(Crossposted to Redstate)
…or possibly a hit and a half:
GENEVA, Switzerland (Reuters) — World Trade Organization (WTO) states sealed a deal early on Sunday aimed at slashing rich nations’ farm subsidies, opening industrial markets and putting the Doha Round of free trade talks back on track.
After failing to reach agreement in Cancun, Mexico, last September on an interim deal on parameters for negotiations in farm and industrial goods and other areas, WTO states had set themselves a new deadline of the end of July.
The text of the agreement is here: what we have here is an agreement that agricultural export subsidies are to be removed, but not hard data for when they’re to be removed. That’s subject for more negotiations, which will probably take a few more years – but haggling over the method of removal is an improvement over debating about whether they should be removed at all. It should be noted that what looks like a blog devoted to this topic – Kick-AAS – is somewhat cynical about what the results mean, but getting governments to agree on anything can be a chore and a half.
Which leads to the reason that this post’s on Redstate: the negotiations for actual hard numbers will not take place until after the election. For those of us here who support free trade – specifically, the continued reduction and removal of agricultural subsidies that have hindered the ability of the Third World to sell its products to Europe – would you prefer that those negotiations be made by President Bush, who still winces ruefully at the memory of the shellacking that the free-trade section of his base gave him over steel tariffs? Or would you prefer one made by President Kerry, who chose to incorporate anti-outsourcing rhetoric in last Thursday’s acceptance speech?
Your call, folks. Maybe Senator Kerry’ll be against outsourcing and for the elimination of farm subsidies, after all – and despite the fact that the latter would be through the WTO, an organization routinely subjected to enough accumulated psychic malice and negative energy to pierce battleship armor plate, if only the antiglobalization movement could ever get properly synchronized.
Maybe.
Moe
UPDATE: Alternatively, you could go read Dan Drezner.
Senator Kerry’ll be against outsourcing
My understanding is Kerry will try to encourage corporations to keep good jobs in the US through tax incentives, but he fully understands that outsourcing is here to stay. There’s just no reason to pay corporations to do it. Is that others’ understanding here?
“My understanding is Kerry will try to encourage corporations to keep good jobs in the US through tax incentives, but he fully understands that outsourcing is here to stay. There’s just no reason to pay corporations to do it.”
I don’t even understand what that means, much less if it makes sense as a policy. Are you suggesting he will pay corporations not to do it? Why would that be a good idea?
Sebastian,
Why would it have to be a good idea or supportable by fact? It’s Edward’s incomplete understanding of JohnJohn’s position, therefore ipso facto it warrants acceptance without scrutiny. If you think not, you’ll be a tired lad by Nov. 2.
The issue might be debatable but with JohnJohn as a candidate, we’ll never know.
“It’s Edward’s incomplete understanding of JohnJohn’s position, therefore ipso facto it warrants acceptance without scrutiny.”
Edward’s quite capable of defending himself, obviously, but I’ve never gotten the impression that he’s an unthinking Kerry supporter. Default Kerry supporter, sure – then again, I’m a default Bush supporter, so I have hardly room to talk on that topic. 🙂
It seems like both parties have claimed to advocate free(r) trade at some point or another. Then, given the chance, backed away in the face of the fact that (truly) free trade could possibly gut a number of American industries. I’ve always been far more in favor of free trade (a term applied rather ambiguously) than not. However, it seems the hardest thing in the world for an elected official to say,”This is going to hurt like hell, but trust me, it’s better in the long run.” Then again, perhaps the hardest thing in the world is for an electorate to reply, “OK, give us the pain.”
I don’t even understand what that means, much less if it makes sense as a policy. Are you suggesting he will pay corporations not to do it? Why would that be a good idea?
I believe (am 90% certain, based on what I’ve read, but don’t know the law here thoroughly) there currently are tax loop holes that make it more attractive for corporations to take jobs overseas. Whether that’s the same as “outsourcing”
(there may be a difference between hiring a subcontractor in India and moving your offices to India that is important here) I’m not sure, but I believe Kerry wants to stop allowing companies to benefit from those tax loop holes.
The way it’s working now (and I’ll disclaim this thing to death just to avoid looking stupid, so let me just say, this is what I understand, and I’m sincere, so correct me if I’m wrong but snark for points at the peril of your mortal soul), companies open offices overseas because they can avoid paying any taxes, either to the US or their host country. Kerry wants to make them pay US taxes if their host country is not making them pay taxes. They’re still incorporated in the US and making profits, so why not?
This article discusses some of the reasons companies move operations overseas, using polling and economic analysis.
There are really two issues:
1) Companies moving their nominal HQs in tax havens to avoid corporate income taxes (like Tyco did);
2) Companies moving or expanding operations (manufacturing, service centers, etc) to other countries.
The former is controversial in congress, because their favorite honeypots are shrinking. Rather than being able to tax global profits, they can only tax profits earned in the US, if the company is headquartered elsewhere. There is a bigger theme here of the US being the world’s most egregious double-taxer, but that seems a discussion for another day (perhaps one for redstate?)
The latter is a thing with unions, because of the perception that jobs are going to cheaper labor (often true, though the rallying cry carries disturbingly racist overtones). However, the reduced costs are often related to just having operations near the new markets, even if costs were otherwise even (which, by the way, they’re not, since American unionized workers have some of the highest wages on the planet). How tax incentives would work to overcome these fundamental economic phenomena is not clear to me.
So I don’t know how Kerry plans to “improve” this situation, except through rolling back free trade under the aegis of “fair trade.” But that’s speculation – does anyone have more hard data?
Either way, I look forward Doha letting me buy cheaper produce.