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Free Trade or Sustainable Trade? An Ecological Economics Perspective Jonathan M Harris
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What Is Free Trade? Harris: In practice, it is “simply the international application of an unregulated free-market system” “Holy trinity of concepts embodied in traditional economic thought” –Economic growth –Technological progress –Free Trade
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Criticisms Unrealistic –Constant economic growth is impossible Increase in pollution Limitations –Short-term –Consumption gains as the sole measure of social welfare
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Short-Term? “Gives no consideration to longer-term issues of sustainability, growth, and the social and institutional impacts of trading patterns”
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Enemy of Sustainability? “According to the logic of ‘free trade’, environmental legislation that restricts or taxes the flow of traded commodities… can be challenged as a barrier of trade”
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GATT Article XX Exceptions to trade rules for measures relating to conservation of exhaustible resources UNREALISTIC
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The Real Problem: Sustainability vs. Free Trade Sustainability requires control over the market Free Trade lets the market decide
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Harris’s Circle Sustainability first means free trade second Free trade cannot be the second priority It is unrealistic to keep it as the top priority
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What About a Compromise?
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WTO Committee on Trade and Environment 1996 Failure to resolve differences in opinions among delegates No proposals for modification of WTO rules VERDICT: FAIL
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Current Ideas Broaden Article XX WTO recognition of multinational environmental agreements Trade measures
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Why Compromise Can’t Work Free trade requires constant growth Environmental protection would disrupt this Conclusion: Free trade cannot be the basis of sustainability
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The Environmental Kuznets Curve Principle (EKC) Environmental damage increases initially Starts to diminish after the nation hits a “Turning Point”
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Flaws 1.Tests of this are limited 2.“Turning Point” is highly variable 3.“Turning Point” is often higher than suspected
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Global “Turning Points” Nitrogen Oxides 2079 Sulfur Dioxide 2085 Suspended Particulate Matter 2089
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Further Issues of Free Trade Rising Inequity Undermining Community Organizations
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Rising Inequity
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Undermines Unions
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The NAFTA Agreement (1993) Praised Commission for Environmental Cooperation (CEC) North American Agreement on Labor Cooperation (NAALC)
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The Truth About the CEC Little more than a statement of good intentions
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NAALC’s Turn POWERLESS
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“Free” Trade Intellectual Property Rights & Bioengineering = Developed nations and multinationals Vs Developing nations
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Conclusions Future of Sustainability Future of NAFTA The Future.
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Future of Sustainability Strategies included in trade policies and agreements –Both globally and locally
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Future of NAFTA Expansion of current policies More effective sanctions
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The Future “Freer Trade” ends Trade evaluated socially and ecologically –Reflected by global and regional policy
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