Managing the Marketplace
Thomas R. Eddlem
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The New American, April 3, 1995
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President Clinton declared on January 26th that "the job of constructing a new international economic architecture through our trade agreements and the revitalization of our institutions is, for our generation, as pressing and important as building the post-war system was to ... the heroic generation of Dean Acheson and Jean Monnet." Our Global Neighborhood, a recent report by the UN-affiliated Commission on Global Governance (CGG) declares openly the need for nations to give up sovereignty to UN-affiliated trade bureaucracies, while bemoaning the reluctance of the United States "to accept the sharing of national sovereignty that must occur for strong multilateral rules and institutions to function." Citing specifically the "struggle to place GATT rules above unilateral trade policy," the CGG report praises the new World Trade Organization (WTO) as a "crucial building block for global economic governance."
Regional Groupings
Since the formation of the United Nations, nearly a dozen UN-affiliated trade blocs have arisen, from regional entities such as the North American Free Trade Agreement (NAFTA), the European Union (EU), and the Asia Pacific Economic Council (APEC) to the less geographically limited trade blocs such as GATT/WTO and the Organization for Economic Co-operation and Development (OECD). NAFTA, the EU, and the WTO pose the most danger to national sovereignty because of their powers to sanction recalcitrant nations.
All of these multilateral trading organizations are linked with the UN's Economic and Social Council and have a place on official United Nations organizational charts. All have acted to break down trade barriers (which have tended to increase national self-sufficiency) while actively ratifying and upwardly "harmonizing" on a global scale most regulatory trade barriers.
For example, while NAFTA and the WTO were nominally adopted as free trade agreements, NAFTA's Article 1114 states that "it is inappropriate to encourage investment by relaxing domestic health, safety or environmental measures." And the WTO's preamble declares that the organization's purpose is to regulate international trade "with a view to raising standards of living, ensuring full employment ... while allowing for the optimal use of the world's resources in accordance with the objective of sustainable development...."
The WTO possesses formidable new global tax, trade, and regulatory powers. An affiliate body under the United Nations Economic and Social Council, the WTO bureaucracy is empowered by its charter with the "exclusive authority to adopt interpretations" to the purposefully vague 26,000 pages which comprise the Uruguay round of GATT, as well as the power to punish uncooperative nations with global economic sanctions.
GATT/WTO's tyrannical potential can be seen today in the increasingly oppressive features taking shape in the European Union. Sold to the people of Europe as a trade arrangement to facilitate the free flow of people, goods, and services, the Common Market was actually intended by its architects to evolve into a supranational regional government that would later be merged into a world government. The Single European Act of 1986 and the Maastricht Treaty have nearly completed the merger. The nations of the EC are finding they have lost virtually all sovereignty, as domestic policies are increasingly dictated by the shadowy and unaccountable EC authorities in Brussels. Regulations and mandates issued by EC bureaucrats govern the manufacture, sale, and distribution of virtually everything. Agriculture, labor, transportation, health, trade, finance, manufacturing, and the environment are micromanaged to excruciatingly minute detail.
It is important to note that the most prominent figures involved in designing and promoting NAFTA, GATT, and other "trade" regimes have repeatedly stated that it is their hope and intent that these new arrangements will "evolve" along the same path as the Common Market/EU.
Forging Economic Dependency
At the end of World War II, the United States stood at the pinnacle of global economic power. Nearly half of the world's gross national product was produced in the U.S., and America relied on few imports to meet its needs.
A key strategy employed by internationalist planners has been to make the United States economically dependent upon a world economy by waging war on the revenue tariff (a tax on imports). Because every tax discourages the activity it taxes, tariffs tend to discourage imports. So tariffs, whether imposed for merely revenue purposes or for protective purposes, tend to encourage nations to produce more of what the nation needs domestically, reduce economic dependency, and encourage national economic self-sufficiency and independence of action.
If the United States could be made economically dependent upon other nations, and its economic destiny could be intertwined with the rest of the world, then Americans could be convinced that it is in their best interest to join a global economic structure to help maintain economic order in other, less responsible nations. With the adoption of the various rounds of GATT and the more extensive regional affiliate NAFTA, the U.S. domestic economy has increasingly become dependent upon the well-being of foreign markets. Time magazine, commenting on the fallout from the Mexican bailout in its March 6th issue, observed, "Like it or not, Americans cannot be indifferent to Mexico's fate. The two countries are inextricably linked by massive flows of goods ... supporting perhaps 750,000 American jobs...."
Tax Tyranny
One of the fundamental differences between a free government and tyranny is how taxes are imposed. Free countries impose taxes to raise revenue for the administration of good law and order, and try to minimize the economic impact on both citizens individually and the economy as a whole. Tyrannies impose taxes primarily to transform society or advance social goals, and consider the revenue raised as only a secondary benefit arising from the primary social objective·
America's Founding Fathers sought to limit government's manipulation of the individual and the economy and to remove the tax collector from direct contact with the citizen. By 1805 the federal revenue agent was banished to the seashore and limited to collecting taxes on imported goods. President Thomas Jefferson declared during his second inaugural address that "it [is] the pleasure and pride of every American to ask, 'What farmer, what mechanic, what laborer ever sees a tax-gatherer of the United States?'" The Founders recognized that taxes imposed directly on Americans would provide far more opportunities for both social scheming and inefficient economic dislocation.
Economic dislocation for social goals is precisely what is sought by the United Nations and its affiliates, especially as it relates to environmentalism. The Committee on Global Governance recommends in Our Global Neighborhood, "All governments should adopt policies that make maximum use of environmental taxes." The OECD issued a report in 1992 entitled Climate Change: Designing a Practical Tax System. The report contained a spectrum of specific policy suggestions, ranging from making domestic energy taxes more comprehensive, to an international tax whereby "an international agency for administering the carbon tax would be set up by the countries participating in a greenhouse gas agreement," to "internationally harmonized domestic taxes" agreed upon by a global compact.
The income tax offers the greatest opportunity to manipulate individuals and the economy. Almost no one today can live without an income. Thus the income tax reaches nearly every individual. The inevitable deductions and penalties included in the vast system of regulations offers more opportunities for social engineers to reshape the economy than is possible with any other tax. With the income tax, social engineers can reach directly into the family itself. During the debate over the income tax amendment to the Constitution (which became the 16th Amendment), Representative Samuel McCall (R-MA) charged: "The character of the argument which has been made ... leads me to observe that the chief purpose of the tax is not financial, but social. It is not primarily to raise money for the state, but to regulate the citizen and to regenerate the moral nature of man. The individual citizen will be called on to lay bare the innermost recesses of his soul in affidavits, and, with the aid of the federal inspector who will supervise his books and papers and business secrets, he may be made to be good, according to the notions of virtue at the moment prevailing in Washington."
Global Invasion
The anti-tariff GATT/NAFTA/OECD network of trade treaties has heightened the pressure for other, more oppressive forms of taxation. During Thomas Jefferson's Administration more than 90 percent of federal revenue was generated from the tariff. The tariff remained a significant source of federal revenue even after the adoption of an income tax in 1913.
Today, not counting borrowing, 90 percent of federal revenue is derived from income and payroll taxes. The trend toward invasive taxation is global, as the 1993 report Taxation in OECD Countries clearly demonstrated. The report noted the dramatic trend away from traditional revenue-based taxes and toward economy-wide taxes between 1965 and 1988 among the 24 member nations of OECD. While tariffs and excise taxes on specific goods composed the majority of consumption taxes in 1965 (55.1 percent), that figure slid to less than 35 percent in 1988. Meanwhile, general taxes such as sales and value-added taxes raised the majority of consumption tax revenue in 1988.
Under the GATT/WTO/NAFTA/EU nexus, world taxation has tended to take on more universal and bureaucratic forms, leading to less efficient taxation, greater opportunities for social engineering schemes, and less economic growth. But more importantly, by selling the agreements as "free trade," social planners have been able to create powerful new regional and global government structures which will infringe upon national sovereignty.
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