cj#720> MAI & Globalization (fwd)


Richard Moore

Date: Fri, 17 Oct 1997
From: CAP *Erie-Lincoln* <•••@••.•••>
Reply-To: •••@••.•••
Organization: Canadian ACT!ON Coalition News
To: •••@••.•••
Subject: Rachel #568: Part 2: The Nature of World War III]

This is good.... especially for the Yanks, as they do not seem to be as
aware of this assortment of scams as we are here in Canada.


Date: Wed, 15 Oct 97
From: Peter Montague <•••@••.•••>
Subject: Rachel #568: Part 2: The Nature of World War III
To: •••@••.•••

=======================Electronic Edition========================
.                                                               .
.           RACHEL'S ENVIRONMENT & HEALTH WEEKLY #568           .
.                    ---October 16, 1997---                     .
.                          HEADLINES:                           .
.              THE NATURE OF WORLD WAR III, PART 2              .
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We saw last week (REHW #567) that the U.S. economy is no longer
working for the benefit of most people.  Although business is
booming (stock prices, corporate profits and executive salaries
have never been higher) --the average worker's wage has declined
19% during the past 25 years, family income has fallen 6% since
1989, good jobs with benefits are disappearing (being replaced by
part-time, temporary jobs without benefits), while the tax burden
has increasingly been shifted from the wealthy and from
corporations onto the middle class and the working poor.

We are told that these changes are the result of "globalization"
of the economy.  And we are told that "globalization" is a
natural phenomenon, like continental drift, impossible to resist
or control.[1]

But globalization is the result of intentional laws and policies
devised by corporate elites.  Their goal is to further insulate
corporations from control by governments, to enable corporations
to continue consolidating wealth and power in the hands of a few

Most politicians are on board.  Because TV is essential for
election campaigns and because TV ads are very expensive, private
wealth is now essential for election or re-election.  This means
politicians are beholden to the wealthy from the day they take
office, and in recent years they have behaved accordingly:
passing laws to reduce taxes on the rich and on corporations,
helping corporations evade democratic control by enmeshing the
U.S. in "free trade" agreements.

Take the GATT (General Agreement on Tariffs and Trade). The GATT
was passed by Congress and signed by President Clinton in
December 1994. The GATT agreement established the World Trade
Organization (WTO).  The WTO makes and adjudicates rules
governing international trade but WTO officers and judges are not
elected, so they are not democratically accountable.

WTO rules make a subtle legal distinction between traded products
and "processing and production methods."  Governments are allowed
to use trade restrictions (import bans, for example) against
products on scientifically-established health grounds, but they
cannot limit imports because of social or environmental concerns
over the way products are produced.  For example, the European
Union (EU) is trying to keep out milk produced by cows treated
with Monsanto's bovine growth hormone (RBGH, or BST).  Monsanto
insists there are no health effects from drinking such milk (and
there certainly is not worldwide scientific agreement on the
matter), so WTO rules will eventually force the EU to accept milk
from hormone-treated cows.  Governments have lost their power to
control products in ways that their citizens see fit. Through
"free trade" agreements, corporations have gained immense power
over government regulators.

A new "free trade" agreement is being debated at this moment
--the Multilateral Agreement on Investment or MAI (sometimes
called MIA). The MAI has been called a "corporate bill of rights"
because it will greatly diminish the power of governments over
corporations.  As Scott Nova and Michelle Sforza-Roderick of the
Preamble Collaborative in Washington, D.C. [phone: (202)
265-3263] have pointed out,[1]

"As proposed, the MAI would force countries to treat foreign
investors as favorably as domestic companies; laws violating this
principle would be prohibited.  Under these conditions,
transnational corporations would find it easier and more
profitable to move investments, including production facilities,
to low-wage countries.  At the same time, these countries would
be denied the tools necessary to wrest benefits from such
investment --like laws mandating the employment of local managers.

"Efforts to promote local development by earmarking subsidies for
home-grown businesses and limiting foreign ownership of local
resources would also be barred.  If adopted, the MAI will mean
foreclosure of Third World development strategies, increased job
flight from industrial nations, and new pressures on countries,
rich and poor, to compete for increasingly mobile investment
capital by lowering environmental and labor standards.

"A key MAI provision could also threaten corporate accountability
laws championed by progressives in the U.S.  The MAI takes aim at
statutes in any nation that link subsidies, tax breaks and other
public benefits to corporate behavior.  This ban could be used to
challenge a host of local, state and federal measures, including
laws requiring subsidized firms to meet job-creation goals,
community reinvestment rules that require banks to invest in
underserved areas, and the 'living wage' laws that are the focus
of activist campaigns across the country.

"Perhaps most disturbing, the MAI would preempt strategies for
restricting corporate flight to low-wage areas --a major cause of
job loss and income stagnation in the industrialized world.  On
top of the damage done by plant closings and layoffs,
corporations use the THREAT of flight to undermine the bargaining
power of unions and scare policymakers away from the tough
regulation and strong public investment necessary to raise living
standards.  Though remote from today's policy agenda, rules
limiting the capacity of corporations to flee are essential to
restoring the ability of government and labor to deal with
corporations on a level playing field.  The MAI would bar such
rules in any country that is a party to the agreement.

"In its scope and enforcement mechanisms, the MAI represents a
dangerous leap over past international agreements.  It grants any
corporation with a regulatory gripe the right to sue a city,
state or national government before an international tribunal
--with a binding outcome.  Governments would enjoy no reciprocal
right to sue corporations on the public's behalf.  And the MAI
ignores most of the exceptions in previous agreements allowing
governments leeway in critical areas like public health and
resource conservation.  The full extent of the drafters'
ambitions is reflected in WTO Director General Renato Ruggerio's
recent characterization of the MAI negotiations: 'We are writing
the constitution of a single global economy...'"[1]

(To enlist in the fight to stop Congress from approving the MAI,
contact the Public Citizen Global Trade Watch; telephone (202)
588-7777 or (202) 547-4996; or:
http://www.citizen.org/pctrade/tradehome.html. You can find the
full text of the MAI at that web site as well.)

In opposition to "globalization" is a growing grass-roots
movement, worldwide, to assert the importance of place, to insist
that the local economy, based on local materials, local skills,
local capital, and local markets is the only economy that can
serve the needs of people while preserving the resources that
will be needed by our grandchildren.  Because few places can
provide all of the energy, food, water, and materials required by
the local economy, it is really REGIONAL economies that are being
developed.  Regional trade, not global trade.  The goal is to
keep supply lines and transportation routes as short as possible,
to keep money circulating in the local economy, and to keep the
economy and local entrepreneurs (even if they are organized in
the form of corporations) under some semblance of democratic
control.  The issue is not "corporate accountability" --a concept
that does not go far enough to curb corporate abuses --the issue
is democratic control of corporate behavior so that corporations
serve human needs (and the needs of the environment), not merely
the needs of financial elites.[2]  The issue is democratic
control of the local (regional) economy to serve the needs of
people without wrecking the environment.

Most of the elements of this "other" economic vision would be
made illegal by the MAI.  As we have seen, some of the elements
of this vision have already been made illegal by the GATT

Basically, it boils down to a struggle between corporate rights
and human rights.  Next year will be the 50th anniversary of the
adoption of the Universal Declaration on Human Rights by the
United Nations (and signed by the U.S. in December, 1948). (The
text of the Declaration can be found at
http://www.ngo.org/UDHR.html.)  It is worth recalling some of the
rights guaranteed to all humans --rights that are currently being
eroded by grasping corporations and their "globalization"

Article 3 says "Everyone has the right to life, liberty and
security." But if your environment is poisoned do you have

Article 16 says, "The family is the natural and fundamental group
unit of society and is entitled to protection by society and the
state." But how seriously is this being taken in the U.S. (or,
for that matter in a country like Mexico where families are
broken up as corporate-style agriculture forces people off their
traditional lands)?[3]

Article 22 says, "Everyone, as a member of society, has the right
to social security...."

Article 23 says, "(1) Everyone has the right to work, to free
choice of employment, to just and favourable conditions of work
and to protection against unemployment.

"(2) Everyone, without any discrimination, has the right to equal
pay for equal work....."  Women in the U.S. don't receive equal
pay for equal work.

Article 25 says, "Everyone has the right to a standard of living
adequate for the health and well-being of himself and of his
family, including food, clothing, housing, and medical care and
necessary social services, and the right to security in the event
of unemployment, sickness, disability, widowhood, old age, or
other lack of livelihood in circumstances beyond his control."
These and other international covenants[4] need to be dusted off
and brought into our struggles for an economy that works and an
environment that can sustain.  Internationally-recognized human
rights include more than protections against arbitrary
imprisonment and torture, as important as those rights are.

One organization that is seeking to rebuild regional economies,
and do so within the constraints of the natural environment, is
Sustainable America in New York. It's time to roll up our sleeves
and take back our economy and our environment. To contact them,
telephone Elaine Gross at (212) 239-4221 or E-mail them:
•••@••.••• or http://www.sanetwork.org (omit the

More next week.

                                                --Peter Montague
                (National Writers Union, UAW Local 1981/AFL-CIO)
[1] Scott Nova and Michelle Sforza-Roderick, "Worse Than NAFTA"
in Trent Schroyer, editor, A WORLD THAT WORKS (New York:
Bootstrap Press, 1997), pgs. 32-34.  An earlier version of this
essay appeared in THE NATION Vol. 264, No. 2, (January 13-20,
1997), pgs. 5-6.  The extraordinarily interesting book, A WORLD
THAT WORKS is available for $19.50 plus $3.50 shipping from:
Bootstrap Press, Suite 3C, 777 United Nations Plaza, New York, NY
10017. Telephone and fax: 1-800-316-2739.

[2] For a discussion of the distinction between "accountability"
and "democratic control," see Jeffrey Barber, "The Role of
Corporate Accountability in Sustainable Development," and Richard
Grossman, "Only the People Can Be Socially Responsible," in Trent
Schroyer, editor, A WORLD THAT WORKS, cited above, pgs. 160-184.

[3] See for example, Tom Barry, ZAPATA'S REVENGE; FREE TRADE AND
THE FARM CRISIS IN MEXICO (Boston: South End Press, 1995).

University Center for the Study of Human Rights, 1994).
Available for $10 from: Center for the Study of Human Rights,
Columbia University, 420 West 118th Street, 1108 International
Affairs Building, New York, NY  10027.  Phone: (212) 854-2479;
fax: (212) 864-4847 or (212) 316-4578.

Descriptor terms:  human rights; corporations; economy; economic
development; united nations' universal declaration of huiman
rights; sustainable america; sa; globalization; economic
redevelopment; sustainable development; multilateral agreement on
investment; mai; gatt; wto; world trade organization; preamble
collaborative; scott nova; michelle sforza-roderick; regulation;

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Posted by Richard K. Moore - •••@••.••• - PO Box 26   Wexford, Ireland
         http://www.iol.ie/~rkmoore/cyberjournal            (USA Citizen)
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