I’m planning on putting the following argument in a piece on the proposed Free Trade Agreement with the United States. Can anyone confirm or refute my understanding of the implications of the FTA?
Under the Bush Administration the United States has, to an ever-increasing extent, rejected the whole idea of multilateralism on the basis that it fails to recognise the special position of the United States. In place of multilateral negotiations in which the United States is, at most, first among equals, the Administration has pursued bilateral agreements on a wide range of issues. The most notable case is that of the International Criminal Court, where the United States has pursued bilateral agreeements exempting Americans from prosecution.
Inevitably these agreements involve an element of ?pattern bargaining?. The United States proposes the same set of terms to each of its negotiating partners, generally on a ?take it or leave it? basis. While adjustments may be made in particular cases, the end result is inevitably that the terms of such agreements are those set by the more powerful party.
The most important multilateral agreement to be boycotted by the United States is the Kyoto protocol on climate change. It is noteworthy that the most prominent advocate of the FTA, Alan Oxley of AUSTA, is also a leading critic of Kyoto, and bases his arguments against Australian participation primarily on the argumentthat Australian industries will lose competitiveness against non-signatory countries such as the United States.
It is easy to foresee the possibility of the Kyoto agreement coming into conflict with an FTA. For example, an effective emission credit trading system will require some form of taxation of carbon dioxide emissions embodied in imports from nonsignatory countries. Applied by Australia to imports from the United States, this would, on the face of it, conflict with the requirements of the FTA.