End of Free Trade consensus

Wayne Mapp fears for the future of free trade:


. . . For decades now National and Labour have had a cosy little arrangement when it comes to free trade. Both parties could count on each other to provide a solid bloc of votes in parliament to pass any bill implementing free trade agreements.

So any hyperventialting by the Greens, New Zealand First, the Maori Party or Mana counted for nothing. Jane Kelsey might get to write as many op-eds as she likes, but she has virtually no influence on the actual outcome of the free trade agenda. The solid National–Labour coalition ensures that the relevant legislation will pass.

But will this arrangement prevail after this election?

Clearly, if National is elected they will want to pass legislation implementing various aspects of TPP, in the event that the TPP treaty is finalised and signed between 2014 and 2017. Of course any such treaty will not be exactly as New Zealand wants since it will be a compromise between fourteen nations. . .

New Zealand already has very open borders. Other countries with more restrictions will be held back by powerful lobby groups wanting them to continue.

To get consensus will require compromises.

But the shape of the TPP treaty is starting to emerge. There will be a long drawn-out phase down of tariffs and quotas in agricultural products. The timing of the phase down will be dictated by Japan and the United States, and it will extend over many years, perhaps as many as twenty. Copyright terms will be extended to 70 years or more. State trading entities like Pharmac could lose at least some of their exclusive rights. There will be an international tribunal for major investment disputes.

For National this will be OK. Over time the US, Japanese and Canadian agricultural markets will open up. And provided the loss of the Pharmac monopoly is not too dramatic, it will be seen to be a good trade off. . .

National is quite clear it supports free trade – but labour is no longer.

This election could see Labour down in the low 30s as a percentage of the total vote. If a combination of Labour, the Greens, New Zealand First, the Maori Party and Internet Mana can form a government, Labour is only going to be 60% of the government, at most.

That has risks for more than trade.

All its likely partners have opposed every single free trade agreement over the last two decades. Collectively they could demand that Labour not support the TPP as a price of coalition. And could Labour resist such a demand?

What’s more, if the Left (apologies to Winston who is not really left) do not have enough votes to form a government, would Labour still continue the cosy arrangement of supporting free trade agreements? Increasingly Labour activists, including their left leaning MP’s, oppose TPP. David Cunliffe, supported by Phil Goff and others, has positioned the party to be able to vote for TPP. But that is before the election. An election loss could well weaken the free trade faction in Labour.

Such a result would cause Labour to look deeply at it options, just as did with National when it lost in 2005. The Labour MPs will be looking at three terms in opposition. They will console themselves that this is the normal political cycle in New Zealand. But they will not be able to tolerate the thought of four terms in opposition. They will do whatever it takes to make themselves electable in 2017.

And in the event of an election loss, what will be the fate of Labour’s longstanding support of free trade when they weigh up what they will have to do for 2017?

New Zealand is one of the best performing economies in the OCED because of the efforts successive governments have put into opening our borders and developing new markets.

Returning to the bad old days of protection and subsidies would harm our economy and the social and environmental initiatives which depend on its strength.

And if Labour lurches even further left on trade what other dangerous territory might it enter in a desperate attempt to be elected?

18 Responses to End of Free Trade consensus

  1. More scaremongers from the doomsday-ist at Homepaddock – “The sky, Henny Penny, THE SKY!!!”

  2. jabba says:

    the Gweens would be in favour of NZ closing its borders and make it’s people walk everyhere and live on seafood and fruit/veggies grown in our backyards

  3. Mr E says:

    After they tax agriculture out of existence that may be our only option.

  4. Ele’s scaremongering flushed out two scaredy-cats!
    Look out behind you!!

  5. Mr E says:

    Behind me I see a Green Party who seems to have lost its way. Putting its popular environmental principles aside and replacing it with flawed socialist propaganda.
    And the polls are indicating the publics reaction.
    Shame.

  6. TraceyS says:

    Right on Jabba, but it would be a managed transition. That’s the most worrying bit. The “how” being much scarier than the “what”.

  7. TraceyS says:

    Sad but true Mr E. Of course the socialism is not just “propaganda” but rather more integral to moving the collective masses in an adopted direction.

  8. Dave Kennedy says:

    I have tried to make comment on this post but none have gone through, hopefully this link will: http://localbodies-bsprout.blogspot.co.nz/2014/06/the-myth-of-free-trade-agreements.html

  9. RBG says:

    Your paranoia about the Greens is incredible TraceyS. You appear to have some warped idea that they want to impose a dictatorship. I realise that I am unlikely to disuade you from this fantasy you have created for yourself, but it is bizarre that you support John Key who is relaxed about executing people without trial, yet are scared of a party that supports the polluter pays principle.

  10. jabba says:

    oh my god .. has John Key shot someone now?

  11. TraceyS says:

    It will TAKE a dictatorship to achieve their policies RGB. Thankfully I will not have to fear that anytime soon. Current polling shows that people are not keen for it in large numbers.

    Sorry, that is not paranoia, it’s the truth.

    For the record, I support personal responsibility at all levels. Therefore, I support “polluter pays” in principle, provided the principle is applied consistently and fairly.

  12. RBG says:

    Jabba- he supports drone strikes on people in countries that are not at war.
    I should have written “relaxed about people being executed without trial”. I am not a Key fan, but I certainly don’t think he is personally responsible for executing people, even though he did have that nickname “smiling assassin” .

  13. RBG says:

    Btw it’s RBG not RGB if you wouldn’t mind thanks TraceyS.

  14. TraceyS says:

    Apologies *RBG*

  15. […] numerous time to comment on Ele Ludemann’s Home Paddock blog in response to her post on Free Trade Agreements and promoting the false perception that they are vital to our economy. While I can’t imagine […]

  16. Mr E says:

    I’m not following Dave’s self promiting link. But I will say, free trade agreements are extremely important to NZ in my opinion.

  17. homepaddock says:

    Mr E – that’s a track-back which means he must have linked to my post.

    That he thinks FTAs aren’t vitally important is enough to show me I’d be wasting my time following the link.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: