 Anyone with paranoid tendencies can appreciate this one: Unbeknownst to almost anyone in the U.S. -- even members of Congress -- a small circle of international negotiators have been meeting every month for the past two years, crafting a plan that would empower corporations to invest, without restriction, wherever they want. The plan would even give companies the right to sue any government that tries to put conditions on their investment behavior. Cartoon: ©Bill Yund Well, this particular paranoid delusion isn't actually a delusion. We know because in February 1997, a 147-page draft of the plan was leaked and fell into the hands of the Washington-based group Global Trade Watch. Now we have a good idea of what's in store under the "Multilateral Agreement on Investment," or MAI. Lori Wallach of Global Trade Watch calls it "NAFTA on steroids." HUSH-HUSH NEGOTIATIONS The plan is being negotiated by representatives of the world's 29 richest countries under the aegis of the Organization for Economic Cooperation and Development. The Clinton administration is a driving force behind the negotiations, which were first launched in May 1995. The draft agreement is now nearly complete, although negotiators have until next May to put the final touches on it. It will eventually have to go to Congress for approval. Despite the potentially massive effects of this treaty, it has gotten virtually no publicity in the U.S. media. The negotiations have been unusually hush-hush. "They didn't start to notify people about the negotiations until they were 90 percent completed," says Global Trade Watch's Chantell Taylor. "I think the idea was not to tell a lot of people about it because they didn't want it to be subject to a lot of debate and scrutiny, and watered down as a result." PROTECTING THE POWERFUL MAI would establish a set of rules giving corporations powerful protections in every country that signs the treaty. Proponents of MAI say it wouldn't have anything like the drastic effect that groups like Global Trade Watch claim. William Witherell, an official from the Organization for Economic Cooperation and Development, maintains that the idea behind MAI is simply to prevent any government from "discriminating against foreign investors." But, he argues, "This approach does not imply any relaxation of corporate responsibility, nor will it undermine the capacity of host countries to regulate their domestic economies, so long as they do not discriminate against foreign investments." No one disputes that the treaty would strictly forbid the government from treating foreign investors any differently than they treat domestic investors. But what would this really mean? Public Citizen and others believe that this provision of MAI could, for instance, effectively outlaw local, state or federal programs that set aside certain loans or benefits for small or minority-owned businesses. The agreement would also make it illegal for government to distinguish between foreign investors based on a country's human rights, labor, or other records. So the successful campaign to impose sanctions on apartheid South Africa, for instance, might have been found to violate the terms of MAI. UNCONDITIONAL RIGHTS FOR COMPANIES MAI would also forbid a government from placing any condition on the subsidies or tax breaks it provides to companies. And that could keep us from passing laws that require a level of "corporate responsibility," like making companies pledge to stay in the community or hire a certain number of local residents. Living wage laws that force companies to pay a decent wage if they are to get government contracts might also violate MAI. MAI would ban any attempt to force corporations to keep some of their profits in the community or nation where they are investing. This provision would be especially devastating for third world nations trying to keep multinationals from plundering precious resources and taking advantage of low-wage labor. At a forum on MAI sponsored by the New Jersey Work Environment Council, a U.S. negotiator of MAI argued that the U.S. should rightly determine the rules for investment around the globe. Since the U.S. is the biggest trader in the world, the official argued, "we should set the rules." The negotiator also maintained that it really doesn't matter if a company is owned by a foreign investor or not. SUING THE GOVERNMENT Perhaps the most frightening thing about MAI is that it would, for the first time, give a corporation the right to act like a government, and sue an entire nation for violating its rights under MAI. In other words, a federal, state, or even local government that dared to pass a law that violated a company's MAI investment rights could be open to a corporate suit. "I think it's very scary," says Chantell Taylor. "But when you talk to some of the U.S. negotiators about it, they don't think that's a bad thing. They don't see anything wrong with it." Taylor believes that the treaty's effect might not be felt immediately. "I think at first local or state governments will just go ahead and pass laws, even if they do violate MAI. I think they'll have no clue that they're in violation of this obscure international treaty. But then a little way down the line, they'll see governments around the country [who have passed similar laws] facing lawsuits before international tribunals -- and then they'll start looking over their shoulder." CONGRESS IN THE DARK Taylor says it's hard to tell what kind of reception MAI would get in Congress. At this point, she says, most legislators don't even know about it. "When we tell them about it, they say, 'No, no, you must be exaggerating. I'll find out about it -- don't worry.'" Predictably, some legislators argue that having a treaty like MAI is okay because foreign investment creates jobs. Says Taylor: "We have to keep reminding them that the debate is not about whether or not we should allow foreign investment or have trade. The debate is about the rules by which we do it. And this agreement offers too many rights for corporations without responsibilities." --Laura McClure For more information, contact Public Citizen's Global Trade Watch, 215 Pennsylvania Ave. SE, Washington, D.C. 20003.*
The Labor Party Press Staff Box.... Labor Party Press Volume Two, Number Five September 1997 Published six times a year in January, March, May, July, September and November. Subscriptions to Labor Party Press are included in annual dues ($20 regular membership; $10 retired/ unemployed/ low income membership). Publication office located at 1532 16th Street, NW, Washington, DC 20036. Application to Mail at Periodicals Postage Rates is Pending at Washington, DC and at additional mailing offices. POSTMASTER: Send address changes to Labor Party Press, PO Box 53177, Washington, D.C. 20009. Phone 202-234-5190; Fax 202-234-5266 VISIT OUR WEBSITE: www.igc.apc.org/lpa/ ____________________ Interim National Council (in formation) Co-Chairpersons: Kit Costello, Robert Clark, & Baldemar Velasquez At Large: representatives of OCAW, UE, BMWE, ILWU, CNA, AFGE, UMWA, CA State Council of Carpenters, and FLOC; Noel Beasley, Joanne Bell, Dave Campbell, Mark Dimondstein, Ed Grystar, Cheri Honkala, Kathy King, Ed Kornegay, Dan McCarthy, Adolph Reed, Jr., Tim Schermerhorn, Leal Sundet, Sean Sweeney, Barbara Walden, Gerry Zero Trustees: Chris Townsend, Gerry Zero, Joanne Bell Interim National Organizer: Tony Mazzocchi Recording Secretary-Treasurer: Katherine Isaac ___________________Organizers: Bob Brown, Philadelphia Ed Bruno, New England Bob Kasen, Washington, D.C. Leo Seidlitz, San Francisco ___________________ New England Labor Party 197 Friend St., 9th Flr, Boston, MA02114 Tel: 617-531-0901 Fax: 617-531-0902 ___________________Editor: Laura McClure Managing Editor: Katherine Isaac Art Director: Michael Kaufman Contributing Editors: Peter Gilmore, Adolph Reed, Jr., Kathy Wilkes Artists: Gary Huck, Mike Konopacki, Howard Saunders, Bill Yund Photographers: Paul Felton, Maggie Hallahan, Michael Kaufman, Bob McKeown Impact Visuals: Bill Burke, Rick Gerharter, Ansell Horn Internet Coordinator: David Walters Special thanks to The Labor Institute The Labor Party Press is produced by members of the Oil, Chemical & Atomic Workers Union Graphic Artists Guild and the National Writers Union/U.A.W. Printed by Vanguard Offset Printers __________________ ©1997 Labor Party All rights reserved. Artists, photographers and writers retain the copyrights to their work. No part of the Labor Party Press may be reproduced without permission. To arrange permissions, contact Michael Kaufman, c/o Labor Institute, 853 Broadway, Room 2014, New York, NY 10003; 212-674-3322. The Labor Party thanks the working artists, photographers, and writers whose solidarity helps make this paper possible. ___________________ CHANGES OF ADDRESS and membership inquiries should be directed to Labor Party, PO Box
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