[Viewpoint] Where has the FTA gone wrong?President Lee Myung-bak enjoyed an unprecedented full red carpet reception during his visit to Washington last month. He received a warm greeting from President Barack Obama as expected. But the reception from Congress was overwhelming. A foreign leader has rarely drawn full applause 45 times and a standing ovation 16 times during a speech.
The U.S. Congress also approved the pending free trade agreement with Korea in lightning speed. Obama wrapped it up with his signature as a gift for his Korean counterpart to take home. The Washington achievement would go down in history as the pinnacle of Lee Myung-bak’s summit diplomacy.
At home, it was an entirely different game. His personal charm received the cold shoulder. The president visited the National Assembly and tried to persuade the opposition leaders in person to ratify the deal.
But the main opposition Democratic Party remained intransigent. It demanded that the president return with a signed agreement between the U.S. and Korea promising an immediate renegotiation of the contentious investor-state dispute settlement clause of the trade pact.
It is clearly impossible to renegotiate terms that have already been finalized in one of the countries. So we must ask what has gone wrong. Conflict of interests ahead of the legislative elections and different interpretations on sovereignty and national interests have complicated the deal. But the government has also ruined it.
First of all, the president has lost credibility with the populace and lawmakers, especially when it comes to his relationship with the U.S. The mass candlelight protests in May 2008 were not entirely about the mad cow scare and American beef imports. What sparked the nationwide protest was the assumption that Lee agreed to lift the ban on American beef imports to score points with his American counterpart, George W. Bush.
Lee’s recent state visit to Washington drew similar cynicism. A leader should take into account the concerns of his people and fight for national interests. But many suspect the president blindly agreed to the FTA terms in order to please the Americans. Some accuse the president of selling out national interests for personal fame. These words may simply stem from critics’ envy of Lee’s accomplishments, but, still, the president should have paid more attention to building his personal image at home.
The arguments in favor of the Korea-U.S. free trade agreement had not been that persuasive in the first place. A trade-reliant country like South Korea can benefit more from multilateral trade groups such as the World Trade Organization than from bilateral trade deals. We cannot conclude free trade pacts with all 190 countries. Korea could have won a broader consensus if it championed the multilateral trade order and the Doha Development Agenda led by major developing countries like Korea and China.
Even after it made different moves, the government could have better persuaded the public that bilateral free trade deals with major markets like the U.S. were an alternative path to improve trade circumstances. The government’s singular pitching for an FTA with the U.S. as a windfall that could suddenly make Korea rich only backfired.
The government fared poorly in marketing the free trade deal as a broad alliance with the U.S. A free trade deal with lowered tariffs is only a stepping stone to complete liberalization, an equal market, economic coalition and a currency union. An alliance implies a joint front against a common enemy or danger.
And the phrasing of the Korea-U.S. economic alliance could send the wrong message to China. The government is doing its math completely wrong if it aims to make China its opponent when it grew a surplus of $69 billion from trading with the country to $201 billion only last year. I was also appalled by the government’s explanation that the two countries plan to upgrade and strengthen ties beyond the defense alliance. It is hard to understand why defense and economy should be associated.
The government also erred in formalities. Regardless of the opposition’s position, a democratic government should have built a political consensus at home before concluding a deal with a partner country. But the government bragging about the deal, which was ratified by Congress and signed by the president in the U.S., and then throwing it in the lap of the local legislators can mean no more than blackmail. The government could have averted the embarrassing standoff if it spent half of its efforts persuading local legislators instead of U.S. members of Congress.
Legendary American Speaker of the House Tip O’Neill famously said “All politics is local” to refer to his mistake of losing a campaign race because he had not worked hard enough in his own backyard. We hope politicians here will take this lesson to heart and try to resolve the issue peacefully.
*The writer is a professor of political science at Yonsei University.
By Moon Chung-in