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Matt Stoller: “Free Trade” Pacts Were Always About Weakening Nation-States to Promote Rule by Multinationals

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Yves here. I hope those of you who are in countries being browbeaten to sign the Trans-Pacific Partnership or the TransAtlantic Trade and Investment Partnership will circulate this post widely.

By Matt Stoller, who writes for Salon and has contributed to Politico, Alternet, Salon, The Nation and Reuters. You can reach him at stoller (at) gmail.com or follow him on Twitter at @matthewstoller. Originally published at Observations on Credit and Surveillance

Here’s part one of this series on the origins of NAFTA and our current trading regime.

It’s amazing what you find in the Congressional Record. For example, you find American political officials (liberal ones, actually) engaged in an actual campaign to get rid of countries with their pesky parochial interests, and have the whole world managed by global corporations. Yup, this actually was explicit in the 1960s, as opposed to today’s passive aggressive arguments which amount to the same thing.

Here’s the backstory.

As I wrote in part one of this series on the origin of modern American trade policy, the first real mention of NAFTA in the Congressional record that I could find came from a hearing in 1967. This was a Joint Economic Committee hearing conducted just after a major series of global trade talks known as the “Kennedy round”, from 1964-1967. The Kennedy round went quite far in reducing explicit tariffs, and was a capstone to the trading regime of tariff reductions that FDR and Cordell Hull put in place in 1934 after the Smoot-Hawley tariffs.

After the Kennedy round ended, liberal internationalists, including people like Chase CEO David Rockefeller and former Undersecretary of State and an architect of 1960s American trade policies George Ball, began pressing for reductions in non-tariff barriers, which they perceived as the next set of trade impediments to pull down. But the idea behind getting rid of these barriers wasn’t about free trade, it was about reorganizing the world so that corporations could manage resources for “the benefit of mankind”. It was a weird utopian vision that you can hear today in the current United States Trade Representative Michael Froman’s speeches. I’ve spoken with Froman about this history, and Froman himself does not seem to know much about it. But he is captive of these ideas, nonetheless, as is much of the elite class. They do not know the original ideology behind what is now just bureaucratic true believer-ism, they just know that free trade is good and right and true.

But back to the 1967 hearing. In the opening statement, before a legion of impressive Senators and Congressmen, Ball attacks the very notion of sovereignty. He goes after the idea that “business decisions” could be “frustrated by a multiplicity of different restrictions by relatively small nation states that are based on parochial considerations,” and lauds the multinational corporation as the most perfect structure devised for the benefit of mankind. He also foreshadows our modern world by suggesting that commercial, monetary, and antitrust policies should just be and will inevitably be handled by supranational organizations.

Here’s just some of that statement. It really is worth reading, I’ve bolded the surprising parts.

“For the widespread development of the multinational corporation is one of our major accomplishments in the years since the war, though its meaning and importance have not been generally understood. For the first time in history man has at his command an instrument that enables him to employ resource flexibility to meet the needs of peopels all over the world. Today a corporate management in Detroit or New York or London or Dusseldorf may decide that it can best serve the market of country Z by combining the resources of country X with labor and plan facilities in country Y – and it may alter that decision 6 months from now if changes occur in costs or price or transport. It is the abilityt o look out over the world and freely survey all possible sources of production… that is enabling man to employ the world’s finite stock of resources with a new degree of efficiency for the benefit of all mandkind.

But to fulfill its full potential the multinational corporation must be able to operate with little regard for national boundaries – or, in other words, for restrictions imposed by individual national governments.

To achieve such a free trading environment we must do far more than merely reduce or eliminate tariffs. We must move in the direction of common fiscal concepts, a common monetary policy, and common ideas of commercial responsibility. Already the economically advanced nations have made some progress in all of these areas through such agencies as the OECD and the committees it has sponsored, the Group of Ten, and the IMF, but we still have a long way to go. In my view, we could steer a faster and more direct course… by agreeing that what we seek at the end of the voyage is the full realization of the benefits of a world economy.

Implied in this, of course, is a considerable erosion of the rigid concepts of national sovereignty, but that erosion is taking place every day as national economies grow increasingly interdependent, and I think it desirable that this process be consciously continued. What I am recommending is nothing so unreal and idealistic as a world government, since I have spent too many years in the guerrilla warfare of practical diplomacy to be bemused by utopian visions. But it seems beyond question that modern business – sustained and reinforced by modern technology – has outgrown the constrictive limits of the antiquated political structures in which most of the world is organized, and that itself is a political fact which cannot be ignored. For the explosion of business beyond national borders will tend to create needs and pressures that can help alter political structures to fit the requirements of modern man far more adequately than the present crazy quilt of small national states. And meanwhile, commercial, monetary, and antitrust policies – and even the domiciliary supervision of earth-straddling corporations – will have to be increasingly entrusted to supranational institutions….

We will never be able to put the world’s resources to use with full efficiency so long as business decisions are frustrated by a multiplicity of different restrictions by relatively small nation states that are based on parochial considerations, reflect no common philosophy, and are keyed to no common goal.”

I’m doing this series on the origin of the modern trading regime because of the current controversies over trade policies, including the Trans-Pacific Partnership. It’s striking how, when you look into these efforts, these agreements are not and never have been about trade. You simply cannot disentangle colonialism, the American effort to create the European Union, and American trade efforts. After their opening statements, Ball and Rockefeller go on on to talk about how European states need to be wedged into a common monetary union with our trade efforts and that Latin America needs to be managed into prosperity by the US and Africa by Europe. Through such efforts, they thought that the US could put together a global economy over the next thirty years. Thirty years later was 1997, which was exactly when NAFTA was being implemented and China was nearing its entry into the WTO. Impeccable predictions, gents.

In previous research efforts, I’ve found that there was a serious elite liberal effort called “Atlanticism” to create an explicit world government, and that this effort really did influence how our current leaders think about international policy-making. By 1967, Ball wasn’t an Atlanticist, he dropped his illusions about the ability to combine the globe into one polity. But he was still a utopianist – he didn’t seek an explicit world government, he wanted to build a set of supranational institutions that could manage all the important economic questions, while national leaders got to argue about symbols.

I guess it turns out that the conspiracy theorists who believe in UN-controlled black helicopters aren’t as wrong as you might think about trade policy, and not just because United Technologies, which actually makes black helicopters, has endorsed the Trans-Pacific Partnership. Oh sure they’re wrong, but so are the people who deny that our trade agreements are just about trade. They aren’t. These agreements are about getting rid of national sovereignty, and the people who first pressed for NAFTA were explicit about it. They really did want a global government for corporations. At the time, of course, multinationals didn’t treat American workers like disposable objects, this was the era of the “Treaty of Detroit.” So Ball wasn’t as naive as he would sound today if he used these same words; it wasn’t totally crazy then to assume that global multinationals might operate in good faith. Moreover, given that there had just been two world wars because of nationalism, it also wasn’t crazy to hope that corporations would “wash away national boundaries”.

But what’s interesting is more the why than the what. Ball in particular expressed his idea of a government by the corporations, for the corporations, in order to benefit all mankind. Keep that in mind when you think you’re being paranoid.

The full hearing can be downloaded here, though it is a big file.

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102 comments

  1. F. Beard

    If common stock was widely used as private money then the benefits of free trade would be widely “shared.”

    But as long as we have government backing for the banks, business will find it more profitable (at least in the short run) to legally steal rather than justly share.

    Reply
    1. diptherio

      One day a wandering sage showed up in the bazaar of Samarkand, carrying an oud. He seated himself in a corner of the marketplace and proceeded to pluck a single note on his instrument over and over again; ting, ting, ting, ting. He plucked the same note for hours, right up until the market closed. The next day the sage returned and repeated the bizarre performance, and the next. Morning till night, he plucked a single note; ting, ting, ting.

      Finally, after this had been going on for a week or more, a young boy finally got up the nerve to approach the sage and inquire of his strange behavior.

      “Excuse me sir,” he said, “I can’t help but notice that all day you play only one note over and over. The other musicians play on all the strings of the oud and play many notes and many scales. Why do you not do the same?”

      The sage looked at the boy with a fierce gleam in his eye. “Those other fools are all looking for the right note–I have found it!”

      Reply
        1. diptherio

          I couldn’t resist. I think of that story every time you bring up the common-stock as wages and currency idea. Personally, I don’t see how it can work, and you’re the only person I’ve ever heard pushing it. Maybe you’re on to something though, and it’s not like you’re the only person with a certain attachment to their way of seeing things (not me, of course…)

          Reply
          1. F. Beard

            Look at a balance sheet: Both Equity and Liabilities are backed by the Assets. Now you tell me why symbolic purchasing power can ONLY be created as debt and not Equity?

            Don’t bother: No one from Karl Denninger to Warren Mosler has been able to because they CAN’T.

            When I first studied banking I created a spreadsheet model to see if banking can be done 100% ethically 100% of the time; it can’t UNLESS the money issued is common stock. (Otoh, I came up with a gold-based fractional reserve model with killer real growth rates and discovered that the more people redeemed their gold, the more profitable the bank! Why? Because gold is a non-performing asset!)

            Reply
              1. F. Beard

                You’re bluffing. Shares in Equity are not debts; they indicate who owns what percentage of the company that is unencumbered by debt or is E = A – L beyond your comprehension?

                Reply
                1. Vj

                  Looked at another way equity is really the junior most form of debt. It is debt that ranks the lowest in the liquidation preference stack. Hence in theory it has no cap on the residual return.
                  So in effect your equity as money will only mean that the most junior debt will get used. I think this will cause huge oscillations in the implied/underlying value embedded in such “new money”, Thereby failing one of the important roles of “moneyness” i.e. store of value.
                  Even worse given the inbuilt variability it will render every transaction a speculation super charged with built-in leverage.
                  So I suggest you chew on this before getting carried away.

                  Reply
                  1. F. Beard

                    I think this will cause huge oscillations in the implied/underlying value embedded in such “new money”, Thereby failing one of the important roles of “moneyness” i.e. store of value. vj

                    EXCEPT you forget or never knew that I also advocate that government backing for the banks should be abolished which would GREATLY reduce their ability to leverage and thus greatly reduce the volitality of everything priced in dollars.

                    Other objections?

                    Reply
                    1. Chauncey Gardiner

                      … “Other objections?”

                      Yes, I have a fundamental objection, Beard. Respectfully, beginning with your first comment at 6:48 am yesterday, I detected the unmistakable odor of red herrings in the air. Matt Stoller’s post was about the history behind American trade agreements and the proposed TPP and TTIP agreements against a backdrop of increasing transnational corporate power. Instead, as you have done on many instances in the past, you have chosen to attempt to divert the discussion into your views about the nation’s monetary and financial system.

                      This is not to comment on the merits of what you are suggesting, or lack thereof. There have been and I am sure there will continue to be ample opportunities to explore issues related to that important topic. I will add that I greatly value the first amendment, and I value both your voice and that of others. I have personally learned much by spending time here.

                      Thank you for your consideration of my comment, Beard.

                    2. F. Beard

                      Instead, as you have done on many instances in the past, you have chosen to attempt to divert the discussion into your views about the nation’s monetary and financial system. Chauncey Gardiner

                      Because they our intrinsically crooked finance system is the root of almost all our economic problems and many of our social problems as well.

                      Let’s have some intelligent refutation and perhaps I can be banished but ignoring me will do no good because frankly I enjoy what I do if ONLY one intelligent reader gets it.

              2. F. Beard

                In your case, I’m beginning to suspect bad faith. Don’t touch the money system” may scare Krugman and you but I might be literally damned if I let it scare me.

                Reply
    2. Septeus7

      There are no benefits of free trade regardless of the kind money used because “free trade” by definition is the creation of a dictatorship of sellers without regards to question of the nature of production.

      It is physically impossible to show that delocalizing production and putting the cost of transport on producers is efficient long term.

      The sole purpose of “free trade” is to create a space for slave made goods to outsell localized production.

      The Free Trader justifies this by hysterically claiming that any association of people committed to upholder their own sovereign laws in their country is voided by the fact if a seller of particular a slave good is wanted by a consumer then such a base consumer desire of an individual voids all sense of community as such a transaction is private.

      In fact any laws restricting commerce is invalid thus the free trade must argue that the Amish must allow for porn shops in the community cause “free trade.”

      Free Trade is aggressive violence against the right of people to make their own rules of association apart from the delusional abstraction called the “free market” but what in reality the Empire’s system of cartels.

      The nature of the script exchange in liue of goods has no relevance to the question of what is the nature of what is being sold and the fundamental exploitation created by “free trade.”

      F. Beard I for one am tired of claim that the solution to all human problems is private script for wages. It is absurd. The problem isn’t the script. The ethics of the people using any system of accounting the nature of what that system accounts for is the question.

      The question is what is being counted as profit not how you count the profit. The fact think you think that money drives the system rather the system that drives the money shows that don’t understand economics at all.

      No Libertarian has ever studied real economics or social dynamics. Libertarianism isn’t to be debated. It is to be smashed.

      Reply
        1. Septeus7

          You didn’t make an argument in response. I have no objection to most of what you say about debt debt jubilee or letting people pay with private credit systems.

          My problem is that you think it will do much without a political order based on a principle of justice. You’ve never defined a just political order and defined how create a credit principle not based on exploitation.

          You’ve simply attacked the notion of private extension of debt based on the accounting system of public credits i.e private banks making loans denominated in the public currency. What you can’t seem to grasp is that doesn’t matter how the debt is created. It’s just technical. The question is the justification of the legal debt itself.

          The reason I’m very hard on libertarianism is mostly because the work of Mark Ames and David Emory. Those men have proved beyond a doubt that libertarianism is the bastard child of the 1920s American Fascist movement of William D. Pelley and other reactionaries funded by the National Association of Manufacturers.

          There is no debate on the history of libertarianism as a creation of America’s cryptofascist corporatists just there is no debate on classical liberalism and anarchism being the creation of the East India Trading Company and the British Foreign Office to attack the Knights of Labor and real worker’s movements.

          You are all wreckers. You refuse a real program like Yyes’s Skunk Party or Roger Malcolm Mitchell’s MS platform, or Dan Kervick’s program.

          You focus on procedural reforms not empowering workers and citizens to demand what is owed them in form of their real needs. People need jobs and a basic income, free education, healthcare, freedom of association, freedom from unwanted spying public and private, workplace protections, etc… they don’t need abstractions about purchasing power.

          Purchasing power is political and determined by nothing other than political power.

          The entire order of what Anglo-American’s now call “freedom”, “liberty,” “equality”, is total bull. It has nothing to with the historical system of American of protectionism, national sovereignty, national self-reliance, and classical republicanism.

          We need to bury this old world crap and start with some basic ideas about no treating other people like commodities and consumers instead talk about real human needs and social roles and how we are going fix the inequality which is causing the social alienation which will collapse society far before the ecological problems will (see the Utopia mouse experiments).

          People don’t need more market freedom and another brand of toothpaste and another fucking iphone. They need less market options. They need real social stability and a real future and real options for their future roles that will actually be important.

          Private money isn’t going to give people a real sense of public worth and purpose. People creating society based on real aspirations and hope is the Kingdom of Heaven Jesus was talking about so to bad you Christians have ignored the entirety of the gospel.

          Reply
          1. F. Beard

            You’ve simply attacked the notion of private extension of debt based on the accounting system of public credits i.e private banks making loans denominated in the public currency.

            Show me where? Let 100% private banks with 100% voluntary creditors extend as much credit as they dare and let them be zealously liquidated when they fail to meet a single liability on time.

            Repost your comment without this erroneous (and insulting) assumption on your part and we can continue to dialog but I’m getting tired of strawman arguments.

            Reply
            1. Septeus7

              Quote: “Show me where? Let 100% private banks with 100% voluntary creditors extend as much credit as they dare and let them be zealously liquidated when they fail to meet a single liability on time.”

              F.Beard what is credit? There is no such thing as 100% voluntary credit. People seek credit because others won’t volunteer resources without forcing a public debt upon a party who lacks the political and social power to claim that resource for themselves.

              If everyone had equal credit then no credit would exist by definition. The need for credit is equal to the degree one lacks the social power of the creditor. Credit by definition is a public political statement. You don’t understand the social dynamics that under lie the exchange. Everything in the market is about public/social validation.

              A liquidation requires an public authority to determine what debt is own in a common measure of value. There is no such thing as purely private credit because all credit must create debt and debt needs a public standard to account for it’s value.

              There is nothing that 100% voluntary or private or public. These are relative terms and 100% is an absolute concept.

              I never insulted you. You claim I made a strawman. Where is the strawman?

              Why do you believe that “free trade” is beneficial? You are the one making the claim and thus you must present empirical evidence for such a claim.

              I have studied all facets of free trade theory and all empirical evidence shows that not only does it not work but that in practice it must maximize physical entropy which is the opposite of a sustainable economics.

              I stand by my statement that free trade is Imperialist aggression and tyrannical by definition. Protection is a right of all free peoples and nations.

              Reply
        2. skippy

          An emotive followed by smug fuax superiority.

          skippy… It has to be one of the most classic examples of – belief – trumps everything else trope ever, alas its the libertarian way!~!

          Reply
          1. F. Beard

            Something about swallowing camels (the largest unclean animal) and straining out gnats (the smallest) comes to mind when dealing with you.

            Faux-superiority? I freely admit I’m a sinner but at least I’m a work in progress. You? What’s your hope except steady decay of your body?

            If you think you’ll destroy my hope then welcome to Stalingrad or Vietnam for that matter and i’ve not yet recovered from my last bing.

            Reply
        3. Lambert Strether

          Stupid baiting ad hominem comment, provoking a stupid religious baiting squabble I had to delete.

          Adding… Looks like I deleted some of the subthread out-of-order, so a few of the stupid baiting comments, confusingly to readers, got dumped at the end the main comment thread. So I blew those away too. C’est la vie!

          Reply
          1. F. Beard

            C’est la vie! Lambert

            Indeed. My job is merely to speak the truth*; how it’s handled after that is not my responsibility.

            *With love but love, like abrasives, comes in various grits with the finest and softest unsuited for some work and vice-versa?

            Reply
        1. F. Beard

          Sept and I will do just fine since he doesn’t have a deep-seated suspicion of and predudice against little ole me.

          Reply
          1. skippy

            People that are allergic to facts have deep seated neuroses ergo ego defense mechanisms.

            Tho Horney’s theory is quite apt imo.

            In her final book, Neurosis and Human Growth, Karen Horney laid out a complete theory on the origin and dynamics of neurosis.[7]

            In essence, neurosis is a distorted way of looking at the world and at oneself, determined by compulsive needs rather than by a genuine interest in the world as it is.

            She proposes that it is transmitted to a child from his or her early environment, and that there are a large number of ways this can happen, but:

            When summarized, they all boil down to the fact that the people in the environment are too wrapped up in their own neuroses to be able to love the child, or even to conceive of him as the particular individual he is; their attitudes toward him are determined by their own neurotic needs and responses.[8]

            The child’s initial reality is then distorted by his or her parents’ needs and pretenses. Growing up with neurotic caretakers, the child quickly becomes insecure themselves, developing basic anxiety. To deal with this anxiety, the growing child’s own imagination goes to work, creating an idealized self-image:

            Each person builds up his personal idealized image from the materials of his own special experiences, his earlier fantasies, his particular needs, and also his given faculties. If it were not for the personal character of the image, he would not attain a feeling of identity and unity. He idealizes, to begin with, his particular “solution” of his basic conflict: compliance becomes goodness, love, saintliness; aggressiveness becomes strength, leadership, heroism, omnipotence; aloofness becomes wisdom, self-sufficiency, independence. What–according to his particular solution–appear as shortcomings or flaws are always dimmed out or retouched.[9]

            Once one identifies with the idealized image, a number of effects follow. One will make claims on others and on life based on the prestige one feels entitled to because of the idealized image. One will impose a rigorous set of standards on oneself in order to attempt to actually measure up to what the idealized image is. One will cultivate pride, and with that will come the vulnerabilities associated with pride that lacks a foundation of real esteem. Finally, one will hate and despise oneself for all one’s factual limitations, which keep getting in the way and threatening to pop the bubble. Vicious circles operate to strengthen all of these factors.

            Eventually, as one grows to adulthood, one particular “solution” to all the inner conflicts and vulnerabilities will solidify. One will be expansive and will display symptoms of narcissism, perfectionism, or vindictiveness. Or one will be self-effacing, and be compulsively compliant and display symptoms of neediness or codependence. Or one will be resigned, and display schizoid tendencies.

            In Horney’s view, milder anxiety disorders and full-blown personality disorders all fall under her basic scheme of neurosis as variances in the degree of severity and in the individual dynamics.

            The opposite of neurosis is a condition Horney calls self-realization, which is when an individual responds to the world with the full depth of his or her spontaneous feelings rather than just anxiety-driven compulsion, resulting in the person growing to actualize his or her inborn potentialities.

            skippy… Good Bye Beardo, I’d wish you luck on your utopia but, that would be a lie.

            Reply
            1. F. Beard

              Where ya going?

              And if ya ain’t going then please spare me your long ad hominums because I won’t defend myself anyway, especially if I have to wade through tedius crap or did the North Vietnamese obligingly walk though known mindfields?

              This was NEVER about me. It’s about justice.

              But as for you, why should I listen to a brain that has come to the absurd conclusion that life is meaningless and is CONTENT to remain with that conclusion? There’s insanity for you.

              Reply
            2. j gibbs

              I always wanted to meet Karen Horney and asked whether that was her real name.

              It seems to me she is describing the inevitable condition of every child, inasmuch as every child is to a large extent helpless and at the mercy of surrounding adults. Even if the adults are loving, indeed even if they are doting, this is likely to be enraging for the child, and to induce the pathologies she details. Thus, it would seem every child ends up a neurotic adult, and when I look around that seems pretty much to be the case, although some adults cover it up more or less when out in public and not intoxicated.

              Narcissism, Perfectionism and Vindictiveness is a large Washington law firm.

              Reply
    3. Vj

      On the whole no matter what is used as money- unrestricted free trade has to necessarily be accompanied by unrestricted movement of people otherwise it will be seen as one sided.
      As unrestricted immigration has little support unrestricted free trade will be difficult to achieve amongst unequal partners.
      The poorer countries will insist on parity to goods as well as services for barriers to be lifted. Free trade in services implies free movement of people. Given the less then enthusiastic outlook on unrestricted migration of people it is not surprising that there is so much resistance to dismantling trade barriers.
      I think if it can all be achieved and if proper supervisor frame work can be adopted there are benefits to shrinking the world. The challenge is how to make this possible and yet non- exploitative.
      I think part of the answer is in to focus more broadly on well being rather narrowly on GDP growth.

      Reply
      1. F. Beard

        The free movement of people is Biblical but, of course, if the domestic labor force does not have an equity share then they will lose out in favor ot those who do.

        Reply
  2. McKillop

    From what I recall learning in high school history (long before the end of the “sun never setting upon the British Empire” was exposed as a slogan become meaningless) the ‘Free Trade’ practices benefited the home countries rather than their colonies. Commodities were shipped to the established manufacturies, there to be processed then turned into wealth for the owners and rulers of, say, England. These owners of the world’s great wealth had gained ownership via gifts from the monarchy, it having negotiated control with natives guided by managers sent from home.
    ’twas never about sharing justly (beyond meaningless slogans).

    Reply
    1. issac read

      See John Gray’s book False Dawn and esp the chapter on the Great Transformation referencing Karl Polyani’s work. This free market idea was a revolutionary utopian concept unprecedented in human history arising out of the some 150 years from Cromwell to mid 19th century England. Adam Smith and Ricardo, indeed economics all arise in this period. The Enclosure Act was the first great privatization and initiated the kind of poverty that made possible industrialization. I’m quoting loosely from skipping back and forth btw Gray and Polyani neither of whom I’ve had time to read in full yet, I just recently ran across them, I had imagined perhaps on this site, but in any case, their material is all over this discussion….hence the insert. Gray is professor of European thought at London School of Economics.

      Reply
  3. The Dork of Cork

    This is the will to power that so many in England warned about so many years ago now,

    These leaders of orcs have been tremendously successful / efficient at marshaling the worlds resources at the expense of local redundancy.

    We cannot afford to buy what they are selling yet they want to sell us yet more stuff!

    This modern world we live in is a expression of pure evil.
    The entire world is a Cromwellian fascist state.

    Look no further then the Euro Soviet.
    Almost no production services local demand.
    We send our money to the financial centers and all they can give us in return is yet more cars to sustain their demonic scarcity engine.

    Reply
  4. WGersen

    As a public education blogger, I can’t help but notice the parallels between privatizers desire to adopt a “Common Core” and the desire of multi-national corporations to “…move in the direction of common fiscal concepts, a common monetary policy, and common ideas of commercial responsibility”.

    Reply
    1. TheCatSaid

      Good point.

      These various drives to conformity in ideas, knowledge, trade terms, and other things — (e.g., the kinds of “ready meals” / fast food offered in the supermarkets and fast food outlets; the kinds of approach to personal health care; seed varieties; as well as the limited ways we are encouraged to think of money, finance and micro- and macro-economics) — this perverse drive to conformity makes us and our “systems” increasingly vulnerable.

      Perhaps that’s a feature, not a bug, at least as implemented by some of the current people driving these trends.

      It seems paradoxical that while we’re supposedly being offered a wider variety of “products” and “services”, underneath it all is an increasing deficit of variety in ways of thinking and of perceived options.

      Reply
  5. Banger

    I have to object to this article. My father was involved in trade negotiations in one way or the other for several decades. He and most of his colleagues who came of age in WWII believed that liberalizing trade was part of the efforts after WWII to avoid the kind of wars that the first half of the twentieth century saw. These people wanted a world that was more tightly knit and less nationalistic. Most of the people involved with direct negotiations wanted a more peaceful world that lifted all boats, not necessarily a world dominated by corporate oligarchs. My father and his generation of diplomats were social democrats who believed that the corporate sector should be dynamic and regulated. Did corporate oligarchs take advantage of the situation? Of course but with the acquiescence of both politicians and the public.

    Today, trade policy has changed drastically–it is specifically constructed to mainly benefit the corporate sector at the expense of other actors–not because the negotiators and corporations that they serve are “bad” but because the public has surrendered power to these forces. The left in particular, is responsible for, essentially, abandoning the field allowing the rightward drift we’ve seen since 1978 which got worse as the post-WWII generation eventually retired from gov’t service. Now their dreams have been thrashed largely by my narcissistic generation (boomers).

    Reply
    1. Generalfeldmarschall von Hindenburg

      This is a common skein in history that goes back to the Victorian Classic “liberal” ideology. They held that free trade (& British finance) would bring the great powers naturally into concord as business interests channelled violent impulses into economic competition.
      Sound familiar? I think a lot of this sort of thing really is high minded and idealistic, but then in those days, if you were a Russian nobleman watching French and English banks get rich off the steadily mounting state debt of your country, you might get suspicious about all this brotherly love stuff coming along with it. Or a German factory worker or a Spanish olive grower or whatever. Then of course it all blew up. F. Scott Fitzgerald had something pithy to say about that.

      Watching these drones from all the best schools and best families spout the same garbage today, it actually helps understand the late Victorian era much better. And maybe well have the same results. Because under the veneer of friendly competition and the inherent efficiency of markets is a rapacious bunch of sociopathic greed heads who give the technocrats their marching orders.

      Reply
      1. psychohistorian

        Thank you for clarifying where the focus should be……on the global plutocratic folks that OWN the corporations.

        I am sure that Banger’s father and his cohorts were confident they were doing their best for humanity but the decisions made by the owners of capital over the past century seriously call those decisions and efforts into question…..give new meaning to the term rape and pillage.

        Reply
        1. Banger

          At one time the capitalists were not all powerful–not like today. There was a balance of power. The power elite did not get nastier but the opponents (the left) got weaker for a host of reasons. The political class had no reason to fear a united left and still doesn’t despite the clearly comic-book evil of the much of the right. My father was bitter about the turn of events–he saw the complete thrashing of international law by the Bush gang and an oligarchy run wild.

          Reply
          1. psychohistorian

            I am 65 and have been watching and studying this shit for over 40 years. I think your short sighted claim that it started with the Bush family is sad and I am trying to encourage to read a bit more history. I don’t have access to the paper I read in the early 70′s (from Battelle or SRI) about where and how the US got its bauxite in the 40′s forward but a read of The Shock Doctrine might give you a hint.

            We have a centuries old problem here and you seem to think we can tweak it back to pre Bush president era and all will be good…..like I said, sad.

            Reply
          2. j gibbs

            “at one time the capitalists were not all powerful?”

            Yes, I think it was 8:47 on September 16, 1936, or whenever they pushed through the Social Security Act. They recovered almost immediately, made up for lost ground in WWII, really got things moving with the National Security Act (1946) and Taft Hartley (1947). The Entertainment Industry and the State Department were full of Reds, but those were quickly cleaned out, making the Country safe for advertising and public relations.

            Reply
        2. allcoppedout

          Churchill had diplomacy as telling people to go to hell in a manner that would lead them to ask for directions. My old man was WW2 and like Banger’s I wouldn’t doubt the motivation. Diplomacy as war by other means had been outed long before though, as well as what trade agreements were about (UK – Argentina between the wars is a glaring example). I am unsure about all trade negotiations. Even well-drained level playing fields favour the team that has one and can practice in such conditions. I think the problem is we have never implemented transparent money, something that suits traders.

          Dad assumed the espoused manners of the bosses true, conflating use of these and promises in them with virtue, at least until Suez. Even the idea we might publicise trade agreements to death seems unlikely when one compares Eden and Blair.

          Reply
      2. Dan Kervick

        It’s earlier than the Victorian era. Much of early modern economics came into being as a critique of mercantilism, and a commitment to free trade was a core element of that critique.

        Reply
        1. just me

          I once went off on a tangent of looking at as many of Yale University’s stonework sculptures and friezes as I could find pictures of online (God bless flickrfolk!). I was trying to find where the Sabatini quote is that no one knew was pulp fiction Sabatini until years later when an undergrad recognized it. Joke on scholars! I didn’t find the Sabatini but I had a great time looking. Thing was, Yale is like a Disneyland of witty sculptures with jokes scattered in with serious stuff, although maybe it’s all jokes and I didn’t get some. Like “Festina lente”– make haste slowly. Etc. James Gamble Rogers thing, the architect, whose likeness is said to be in the Christ sculpture at the library entrance. Anyway, over the entrance to Davenport College are, on the left, Camera Principis (the prince’s chamber — Coventry coat of arms — I dunno), and on the right, Mare Liberum: http://www.flickr.com/photos/tonianne/3019545460/in/photostream

          So, on my tangentquest I found Wikipedia’s entry for Mare Liberum — freedom of the seas, and it goes back to a treatise by Dutch jurist/philospher Hugo Grotius in the early 1600s written to justify the Dutch East Indies Company capture and taking of the Portuguese merchant ship Santa Catalina and her cargo, which was so rich it doubled the capital of the Dutch East Indies Company. Wasn’t that theft and against the law? Hugo said no, naturally not. In logic that I can’t follow, which maybe is why it’s carved in stone at Yale but I don’t know, Grotius was arguing free trade, and that the sea was international and belongs to no one and is free to everyone — a commons, like air. So the Dutch East Indies Company can steal another company’s ship on the high seas, well actually anchored off Singapore? I guess: Breaking up a monopoly, because the Portuguese supported Mare Clausum, closed seas, instead… as did England btw.

          I expect this has something to say as well to Lambert’s recent post on Elinor Ostrom’s Nobel-winning debunk of the tragedy of the commons. In comments on Corrente, the Magna Carta’s Charter of the Forest was brought up, the way the commons protected itself from the king/private owners. Would love to learn more about that, and Lambert does not fail: http://www.correntewire.com/comment/227835#comment-227835 … Also more about the commons here, James Levy and replies: http://www.nakedcapitalism.com/2014/02/elinor-ostrum-prisoners-dilemma-approach-hermneutic-suspicsion.html#comment-1864828

          Meanwhile, here and now, in terms of management of the globe’s commons by supranational corporations, I think of BP and the Gulf of Mexico, and Obama’s worse than uselessness. I wonder what James Gamble Rogers would have sculpted about that.

          Reply
    2. Fíréan

      I truely believe that there were many sincere persons involved within establisment of this whole “project” at the onset, who had recently experienced the Second World War, and were unaware of the ulterior motivations and intentions of others within their ranks. Not only they but the general public got hoodwinked too. How many throughout the last sixty years or more thought that they or their country were fighting, and dying, to spread democacry ?

      Reply
    3. j gibbs

      I don’t believe it’s coincidental that the best and the brightest nearly always turn out to be bubbleheads. They get these cuckoo ideas up at Harvard, where they are all taught to ignore Marx, Veblen, Henry George, and anyone else who writes about things the way they actually are.

      Of course, the problem is that they want to preserve their own elite position while simultaneously making the world more perfect. I’m sure it never occurs to many of them that the world’s problems are caused by preservation of their elite position.

      Reply
      1. diptherio

        I think our “best and brightest” turn out to be bubble-heads at least in part due to the over-estimation of self that seems to occur to most everyone when they are placed in a privileged position. I think the recent experiment on openly-rigged Monopoly games is telling in this respect, and explains a lot of otherwise inexplicable aspects of people’s thinking. I’m being treated better than others and therefore I must be better than others… Even the best intentioned people can fall prey.

        Reply
    4. Matt Stoller

      The corporate liberals were in many cases well-meaning peace-seeking globalists, and multinationals were less malevolent towards American workers at the time, hence my allusion to the Treaty of Detroit.

      So I’m not sure what your objection is.

      Reply
      1. Banger

        I felt you were painting with too broad a brush concerning the people actually doing the negotiating. Policy was more nuanced and people in government actually did have the interests of the American people at heart. I agree with you that they did not fully understand the implication of what they were doing. But how were they to know from the eighties onward the public would drift inexorably towards the right and give the capitalists the keys to the Kingdom.

        Reply
        1. different clue

          How much of the public was against NAFTA before it was passed? Quite a lot, as I remember. It took Clintonite Democrat treachery to get it passed. The public never accepted it during the 80s. That is why the Republicans could never get it passsed. So it might be well to stop lying about the public.

          Also, I have my doubts that the One World Corporate Plantation planners were well meaning and not smart enough to know. Is it purely coincidence that they bequeathed their successors and patrons every tool needed to achieve what the battlespace was shaped for them to achieve? Perhaps certain useful idiot fellow travelers really meant well.

          Reply
          1. Banger

            People were unsure about NAFTA but they rolled out all the big guns for it and people gave the leadership the benefit of the doubt. But the people are always fooled and that doesn’t absolve them–decade after decade they believe the leaders. Eventually people have begun to understand that the officials are liars and now, perhaps, they are getting that the mainstream media cannot be trusted which is why no future trade deal has a chance of being passed right now and big wars are not likely either.

            Reply
            1. different clue

              Many people were not fooled. They opposed NAFTA beyond the day of its passage. I do not know how many pro-NAFTA D-officeholders had majority anti-NAFTA constituencies but I feel confident some-to-many of them did. They betrayed those constituencies by choice or under Clintonite extortion. Not being armed or prepared to launch civil insurrection or civil war or threaten assassination of pro-NAFTA officeholders if they voted for NAFTA is not the same as “giving their leadership the benefit of the doubt.” Again, it is well to stop lying about the anti-NAFTA portion of the public.

              Reply
  6. Fíréan

    The same multinational corporate interests lie at the heart of the European Union, and such was witten back in the early nineteen eighties. The article I read was printed in the International Herald Tribune of the day, when the European project was evolving from the Common Market to European Economic Community to the European Union and on.
    As was stated back then, there would be no oppostion yet support from the Left as they too saw the opportuniy to more easily gain overall power and impose their agenda, though bureaucratic rather than corporate, through such an undemocratic structure or “Union”.

    Reply
    1. Synopticist

      And the European left is still deluding itself about the EU’s nature. It’s leaders seem to think that if they can win the bureaucratic and legal battles over cuddly socially-liberal policies like gay rights and gender discrimination then everything will work out OK in the end.

      It won’t.

      Reply
      1. TheCatSaid

        In some smaller political parties the potentially beneficial social aspects of the EEC were naively thought to be sufficient to counter-balance the negative economic aspects. Big mistake.

        Reply
  7. Ulysses

    “But to fulfill its full potential the multinational corporation must be able to operate with little regard for national boundaries – or, in other words, for restrictions imposed by individual national governments.” This is pretty much where we have already arrived. Yet the “little” regard that our corporate overlords now show towards national governments– bribing politicians, corrupting regulators, spending money on PR campaigns to mislead people that their actions contribute to the common good– is now seen as too much effort. The passage of TPP and TAFTA would allow the big multinationals to openly enforce a global regime that privileges their profits over any other consideration. The sole remaining function of “governments” will be as monopolizers of violence– used to prevent anyone from interfering with, or even criticizing, their wealth extraction activities.

    It is no coincidence that private security outfits like Stratfor are already deeply embedded in our supposedly public “law enforcement” agencies. We commoners can no longer aspire to having any meaningful rights, other than the right to produce wealth for extraction by our rulers. Once we fail to produce wealth for them we become dispensable. The continuing project of the neoliberal “governments” is to shred any humane safety nets remaining from a kinder era, so that we “useless” ones will perish more quickly.

    Reply
    1. Banger

      We commoners have laid down with our legs wide open waiting for the oligarchs to have their way with us. We still have the freedom to counter this movement to authoritarianism but most of us love the fruits the oligarchs class has delivered–the electronic toys, the absurd luxuries that have become necessities, the lies we crave that the entertainment media and the news manufacturing industry are only too happy to supply us with.

      Reply
      1. JTFaraday

        “We commoners have laid down with our legs wide open waiting for the oligarchs to have their way with us.”

        Oh yeah? And when did that start?

        Reply
      2. different clue

        Is that why the Unions, among others, all supported NAFTA? Oh wait, they didn’t. They opposed it. So what “we” are you talking about? People like you? This sounds very much like the snobbish hippy talk from the 60′s, looking down their noses at working people from generations of poverty who finally had something for the first time in their lives. Something which Free Trade was designed to take away and destroy once and for all.

        Reply
        1. Banger

          Reeeelax—The general population, as a group, has continued to elect stooges in increasing numbers since 1978. They have swallowed the lies of the media because they believe in the American Dream and endless mass-quantities of products that would emerge from NAFTA and NAFTA and general trade policy did deliver extraordinary large amounts of cheap goods and that’s what the majority wanted and still may want.

          The left stopped functioning almost completely and fell for the fraud (and he was obvious) Obama in 2008–by dangling a shiny object to what was left of the left they all fell in line and worshipped a center right politician. Where is the left? Where is the power it can wield?

          Reply
          1. j gibbs

            The people have been electing stooges since the Civil War. Garfield tried to escape stoogism, so they shot him. Some people think the same was true of Kennedy. FDR fooled everybody for a while, but he also engineered America’s entry into WWII, so I give him mixed reviews.

            The last real democratic president was probably Andrew Jackson. He was also the first real democratic president.

            Reply
      3. Ulysses

        Speak for yourself! I was tear-gassed along with my parents at an anti-war protest when I was 6 years old in 1969. In 2011, I had my ribs cracked by NYPD on Rector Street for trying to shut down the stock exchange. I am happy to say that I will definitely be a free man in my grave before I ever live as a puppet or a slave.

        Reply
        1. Banger

          I’ve been on the left and done actions and helped organize demonstrations. I’ve put my ass on the line. But the fact is that the majority of the American people, except back in the 60s and early seventies are not impressed with the left and always vote for more mass-quantities of junk for them to play with–I wasn’t attacking you or activists other than say that our tactics and our organization sucks big time. But even if it didn’t it would be an uphill fight to pry people away from their cable shows, toys and porn. Like, don’t you get that? Where is the influence of the left?

          Reply
    2. jrs

      “The sole remaining function of “governments” will be as monopolizers of violence– used to prevent anyone from interfering with, or even criticizing, their wealth extraction activities.”

      Well put. I’m as firely as the come in outrage and rebellion but there is a more resigned perspective. Ultimately, as long as things stay as they are, like the grace of some diety, we do just live at their (1% of the 1%) permission, don’t we? So long as they decide we should live. So long as the planet is livable, which is up to them (and they don’t seem to care).

      Reply
  8. Generalfeldmarschall von Hindenburg

    The way Maastricht played out was an abject lesson in how these people operate. Vote “no”? That’s ok, well just hold the referendum again until you get it right. That is if there’s even a referendum. In the US we had Clintonoids with “fast track”, because not only were the commons too poorly informed about the glorious utopia of free movement of capital, but congress people couldn’t be bothered to read the proposals. I remember it well.

    Reply
    1. psychohistorian

      I keep wanting to ask my Oregon congress/senate-critters….why couldn’t you have been filibustering these “fast track” trade and Patriot Act efforts and shutting down the government like the Cruz dude?

      What are you going to tell to all those wasted lives in jail for the Drug War you would not stand up against until now?

      We got the best government Big Money could buy!

      Reply
  9. The Dork of Cork

    Reading IEAs official documents is enough.

    The Anglo dutch monetary /oil cartel concentrate almost exclusively around increasing the rate of profit via efficiency measures with the reduction of subsidies for the home market which is under attack.
    Local or national redundancy measures which reduce the rate of profit and therefore flow of wealth to the financial centers is obviously not considered.

    The energy released is then used to sell the population more cars and other consumer stuff of a conduit nature so therefore no capital is saved for another day.

    http://www.iea.org/publications/freepublications/publication/Ukraine2012_free.pdf

    “Another strategic priority is the progressive and predictable removal of subsidies for gas,
    coal and electricity consumers and reallocation of budget resources towards energy
    efficiency support measures. Although this may be perceived as socially difficult, it can
    deliver manifold benefits. These include: improving public finances and redirecting resources
    to support energy efficiency; providing price signals to industrial and residential customers
    to modernise equipment and practices, and to invest in efficiency improvements; and
    improving the financial situation of public companies that are burdened with the high
    costs of subsidies. Efforts to reform energy subsidies need to be accompanied with
    targeted support programmes to protect vulnerable communities from the full impact of
    higher energy prices and in parallel to create a strong policy framework to support
    energy efficiency improvements. They also need to be accompanied by the systematic
    installation of meters and the possibility to adjust consumption accordingly.
    Over time, subsidies to the coal industry will also need to be removed. They will need to
    be accompanied by social programmes to support areas where mines are closed and
    support schemes for structural adjustment of the concerned regions.”

    Yeah right …………….

    The surplus produced via efficiency programmes is merely wasted on conduit goods.

    “Energy consumption in the transport sector in Ukraine is relatively small. Rail transport
    plays a leading role in freight and passenger transportation. The rail system length is
    22 800 kilometres (km), of which 8 300 km are electrified. The rail system transports
    over 300 million tonnes of freight and more than 500 million passengers per year.
    Ukraine has 18 ports, 8 shipyards and more than 100 airports.
    Road-based transport energy consumption in Ukraine is about 7 ktoe, 10% of total final
    consumption (compared with 34% in the OECD).23
    The Transport Strategy of Ukraine for the Period to 2020 (2010) sets energy efficiency
    objectives, but does not provide for the actions to achieve them.
    Motor transport has been on the
    increase to reach more than a billion tonnes of freight and 2.5 billion passengers per year.
    The length of general-purpose motorways totals 169 000 km. In the last 20 years, the
    level of car ownership has risen and passengers have shifted away from public transport”

    This is classic Rockefeller style demand management which sucks out the wealth from these conduit countries and people.
    The real cost to the subject countries of Europe from Bank of St George operations is growing ever larger.
    We as a people of the Euro soviet must push our trade system ever further up in tempo to service London and other financial city real goods deficits.

    This is total monetary warfare.
    Ireland is now a classic modern conduit consumer economy which is really a war economy – almost all of our oil consumption is somehow detached from the domestic economic loop, yet we must pay for the privilege to drive around in circles via rationing of domestic goods !!
    This explains the meaningless nature of our present political structure and society.

    The EU is the most evil political construct ever created – its a demonic apparatus of control.
    Yves never explains the trajectory of modern capitalism for some reason…….
    We had Genoa , Holland , UK and the US – all expanding for apparently pointless reasons.

    Who are these people Yves ?
    Why do they continue to increase the scale of banking operations when its mathematically certain that this will end in total disaster?

    Reply
    1. Vj

      Well following F. Beard’s thoughts I might offer you equity instead of money if that is all right with you. The equity will be in a soon to be formed and then immediately bankrupted transnational corp.
      We are currently in heated debate as to the best name for this cutting edge entity. You may also offer suggestions but will have to pay legal tender if you absolutely want naming rights.

      Reply
    2. Vj

      Following F. Beard’s Logic in this case I am considering giving you equity rather than money. The equity will be in a fine to be formed and then soon bankrupted entity. Transnational of course.
      Am considering names for this entity. Wording is important – look at the care the fed took with word smithing their press release during 2008. Will consider your suggestions for naming if accompanied by adequate legal tender. Don’t miss the opportunity.

      Reply
  10. craazyman

    There are a lot of nation states which, if weakend, would leave their citizens probably better off.

    There’s also a lot of corporations which, if weakend, would leave all citizens probably better off.

    Do you weaken the nation state or the corporation? Is there an optimal circuitry of collective enlightenment? Do you deal in abstractions or in realities? What’s the difference between a nation state and a corporation? Is there one? You can’t escape the dialectic, the faster you run the more entangled you get. Testament of Amram, Dead Sea Scrolls, Manuscript B.

    Reply
    1. psychohistorian

      I want to weaken the folks that OWN the corporations and nations states you refer to.

      Then we just might get somewhere.

      Until then it is just misdirection away from the head of the rotting fish we call civilization.

      Reply
  11. JTFaraday

    Are we sure that the aim of the 20th c. corporate enabling anti-communist liberal regime was to weaken the state or was its aim merely to weaken communist/ socialist states while strengthening capitalist regimes, like that of the US?

    In any case, whatever anyone may think various historical actors intended, this does seem to be what was actually achieved. And as Naomi Klein details in The Shock Doctrine, this was achieved through force.

    Because I’m not sure that I would understand the current TPP “trade agreements” as weakening capitalist, or corporatist, regimes so much as more firmly aligning the power of states with the interests of corporations, and then deploying that power in the pursuit of those interests.

    This would undermine our ability to try to create the democratic government (we never quite had in the first place), much as the autonomy of the budding democratic governments that Klein shows us fell to US placed authoritarian strong men. This was The State properly understood as far as US backed capitalists were concerned, and these were strong states not “weak” ones. The citizenry had no actionable civil rights or civil liberties, etc. The governing regime did whatever the f*ck it wanted, in a state of low grade (and sometimes high grade) war on the citizenry.

    Someone is sure to tell me this is “just semantics,” but I don’t think so.

    Reply
    1. Tony Wikrent

      There were some elites who were quite explicit about their desire to smash the sovereignty of nation states. There is an infamous direct quote from David Rockefeller’s (his memoirs, I believe) which I always considered was part sarcasm, about his desire for a one world government. I was surprised Mr. Stoller did not use it. These elites were the kernel of the “eastern liberal establishment” that William Buckley and other conservatives began to attack in the 1950s and 1960s. Of course, part of the elites’ defense mechanism was to convince people that anyone who made a public show of attacking the Trilateral Commission, et. al., were simple-minded “conspiracy theorists” who were best ignored. Exactly what they did to the Populists and Henry George in the nineteenth century. It worked great then, and it’s worked pretty well so far today.

      In the 1990s, I worked on a team that tracked the finances of the royal families of Europe, to find what connections there were with the old opium and slave trade fortunes. My particular role was to cross-index the boards of directors of such as Rio Tinto Zinc, DeBeers, British Petroleum, Royal Dutch Shell, and so on. It’s all in plain sight, actually. In December 2011, the Swiss Federal Institute of Technology released the results of a similar project, which used massive computingg power and was much more robust and comprehensive, but which reached pretty much the same result. Business Insider’s story on the project had an eye-catching graphic of a densely interconnected sphere, and a nice list of the 50 most important companies in the world.

      Reply
  12. Chauncey Gardiner

    Thank you for raising the public visibility of these profoundly anti-democratic supranational agreements, Matt. To me, the paramount considerations here revolve around our national sovereignty and system of governance, including the primacy of our legal and monetary systems, and our capabilities and capacity to unilaterally initiate change in response to changing conditions.

    If these agreements are approved, the TPP and TTIP would appear to trump the Constitution and will of subsequent democratically elected governments.

    Large transnational corporations are the antithesis of democratic institutions. Blanket approval of these agreements should not be casually and freely given under the guise of “free trade” under any circumstances. We don’t even know what’s in these highly secretive agreements.

    Reply
  13. Binky Bear

    It’s a cookbook! A cookbook!

    Rod Serling, To Serve Man, Twilight Zone 1962 episode based on Damon Knight short story of the same name.

    Reply
  14. FederalismForever

    Excellent read. Many don’t realize that through most of America’s history Democrats have promoted “free trade” far more than Republicans, at least up until recent decades, when many former Southern Democrats jumped to the Republican Party and convinced Republicans to jump on the “free trade” bandwagon.

    Prior to the Civil War, it was the Democrats and the sympathetic “doughboys” in the North who advocated for reduced tariffs and free trade, as this benefitted the Southern plantation economy. After the Civil War, it was the Republicans who adopted the Hamiltonian protectionist “American System” with its high tariffs, leaving it to Grover Cleveland (the lone Democrat President during this time) to advocate for free trade and laissez faire. Similarly, it was Democrat Woodrow Wilson, and his Underwood Tariff, that reduced the McKinley Tariff. Moving forward, as this article states, it was the Johnson Administration in 1967 that would again take up the free trade agenda. But it was Southern Democrat Bill Clinton and Southern Republican Newt Gingrich who would combine to push the free trade agenda to the next level. Ross Perot is really the last Presidential candidate to challenge the free trade orthodoxy. It is so strange that the Democrats have a populist/pro-labor reputation, when their party has been the most vocal proponent of “free trade”.

    Reply
  15. Jerome Armstrong

    Back in the day, I remember when coming across this in business school as an undergrad. The business professor was displaying quite the “benefit for all mankind” type of attitude. Basically, that of a ‘rising tide raises all boats’ type of rationale.

    So, ‘yes, workers are being exploited in A country, and once they are raised, the corporations move onto B country, and so on, eventually reaching X, Y Z, and everyone’s better off’ by then, right? A never-never land to point to as the beneficial goal to rationalize the push for the lowest possible wages and benefit in the present. A schizophrenic mindset. One that reverses the usual existential morality that mixes nihilism and idealism.

    Not that, ‘I’ll do all the good I can but eventually its all going to end up shit’ type of hopeless heroism; but instead, ‘I can shit on all now because eventually all will wind up smelling like roses after it’s all been shat upon.’ As a mindset, it’s not a far throw from the Christian precursor which used heaven as justification, to this global monster.

    It’s been obvious for a while now that the world, and not the nation-state, is where the next ideological battle will be held. The multi-nation corporations have been laying the ground rules down for quite a while.

    Reply
    1. different clue

      The nation state concept was used to break up and tear down the PreWarI royal family empires in Europe. The nation state concept can be weaponised and used again to tear down
      the Free Trade World Order. The non-rich majorities of a few big nation-states have to reconquer their governments and renounce/ withdraw from all Free Trade treaties and organizations and impose Equity Fair Trade against all imports from Free Trade platforms.
      Of course the Free Trade entities will attack such Fair Trade nation-states just as thoroughly
      as the Powers attacked Soviet Russia right after WWII. So its “simple” but not “easy”.
      But killing the Obamatrade pacts currently under consideration would be a first step towards
      “rollback” against Free Trade and the Globalonial Corporate Plantation.

      For example, if we withdrew from WTO ( and as many of the earlier GATT conventions as necessary) and cancelled MFN for China, we could then impose a carbon tax against every fossil fuel use in America and then ban imports from every country which fails to impose the same carbon tax. We can’t do that now. It would be a “non-tariff barrier” or some such.

      Reply
    2. Lambert Strether

      “[T]he world, and not the nation-state, is where the next ideological battle will be held.” Which is why all the labor (and other) troubles with the World Cup are so interesting (and may prove instructive).

      Reply
  16. Gentlemutt

    Interesting that this piece starts off with Michael Froman’s ignorance about the development and purpose of US trade policy. Froman was Citibank errand boy for that evil genius Robert Rubin. He managed to slither out of Citi after helping ‘manage’ it into near-bankruptcy leading to the 2008/9 financial meltdown, take an incredibly slimy $5mm+ walk-away bonus for himself as special reward for being a Rubin-boy while the bank was being explicitly propped up by the US, and promptly insinuated himself deeply into the early Obama administration because Obama knew absolutely nothing except that Froman went to Harvard Law with him and Obama had to do what Rubin told him (Obama) to do.

    In effect, he was rewarded with taxpayer money to help bring down Citi and then sent to do the same to Obama. Now he gets to do the same to all us little people – in our name! And our Senate was nearly unanimous in their support for this guy as Trade rep, so there is no “hoping for the best” here….

    Reply
  17. different clue

    I reread the bolded lines by George Ball. It seems to me he wanted to restore a New British Empire under any other name. “Parochial concerns”? That’s what the Manifest Destinists said about the Indian Nations. That’s what the India establishment says about the tribal hill and forest peoples of India today. Why should their parochial concerns about water, subsistence-providing forest, culture, etc.; be allowed to interfere with the greater good of a billion mainstream-India human beings?
    The people who made all these plans and wrote sanctification pieces in praise of these plans must have been deeply and utterly depraved.

    Reply
  18. different clue

    Charles Walters Jr. was writing articles of condemnation against the Free Trade concept since the 1950′s, I believe. He was certainly writing such articles in Acres USA since its founding. The Free Tradists could have found them and read them if they had wanted to.

    Reply
  19. Tony Wikrent

    Well, going back to the 1960s is better than what the bobble heads on TV do, but how about going back to the 1850s? Back then, less than a century after the American Revolution, it was pretty well understood, in the U.S., what “free trade” really was. Excuse me, but here’s a long excerpt from Chapter 5, “Why Is It that Protection Is Required?” of Henry C. Carey’s 1851 book The Harmony of Interests: Agricultural, Manufacturing & Commercial

    BEGIN QUOTE
    The object of the colonial system was that of “raising up a nation of customers,” a project “fit only,” says Adam Smith, “for a nation of shopkeepers.” He was, however, inclined to think, that even for them it was unfit, although “extremely fit for a nation whose government was influenced by shopkeepers.” As early as the period immediately following the Revolution of 1688, we find the shopkeeping influence exerted for the “discouragement” of the woolens manufacture of Ireland; and while the people of that unfortunate country were thus prevented from converting their own wool into cloth, they were by other laws prevented from making any exchanges with the fellow-subjects in other colonies, unless through the medium of English ports and English “shopkeepers.”

    Such being the case, it was little likely that any efforts at combination of exertion among distant colonists, for rendering labour more productive of the conveniences and comforts of life, should escape the jealous eyes of men whose shopkeeping instincts had prompted them to the adoption of such measures in regard to nearer ones. The first attempt at manufacturing any species of cloth in the American provinces was followed by interference on the part of the British legislature. In 1710, the House of Commons declared, “that the erecting of manufactories in the colonies had a tendency to lessen their dependence upon Great Britain.” Soon afterwards complaints were made to Parliament, that the colonists were setting up manufactories for themselves, and the House of Commons ordered the Board of Trade to report upon the subject, which was done at length. In 1732, the exportation of hats from province to province was prohibited, and the number of apprentices to be taken by hatters was limited. In 1750, the erection of any mill or other engine for splitting or rolling iron was prohibited; but pig-iron was allowed to be imported into England duty-free, that it might then be manufactured and sent back again. At a later period, Lord Chatham declared, that he would not allow the colonists to make even a hob-nail for themselves….

    We see thus, that the whole legislation of Great Britain, on this subject, has been directed to the one great object of preventing the people of her colonies, and those of independent nations, from obtaining the machinery necessary to enable them to combine their exertions for the purpose of obtaining cloth or iron, and thus {compelling} them to bring to her their raw materials, that she might convert them into the forms that fitted them for consumption, and then return to the producers a portion of them, burdened with great cost for transportation, and heavy charges for the work of conversion. We see, too, that notwithstanding the revocation of a part of the system, it is still discretionary with the Board of Trade, whether or not they will permit the export of machinery of any description. (pp. 52-53)

    …The whole system [of British free trade] has for its object an increase in the number of persons that are to intervene between the producer and the consumer — living on the product of the land and labour of others, diminishing the power of the first, and increasing the number of the last; and thus it is that Ireland is compelled to waste more labour annually than would be required to produce, thrice over, all the iron, and convert into cloth all the cotton and wool manufactured in England. The poverty of producers exists nearly in the ratio in which they are compelled to make their exchanges in the market of Great Britain….

    The manufacturers of India have been ruined, and that great country is gradually and certainly deteriorating and becoming depopulated, to the surprise of those people of England who are familiar with its vast advantages, and who do not understand the destructive character of their own system. (p. 61)

    The impoverishing effects of the system were early obvious, and to the endeavour to account for the increasing difficulty of obtaining food where the whole action of the laws tended to increase the number of consumers of food and to diminish the number of producers, was due the invention of the Malthusian theory of population, now half a century old. That was followed by the Ricardo doctrine of Rent, which accounted for the scarcity of food by asserting, as a fact, that men always commenced the work of cultivation on rich soils, and that as population increased they were obliged to resort to poorer ones, yielding a constantly diminishing return to labour, and producing a constant necessity for separating from each other, if they would obtain a sufficiency of food. Upon this theory is based the whole English politico-economical system. Population is first supposed to be superabundant, when in scarcely any part of the earth could the labour of the same number of persons that now constitute the population of England obtain even one-half the same return. Next, it is supposed that men who fly from England go always to the cultivation of rich soils, and therefore everything is done to expel population. Lastly, it is held that their true policy when abroad is to devote all their labour to the cultivation of those rich soils, sending the produce to England that it may be converted into cloth and iron, and they are cautioned against any interference with perfect freedom of trade as “a war upon labour and capital.”

    Colonization is urged on all hands, and all unite in the effort to force emigration in the direction needed to raise up “colonies of customers.” It is impossible to read any work on the subject without being struck by the prevalence of this “shopkeeping” idea. It is seen everywhere. Hungary was to be supported in her efforts for the establishment of her independence, because she was willing to have free trade, and thus make a market for British manufactures. The tendency of the Ricardo-Malthusian system to produce intensity of selfishness was never more strikingly manifested than on that occasion. (pp. 63-64)

    We thus have here, first, a system that is unsound and unnatural, and second, a theory invented for the purpose of accounting for the poverty and wretchedness which are its necessary results. The miseries of Ireland are charged to over-population, although millions of acres of the richest soils of the kingdom are waiting drainage to take their place among the most productive in the world, and although the Irish are compelled to waste more labour than would pay, many times over, for all the cloth and iron they consume. The wretchedness of Scotland is charged to over-population when a large portion of the land is so tied up by entails as to forbid improvement, and almost forbid cultivation. The difficulty of obtaining food in England is ascribed to over-population, when throughout the kingdom a large portion of the land is occupied as pleasure grounds, by men whose fortunes are due to the system which has ruined Ireland and India. Over-population is the ready excuse for all the evils of a vicious system, and so will it continue to be until that system shall see its end… (pp. 64-65)
    END QUOTE

    Reply
    1. FederalismForever

      Exactly! Carey’s book was very influential at that time, along with similar theories espoused by Friedrich List. This was all part of the “American System” that originated with Alexander Hamilton with further developments by Carey, List, Henry Clay and Abraham Lincoln. This “American System” would be copied throughout the world – Sergei Witte used it in Russia under Tsar Alexander II; Shigenobu Kuma (Carey’s student) in Japan under the Meiji Restoration; in China it was studied by the Kuomintang, etc.

      What is so strange is that so many of today’s Americans don’t even know about this “American System,” even though its precepts were copied or adopted by so many countries around the world. It seems Hamilton’s protectionist system is without a home in either of today’s Democrat or Republican parties.

      Reply
  20. Lambert Strether

    Recovering this buried history is important work and kudos to Stoller for doing it.

    * * *

    Reminds of “When it changed” in William Gibson’s Neuromancer series; Stoller is untangling the players and whiteboarding the game. Looks to me like the liberals decided a super-national capitalist class was fine with them, and the neo-liberals decided an unregulated* capitalist class was fine with them, and here we are….

    NOTE * Not even culturally, as in no sense of noblesse oblige.

    Reply
  21. Paul Tioxon

    There has been a more expansive strain of thought from post WWII that was derided as “one worlders”. Internationalist that want a supra-national government, a strong UN. It was called THE WORLD FEDERALIST MOVEMENT. All of the crack pot right wingers saw its a Rockefeller/Bilderberg conspiracy to destroy US sovereignty. Of course, there are always real high minded types, statesmen and stateswomen who really are idealists and try to promote rational schemes based on ideals that are just as much social constructs as everything else promoted by opposing or competing ideas. Sometimes a strong central nation-state is promoted, especially among the core states of global capitalism. Think of G-7 or G-20 or Davos. Not that neo-liberals aren’t about the private sector, but just look at who counts in the world. The richest are also the mightiest or tightly aligned by military treaty. Think NATO, SEATO.

    But at the commanding heights of capitalism where the yin and the yang of government and business compose the total world political economy, you find the ties that bind during peacetime are commercial and during wartime military. And there has historically been strange bedfellows during both cycles of peace and war, boom and bust. Wars are usually won by the nations that can outlast the material production of the implements of the arms race. The US enforces the ban on large scale so called World Wars, which are in effect struggles for domination, not so much territorial conquest. Small scale, relatively speaking , regional conflicts, the hot wars, were preferred to WW fight to the death with nukes. Regime change not assimilation into empire, but sub-ordinate role playing within a hegemony, is the structure of the current world system that now extends into all nations. Hence the need for terms spelled out in treaty as to what your role is to be. The limits of your power. And this has been going on for quite a while as Matt points out. Not everybody agrees. Not everyone benefits, even among the elites. Not everyone is a multinational player, so not every garden variety billionaire has a stake in global trade. Some are just old fashioned patriots whose horizons extend from sea to shining sea, but not 10 miles out from either shore.

    Here are some the internationalist, the world federalists types and what they want from defined, enforceable policies among the nations we trade with. The so called sovereignty dilution was always the case. We have the most power but now, it is in decline not because we are weaker in military capacity or industrial capacity. Other nations have just grown their capacity and can resist our policies in instances where they previously just went along with us to get along with us. Nations are striking out on their own where previously they did not dare do so. The fact that it is done at all is not what would have happened 40 years ago.
    ————————————————————————————————————————-

    http://www.atlanticcouncil.org/

    The Danger of Divergence event series underlie that, essentially, all sides are now on the record, coming out in favor of financial services in TTIP, with the exception of the US Treasury. Although the G20, FMRD, and other global institutions have been viable channels for transatlantic coordination before, pressure from emerging global markets makes the coordination of US-EU rules more crucial. The American and European economies will face a growing number of new competitors from emerging markets with different financial regulatory standards in years to come, making the finalization of transatlantic financial regulatory coordination all the more important.

    from the final paragraph from the link below:

    http://www.atlanticcouncil.org/events/past-events/financial-regulatory-reform-discussion-pinpoints-ttip-as-the-way-forward-on-coordination

    Reply
    1. different clue

      Those of us who believe in resistance to globalonial colonization should support such resistance in nations growing strong enough to mount such resistance. If any such nations are taken over by their own national resisters, they can support such a national resistance here in this country.

      Reply
  22. Ellen Anderson

    Why oh why do all of you subscribe to the notion that “putting the world’s resources to good use with full efficiency” is/was a good thing! This whole enterprise that you are endlessly debating is just mad.
    “We will never be able to put the world’s resources to use with full efficiency so long as business decisions are frustrated by a multiplicity of different restrictions by relatively small nation states that are based on parochial considerations, reflect no common philosophy, and are keyed to no common goal.”

    Reply
  23. Fiver

    Point of view matters. The ‘left’ in every country that was not the United States knew all this at the time, and quite correctly named it US imperialism, or US corporate imperialism, and people like Ball were pegged, not as ‘liberal’ but as elite technocratic Olympians under the ballooning umbrella of immense US power, not for one second doubting the proposition that America was the only credible model for the global economy, or that the US State would successfully ensure the world accepts it. US planners for FDR pre-War just happened to have the same ‘vision’. Ball distinguished himself by opposing the war in Vietnam, but do not doubt his enthusiasm for the globalization project, as a good corporate capitalist in the world’s most powerful nation.

    So when, in praise of the multinational corporate, Ball swoons “…it is the ability to look out over the world and freely survey all possible sources of production… that is enabling man to employ the world’s finite stock of resources with a new degree of efficiency for the benefit of all mandkind.” we knew this was utter bullshit, the sort of PR garbage we still hear in muted form as cover for the not-quite-completed pacification of the rest of the planet. To save the World, it must first be destroyed…

    Here is a man so mesmerized by technological power in general and US power in particular that it never entered his mind that the answer to ‘finite resources’ was to curb already rocketing consumption, and the way to do that was curb the giant corporations and the State, both engaged in creating infinite demand where none before existed, because they now had the pure power to do it.

    It’s what I’ve been preaching at NC from the first time I came here – there has been a US plan for global dominion since the late ’30′s; the plan has always envisaged giant corporations and the US State as operating with near-identity of interests; the combined resources of the non-Soviet world were arrayed to break the Soviet Union though it never remotely posed the kind of threat to sovereign freedom on a global scale the US has; the EU was a US construct and US power still rules there; Free Trade, NAFTA, WTO were/are disastrous for the peoples of every country involved; corporate globalization has demonstrably done the exact opposite of what Ball claimed re ‘efficiency’ or ‘benefit to mankind’ as predicted by the ‘left’ everywhere; dozens of major and minor wars, conflicts, etc., have been waged to pacify (i.e., imposition of business-friendly regimes) huge portions of the planet and bring them into informal (but forced) Empire; that the anti-globalization movement was de-railed by 9/11, and every nation, group or individual subsequently deemed to be in the way of rapid acceleration and completion of the global integration project would become an ‘enemy’ – from Snowden to China; that the ‘utopia’ coming looks an awful lot like Hell on Earth.

    This vision cannot and must not be allowed to prevail – it will mean a human and ecological catastrophe beyond our imagining.

    Reply
    1. hunkerdown

      As rapey as Ball’s policy position was, he got the finite part right; today, to even suggest that running out might be possible is tantamount to heresy, crude oil notwithstanding.

      Reply
  24. chaussures supra

    China tells US to avoid debt crisis for sake of global economyThere is little doubt that Mr Boehner,mbt baratos, a Republican,ralph lauren italia, could whenever he wants gather enough votes from moderate Republicans and most all Democrats to reopen the government.Why he is so attached to sticking with such a bruising job is another question. His caucus is balkanised and unruly. This Congress is held in the lowest public esteem since the invention of public opinion polls. And the Republicans are

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