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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

it's a done deal « Previous | |Next »
August 2, 2004

Federal Parliament resumes tomorrow for seven days or so in what is likely to be the last sitting before an election is called. Parliament will be dominated by the FTA with the US.

The spotlight is on the ALP since the Senate Report is to be tabled this week. The FTA as a preferential trade agreement with the US could, and will harm the multilateral trading system and Australia's interests globally and in its region. The ALP has been hiding behind the figleaf of the Senate Report whilst worrying about being attacked over being anti-American. It was all a bit of a charade, given the political necessity of having to beat John Howard.

Alan Ramsay spells out how politics in the ALP works:

"While in theory it is supposed to be a matter for the entire Labor parliamentary caucus to decide, it is Latham's decision that will determine what happens. And that decision will be made in the shadow ministry, not the full caucus. Once Latham's front bench decides its recommendation, based on Latham's attitude, that will lock in all 32 members of Labor's front bench to a collective decision. This, in turn, will determine the formal caucus outcome, whatever the vote of Labor's backbenchers."

Why a charade? Remember that around Feburary 8th on the Ten Network's Meet the Press program, Mark Latham told Paul Bongiorno:

"If it's a deal that excludes access to our sugar cane growers, if it's a deal that weakens our [Pharmaceutical Benefits] scheme and makes pharmaceutical products less affordable in this country, if it's a deal that starts to wipe out TV and cultural content, then obviously it's a deal the Labor Party won't be supporting."

That was then. Today the same issues are still there:

David Rowe

Given that it is that sort of deal, you can see why a large number of the Labor caucus want the FTA rejected. They argue reasonably that it will deliver few economic benefits to Australia (around $53M) but will undermine important parts of our social, economic and cultural infrastructure.

However, the ALP will sign up on the FTA. Latham has always been about free markets, free trade, freedom of choice, individual aspiration and rolling back government intervention.

And secondly, it is the political imperative of the wider issue of the American alliance that drives the decision to support the FTA. The political reality is that Australia got the FTA because of its role as part of the coalition of the willing. The strategic imperative to link our wagon to that of the world's greatest economic and political power is too great to ignore No matter that Australia will play an economic cost to hitch up to the imperial wagon train. That is to be expected. It is the price that has to be paid. So say the pragmatists in the ALP.

What is rarely mentioned is that the FTAs are not building blocks for a rejuvenated multilateral system. As Alan Wood observes the rapidly growing number of bilateral trade deals will lead to a spaghetti bowl of bilateral and regional trade deals, with their web of different trade rules in hundreds of agreements. Does this not become a significant burden on companies and countries engaged in international trade?

August 3
The news this morning is that, though the ALP acknowledges the FTA is not a good deal for Australia, it will sign anyway. So said the Labor senators' at their news conference yeterday. They recommended minor changes to deal with adverse effects on the software industry, manufacturing, local television productions and the pharmaceutical benefits scheme.

The shadow ministry and caucus will ratify a recommendation by the three Labor members of the Senate inquiry into the FTA to pass the legislation. The ALP caucus meets today, but the Left do not have the numbers to roll the decision.

Do the proposed minor changes do enough to protect the Pharmaceutical Benefits Scheme. The last thing we want is US drug companies whose products were rejected for listing on the PBS appeal to an independent review panel to have the decision reconsidered. That opens the door to Australians paying subsidies to the US drug companies. The ALP says aLabor Government wil stand firm.

I reckon Australia will be outgunned on the PBS by the American state and drug companies. Prices for drugs under the PBS will rise over the next five years. The Americans keep talking about the Australian's policy of subsidized medicine being equivalent to them having a free lunch. The Australians need to pitch in to help pay for all the research and development for the miracle drug.

| Posted by Gary Sauer-Thompson at 2:23 PM | | Comments (0) | TrackBacks (1)

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