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In the Open Source world, when people are talking about what the term "free software" means, a well-informed geek will tell you about the distinction between free-as-in-beer and free-as-in-speech.  You can download a complete Linux system with the OS kernel, a GUI environment, an office suite, web browser, development tools, games, etc. etc. etc. for zero cost.  What’s more important to me is that Linux is free as in speech as well, and that’s a big reason why I’m such a huge fan.  With Linux, you get freedom.

But ultimately, the point I’m writing about has to do with trade policy.  Here in the U.S., we have a bunch of "free trade" agreements.  We have treaties such as NAFTA, we belong to organizations like the WTO, and we extend tremendous trading privileges to nations such as China, because the prevailing philosophy in government circles is to reduce barriers to trade, in other words, to make trade in goods and materials free-as-in-beer.  There’s a huge problem.  Just as there are multiple definitions of "free" in software, there is also a distinction in trade policy and their economic effects, and the biggest problem is that our current trade policy actually causes people here in the U.S. and elsewhere in the world to have less economic freedom.

The link between goods and labor.

Trade in goods, and trade in labor are inextricably linked.  You cannot produce goods without labor.  To make the silicon in computer chips, it takes the labor of many people to extract materials from sand and various ores to produce the silicon, rare-earth elements and chemical compounds.  Those compounds undergo more labor to purify them and put them through various chemical reactions and manufacturing processes to make them suitable for use in integrated circuits.  Then the silicon is milled and shaped into chips, the chemicals are deposited onto the chip through photolithography, producing circuits and transistors and other components, then the chip is placed into a housing with electrical connections, and it is soldered onto a circuit board.  Sand and dirt become electronics, and the reason that is possible is because countless people learn specialized skills and work to make that possible.

The problem is that while the goods, whether they be raw ores or finished computer chips, can be traded between nations with little cost or restriction, labor is not so free.  There are huge barriers that prevent labor from moving from place to place as goods are moved.  For one thing, there’s the financial barriers - moving is expensive.  Also, thanks to cost-of-living differences between countries, many people in third-world countries find it completely impossible to gather the means to emigrate to a country with better living and working conditions.  They’re trapped in places where they’re forced to work for pennies a day, no benefits, for long hours, in brutal and dangerous living conditions, with very little financial security and little hope.  The instant a worker is injured on the job, he’s fired, and his family is left destitute.

Even if they have the means, there are the legal barriers.  Emigrating to the United States is a legal nightmare, requiring years of waiting just to get things like green cards and immigration visas.  Government organizations like ICE and INS have proven to be very capricious and arbitrary, expelling people from the United States for little cause or even no cause at all, forbidding them from reentry for periods from a decade to forever.  Becoming a citizen takes years, and that’s after going through the process of legally emigrating to the United States and getting a green card.

The costs of having free trade with unfree labor.

The process of emigrating to the U.S. is so onerous that it is a significant barrier to movement of labor.  It is one of many significant barriers to the movement of labor here and elsewhere.  In fact, there is a large and thriving black market in illegal immigrant labor.  The human cost of this black market is tremendous.  As I mentioned, ICE expels foreign residents from this country with very little cause, and very high human cost.  They imprison immigrants, they expel them, they break up families and they uproot lives.  If a citizen commits a crime in the U.S., they pay fines, serve jail time, go on probation and parole.  If they keep their nose clean and pay their penalties, they regain their freedom and go back to being a citizen in good standing.  That is not possible for illegal immigrants.  The only remedy in law for illegal immigration is expulsion from the United States, with the disruption to families and uprooting of lives.  In essence, we have people in the U.S. who’s crime is that of existing on U.S. soil.  We have an underclass of "illegals", illegal people.  It’s a form of apartheid that is destructive to the very values this country should be holding dear.

The cost in basic humanity is high, but the financial cost is also high.  Illegal immigrants are forced to have fewer choices in jobs.  They have to work in farming, manufacturing and service-sector jobs for relatively little pay and no benefits.  Because of their status, they are under constant threat of deportation, sometimes with explicit threats from their employers, and they’re forced to work in conditions that they otherwise would not accept.  Their illegal staus is exploited to ensure they have less economic freedom and security.  On top of that, legal citizens are forced to compete with these "illegals" for jobs, and as a result, there is downward pressure on their wages and benefits.

Free trade in goods, without free movement of labor, ensures that on top of the downward pressure inside the U.S. from "illegals", there is yet more downward pressure on wages and benefits from abroad.  Can anyone in the U.S. work for a dollar an hour?  Could a person work for that little and have the means to pay for food, shelter and basic needs.  Could a person provide for his or her children, and save some money so they could go to college?  In the U.S., that is impossible, but people in China, Mexico and various third-world countries do exactly that because costs of living are far lower.  On top of that, many workers live in shantytowns and endure living conditions that are just plain inhumane and completely unacceptable in the United States.  Other countries do not have things like a minimum wage, workplace-safety laws or child-labor laws.  They don’t have product-safety regulations, or if they do, they’re unenforced.  Why do you think we’re getting melamine baby-food and baby toys with lead paint? Other countries have lax and unenforced environmental regulations, and companies in those countries exploit, destroy and poison those lands in ways that would not be tolerated in the United States.  Manufacturers here incur significant expense implementing mandatory measure that protect the environment, and they are undermined by foreign competitors that do not have similar requirements.  The free marketeers tell us "Hey, it’s free trade!  Compete!"  What do you think businesses are going to do under these conditions?  They’re going to do business where labor is cheapest.  It is impossible for Americans to compete under those conditions, and even if we could, the end result is a race to the bottom that damages the livelihoods of everyone except a few sharks at the very top of the economic food chain.  Free trade in its current form undermines the middle class.

To have freedom we must have rules of the road.

Let’s get back to Open Source software.  On  top of all the technical achievements that enable Linux to perform duties on servers, desktops and embedded devices, the most clever invention in the world of Open Source is the Open Source License.  Just as programmers have hacked computing systems to make them do things that are new and innovative, Open Source developers like Richard Stallman have developed licenses like the GNU Public License.  The GPL takes the copyright laws in this country that have been written to restrict the use of intellectual works so that their authors can profit from royalties and license fees, and turns it on its head.  In the GPL are written restrictions that actually increase freedom.  The GPL explicitly gives to the public the rights to use a piece of software, download it, modify it, and even redistribute it and sell it.  Source code, the secret-sauce of the software world, is explicitly made available in software licensed with the GPL.  The restriction come in if you want to add restrctions.  You’re not allowed to do that.  If you make changes to a GPLed program, and distribute those changes, you must make your changes available under the same conditions in the GPL, and that includes making source code available.

Without the restrictions in the GPL, the freedoms that Open Source software developers and users have would evaporate.  Companies and individuals would take Open Source software, make their own modifications, and keep those modifications secret.  They would lock their derivative software under onerous restrictions enforced with patents and copyrights.  The free sharing of code and ideas that is the foundation of the Open Source community would be seriously undermined, and the collaboration of programmers all over the world that developed everything from OS kernels to web servers to industrial-strength database systems to desktop environments would not be possible.

With that thought, just how should we build our nation’s trading policy?  What we have now is free-as-in-beer trading policy in goods, with unfree movement of labor, which is actually pretty destructive.  What we should be working on is free-as-in-freedom trading policy, trade rules which serve to promote the civil liberties and economic opportunities of human beings here in the U.S. and in other nations.  Others have already come up with a name for this - Fair Trade.  Go to a trendy cafe, and you’ll see them advertising Fair Trade coffee.  There’s a market for that stuff, because people recognize that people here and abroad deserve to be paid a fair price for their labors, and that they should make enough to provide for themselves and their families, thus they choose to buy Fair Trade products to protest against unscrupulous people and companies that force people to work at subsistence wages under atrocious working and living conditions.

We shouldn’t be going all Smoot-Hawley.  Isolationism has its own destructive side-effects, and implementing such policies unthinkingly will cause yet more economic calamity when we’re already in economic crisis.  We should be pushing for trade laws that accomplish the same thing for international commerce that the GNU Public License achieved for Open Source software.  Like I said, push for free-as-in-freedom trade policies.  There is a point behind Most Favored Nation trade status, and originally, it was for doing things like using lower tariffs for rewarding nations that implemented workplace safety laws, minimum wages, environmental regulations, and other policies that promoted the development of a middle class.  Yes, tariffs are intended to be used for more than mere collection of government revenue.  Like many taxes, they are also intended to alter behavior through financial incentives.  Lower tariffs have been used as a reward for nations that do things like building schools, hospitals and infrastructure for their citizens.  They rewarded nations that allowed good freedom of movement for their citizens, so they could travel freely, emigrate if they wanted, and do business here or at home.  For that matter, we should be reforming our immigration laws - sane immigration policies will work wonders in dealing with the illegal immigration problem.  Like I said, movement in goods should reflect movement in labor.  It’d also improve border security if people could just go through a border checkpoint without being turned away or being given the latex-glove treatment - they’d have no motivation to sneak through the desert.

Trade policy was used to punish nations that did things like repressing the liberties of their citizens, promoting child labor or slavery or other cruel practices, or abusing trade rules and systems to undermine competitors by dumping products on the market at prices below cost, or otherwise acting unethically.  Tariffs and trade regulations are used to protect the people from products that are harmful.  In theory, we still have laws that prohibit the importation of foods that have poisons in them, or of products that are fraudulent.  They’re not properly enforced, but they’re on the books.

International trade has been pwned.

Yes, free trade, as in trade laws that encourage freedom and prosperity, would be nice.  We don’t have that now.  We have free-for-all trade.  We have anarchic trade.  We have organizations like the IMF acting to undermine nation’s attempts to improve the lives of their citizens by demanding free trade for corporations, demanding loosening of laws that protect people from exploitation, and pushing for the dismantling of social safety nets, in exchange for loans that were originally intended to help nations build a middle class.  We have the WTO demanding the abolition of tariffs and regulations, and leaving absolutely no mechanism in place to prevent abuses or deal with market failures that are destructive to national economies.  We have multinational corporations who are calling the shots solely to enrich themselves, at the expense of the rest of humanity.

The system’s been hacked.  Black hats are running sploits on the system of international trade, and they are sucking us dry.  We no longer have free-as-in-freedom trade, we have anarchic trade couched as free-as-in-beer trade, and because of that, we have sharks eating everyone else in the fish tank.  If we are to preserve our way of life, and hope to make things better for others, our trade policy needs to change.

(This diary was originally published on http://www.meldroc.com/ at http://www.meldroc.com/....  Diggs, Reddits and links are most appreciated.)

Originally posted to meldroc on Mon Feb 09, 2009 at 03:12 PM PST.

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