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  • Eyes on Trade is a blog by the staff of Public Citizen's Global Trade Watch (GTW) division. GTW aims to promote democracy by challenging corporate globalization, arguing that the current globalization model is neither a random inevitability nor "free trade." Eyes on Trade is a space for interested parties to share information about globalization and trade issues, and in particular for us to share our watchdogging insights with you! GTW director Lori Wallach's initial post explains it all.

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January 09, 2008

All these change agents, and I still can't break a 20

The growing usage of the phrase "change agent" has to be the oddest and most incongruous adaptation of radical thought into recent American political discourse. For many folks on the left, some variation of the phrase "change agent" has denoted the working class, the multitude, oppressed nationalities, etc. Overnight, everyone from Mitt Romney to Hillary Clinton assumes the mantle previously given to very large, very strategically placed groups of people.

Whatev. Here at Global Trade Watch, as we are apt to disclose, we have no preference among the self-designated change agents. What we are concerned about is how the struggle for a break from the neo-liberal policies of the past is informing or being informed by the horse race now moving on to South Carolina, Nevada, Michigan and beyond.

The good news is that many of the candidates, including last night's victor Hillary Clinton, are coming up with specific ways that they would change trade policy, as the Iowa Fair Trade Campaign documented in the letters it received from the candidates.

One of the major issues that a new president will likely have to deal with is an economic recession, and they will have to come up with ways to deal with the problem. Corporations have worked hard to ensure that constraints are put on the ability of people to democratically determine how they get themselves out of a recession. Thus, while many of the candidates banter on about international labor and environmental rights that are largely unenforceable in current trade policies, relatively short shrift has been given to the ability to break from NAFTA-WTO style policies during times of national crisis.

In last year's debate over the Peru FTA (and the 2006 debate over the Oman FTA), some attention was given to trying to come up with policies that would safeguard the ability of the U.S. government to block without FTA challenge any takeover of U.S. ports by foreign entities. The "great leap forward" given by our fearless leaders in Congress (they're like 535 little change agents!) was to insert a clause into the "revised" Peru FTA that read:

"Nothing in this Agreement shall be construed: ... to preclude a Party from applying measures that it considers necessary for the fulfillment of its obligations with respect to the maintenance or restoration of international peace or security, or the protection of its own essential security interests."

Some are claiming that this allows "full non-challengeable authority" for the U.S. to do whatever it wants if it invokes this so-called "national security" exception.

Unfortunately, the history of these clauses are a little murkier, as this law review article shows. Take the case of Argentina. In 2001-02, the country of my childhood went through an economic recession on par with the Great Depression. The government took a series of measures that it deemed necessary to insulate it's citizens from the worst aspects of the recession - a regulatory move that has made it the target of countless challenges from multinational corporations. These corporations, including Enron, have used NAFTA-like provisions in so-called bilateral investment treaties (BITs) to go after the country in foreign courts and demand billions in Argentine taxpayer dollars. Their gripe? Argentina making use of these so called "non-precluded measures" during a time of national emergency.

As the aforementioned article by William Burke-White and Andreas von Staden argues, even though the U.S. and other countries have tried to move closer to a clearly "self-judging" standard on these "non-precluded measures", the case history shows a lack of agreement among the corporate trade elite about this discretion.

When Enron sued Argentina, for instance, the corporate trade tribunalists ruled that Argentina could not decide for itself what measures it could take during an economic recession (and avoid challenge and compensation claims). But in a very similar case brought by LG and E, the tribunal ruled the exact opposite way. (See pages 106 and 4 respectively). Both these cases were brought under the U.S.-Argentina BIT, which is like the investor-state regime inserted into NAFTA-style trade agreements.

Anyone still think we're immune from what our corporations have gotten written into pacts that we're party to? Anyone who still thinks it's a good idea to offer up sovereignty to such a fickle, unelected grouplet of trade specialists? Anyone who still buys the idea that you can offer up whole swaths of the U.S. economy and regulatory structure to FTA dictates, and then hope and pray that clever exceptions will stand up when the corporate class wants to teach democratically elected leaders a lesson? (As Sirota points out, they're already in the ginger phase one of that lesson here in the U.S.)

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