WTO Dispatches from Hong Kong

By Joshua Holland, AlterNet. Posted December 13, 2005.

AlterNet staff writer Joshua Holland is reporting live from Hong Kong on the World Trade Organization Sixth Ministerial Conference. His dispatches of events from the protests and trade negotiations will be updated throughout the week.

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Ending on the Wrong Note -- from Deborah James
Updated -- December 18, 9:24 am PST

Note: Deborah James, who is the Global Economy Director of Global Exchange, sent this dispatch in from Hong Kong on the conclusion of the trade talks.

Tonight, the hope of millions of farmers around the world for a better life for their children were dashed when talks at the World Trade Organization came to a conclusion.

The great economic powers of the world were successfully able to pressure the developing countries into agreeing to a text that is vastly against their interests.

Negotiators have been attempting to portray the deal as a step forward for developing countries. In reality, the deal is a setback for developing nations and for democracy and sovereignty of all countries.

A couple of the salient points:

Agriculture:
The US and EU agreed to allow the imports of goods from the world’s poorest countries, free of tariffs of quotas. However, they agreed to do it for only 97% of the goods, which actually allows them to leave out key products of interest to the same least developed countries.

Several West African countries have made a elimination of rich nation subsidies for cotton a key issue, because it is estimated that these subsidies cost poor African farmers billions in lost revenue. Rich nations agreed to eliminate cotton export subsidies, but failed to set a final date for all subsidies, as the West African countries had demanded.

Development:
The US, EU, and Japan agreed to provide several billion dollars a year in so-called development aid. However, most of this aid is actually already promised; is actually loans, not grants; or will actually be used to for these countries to restructure their economies for integrate the WTO rules, rather than for development. This was often referred to as the “empty development package” because the package will likely not be fulfilled.

Services:
The horrifying text that had been forwarded on services, which would have made service privatization for the vast majority of developing countries mandatory, was somewhat rolled back. However, the fight will now be taken to Geneva to define the future of the privatization of energy, banking, health, water, education, transportation, etc.

The highlight of the evening was the Venezuelan delegation. Venezuela and Cuba had claimed certain reservations in the second to last private meeting, which stated that they disagreed with the text on services and industrial tariffs. During the final public plenary, the chair introduced the final declaration for approval. After hearing applause, he pounded the gavel. At that point, the Vice Minister for Foreign Affairs, Mari Pili Hernandez, jumped up on the stage, and insisted that she and the Cuban delegation be given the right to make their reservations public in the meeting. The Chair, after some resistance, finally had to allow them to speak. The Cubans stated that they agreed with consensus, but had certain reservations. The Venezuelans then stated that they made reservations on industrial tariffs and services that they wanted to be put in the final report.

This was a courageous stand, the first time a country has registered reserves, and opens up opportunities for the fight in Geneva.

We will continue.

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The Police Unleash Tear Gas -- for What?
Updated -- December 17, 7:26 pm PST

After a week of noteworthy restraint by the Hong Kong security forces things turned ugly tonight when police responded to a small group of protesters rushing their lines by firing multiple rounds of tear gas at crowds of peaceful demonstrators and onlookers who had gathered outside the Convention Center.

The scene in the street was surreal as I left the "locked down" venue through a little-used entrance on the side opposite the large group of protesters. The streets were filled with riot police. Many were in jeans and t-shirts -- all were helmeted -- after apparently being called to duty from their homes.

On the street in front of the Convention Center, a group of Korean farmers were entertaining the crowds with a large drum circle. In addition to chanting "down, down WTO," they chanted "Citizens of Hong Kong" about thirty times and then: "nice to meet you!" At a later point, on another street, they sat and chanted: "We love Hong Kong," to which some onlookers yelled, "We love Korea!" One person then yelled: "South Korea, that is."

Police seemed flustered by the demos. I stood in front of the Convention Center for perhaps an hour witnessing a bizarre series of moves. At a signal, the riot police would extend their collapsible metal batons and yell something in unison. Then they'd rapidly advance in a line for a hundred feet or so. Then retreat.

At other times, they made dramatic rushes to spots where nothing was going on. From where I stood it looked as if they were responding to imaginary foes that only they could see. All around the tense lines of riot cops were people watching from the sidelines, wondering what was going on.

At one point, these bizarre moves became comical as police decided they simply had to run across an empty street to guard a piece of road under a largely empty footbridge. Separating them from their goal was a concrete barrier about three feet high. Laden with gear, a number of police tripped on the way over. One cops' shotgun was sent sliding into the street.

Watching these precision but incomprehensible feints and charges were a legion of press and some rather nonplussed citizens. When the police charged over the wall, a few reporters and I, who happened to be standing on that wall, lent them a hand.

Later, when I saw a camera crew carefully compose a shot where their reporter would have a huge group of riot police standing with visible tension in the background, I got into their shot and languidly yawned to show a glimpse of the reality on the street. Not much was happening except for the police's impressive "lockdown" of the Wan Chai area.

At a later point in the evening, a few blocks away from the Convention Center on Johnston Road, police put on a great show of force to take an intersection where by all appearances Hong Kong residents were simply going about their business. The scene was dreamlike: one small woman trying to get home didn't bother to end her cell phone conversation as she attempted to push through the heavily geared police. They yelled at her to go around, but she yelled back and pushed through, still talking on the cell.

The scene turned ugly when a group at the front of the largely peaceful demo attempted to get through the lines and into the Convention Center. Unconfirmed reports suggested that a lone protester managed to breech the outer ring of security. At that point the police began firing round after round of teargas at the entire crowd. Great clouds of it filled the air enveloping the protesters, onlookers and media. I was standing with a member of a Danish NGO when we were enveloped. There were several children nearby who were also gassed.

Teargas claws at your lungs, sears your nasal passages and burns your eyes. After we stumbled away, half blind, there was a real sense of anger and confusion. Certainly the security forces had a responsibility to stop the protesters up front from breaking their lines, but why not employ the pepper spray and water hoses that they had used earlier? Why had they gassed a thousand people on the streets of Hong Kong because a few had crossed the line? Again, there were children present and the gas permeated an area of several blocks.

When the first rounds were fired the demonstrators were singing a chorus of "We shall overcome."

Later in the evening a number of Hong Kong residents, seeing my press badge, wanted to set the record straight. They told me Hong Kong police had no experience with this sort of thing and that "Hong Kong people are very peaceful." I told them I thought so as well.

** Sunday morning follow-up

Isolated incidents of violence do not a riot make. But last night, in the streets around the Convention Center and in the briefing room inside, a story of widespread mayhem was created. It will go down with other incidents in the history of "violent" WTO protests. Like Seattle, and like Cancun, that story is exaggerated at best. During hours on those crowded streets, I didn't personally witness any violence by protesters whatsoever (although I don't want to overstate it; like Seattle and Cancun there definitely was some).

The headline in this morning's South China Morning Post says it all: above a picture of the teargas canisters exploding, it reads "The Siege of Wan Chai." The paper had page after page of sensational stories. If I hadn't personally been there, I would think it had been World War III. One photograph carries the caption: "A group of locals beats a retreat from Wan Chai after police told them to stay away from the area." In the photograph, it's clear that the "group of locals" had just been tear gassed; people can be seen covering their eyes and coughing.

After I left I had dinner in a restaurant with a large TV showing continual coverage of the events. It was hard not to notice the number of tight shots -- tight shots of groups of tense riot police at the ready and tight shots of Koreans throwing metal barricades at officers. Those tight shots are purposeful: the scene isn't the same when you see all the people milling about right next to those riot police, trying to get home or looking annoyed. A wide shot won't show that the police line is facing off against a largely empty street.

The media hyped the potential for violence for weeks. A few protesters fulfilled their wish and used aggressive tactics. The police shut down the entire area for no obvious reason. One person said to me: "don't you get the feeling that if they went home not much would happen?" I did.

And this morning the media are enthusiastically reporting a situation they helped create. It's a circular loop.

**

When I left the Convention Center, it was looking more and more like a watered-down deal was in the making. Most of the participants don't want to see the talks collapse, so they're pushing the stickier issues down the road. That's not certain, but there was an increasing consensus that would be the outcome.

I'm flying out before the final draft or final collapse happens. I'll see if I can get Global Exchange's Deborah James to file a dispatch about the last hours of the meet while I'm flying over the North Pole.

Several readers requested I give more detail on specific issues. I've gathered the information and done the interviews but haven't had the time to sit down and do the reporting. This link won't be here Monday, so look in The Mix on Monday and Tuesday for some follow-up, including responses to your queries.

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What's the Strategy?
Updated -- December 17, 2:20 am PST

The developing countries may be trying to avert a collapse by kicking the contentious issues down the road until March. That from Jose Africa, of the Philippine NGO Ibon. Africa -- who was tickled pink that his name's Africa but he's from the Philippines and my name's Holland but I'm from America -- said that Brazil and India feel they have a lot to gain from the services agreement. They think that if they can commit to as little as possible on the provisions that the developing world aren't happy about they can avoid a collapse.

Now a phrase I'm hearing a lot of is "watered down."

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Now That's a Riot!
Updated -- December 17, 1:32 am PST

The Koreans have escalated. But not here -- they're rioting in front of the Korean embassy. This isn't a photo-op; there are batons flying and water cannon in play. Rumor has it the Convention Center is locked down. Everyone in the press center's gathered around the video screens watching the live broadcast.

I'm trying to get to Victoria Park, but I don't want to get shut out and there are some people I'm waiting to have brief me.

**

Just came from a G-20 press conference. Indian Trade Minister Kamal Nath compared the EU and U.S. resistance to setting a date to end their export subsidies -- those that violate WTO rules most clearly -- to announcing that you won't stop running red lights. He made a good point: the big economies often say they're democracies and they have legislators and constituencies to worry about. He pointed out that India's the world's largest democracy and he has a parliament to deal with at home too, but that doesn't deter the U.S. and EU from asking for unpopular concessions.

There's much discussion about a potential collapse because of services -- God bless those Venezuelans, they're fired up -- but it could just as easily be agriculture.

**

Let me confess to being a bit first-world centric in a piece last week. I said nobody got excited about tariff reductions. I should have said nobody cares if the wealthy states negotiate tariffs with other wealthy economies. But for the poorer countries, tariffs are a key source of government revenue, and they are concerned. The non-agricultural access agreement is a pretty contentious issue here as well.

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Drafts Are Flying
Updated -- December 17, 12:40 am PST

The mood in the Convention Center is heating up. A proposed draft of the services agreement came out at three this morning, and a half hour ago a draft of the whole enchilada was released. Everywhere you look are lawyers and advisors and NGO people huddled in corners over copies, marking up passages that they like or that they hate.

There were reports in just about every major negotiation about tempers flaring. Celso Amorim, Brazil’s Trade Minister and leader of the G-20 reportedly walked out of a late-night negotiating session on agriculture, asking “why are we here?” when U.S. and EU negotiators said they weren’t authorized to offer more than the weak proposals I described previously. The services negotiations were described as even more contentious.

The devil’s in the details, and here are a few. As I’ve said the big picture is that the advanced economies are asking for a quid-pro-quo: agricultural reforms that they’ve been promising for years in exchange for services and reduced tariffs on manufactures.

When I say services -- and I’ve alluded to this but not explained it -- the big contentious issue is one of process. The services framework that the developing countries have agreed to previously is structured for individual requests. I want you to liberalize your postal service, I ask you for postal. You can say yes, or you can (theoretically) tell me to suck an egg.

Aileen Kwa from the NGO Third World Network told me that services make up 70 percent of the global economy but only 20 percent of world trade. The Big Three are unhappy by how slow the process has been under the existing framework. This has gone slowly for a simple reason: poor countries don’t have the capacity to compete with the leading countries in these areas. They’d like to keep going one on one so that they can say no.

The developed services economies want these to be clustered together and negotiated on a sectoral basis. They want plurilateral negotiations outside the historic WTO framework where groups of countries can challenge other groups. This would bring enormous pressure on countries to open up their services, including public services.

Let’s cut to the chase: it’s about forcing deregulation and privatization.

Now, the way this whole thing works is that negotiators in Geneva create a draft. That draft goes to the Ministerial. Things that are yet to be finalized are put in brackets, and it’s supposed to be the bracketed text that’s negotiated.

Heading to Hong Kong, the Chairman of the committee basically had some text to which the negotiators hadn’t agreed inserted into the draft. That’s caused an uproar here.

Once here, the G-90 group of developing countries said that they weren’t buying. They presented an alternative text which, according to WTO rules, is supposed to be distributed around. But, wouldn’t you know, their draft somehow didn’t make it “into the system.” So only the service economies’ draft was presented. This is, my sources tell me, absolutely typical.

Now, for the fun. They’re resisting. So now, according to Kwa “the calls are being made from DC to various capitals, trying to pick off vulnerable countries.” The strong-arm tactics will begin heating up. According to Kwa, Venezuela, which has strongly condemned the draft shenanigans (I’m only giving a taste so as not to drown you in minutia) is being painted as trying to torpedo the meet. Ugly umors have been started. Kwa says that they’re completely unfounded: Venezuela has been negotiating in good faith but the concerns of developing countries aren’t making their way into the drafts as the process goes on.

Will the new G-110 hold together in the face of this? For that matter, will the advanced states at least commit to a year to phase out ag subsidies?

On that front, I understand that some progress was made, but it was “insignificant for the poor countries of the world,” according to my go-to guy, Aftab Khan of Action Aid

People have started using the word “collapse” here in Hong Kong.

More to come.

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Odds and Ends and Some Poignant Moments
Updated -- December 16, 9:03 pm PST

I wrote previously about the South China Morning Post's ominous report about someone buying up dozens of gas masks in Mong Kok. Turns out it was the media, who love to dress up in helmets and flack jackets for covering what my new friend Doug Crets of The Standard calls a Korean "soap opera."

Read Crets' blog-post from the front line of yesterday's photo-op protests here.

**

As I wrote yesterday, amidst all the finger pointing between the U.S and EU, it looks like EU Negotiator Peter Mandelson might be backing off his promise to set a date certain for ag subsidies.

That's because, just as Portman's giving press conferences to announce offers that he probably can't get through Congress, Mandelson's negotiating in the midst of a huge EU budget fight. There probably isn't the billion Euros he's been dangling out there for "aid for trade" (see previous post). And there's a bitter row developing amongst the big EU players on ag.

Did you know that 37 percent of the EU's budget is for agricultural subsidies? I didn't.

**
Speaking of things I've been in the dark about, there's a democracy movement going on in Hong Kong. People are marching for their voting rights, but I haven't gotten a clear picture of the details.

What I have grasped is that they're emboldened by the street protests here. Local activists are trying to build a bridge between the fair trade movement and the democracy movement.

**

The most maddening news story I've come across so far was a gotcha! piece by Agence France Presse in the Mail and Guardian (South Africa) by a reporter who "caught" some Korean farmers eating at McDonald's. "Eight protesters ignored the anti-globalization message of their 'junk WTO' baseball caps and feasted on sausage McMuffins as they planned how to get across their anti-capitalist message," wrote this complete wanker.

I suppose it never occurred to the AFP reporter that while the Koreans are neither anti-globalization nor necessarily anti-capitalism, they are here because their livelihoods have been decimated by agricultural liberalization. They're poor you asshole. And far from home. And Mickey D's is, whatever else, cheap.

Let me say in a few sentences what the Koreans' story is -- something that no mainstream papers do. They have a strong cultural tradition in agriculture. The South Korean government -- the elites in Seoul -- wanted to be one of the Asian Tigers -- the fast-growing manufacturing economies in East Asia, and they succeeded. South Korea's a poster-boy for industrialization under liberal market rules. But it came at a cost. The folks in Seoul gave away the farm for market access -- literally. Rural communities were thrown open to world commodities markets. The one Korean I've talked to said that his family has been farming for generations. He used to make about $12,000 in a decent year. Now, he hopes for $7,000.

And while he's in Hong Kong, he has to eat and he has to eat cheap. Maybe at a fast-food joint, and maybe at McDonald's. I wonder where that French reporter would eat on seven grand a year? At La Tour d'Argent?

**

Just a bit more on yesterday's announcement of a new G-110 group of countries that have united to put development issues front and center.

The applause lines were the first I've seen at the maybe twenty official press briefs I've been to. The Ministers actually thanked Oxfam, so if you scrape together a few bucks to send them once in a while, you know you're getting your money's worth. The Oxfam person sitting next to me was absolutely gleeful.

But before we get to excited, and I'm admittedly a cynic, we should bear two things in mind. One, as you've probably noted, there's a theme to these negotiations. The wealthy countries can just hold steady and refuse to make concessions that would be unpopular at home. They're not indebted to the IMF. And while it may be 39 against 110 now and far more even, those 39 probably control 60 percent of the global economy. I don't know the exact break down, but the point is the structural imbalance remains. All those 110 can do -- and this does have huge significance -- is say "no." They don't have any of the tools that the wealthy countries have to push negotiating partners into accepting onerous provisions. And, and this can't be overstated, they don't control the agenda.

The other point is that there are two billion people on this planet -- about 40 percent of all humans -- scratching out a living on $2 dollars a day or less. Some on much less. Their needs are wholly unrepresented. No matter how satisfying it might be to see the poor countries' negotiators stand up for their economic interests, the fact remains that many of them, even while they insist on agricultural access, are representing landowners more than those who work the land. I'm going to have a few words about rural/urban divides later on.

**

I want to clarify something I've alluded to: Rob Portman's here offering tariff- and duty-free access to the least developed countries that he's not authorized to offer. Fast-track, as you no doubt know, is a law that allows the executive branch to negotiate a trade deal, and when it goes to Congress for ratification there's no amendment process -- legislators can vote yea or nea. That offended a number of members of Congress and when they approved fast-track for Bush in 2002, they specifically excluded a lengthy list of 500 agricultural products from the authorization. They did that for a reason: they have no intention of giving up the access, regardless of the rhetoric in Hong Kong.

**

Yesterday some of those most marginal voices -- the ones that never get heard -- held a Women's tribunal, judged by women from the developing countries in the Pacific Rim and South Asia.

They found the WTO guilty -- there wasn't much suspense on that -- of preventing them from saving seeds as they've done since the dawn of time, privatizing their water, shifting production and sending rural peasants to work in urban factories -- there was testimony from a Philippina who was forced to turn to prostitution to feed her family after the land she worked was "reformed" -- and undermining their government's ability to provide needed social services.

Afterwards they marched on the WTO. Twelve of them got through the barricades and were allowed to present their gripes. I caught up with one of the 12, a woman who works for a grass-roots rural women's NGO from Pakistan, and this is what she recounted (this is my best reconstruction of the story, not an actual transcript):

"We arrived at the police cordon, and they let us through. Our delegates had arranged for the meeting in advance. We brought them soup that our sisters from Hong Kong had made -- a traditional healing soup because the WTO is sick and needs to heal. They didn't let us in or greet us in a conference room. They kept us by the inner security gate waiting for two hours.

"The police surrounded us -- there were three rings of police in concentric circles. They had more back up waiting. I said, 'my God, we're just 12 women, what do you think will happen.'

"Finally two ministers came out to talk to us in the passageway by the gates. In Asia, our culture says that you greet visitors with respect. They had no respect for us. One of our delegates represents an organization with 200,000 rural women from the Philippines. Together, we represented millions of women, and they seemed not to have the time to even listen to what we had to say. Even after making us wait for two hours.

"The two that they sent were very rude. One was a white man from Holland, the other was an external relations officer from Bolivia. At least the Bolivian smiled, the other was so cold. They wouldn't take the soup. They wouldn't look at the quilt that hundreds of women from around Asia had made. They had no respect. If they can't respect us enough to hear what we're saying, we can't respect them.

"I asked one of them if he was married, if he had children and he said yes. I asked what he would do if one of his children died and he said he would cry. Several of the women in the group were crying -- from exhaustion and frustration -- and I said, 'look at them. That's why they're crying, because they've been watching their children die in front of their eyes.'"

There are many divides here that are unbridgeable. This was the most poignant. I'll have more on these women -- a reader requested it -- later.

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Bridging the Ideological Divide
Updated -- December 16, 4:45 pm PST

It gives me a warm feeling when right and left can come together to experience a moment of shared indignation. So it pleased my heart to get briefed by both the Teamsters International and the American Friends Service Committee (AFSC) -- the Quakers -- about "mode 4" of the services agreement being negotiated this week. It's something we all can hate.

Mode 4 governs the trade in human labor. The details are sketchy, even among the delegations.

Migration of labor is a major source of income for some countries. If, God forbid, you should get hurt tomorrow, there's an excellent chance that you'll receive the expert care of a Filipina nurse. There's also a good chance that the remittances that she sends home is important for her family. And, of course, that tomato you had on your BLT was probably plucked from the vine by a migrant laborer. That plays out for a number of countries.

So far there's agreement on the movement of white-collar professionals -- the wealthy countries are offering what they already have in place with programs like the United states HI-B visa programs. Countries like India want the United States and others to increase those numbers (according to AFSC's Jessica Walker Baumont, the U.S. currently has about 65,000 H1-Bs, but has had as many as 195,000 in recent years).

That's not the contentious part. The controversy -- and this is a dead deal before it begins based just on domestic politics in the U.S. and EU - is about the less-developed countries' request to expand the program to include medium- and low-skilled workers.

It looks to be coming together along the broad lines of a global guest-worker program tied to employers, somewhat similar to the Bracero program in the U.S. that brought millions of migrant farm workers from Mexico to the U.S. between 1942 and 1964. For those not familiar, Bracero sounded good on paper: the workers had some theoretical protections, were guaranteed minimal housing, etc. And for some, it worked out -- I once met a former Bracero worker who had good things to say about his experience.

But AFSC's Baumont said that because the workers would be tied to an employer, they would be extraordinarily vulnerable. "If you tried to organize, you could be fired and deported. And sometimes we see situations like in the past century where workers have to buy their goods from a company store and they get indebted to the employer. It's almost like indentured servitude."

This is, of course, a non-starter. The Teamsters' Yvette Peña-Lopez brandished a letter to Trade Rep Rob Portman from James Sensenbrenner (R-WI) and John Conyers (D-MI) -- the Chair and ranking dem on the House Judiciary Committee and two rivals representing pretty much the American ideological spectrum -- saying, in effect, 'don't you dare negotiate on this.'

I should point out that this is a Constitutional issue: only Congress has the right to make immigration law. Certainly not the USTR in a global trade treaty.

There's some history here. When the U.S. Singapore deal was worked out with some immigration language it almost torpedoed the deal. "Some in Congress voted against it," said Peña-lopez. "Others said I'll vote for it but don't ever come back with this stuff again." She added that if it ever worked it's way through, "my job lobbying against the WTO in Washington would become a lot easier."

Mode 4's not making big waves because this week the negotiations are based on the process that will guide the services agreement going forward, not specific requests.

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Breaking: A Dog Comes Out of the Green Room
Updated -- December 16, 7:29 am PST

A draft text leaked to NGOs from the ongoing green room negotiations on agriculture highlights the potential for an impasse in Hong Kong, as wealthy states continue to offer nothing and ask for much in return.

According to Action Aid's Aftab Khan, who examined the leaked document, the text gives the poorest countries "no significant mechanisms" to protect their farmers from cheap imports. That means, for example, that sugar farmers in Kenya will be exposed to world commodity prices.

However, wealthy countries like Swtzerland, Japan and the EU will be able to protect their own agricultural products.

According to the draft, the EU will not commit to an end date for its export subsidies, long a demand of the least developed countries. The draft had brackets around the date of 2010. Brackets indicate a provision that has not yet been agreed upon. Khan tells me his sources say the EU is refusing to agree to any end date.

According to Action Aid's sources, the EU has insisted that discussions of an end date be conditioned on the United States making an offer on its own subsidies by March of 2006. The U.S. has refused to negotiate on those terms, and powerful ag state Senators in Congress have vowed to scuttle any such offer.

For the United States, the draft allows the continuation of market-distorting subsidies in the U.S. Farm Bill on crops such as rice, corn and soy beans. A poor farmer in Haiti would have no protection against those products.

The draft also allows the U.S. to shift subsidies -- perhaps including cotton subsidies -- from a category that is against the WTO rules to a permitted category.

Khan told me that his group is urging countries to reject the draft. What's quite clear is that the U.S. and EU didn't fully comprehend the significance of the formation of the G-110 (see post below). This is the kind of stuff we'll be seeing late at night as the conference approaches its end date (it's 11:30 here).

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Globalizations Colliding
Updated -- December 16, 6:21 am PST

I've said it before but it bears repeating: the anti-globalization activists who have traveled to Hong Kong are fiercely pro-globalization. They're building transnational social movements, they're linking workers and farmers and unionists and NGOs across borders and they're doing it North-South, North-North and South-South. They're black and white and brown and they use all the technologies that make up the wonder of globalization.

Inside the Convention Center in business suits and power skirts are the real anti-globalization activists. They have little interest in globalizing rule sets for human rights, they don't want transnational environmental frameworks, they don't want to see labor reaching out across borders and the pro-globalization "anti-globalization" activists scare the crap out of them.

Their media have created the wild-eyed anti-globalization activist -- the bogeyman lurking under the beds of good capitalists everywhere - to draw attention from the fact that the global justice movement is gaining strength and sophistication, and all on a shoe-string budget.

Let me paint you a picture of Victoria Park, where people have gathered from all over the planet -disproportionately from the developing world (I use that phrase but I hate it). The big secret is that the anti-corporatization movement is a series of teach-ins. People gather to share their experiences, discuss the tactics that have worked and those that have failed and, most of all, to learn.

For every mahogany-paneled room with little WTO pads and pencils in front of each seat in the Convention Center, there's a tent in Victoria Park with some cheap rented chairs and a piece of plywood on crates. For every information session in the Convention Center where the Chamber of Commerce or the National Association of Manufacturers presents their hired gun academics' data, there's an NGO or post-doc presenting theirs.

But in Victoria park there's something you won't find in the shiny Convention Center: humanity. There's food -- no charge. Some Indonesian or Argentinean decided to make enough for everyone. People share water. People laugh and share their war stories.

I don't have a doubt in my mind that there are a lot more loving relationships - and, for that matter, tawdry, sweaty hook-ups -- formed in Victoria Park than in the Convention Center. It's a breath of fresh air outside.

The people inside have an enormous amount of resources. They have the power of the state, the riot cops and the money to give everyone a welcome bag -- I'll open mine one of these days. They have the media.

But those gathered in Victoria Park have the sympathies of the guy selling falafel and the cab drivers. What's more, they can walk between these colliding worlds -- they have the ability to work in both places. Sometimes you see guys in suits and gals in power skirts in Victoria Park. But they're not trade reps or advisors, they're from the NGO community and they left the Convention Center for a while to educate the folks on those rickety chairs about what's really going on in the mahogany-paneled conference rooms. And, no doubt, they're happy for a breath of fresh air and a bit of humanity.

**I'll post some pics of Victoria Park when I get a chance.

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Breaking: Tidal Change in the “Architecture of the Global Trading System”
Updated -- December 16, 12:21 am PST

I reported earlier about the buzz around the formation of a G-110 bloc of countries. That was tentative, it’s now official. The group has consulted and “harmonized their positions.” And it’s huge.

Ministers from the new group held an unusually energetic press conference where they vowed to stick together on the demands of countries representing over 80 percent of humanity. Adriano Campolina of the NGO Action Aid said, “this changes the entire politics of the global economy. No more will the wealthy states be able to use their strategy of divide and rule.”

India’s Trade Minister Kamal Nath, a prominent member of the G-20, said that the ministers were tired of the status quo. “We have no more desire to preside over the inequities of world trade,” he said. He added that the group would no longer accept the big three’s demand that “we pay them to do what they’re already supposed to do” -- a reference to developed countries’ demands for access to WTO members’ service markets in exchange for agricultural reforms promised in the Uruguay Round completed in 1994. Nath called the formation “historic” and said “the economic architecture of the world is changing and the developed countries must recognize this.”

Dipak Patel, Zambia’s charismatic trade minister and leader of the group of Least Developed Countries said, “We’re not looking for elegant uses of the English language. We’re looking for what and when” -- referring to the tariff- and duty-free access that the LDCs have long demanded. He got an applause line from the normally staid hall of journalists when he added: “And if you can’t tell us what and when, then you need to answer: what part of ‘no’ don’t you understand.”

This was in effect a coup: the developing countries of the world just hi-jacked the Doha “development round” and made its central focus the development that was promised in Doha. If they are successful, we’ll have to stop putting “development” in quotes.

The reactions of the U.S. and EU remain to be seen. It is entirely possible that this moment might mark the effective end of the WTO system. Will the U.S. and EU accept their status as equal partners? Or will they abandon the WTO system as a mechanism for moving forward and instead concentrate on bilateral and regional deals? And if they do, will the developing countries accept negotiations on those terms, or will they insist on negotiating within the WTO, a framework where they now have some clout?

Whatever develops, this was a sea-change.

*************************
Cultivating an Impasse on Agriculture
Updated -- December 15, 5:13 pm PST

The big issue -- and the issue that threatens the 6th WTO Ministerial meet most prominently -- continues to be agriculture.

While U.S. Trade Representative Rob Portman is in Hong Kong defending the United States' against continued criticism, an unfortunate bit of timing back in DC may undermine his position: the House and Senate may announce as soon as today a budget reconciliation package that would extend the commodity subsidies in the U.S. Farm Bill through 2011.

The Senate version contains the extension, authored by Saxby Chambliss (R-GA). Chambliss has said, "U.S. food and farm policy won't be decided in Hong Kong."

His bill would extend only the price supports that distort world crop prices and hurt the livelihoods of poor nations' farmers. The rest of the farm bill includes anti-hunger provisions- food stamps are a part of the bill -- money for environmental protections, support for low-intensity farming and other areas. These would all be allowed to expire as scheduled in 2007.

Members of the NGO community slammed the provision, which insiders expect to survive in the final budget. Gawain Kripke of OxFam U.S. said it was indicative of a "troubling disconnect" between Congress and the Trade Representative -- a member of the president's Cabinet. He said that the Farm Bill has provisions for "haves and have nots" and this would "give a free pass to the haves." David Waskow of Friends of the Earth said, "Congress is balancing the budget on the backs of the poor and the environment" -- pretty much in keeping with this Congress's governing philosophy.

The farm bill is currently set to expire at the same time as the Doha "development round" -- in which the development needs of poor countries is supposed to take center stage -- is scheduled to be completed. That would have lined up nicely for some much-needed ag reform. Sophia Murphy of the Institute for Agricultural Trade Policy said if the provision makes it into the final budget it will "change the whole political calculus."

The United States has been in violation of some agricultural provisions since the completion of the Uruguay Round in 1994. It lost a case brought by Brazil challenging its cotton subsidies -- $4billion dollars worth for 25,000 farmers -- in 2004. It lost a subsequent appeal, but has not cut the subsidies, which are among the provisions extended under Chambliss' bill.

The United States and EU (then EC) have promised to address crop subsidies since the 1950s, but haven't gotten around to it yet. Readers should keep that in mind when they peruse the next Wall Street Journal editorial lambasting the developing countries for creating an impasse. Emily Byers, with the U.S. faith-based lobbying group Bread for the World, said plainly that the United States has a "rogue" crop policy. The EU may be even worse.

In a press conference of leading G-20 members, Brazil's Trade Minister said yesterday that "it is clear these issues are not going to be resolved now," and the Argentinean Minister affirmed what everyone knows: "Agriculture has to be the first domino to fall" if a deal is to be made. The Indian Minister said, "There have been too many statements of good intention. At the end of the day they have to yield some results."

The Ministers said that some progress had been made on one kind of agricultural subsidy, but they remained pessimistic that the large services-dominated economies would give enough to the group of agricultural producers to complete a deal. The movement was on one of the easiest points of negotiation -- changing "at a date to be determined" in one paragraph to a date ... that's been determined -- for the expiration of crop export subsidies. Those are the subsidies that everyone agrees are "market-distorting." Brazil's Minister said subsidies in general are the "big elephant in the room." Of a potential deadlock on the least controversial issue, he asked: "if we can't deal with the mouse how can we hope to deal with the elephant?"

The farm bill extension couldn't have come at a worse time. When I asked OxFam's Gawain Kripke if the conference report could have been scheduled a few days later, and whether we were seeing a message to the Trade Rep in the scheduling, he made it seem like I was suggesting something conspiratorial - he used that word. What is it about these DC-based weenies that leads them to deny that back-stabbing politics transpire everyday? Anyway, there's the usual tension in the right's worldview: being global's good for the bottom line, but there's the hyper-Jacksonian idea that we can't cede an inch of sovereignty under any circumstance. Kripke's probably right that the timing is an unfortunate coincidence as lawmakers scramble to get home for their secularized holidays, but that tension between the corporatists and the hegemonists is almost irreconcilable.

Speaking of weenies, the EU claims that it has already cut crop subsidies by 70 percent. I got the scoop on that claim during a briefing by the NGO Action Aid. There are different kinds of subsidies -- in WTO-speak: "amber box" are definitely trade-distorting, "green box" are not and "blue box" falls in between. If you don't behave, I'll explain the details -- they're mind-numbing.

The EU claim is based 1) on tweaking the structure of subsidies so that they move from box to box and 2) using not the actual subsidies that they were paying as the baseline, but theoretical caps agreed to in the Uruguay Round. Say I've never had a hundred dollars in my pocket, but I theoretically could have. I actually had fifty. If I spend ten, you and I would think my funds have been reduced by 20 percent. The EU would claim that as a reduction of sixty percent from the theoretical C-note I never had. Trade gobbledy-gook.

Anyway, nobody knows if they're even being straight on the issue because the U.S. and EU haven't filed the WTO-required reports on subsidy levels for the last four years.

**
I uploaded some pix here.

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Day Three Wrap-up
Updated -- December 15, 2:10 pm PST

It was a relatively quiet news day today, as the action moved to the "green rooms." The word is that the late-night negotiations will start to heat up, running between 6 pm and 3 or 4 am. This, as one reporter put it, is when it becomes a "war of attrition." The U.S. and EU delegations have a leg up as they're staffed by hundreds of negotiators and advisors.

Lots of yawns, and my many NGO sources all looked ragged.

**
Oh, and those green room sessions have become so infamous that the WTO Secretariat (the bureaucrats) are trying to rename them. They're now officially "Chairman's Consultative Groups." But it doesn't seem to be catching on; too many syllables. Everyone still talks about green rooms, including U.S. Trade Rep Rob Portman.

**
Speaking of Portman, he said today that the U.S. "shouldn't promise what it can't deliver." This, a day after he had done just that (see below). Ben Lilliston of the Institute for Agricultural Trade Policy (IACT) -- an NGO -- said that Portman "didn't have a mandate for some of the proposals" he made in months leading up to the Ministerial.

Also today, an offer for duty- and tariff-free access for cotton imports from the poorest countries -- cotton being a sticky widget if ever there was one. But Sophia Murphy, also of IACT, said that access wasn't going to help because the poorer producers in Africa didn't have the capacity to take advantage. It's the U.S. cotton subsidies that have hurt the livelihoods of millions of poor cotton farmers by bringing down world prices.

She added that enforcing the existing rules would help. Part of the U.S. offer was to live up to previous commitments -- we've been in violation of some agricultural rules we'd previously agreed to for the past 10 years. I spent most of the day talking agriculture, and a more detailed dispatch will follow after a bit of shut-eye.

**
I've had a low-level headache since that little snoot of "pepper foam" at the riot photo-op yesterday. I don't want to leave the wrong impression about the Hong Kong police, they weren't aiming at me and I didn't get much. I don't think the headache is related; I'm as sleep deprived as the next person and the air quality in HK is terrible.

This makes me four for four: hit with "less-than-lethal" chemical weapons in four countries at four trade meets. For you connoisseurs, the Mexican tear-gas was the worst, the Miami cops shot me with pepper paint balls that wore off pretty quick (no notice to disperse, I might add) and the Canucks used something that fell in between.

The police here have been very restrained. Just like the Canadians and the Mexicans. It's interesting that so many Americans think they live in a land with absolute guarantees of freedom of expression -- they take it for granted -- but in fact it's the worst place to demonstrate in the West.

Granted, we have a strong rule of law. That means that after you get pushed around and abused and arrested for speaking out you can pretty much count on the prosecutor dropping all charges just as soon as whatever you're demonstrating against is over.
**
While I'm on the subject of riots, a headline in this morning's South China Morning Post read "Faced with fists of fury, police won't rule out heavy hand." Yup, my friend and "fellow journo" Barclay Crawford at it again, reporting what hasn't been "ruled out." A neat trick, that. (If you're just tuning in, scroll down to see what I'm talking about).

And while I've been bashing the sensationalistic SCMP, there's a second English-language daily in Hong Kong, The Standard. I got an e-mail from reporter Douglas Crets, and he linked me to his coverage of the same protest:

Six protesters were injured Wednesday, two of them foreigners, when for the second consecutive day a protest march ended in confrontation at the Wan Chai Public Cargo Working Area near the convention center headquarters for the WTO gathering. Televised images make the clashes between protesters and local police appear chaotic and violent, but up close the incidents seemed controlled and almost ceremonial.

In Wednesday's scuffle, about 200 protesters -- mostly Koreans under the banner of the Korean Federation of Trade Unions -- separated from a larger group near the cargo area, broke through a police line and confronted a security cordon in the same place they engaged police the day before.

Then about 20 protesters, wearing cling wrap to protect their eyes from pepper spray, repeatedly walked up to the cordon and attempted to break through the police line.

The injuries occurred in the confrontation, but no stones were thrown, no firebombs hurled and no one was arrested.

Crets pointed me to a local WTO blog as well. You can read it here.

Very accurate, although he does buy that previous WTO meetings have had a lot of violence, and implied is that it was on the part of the protesters.

Last note on the myth of the violent WTO protests. I was chatting with a BBC reporter who commented in passing that the WTO demos were nothing like those at European G-8 meetings. That struck a cord -- those EU anarchists are true bad-asses, and there's heavy violence at those meets. I think there's a tendency to conflate the two groups, even though they don't really travel to these things if they're not in Europe.

**
While the big news story yesterday were the offers put on the table and the U.S.-EU finger pointing on topics like food aid (see below), probably more significant was the emergence of a "G-110" group of countries. They're a mega-grouping that includes members of the existing big blocs of developing countries (G-20, G-33 and G-90), and they represent over 80 percent of the world's population.

This flummoxes all those economists who believe firmly in the rational actor; they say such a large bloc has too many diverse and divergent interests to hold together. They always point to Brazil, a leader in GMOs, and all those poor countries that are fighting to maintain their food security by avoiding patented seeds.

My own sense -- take it for what it's worth -- is that this is the law of unintended consequences at play; it's a backlash against the big three's (U.S., EU, Japan) legendary bullying, tactics that have worked so well for them in the past.

In Cancun, the U.S. tried to peel off five of the G-20 countries, but they held firm and the talks collapsed.

If this big bloc does hold together, it's of huge significance. Adriano Campolina of Action Aid told me, "It's the only way that the issues that matter most to billions of people in the third world will come to anything in these negotiations."

I asked what kind of tactics we were going to see to peel countries off and he said, "there's a wide range of tools. Sometimes they seduce, sometimes they offer one or two countries a good deal. And sometimes they get rough. Among the tactics in Cancun was the promise that USAID would "be watching" those countries that didn't toe the line. Campolina said I should look for an escalation in tactics and rhetoric in the next few days. So far, things have been relatively civil.

**
After writing about how easily one could be seduced by the one-stop-shopping convenience of the Convention Center, I realize I've been spending too much time there. Tomorrow, I'm going to spend most of the day in Victoria Park with the humans. I just can't resist the G-90 press briefing, and I'll swing by in the evening to get the day's wrap-up.

**
I've been thinking about how the Canadians are very aggressive in all the same areas as the U.S. and EU, but they don't get much flack for it from activists. They work under the radar. Why? I have two theories.

The first is that they're 6.5 percent less aggressive and that makes a huge difference. I spoke with a member of the Canadian team a couple of years back -- this'll be off the record because I wasn't writing for public consumption when he spoke to me -- and he said that Canada wanted all the same things as the U.S. and EU, but were "a bit softer" about getting it. The other theory is about foreign-policy bleed-through. The Canadians have developed what they call the "New Foreign Policy," which is very human rights and aid-oriented. Lots of development projects bring lots of good will. And their NGOs are really prominent in working with the poorer countries.

Of course the conventional wisdom is that it's a result of their much smaller economy, which probably does account for most of the difference.

**
The Turkish ex-pat who sold me a much-needed döner-kebab the other day explained what was going on inside: "I understand the rules allow Americans to sell everything everywhere around the world and nobody can sell anything to them."

At first I thought, "what a wildly distorted view." Then I asked myself if it was any further from some elemental truth than the Moonies at the Washington Times spouting off about how "free-trade" is the answer to everything -- from world peace to the end of poverty to coming and mowing your lawn. I decided it was a draw.

*************************
From the Farmer's Mouth
Updated -- Dec. 14, 11:49 pm PST

The bad guys here in Hong Kong are, in order: wild-eyed anti-globalization protesters, rich countries' selfish farmers, the stubborn and dependent poor countries, the ignorant anti-trade NGOs and, as usual, the obstructionist surrender-monkey French.

George Naylor falls into one of those categories -- at least -- and he would like you to rethink that. Naylor looks like a family farmer from Central Casting -- big, hearty and all-American. He's traveled from Iowa to Hong Kong because his livelihood is threatened by agricultural liberalization.

More than anything else, he'd like you to understand the difference between the family farmer -- a dying breed in America -- and the big multi-national agribusinesses.

I'm not an expert on these issues. I hear from the NGOs how damaging U.S. and EU farm subsidies are for poor nations. But 70 percent of those subsidies go to big agribusinesses, not guys like Naylor.

Here's a brief Q and A, so you can get Naylor's take on what's at stake in Hong Kong in his own words:

Why did you come all the way to Hong Kong?

We come here to be here with other farmers from around the world -- to be with other farmers in an international coalition called Via Campesina to say that the WTO shouldn't be making rules on agriculture. Liberalization of agriculture is a disaster for family farmers and for the environment. And it's really a disaster for consumers too because it's putting all the power into the hands of multinational corporations – power over their food supply.

People here say that rich countries' subsidies are hurting the development of poorer countries, say in Africa. But you have a different view.

The subsidy system is very hypocritical -- it's hypocritical for the United States to be preaching free trade and then still relying on subsidies. The fact is that when you liberalize trade and then let commodities be priced in international markets -- like letting the Chicago Board of Trade determine what the price of wheat and corn is, then the price is going to go so low that an agricultural system in almost any country will not function. So the United States uses subsidies to make up for it. And the cheap grain and soy beans still get sold to big corporations where they can use that to feed livestock themselves instead of having farmers do it.

Tell me about the environmental impact, and the difference between family farming and factory farming

Well, it's a funny thing with farmers: when their price goes down they're not going to produce less, they're going to try to produce more to make up for the low price. And consequently they -- lots of times they use chemicals or other technology that's bad for the environment. And then, like in the United States the cheap corn and soybeans will feed livestock in big corporate confinements and the family farmer doesn't have any need for hay or pasture anymore. And then the manure runoff from these huge livestock containments creates a huge environmental problem in contaminating groundwater for instance, which goes down to the Gulf of Mexico.

How do you think the media does in portraying your issue?

In the media they try to say that us farmers are benefiting from the subsidy system, and the US government is representing us farmers but that’s not the case at all. They'd love to stop paying subsidies, but if they did the whole system would crash. And they don't put in enough to take care of family farmers; they only pay enough to keep the system alive. So it's really just the multinational corporations that benefit because they can still buy tons of cheap corn and soybeans.

Many say that consumers benefit from those low grocery prices. What's your response?

Well, I'll tell you when a consumer goes into a big supermarket and they see the price of apples or meat or milk and things like that, they should realize that the difference in the price they're paying and what the farmers get is huge. And you don't know where that produce came from and you don't know how it's produced. And chances are there are family farmers in rural communities that are suffering because of the way our system is functioning.

*************************
Day Two: Grand talk, But Where's the Beef?
Updated -- Dec. 14, 5:50 pm PST

During the second day of the 6th WTO Ministerial Conference, the U.S. delegation announced an offer it claimed might break through what is looking more and more like another deadlock in the making. The package would include an increase in trade-related development assistance from 1.3 billion dollars annually to 2.7 billion. It also included some tariff-free access to the U.S. market for the least developed countries.

The move comes a day after The European Union offered an aid package for developing countries worth 400 million euros annually. In announcing the package, EU Trade Commissioner Peter Mandelson took a swipe at the other wealthy countries -- and especially the U.S. -- saying: "Europe did not come to Hong Kong empty-handed." He also criticized the U.S. for unloading surplus agricultural goods on poor countries in the form of food aid. Europe has been transitioning from shipping foodstuffs directly to needy countries to offering cash grants, which don't depress prices for poor countries' domestic farmers. The EU's offer also included tariff-free access to the poorest countries.

Both packages were presented with great fanfare, and both, according to members of the NGO community, are typically hollow when one gets down to the fine print.

The offers were in the form of "aid-for-trade," a popular catch-phrase among wealthy country negotiators that, in theory, means aid grants designed to build trade capacity. In reality, say activists, aid-for-trade deals are highly conditional on developing countries buying into provisions that they've so far resisted as too onerous.

Walden Bello, Director of Focus on the Global South, said the packages were being used "as a battering ram" to bring countries into agreement on issues like privatizing public services. He compared the package to the IMF's structural adjustment agreements, which force developing countries to enact public sector cuts that often impact the most vulnerable. He added that the aid would be in the form of loans, adding to the poor countries' debt burdens.

Aftab Khan, of the NGO Action Aid, agreed, saying, "trade cannot substitute for aid." He also pointed out that much of the U.S.'s offer had already been made under the terms of the African Growth and Opportunity Act enacted in 2002.

Activists say that these offers, like the whole "development package" being touted here in Hong Kong, are an attempt to "change the subject" from the WTO's failure to follow through on the development-focused round promised in Doha, Qatar in 2001.

Lori Wallach, director of Global Trade Watch, summed it up thusly: "If it's a development round, why do you need a development package, unless the round undermines development, at which point you have to buy the developing countries' agreement for a development round with a development package. This was not necessarily a good reframing and change of message."

"The only thing worse than a bad anti-development deal," she added, "is a deal based on lies."

And that's what yesterday's offers look like. Caroline Lucas, a member of the EU Parliament with the Greens, called the EU's offer a "sweetened pill" and a "massive diversion." She pointed out that the offer consisted of "concessions that have already been given" under the EU's "everything but arms" program -- an initiative that allows the poorest countries duty free access for just that -- or things that the EU couldn't possibly deliver in a time of tight budgets.

The U.S. offer is similarly disingenuous. As Citizen's Trade watch pointed out in a release, Rob Portman doesn't have the authority, under U.S. law, to offer tariff reductions on 500 different goods. His office lost it in the 2002 Fast Track bill. It would require amending the General System of Preferences, which only Congress can do. And influential members of Congress have said publicly that they'd fight against it tooth-and-nail.

What's more, the offer of increased aid is "contingent on approval of the president's budget request." That's laugh-out-loud funny; the president's budget request is recycled 10 minutes after it hits congress, and then the real budget process begins.

Now, let me use these grand and beneficent offers to make a larger point. In your paper tomorrow morning, if it's covered at all, these carrots will be announced as a big move to come to terms with those stubborn poor countries. None of the details -- the fact that these are completely empty gestures -- will be mentioned.

Then, if the talks collapse, the National Review or the Wall Street Journal's editorial board will blame the poor countries for being "anti-trade." But, and this will be a recurring theme, the devil is indeed in the details. I have yet to meet anyone who is against trade in general. The only issue being kicked around in these late-night "green room" sessions is trade on what terms?

*Update: the U.S. aid-for-trade offer is a grant, not a loan. Either Bello had it wrong or I heard him wrong.

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WTO, Where Did You Come From?
Updated -- Dec. 14, 2:07 pm PST

I want to take a brief moment for a bit of background.

Most people still believe that discussions of "free-trade" are about ships full of bananas or ball bearings or high-tech widgets crossing oceans. Understanding why that's just a small part of the issue is key to grasping the difference between "free trade" and "power grab."

Prior to World War II, trade wars were common, and they often led to shooting wars. In the mid-1940s the General Agreement on Tariffs and Trade (GATT) was created to foster world peace. Many of its authors were F

              

Joshua Holland is an AlterNet staff writer.

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