordingly, the authority to maintain the law with force on the basis of justice and the law belongs to the state. Justice and the law are herewith not defined in a purely positivistic sense, but as a realisation of natural and human rights, which must find their expression in positive law and which can rightly be described as just. Law and justice belong to every person by nature, as an individual and as part of the community, and they guarantee every person’s freedom. The internal and external security of the community is the condition of this freedom.

… to prosperity for all

As the state’s monopoly of power is oriented towards the common good, it promotes the free development of every individual member of the community. Therefore the state’s laws in the sphere of the economy must equally be understood in such a way that the state, as a representative of the community, which is based on the national will of its citizens, must also promote the common good and therefore prosperity for all in the territory concerned. Article 14 (2) of the GG (Basic Law of the Federal Republic of Germany) stipulates this purpose when it says, “Property entails obligations. Its use shall also serve the public good.” The legitimate entrepreneurial pursuit of profit, continuity, development and expansion is not being hindered or confined, but the orientation and attachment to the common good confers on every entrepreneurial striving as the very essence of the matter: the common good of the people connected together in a state community. Professor Eberhard Hamer, of the “Mittelstandsinstitut” (mid tier institute) Hannover, once expressed this in one of his lectures, when he defined the medium-sized company as a company of people, with people, for people. There is no finer way of describing entrepreneurial activity in its relation to the well-being of the individual and the community.

A democratically unacceptable enforcement strategy

As far as the currently very popular defense of free trade agreements is concerned, a look at history will help as well as a description of the anti-democratic practices used in the attempt to enforce the free trade agreement TTIP; with CETA it was no different. These practices should be called anti-democratic because matters concerning the public were being negotiated behind closed doors. Even re≠presentatives of the people were not allowed to make copies of the provisional contract. The text was made available for study to German parliamentarians in a specially guarded separate room without recording facilities. Not even a cell phone was allowed, because it could have been used to photograph the text. Now what is it that has to be protected here and from whom? We are speaking about a contract of more than a thousand pages. What is the point? That which urgently needs to be made public is instead kept secret meticulously, negotiated behind closed doors, to the exclusion of the public. All this has nothing in common with a republic, with a res publica, with the cause of the general public, and it mocks democratic practices. And what is the reaction of our people’s representatives? No one is protesting! No one is resisting! There is no report in the media committed to the public. No magazine enlightens the public. And this despite years of mass protests, internet petitions and collections of signatures, which have gone into the hundreds of thousands and which have been giving expression to their legitimate protest in the alternative media.
And then there is this word creation from the arsenal of the spin-doctor school: “Harmonisation of competition”. Here two concepts which are generally associated with positive emotions are deliberately put to an inappropriate use. They do not belong together. Karl-Albrecht Schacht≠schneider has long criticised the fact that both the EU legislation and the free trade agreements deal with the terms free or fair competition without defining what they mean by this. In the case of TTIP, harmonisation of competition means nothing but a continuous shutdown of social and environmental standards. For what one does not need to grant, the other does not have to fulfill either, because that would be a “distortion of competition” – again a word creation like the one above. Yes, he should even be able to take legal action to enforce his right of non-compliance. Thus the concept of competition constructed by the corporations and the EU is elevated above national legislation and, on closer inspection, proves to be unconstitutional and just as contemptuous of democracy as the enforcement strategy described above. What is to remain is the corporated state, which is to function as a part of large corporations. We cannot want that.

Food sovereignty – the first victim of free trade

In his book, “Mit der ÷lwaffe zur Weltmacht” (“With the Oil Weapon to World Power”), the economic journalist F. William Engdahl describes the introduction of free trade in Great Britain by London financiers and traders in the first half of the nineteenth century as the establishment of a new, powerful power instrument of the English financial elite. Theoretically, these circles, which belonged to the City of London, (not quite correctly) relied on the moral philosopher and national economist Adam Smith, who was interpreted as having postulated the voluntary subjugation of society to absolutely free trade and to the propagated automatism of market mechanisms.
The fact that in essence, this free trade had nothing to do with public welfare, social justice, or the sovereignty of the English state, was demonstrated by the first great victory of those advocates of free trade. In 1846, they repealed the corn laws which had, for a hundred years, assured the English and Irish peasants of the purchase of their harvests at fixed prices, thus ensuring the peasant’s livelihood and the dietary sovereignty of England. This changed promptly when the corn laws were repealed. Now coolies in India and fellaheen in Egypt, who already lived under the economic pre-eminence of the London City and worked for starvation wages, became rivals of the English and Irish peasants. The tide of cheap agricultural products, which now began to flow in, drove the English and Irish peasants into ruin. Mass misery was the direct result of free trade, and it forced many into emigration. They became immigrants in other states.

Forced wage dumping and intentional impoverishment

The ensuing “automatisms of the market mechanisms” led to the impoverishment of industrial workers, since their wages were tied to the price of a loaf, which was now in free fall and soon arrived at the lowest possible level. The fact that this development in England had the harshest consequences also for farmers and industrial workers in Germany and in the whole of Europe, and even for the US, is easy to understand, as England now flooded all these markets with cheap products. In this way, economic wars can be waged against emerging countries and these can be withheld from making their economies prosper, even in the name of such a well-sounding term as “free trade”. At the same time germs of future social upheaval and mass protests were then and are now being implemented, as well as new problems such as refugee and emigration movements resulting in a migration of people of foreign cultures into European countries. These consequences were also intended and are still intended today, and they present the countries involved with challenges which are almost impossible to master.

The nature of the free trade

At the end of the same chapter, Engdahl draws the following conclusion: “In short, the nature of free trade can be defined in such a way that it divides people into ever less extremely rich families and a rapidly growing number of ever poorer, mostly underprivileged people. (“With the Oil Weapon to World Power”, 2002, pp. 14)
The cynicism of describing impoverishment and immiseration as a result, not of free trade but of over-population, cannot be surpassed, as a new chapter is opened here which is still being continued by interested parties.
Also the comments on this first chapter, in which Engdahl quotes the American economist Henry C. Carey as a contemporary critic of the British free trade policy, are definitely worth reading. Already in the early days, the watchful observer who felt connected and committed to his fellows could clearly see who profited from free trade. We are struck by the recurrence of the phenomena and consequences of forced free trade agreements, which have been forever repeated till this day.

Free trade as an economic war against “developing countries”

We can see how also in the 21st century, the free trade market mechanisms described by Engdahl follow the same agenda and have the same consequences as the repeal of the corn laws in the year 1846, if we dip into the book by Friederike Beck “Die geheime Migrationsagenda” (“The Secret Migration Agenda”) and in particular into its chapter 4 “EPA: Wie Freihandelsabkommen der EU mit afrikanischen Staaten dort wirtschaftlichen Schaden anrichten” (“EPA: How free trade agreements between the EU and African states do damage there”. EPA is the abbreviation for Economic Partnership Agreement. But on closer examination, there can be no question of partnership and agreement, since the opening up of African markets for European products was not infrequently enforced by targeted economic war scenarios. African countries refusing to open their markets up to 83% for European goods, and not prepared to abolish tariffs and charges at the same time, were punished with exorbitant import duties on their goods upon entry into the European market. The result showed itself sooner or later: several African states gave up and signed this forced submission contract.
There are quite a few economists who think that these free trade agreements jeopardise the development of African economies as these are not able to compete with the products of highly industrialised economies in European markets and in the meanwhile also on their own. At the same time, these countries are unable to protect their own economies. For example, the export of surplus European chicken meat to African countries has tripled since 2009. Since the production costs of domestic farmers are higher, they are driven into bankruptcy. Protective measures by African states do not work. According to the agreement, they can only charge 35% import duty on poultry imports, but this is not enough. So the African farmers give up. And their collapse not only increases the country’s dependence on imports, but also causes the fading out of the knowledge about animal breeding and agriculture, which was traditionally transmitted and further developed over generations. It is no longer available to that community.
The EU’s fishing policy is turning out to be equally catastrophic for African countries. Big European ship owners have overfished the European fishing grounds by more than three-quarters, and are now urging European countries to conclude contracts with African countries in order to allow them to fish in their grounds. Not only do the big ship owners not participate in the costs – 90% are covered by taxpayers – but they can even count on subsidies. European taxpayers pay, and the fishermen of Somalia and Senegal catch no more fish. Indeed, this is a well-known fact. Angela Merkel’s Africa Commissioner GŁnter Nooke says: “A country should not use economic negotiations to destroy on the one hand, what its development ministry is trying to build up on the other hand.” Are these the Western European values, which are so frequently invoked by a certain side? Definitely not.

The food weapon – a popular free trade tool

Jean Ziegler’s contribution to the documentary “We feed the world” and the film by Hubert Sauper “Darwin’s nightmare”, both available on DVD, depict in frightening pictures, figures and facts the interrelationships here described. Already at the time when Jean Ziegler compiled his documentation, Western industries supported their farmers with more than one billion dollars a day and also subsidized agricultural exports to developing countries, so that any food export to a developing country occurred at prices that drove every native farmer to ruin. The agenda behind this procedure is easily understood: The food weapon is used in order to create dependencies and force cheap raw material imports, to open up new markets and to recruit the cheapest possible labour, as well as to enforce other things like, for example, setting up landfill sites for so-called problem scrap, where local inhabitants reclaim raw materials under conditions which endanger their lives. And is this brutal enforcement by means of economic power to be perceived by the peoples suffering under it as Western values?

The EFTA as an exemplary alternative

And yet there are alternatives to the market radical free trade agreements. In the EFTA, for example, we come to agreements in respectful coexistence on an equal footing and with the intention to create a win-win situation (to use a neo-economical term) for the stakeholders. From the outset, the EFTA was a counter-proposal to the market radical Anglo-American free market trade. To date, its members still negotiate agreements with other states, if these regard the orientation towards the common good, which was explained at the beginning of this text, as a basic requirement that has to be taken into account by all parties. This practice makes it clear that favourable trade agreements and social welfare orientation do not have to exclude each other. Quite the contrary is true! But where is the school book or teaching material that mentions this? Current Concerns has often reported on the EFTA. The knowledge about the devastating effects of unfair free trade agreements is available to everyone in text and images. Education in these questions is an indispensable commitment stemming from compassion, responsibility and love of peace. Decisive for this are the conception of man and the resulting view of the economy which determine the contract partners’ goals: Is it to be “make money, make more money,” or social well-being according to the hard-fought European traditions?    •