Consumer activist Ralph Nader used the annual Cornell Political Forum debate Sept. 16 to sound the alarm on the anti-democratic corporate governance of the world's economy that he argues is the foundation of free-trade agreements.
Judging by the reaction of the packed audience in Statler Auditorium, about a third of whom gave Nader's impassioned closing statement a standing ovation, his view of the North American Free Trade Agreement (NAFTA) and the General Agreement on Tariffs and Trade (GATT) is the correct one.
But his opponent in the debate, the highly respected Columbia University economist Jagdish Bhagwati, countered that much of Nader's argument was alarmist, often false and based on "cheap rhetoric." Free trade is a "moral cause" for the world's economy, Bhagwati argued, and an engine of prosperity for developing countries.
Much of the debate focused on the process of free-trade agreements, as well as on their openness to the public and rights of countries to appeal rulings on trade issues.
Nader argued that the American public does not know enough about what provisions GATT and NAFTA contain and how they affect American workers and laws set up to maintain environmental and safety standards. He said that appeals are handled by a secret tribunal in Geneva, Switzerland, and that in all issues the United States has just one vote, the same as any other country in the world, even the smallest ones.
"The governance system itself is blatantly anti-democratic," Nader said. "The whole subject of governance under these agreements is corporate governance."
Bhagwati, who served as an economic policy adviser to the director-general of GATT, said that while current free-trade agreements still have some problem areas, they are evolving and will continue to evolve as nations meet to resolve problem areas by consensus, which, he argued, is a better way of doing things than having prosperous nations "ram decisions down [developing countries'] throats."
Nader countered that free-trade agreements will bring down standards for worker safety, child labor and the environment in the United States. "It's a pull-down trade agreement," he said. "Our higher standards can be turned to disadvantage."
Bhagwati argued that nations can continue to maintain high standards but will have to pay for them. Social agendas should be kept separate from free-trade agreements, he said, since prosperity itself will bring about positive social change, such as reduced child labor.
Nader often portrayed corporations as agents of a global evil empire. "Do we really want to let corporations have patents over life forms?" he asked.
"Pitching up the rhetoric is not helpful," Bhagwati countered. "We have to evolve, and we need to build bridges, not burn them."
Robert Frank, Cornell's Goldwin Smith Professor of Economics, moderated the debate. Sam Pollack, events president of the Cornell Political Forum, introduced the debaters.
The Cornell Political Forum is a 13-year-old student-run nonpartisan organization that publishes an award-winning quarterly journal and sponsors campus debates and symposia to enrich the Ithaca community and beyond. Matt Wexler is the group's current president and editor in chief of the Cornell Political Forum.
In addition to the Cornell Political Forum, the event's main sponsors included Cornell's School of Industrial and Labor Relations and the College of Human Ecology, the Adelphic Cornell Educational Fund and the Student Assembly Finance Commission.
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