It seems that every society and age has its Luddites. There will always be some folk who oppose any form of progress or technological development because of the harm that will accrue. Granted, it is arguable that any economic or technological process will cause harm to some. The invention of the mechanical milking machine threatened and extinguished the livelihoods of manual, hand milkers. Luddites are folk predisposed to protect the livelihoods of milkers by obstructing the development and installation of milking machines.
But the following axiom is irrefutable: economic change and technological developments always mean losses in specific jobs, even while they open up and create new jobs in the same and other sectors. However, that does not mean that the person losing a job milking cows can always seamlessly move across to operating a mechanical milking machine. Different skills and aptitudes may well be required. Fewer jobs may be (initially) available. Meanwhile, on the other hand, jobs will open up in engineering plants fabricating the milking machines; construction jobs will be created to build bigger milking sheds and milk processing plants, and so forth.
Free trade agreements facilitate economic efficiency and open up new markets for trade. But there is always a cost.
Once New Zealand had a stable shoe manufacturing industry; when tariffs were removed, production shifted to much lower cost countries, such as Fiji and South-east Asia. Shoe manufacturers in New Zealand closed up shop. Jobs were lost. But the flip side is that new jobs became available in New Zealand in other areas where we were globally competitive.
We have our Luddites in this country, resolutely opposed to free trade agreements. The first free trade agreement of significance in this country was with Australia. It has been a great boon to the New Zealand economy, notwithstanding the inevitable job losses in some industries and sectors. The largest agreement by far has been NZ's free trade agreement with China, the first in the world with that country. Our exports to China have exploded. But the Luddites focus only upon the negative side of the ledger (which undoubtedly exists) and do not consider the longer term benefits, nor the growth in sustainable employment that results in New Zealand.
These days there is always a Marxist sub-text to Luddite propaganda: free trade involves business, owned by the wealthy, who exploit and destroy the lives of workers. Business prospers, workers suffer. Ergo, free trade agreements exploit the poorest and the weakest: therefore they are evil. The truth is not quite such a "good story". Growing exports results in expanding businesses which hire more workers, and rising prosperity for all involved. But the passion and invective, once thus qualified, would not get the folk out on the hustings. Myopia and cynicism best characterise the Luddite mind.
New Zealand is involved in negotiating its largest free trade agreement--the Trans Pacific Partnership. There are open questions as to whether the negotiations will ever conclude successfully--but the Luddites have been in full voice. As usual, they have presupposed from the get-go that the whole enterprise is wicked and oppressive.
Columnist Patrick Smellie explodes some of the Luddite canards and myths surrounding the current free trade negotiations:
. . . . While NZ First leader Winston Peters may claim that WTO negotiating documents are always made public, the truth is those documents themselves are the product of negotiation, and negotiations involve secrets. No-one starts a Trade Me auction with their best price. So, that's No 1 in a list of the things that opponents of the Trans-Pacific Partnership agreement don't want you to understand. The secrecy surrounding TPP negotiations is typical of any such exercise.
No 2: The bogey of corporations being able to sue governments is not only overblown, but corporations can do that now, without a TPP. Look across the Tasman, where Big Tobacco is suing the government over its plan to enforce plain packaging for cigarettes.
No 3: Corporations might try to sue but they'll be whistling if the government is acting in the public interest. Raising new taxes, protecting the environment, or regulating for public-health reasons won't be excuses to mount court action.
No 4: United States corporate interests are obviously among those seeking influence on the TPP agenda, but that doesn't mean the US Senate and Congress are on board. That's why US President Barack Obama is having such trouble getting "fast-track" authority to negotiate TPP.
No 5: US politicians know less about what's in the TPP negotiating documents than US corporate lobbies. So it must be a plot, right? Well, actually, no. Politicians in the US, and in New Zealand for that matter, can agree to maintain confidentiality and be briefed on whatever they like with respect to TPP. Labour's trade and foreign affairs spokesmen, Phil Goff and David Shearer, avail themselves of this benefit . . . .
No 6: No-one knows what the TPP could be worth to the New Zealand economy, so the Sustainability Council is right to question the $5.16 billion figure the Government has used, based on estimates from the internationally respected Peterson Institute, and peer-reviewed by an independent local bastion of credible number-crunching, the New Zealand Institute of Economic Research. . . .
[O]fficials saw little value in the 30 year-old Closer Economic Relationship agreement with Australia, whose value is a no-brainer today. And growth in trade with China has exponentially exceeded projections for the six-year-old China-New Zealand free-trade deal, which incidentally includes its own version of TPP's feared "investor-state dispute settlement" provisions.
No 7: The US is railroading its agenda because it's just a big bully. That's not what you get from reading the Wikileaks versions of negotiation drafts. They show the US on the backfoot on many of the most contentious issues. . . .
No 9: The deal will be done behind closed doors. It can't be. Every Parliament of every country involved will have to ratify any deal signed by leaders. That could take years. It will ensure public scrutiny of the detail.
- © Fairfax NZ News
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