Korean Free Trade Agreement Threatens Family Farmers

It was embarrassing for the Obama administration when he returned empty-handed from his recent trip to Korea. A free trade agreement between our countries has been stalled, awaiting ratification from the legislature of both governments since it was signed three years ago, and the President failed to settle the remaining disputes before coming home. He quickly made up for it, however, and negotiators came up with a new deal almost as soon as he got back.

But do we really even want this agreement? The National Family Farm Coalition (NFFC) says "No!"

Now, I'm a bit of a utilitarian, so regardless of one's political position on free trade and protectionism, I think we need to look at actual results. The Korean Free Trade Agreement closely resembles NAFTA, the North American Free Trade Agreement between the United States, Canada, and Mexico. NAFTA has been widely criticized for failing to protect labor and the environment, but it promised increased jobs and profits for everyone, especially farmers. So did it deliver? Only on one of those counts.

Under NAFTA, investors and big agribusinesses indeed saw their profits rise, but farmers in both the U.S. and Mexico have suffered. Since the trade agreement was signed, Small Mexican corn farmers have been put out of business at such an alarming rate that it's approaching a crisis level. The combination of lifted tariffs and the U.S. corn subsidies means a flood of cheap corn into Mexico, and the local farmers just can't compete. These displaced farmers make up a very large percentage of the wave of immigrants crossing the border to pick our crops, but that sadly ironic trade-off is another story.

You would think the U.S. farmers, at least, would be doing great under this arrangement, but the dropping corn and other food prices — discounts that were not passed on to the consumer — have hit everyone hard in a "race to the bottom." Since NAFTA came into effect in 1994, nearly 300,000 U.S. family farms went out of business and farm income declined 13 percent. America's agricultural trade surplus has actually decreased significantly, and that trend is most profound with our NAFTA partners, Canada and Mexico. Between 1994 and 2001, our agricultural GDP declined by $4 billion, and meanwhile, farm debt skyrocketed 50 percent.

Certainly there are many factors at play here, but this is exactly the opposite of what we'd expect if NAFTA had worked the way it was supposed to.  If we agree to more of the same with Korea, we're gonna get, well, more of the same.

Part of the problem with NAFTA was that it included significant protections for foreign investors, but not many for labor or the environment. The Korean agreement is no different. Both allow investors to sue governments for policies that result in a loss of profit, regardless of how good those policies might be for citizens. In its statement, the NFFC suggests we should be focusing on cooperative agreements that benefit farmers, workers, and consumers, not international investors. I'm inclined to agree.

Korean farmers and labor unions are already protesting this trade agreement. The NFFC strongly urged Congress to reject this irresponsible deal, and you can too. Sign our petition telling Congress not to ratify this flawed agreement. It's nothing but pure foolishness to try the same thing over and over expecting a different result, and family farmers the world over have suffered enough.

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Photo credit: U.S. Navy via Flickr