How to Tank an Economy

There is scant data on the U.S.-Korea Free Trade Agreement. The only thing clear is that "free trade" needs to be put in quotation marks, since the first announcements make it clear that the U.S. is interested in imposing trade restrictions upon South Korea in terms of intellectual property rights. The population of South Korea is clearly upset: Workers hold protests against U.S.-South Korea free-trade talks.

Despite the fact that 80,000 people took to the streets, there is very little information out there about these protests, particularly in the L.A. Times which serves the largest Korean-American community in the country. The Korean TV news showed pictures of windows being broken and police riots, but provided little explanation as to why. The protests have been heavier in the poorest areas of the country.

This FTA is definitely going to devastate South Korean agriculture – there is already a plan to provide $119 billion to farmers over 10 years. There should be little doubt that this money will only cover a small part of the damage done. It may also hurt the film industry, which is protected by screen quotas that Hollywood hates. Medical costs are set to soar as well with the price controls on drugs being removed.

Reading through the data provided by the United States Trade Representative, I don't see anything that will actually help South Korea. So, reading between the lines, this is being shoved down the throat of South Korea at the threat of economic violence. The claims that this will increase GDP are easily counterbalanced by the fact that nearly all countries that have entered into "free trade" agreements with the U.S. have seen GDP growth shrink, not grow.