Global Policy Forum

“Free Trade� Takes a Dive in Miami


Forced Smiles & State Repression Can't Hide the Victory for Global Justice

By Soren Ambrose

50 Years is Enough
December 2, 2003

Reality Check
This article covers the implications of what was decided – and not decided – by the trade ministers meeting in Miami to discuss the Free Trade Area of the Americas (FTAA) from November 17 to November 21.

It is, I hope, well known that thousands of activists came to Miami to express their opposition to the treaty while the FTAA talks were taking place. The largest single contingent was from organized labor, although well over a thousand retirees came, as did thousands of dedicated direct-action protesters and representatives of non-governmental organizations. The level of knowledge and commitment, as usual, was amazing. Although the substance of the protests and accompanying teach-in events received little media coverage, the turnout was large and diverse, and the sophistication and dedication of the activists was certainly serious enough to assure anyone that the movement for global justice in the United States is alive and well and on the move.

The opposition to the FTAA that has been so vibrant and assertive in South America, the Caribbean, and Central America was also represented in Miami, and, more importantly, echoed in the solidarity of people from around the U.S. It is no exaggeration to say that popular movements throughout the hemisphere have called their governments to account, and have as a result largely stopped the FTAA in its tracks. That the U.S. government is the most recalcitrant in this regard should surprise no one, and U.S. activists should feel no discouragement for having less obvious success than their counterparts in the rest of the hemisphere. The U.S. government continues to be the driving force in the FTAA, and the U.S. activist effort remains crucial.

The cooperation and respect that characterized the interactions of major labor unions, radical direct action protesters, church groups, and NGOs in Miami, hammered out over sometimes-difficult issues, has made the U.S. movement stronger and more aware of its own potential. The outcome of the Miami talks and the resilience of the movement in the face of intense repression in the streets of Miami reflect, I think, a momentum that will bring the movement to a peak at the time of the mobilization coming together for the IMF/World Bank spring meetings (April 23-27, 2004) in Washington, DC.

What did get media coverage was the over-the-top brutal response of the South Florida law-enforcement agencies to the protests. Nothing I have seen in North America or Europe – and I've been to a few protests – matches the level of provocation, intimidation, and hostility I saw on the streets of Miami. There is so much to say about what happened, about the arbitrary violence visited upon defenseless elderly people, the mass arrests, the casual assumption of a war-like attitude against people of the U.S. for daring to have opinions at variance with local and national power structures, and a local media so poised to parrot the authorities that they often outdid the police.

Much of it is being said by others who were closer to the worst repression, and what I have to report about the trade talks themselves is long enough to occupy most readers. Suffice it to say that the crimes committed against the U.S. constitution and against common decency in Miami will not be forgotten any time soon. Legal action is underway, and a broad range of organizations are working together to demand that the climate of casual repression, fear, and hate fostered by the Bush/Ashcroft Administration be exposed and ended. While it is true that the indignities and brutalities suffered by people on the streets of Miami still pale in comparison to those that are all too routine in countries like Colombia, Guatemala, Bolivia, and most recently the Dominican Republic, a giant step toward those unenviable benchmarks was taken in Miami, and must be rejected in the United States with as much vigor as possible. That the repression was financed in part by $8.5 million in federal funds contained in the most recent Congressional appropriation to support the military occupation of Iraq is a sad, and appropriate, reflection of what this country has come to. The task of recovering some measure of sanity in this all-too-flawed country is indivisible from the struggle we wage for global justice every day.

That said, let me offer a few reflections on the outcome of the "other" events at the FTAA talks in Miami.

None of the Fun of Cancún: Boring (not Boorish) and Shortened
Months of preparation were devoted to the FTAA summit in Miami, scheduled for November 20-21. Caravans of opponents organized and traveled from across the U.S. and Canada; seminars and workshops were planned; activists from across the hemisphere scraped for funds to get to Miami. The 40-plus law-enforcement agencies of South Florida charged with protecting the trade ministers from the imagined mischief of protesters spent months building up their stock of weapons and adrenaline. Trade lawyers and public relations consultants bickered over both technical details and big-picture economic philosophies.

So it felt almost disrespectful when the office of the U.S. Trade Representative (USTR) announced at 5:50 pm on the meeting's first day (of the two scheduled) that the Brazilian delegation's press conference scheduled for 6 pm was cancelled and would be superceded by a 6:45 pm press conference featuring all 34 trade ministers. Speculation that an early agreement had been reached was confirmed by a second announcement about 15 minutes later: this would be the meeting's closing press conference. After all that work, to have the meeting stop at the halfway point, after less than six hours of official talks!

The sense of being cheated was probably strongest for those who had been in Cancún for the five-day September summit of the World Trade Organization (WTO) which set the stage for Miami, and particularly for those with a seat in the media center, where all sorts of maneuvering, posturing, back-stabbing, manipulation, deceit, and bravado were on display in a dizzying series of press conferences, corridor chats, stunts, and communiqués. The media center in Miami was, by comparison, a complete backwater. The U.S. government was more successful this time stage-managing the process and keeping the surprises and excitement to a minimum. The goal was to assure everyone that the assembled negotiators were getting along fine and reaching measured agreements with equanimity, and to wind it up and get home before too many questions were asked.

The U.S. Swallows Hard & Smiles Wanly
The closing press conference simply confirmed that the compromise between the U.S. and Brazil, already widely reported on for several days, was now being accepted by the larger body. The result was a defeat for the U.S. government and its corporate constituency. Rather than a hemisphere-wide treaty that would lock in investment and patent rules that favor multinational corporations, as had been promised for nine years by both the Clinton and Bush administrations, the U.S. now had to settle for what the Brazilians made their bottom line: an agreement, called by some "í  la carte," where each country could opt-in or opt-out of each provision of the treaty. The sole U.S. accomplishment was in keeping the smorgasbord open: the FTAA countries will be able to opt into or out of agreements on issues in all nine technical categories it wanted (including investment, patents, market access, dispute settlement procedures, and anti-dumping measures).

No silver stake has yet been nailed into the heart of the FTAA, but its fangs are significantly dulled. The í  la carte approach, which was never even contemplated publicly until after Cancún, appears to be a done deal, and provides the room needed for governments to avert the coercion that would be the agreement's greatest danger.

But activists will still have to guard against a Hollywood ending where the injured monster roars back to life, its viciousness redoubled by its rage. One of the greatest victories for the global justice movement – the defeat in 1997 of the Multilateral Agreement on Investment (MAI), which would have pressured governments to give up their capacity to regulate foreign investment, provides a lesson worth remembering. After the Organization for Economic Cooperation and Development (OECD) was finally persuaded to halt discussions on the MAI, it has continued to pop up, in different guises, at the IMF, the WTO, in bilateral trade treaties, and at the FTAA; indeed, the U.S.'s insistence on keeping MAI-style provisions in the FTAA was one of the key reasons for its failure. Those silver stakes are elusive.

Making agreements "voluntary" can only be a partial comfort: joining the WTO, after all, is voluntary. Weak governments come to the table out of fear -- often backed up by explicit threats -- that failure to volunteer for what the U.S. recommends will mean being frozen out of global markets entirely. These realities of power create the irony of meetings like Seattle and Cancún, where the majority of WTO members work very hard to prevent the organization from agreeing to anything substantial. They have to be at the table to stay in the game, they think -- and to keep the rich players from walking away with all the chips.

What the global justice movement wants is to start a new game with a new rulebook – and not necessarily one identical to what governments like those in Brazil or Jamaica or Argentina would like. Calling Cancún and Miami successes may, in that context, seem excessive. But so decisively preventing the U.S. (and in Cancún, the European Union and Japan) from winning anything at either meeting is a solid achievement, and advances the larger cause. It could be objected that the U.S. won something simply by being able to say that the negotiations are moving forward with all of the issues, including investment, still on the table – or, to use the USTR's metaphor, the FTAA train has left the station with all nine boxcars attached. But, as Deborah James of Global Exchange pointed out, those boxcars are empty, and looking toward the next sub-ministerial meeting, slated for Puebla, Mexico in February, "rather than moving on track towards success, it looks more like a train wreck ahead." The good kind of train wreck, that is.

What Has Been Won, and How to Preserve It
What has been won is pretty big: confirmation, after Cancún, that developing countries will refuse to be bullied by the U.S. and other wealthy governments; confirmation that other countries will resist the coercive rules that would cripple their capacity to regulate investment and provide basic services such as the provision of water, health care and medications; and confirmation that U.S. insistence on further stacking the deck for its agribusiness interests will be opposed by countries whose farmers and food security have already been devastated by U.S. policies.

The question for civil society groups now is whether it would be better to hope for a small-scale FTAA to be finalized and signed on schedule – within the next year – or to hold out for a complete collapse. It may well be that sealing a non-binding FTAA now, even with skeletal provisions on investment and intellectual property rights written in, would more effectively minimize the chances for mischief down the road, so long as it would not be possible for the U.S. to use it to bludgeon countries into making future commitments. Better the U.S. should have to convince the rest of the hemisphere to start an entirely new process than to keep the FTAA process open for the U.S. to twist in future years.

Of course it is hard to predict what direction the talks will take in 2004, though the "lite" approach seems to be the course for now. Regardless of what surprises may loom, the result in Miami should be recognized as a victory for progressive political forces North and South, a valuable extension of the victory won in Cancún.

Mr. Zoellick Eats Humble Pie, Discreetly

At the closing press conference, Robert Zoellick, the U.S. Trade Representative, demonstrated a nimble capacity for painting a happy face on what to him must have been a pretty sad piece of merchandise. As he said several times, lessons were learnt in Cancún. Zoellick was suggesting that his colleagues had learned that cooperation is wiser than confrontation: only such a line could make his post-Cancún finger-wagging at Brazil and its "won't do" partners in the "Group of 21" at the WTO cohere with his renunciation of virtually everything the U.S. had wanted to get out of the Miami meeting on the FTAA.

The real lessons of Cancún for Zoellick seem to have been twofold: 1) a trade meeting being branded a failure was a headline the Administration did not want to see twice in two months, especially with a presidential election on the horizon; and 2) the dream of using multilateral trade treaties to win sweeping victories for market fundamentalism is over, at least for now.

In the immediate aftermath of the Cancún WTO talks, Zoellick spluttered with rage. Worse perhaps than the collapse of the talks, for Zoellick, was the confrontational approach of the developing countries that prevented the U.S. from at least crafting a congenial cover story to conceal the absence of agreement. He railed against Brazil, the most visible leader of developing country opposition in Cancún. He traveled through Central America making hard-line declarations about the Central America Free Trade Agreement (CAFTA), due to be signed in a few months, and he successfully pressured most of the Latin American countries which had allied themselves with Brazil in Cancún – Peru, Colombia, El Salvador, Guatemala, Costa Rica – to announce a change of heart. He made clear that the U.S. would not settle for a reduced vision of the FTAA in Miami. But at the end of October, something changed. A hasty pre-Miami mini-summit was arranged for Lansdowne, Maryland in early November, and though no great announcements were made, it would appear that meeting sealed the U.S.'s decision to give up on its nine-year vision of the FTAA.

The picture Zoellick tried to portray at the closing press conference was of a new, warm relationship with Brazil and a big-tent FTAA that would please everyone. But the first question in English came from Neil King, the Wall Street Journal's trade reporter, who punctured the myth-making quickly, if politely, by asking Zoellick how he had moved from the threatening hard-line language of September to the warm and fuzzy talk of "chemistry" in November. Had he and the head of Brazil's delegation, Foreign Minister Celso Amorim, who is the co-chair of the FTAA talks along with Zoellick, gone out for a very chummy dinner? The question had the effect of laying bare just how much the U.S. was giving up, even if King's article the next day was significantly muddier than his zinger question.

Zoellick was able to spin his way around reporters' questions pretty well, but his main constituency – big business – was in Miami and was clearly not buying his line. The National Association of Manufacturers and other influential U.S. capitalists did not try to hide their displeasure with the shape of the agreement, going so far as to imply that no agreement would be better than the "í  la carte" approach. The only part of Bush's corporate constituency likely to find the outcome in Miami wholly satisfying are the agribusiness interests, who did not want to see their fix on the markets discussed (much less threatened), and particularly the sugar and fruit juice lobbies, who were most vulnerable to the sort of bargaining the U.S. and Brazil decided against engaging in.

What a Change a Decade Makes
As Sarah Anderson of the Institute for Policy Studies, who has been monitoring the FTAA since its beginnings in 1994, has pointed out, the atmosphere for hemisphere-wide free trade talks is significantly different now. Back then, the FTAA was portrayed as the next great step for the neo-liberal "free trade" model: the WTO was about to come into existence, the U.S. economy was riding high under the shallow but reassuring gaze of Bill Clinton, popular challenges to the neo-liberal model had not yet hit the headlines, and Latin America was nearly entirely democratic (in the U.S.'s reckoning), with most of its leaders sufficiently tamed by the International Monetary Fund (IMF) and World Bank so they could be relied on to continue following the neo-liberal "free trade" path.

A few months after the 1994 meeting however, Mexico, already hit by the Zapatista rebellion the same day NAFTA went into effect, entered its disastrous "peso crisis." Since then, numerous governments in the region have lost power because of their insistence on neo-liberal economic polices – several of them in Ecuador, but also in Paraguay, Argentina, Venezuela, Brazil, and, most recently, Bolivia. El Salvador will probably elect a leftist government in a few months. Mass demonstrations there and in Peru and Bolivia have reversed plans to privatize basic public services. The week before the Miami meetings, six people were killed in demonstrations in the Dominican Republic over new demands being made by the IMF. Public opinion polls indicate a complete loss of faith in the "free trade" model throughout the region.

In this context, the Miami meeting was probably doomed long before Cancún. Indeed, the outcome in Miami could have been more calamitous for the U.S. and other true believers in trickle-down corporate globalization. As it was, Zoellick's humiliating climb-down just confirmed the established trend in Latin America. If Zoellick and the Administration were in denial before Cancún, it is clear that sometime before Miami they faced the music and started adjusting to the fact that the democracy their predecessors hailed in the region had created more accountable governments that would not be able to continue ignoring their populations' rejection of the unbalanced economic policies forced on them for the past 25 years.

The Bilateral Blitz
Part of Zoellick's strategy after Cancún was to declare that the U.S., as much as it desired global agreement on pro-corporate rules, would not wait for those who refused to negotiate on its terms: it would create bilateral (two-country) and regional "free trade" agreements with "can-do" countries that would play its game. His trip to Central America underlined this approach: the CAFTA would go forward regardless of whether troublesome countries like Brazil would agree to a full-scale FTAA. Zoellick's harsh words in San José when the Costa Rican government demurred on privatization of its communications sector – he would just move to drop Costa Rica from the CAFTA, he said – were part of his macho strategy.

Although it was clear that Zoellick had decided to make nice with Brazil for the cameras in Miami, the day before the official opening (and, as it turned out, closing) of the talks he was in a more aggressive mode. He issued a barrage of statements and held press conferences with governments which declared themselves willing to work on bilateral or regional treaties. Panama, which is not part of CAFTA, will begin talks with the U.S. about a bilateral treaty. The Dominican Republic, apparently despite the fact that activists there are willing to risk their lives to oppose its recent IMF agreement, wants to get in on CAFTA (why it and not Panama would be allowed to do so is not clear). Peru and Colombia will start talks with the U.S. in the spring of 2004; Bolivia and Ecuador would like to at some later point. And on the day after the end of the Miami meetings, Zoellick announced that the U.S. and Uruguay would begin negotiating a bilateral investment treaty.

This part of Zoellick's strategy was more in keeping with his usual persona: "The Godfather" is a better model for understanding his negotiating style than his formal title of "Ambassador." By announcing – in the vaguest terms possible, and with his counterparts making the most desultory supporting comments – talks with Colombia, Peru, Bolivia, and Ecuador, Zoellick was in reality trying to demonstrate that the U.S. had the power to isolate Venezuela from its Andean partners. Venezuela, of course, is governed by Hugo Chávez, a maverick leftist whom the U.S. is anxious to ensure no other regional governments will consider imitating.

Negotiations with the Dominican Republic and Panama should make clear, Zoellick might reason, that any potential troubles with the CAFTA in El Salvador or Costa Rica will be put to rest by the spectre of the entire region rushing to obey the whims of Washington. And Uruguay is perhaps the most carefully calculated of all. There the announcement waited until after the buddy-buddy photo opportunities with Mr. Amorim from Brazil: a gentle reminder that the U.S. can play nice, but is also capable of peeling off Brazil's allies in Mercosur, the customs union of Paraguay, Argentina, Uruguay, and Brazil. It is also quite possible that the Andean gambit was partly intended for Mr. Amorim: the Andean community (with Venezuela in this case) has in the past year been talking about closer cooperation with Mercosur, possibly leading to a full South American trading bloc.

Many progressive commentators were alarmed by the "bilateral blitz." As well they should be: when the U.S. negotiates one-on-one, or with a group of weak countries such as in the CAFTA, it has much more leverage, and can generally force governments to agree to virtually anything in exchange for the supposedly special access to U.S. markets. For each country where such talks do proceed, the dangers are substantial.

It is also the case, however, that this strategy was in place before Cancún; indeed, a bilateral agreement with Chile – in which Chile took the very regrettable step of committing to eliminate probably the most progressive regime of investment regulations of any developing country – was signed just before the WTO meeting. Many NGOs present in Miami issued statements welcoming the U.S. climb-down on the FTAA while also highlighting their deep concern over the focus on bilateral agreements. The bilaterals are dangerous, and have been for some time (the U.S. is also negotiating, or has signed, bilateral or regional treaties with Morocco, Jordan, Australia, South Africa, Botswana, Namibia, Lesotho, Swaziland, and Thailand). But with the 2004 election year upon us, it is not clear that rapid progress will be made on new bilateral agreements. In the medium term, however, if opposition like that seen in Cancún and Miami continues to be successful, the bilateral and regional treaties are likely to be where the fights over global trade policy take place.

Stop CAFTA! Now!
For now, the next big moment in the fight against free trade treaties is upon us: talks are scheduled for the week of December 6-12 in the Washington, DC, area to finalize the terms of the CAFTA. This agreement would handcuff some of the poorest countries in the world to policies they cannot afford, and to greater and greater domination by the United States. It is a true disaster. Opposition to it has been intense in Guatemala, Honduras, El Salvador, Nicaragua, and Costa Rica. In Washington, actions against the meeting are being organized from within the large Salvadoran expatriate community. We are hopeful that the final treaty that emerges will be one a future progressive Salvadoran government can extricate itself from – or, even more hopefully, that the difficulties encountered by governments like Costa Rica's will postpone the signing of the treaty until governments have a chance to become more accountable to their populations.

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FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.