Multinationals Use International Tribunals to Overpower Nation-States

From: Suzanne de Kuyper <suzannedk@gmail.com>
Date: Mon, Jun 18, 2012 at 1:57 PM
Subject: Fwd: [R-G] [BillTottenWeblog] Multinationals Use International
Tribunals to Overpower Nation-States
To: a-list@greenhouse.economics.utah.edu


This is what underpinned the ability of the US makers of genetically
engineered seeds such as Monsanto, to be able to order the US State
Department to send an official message to the US ambassador to France to
have him warn the French government in 2011 with dire US sanctions should
the French government continue to listen to it's farmers fear of using the
poisonous and exorbitantly expensive seeds that kill those who eat their
produce. A contract with giant Monsanto had to be signed! The US State
Department did as it was told. One begins to see how simplistic it could be
for such a country to order gory massacres in Syria, Libya, Iraq and Egypt
or, any other place, even at home. Where all seeds stocks are fatally
effected in the US. Any country buying US seeds in large quantities will
not be getting what they pay for, big-time. China, unknowing, did so in
vast quantities. Could be an act of war. Suzanne


---------- Forwarded message ----------
From: Bill Totten <shimogamo@ashisuto.co.jp>
Date: Mon, Jun 18, 2012 at 1:18 PM
Subject: [R-G] [BillTottenWeblog] Multinationals Use International Tribunals
to Overpower Nation-States
To: Suzanne de Kuyper <suzannedk@gmail.com>

by Michael Busch

Foreign Policy in Focus (June 15 2012)

A leaked document {1} posted at Public Citizen {2} last night offers a stark
reminder of the rising power transnational corporations enjoy in the
domestic settings of nation-states where they do business. The Huffington
Post's Zach Carter writes that {3}

The newly leaked document is one of the most controversial of the
Trans-Pacific Partnership trade pact. It addresses a broad sweep of
regulations governing international investment and reveals the Obama
administration's advocacy for policies that environmental activists,
financial reform advocates and labor unions have long rejected for eroding
key protections currently in domestic laws.

As Carter points out, "The terms run contrary to campaign promises issued by
Obama and the Democratic Party during the 2008 campaign" {4}.

The threat faced by nation-states from the growing power of multinational
corporations is very real. At the center of concern is the power that
multinationals have to override the domestic laws of countries through the
arm of international tribunals tasked with adjudicating trade disputes
between states and multinational firms. The most important example that
illustrates this concern, as Carter rightly points out, is the case
currently before a World Bank tribunal assessing the claims of a Canadian
firm arguing for its right to mine for gold in El Salvador irrespective of
the objections of the country's government and people.

The case of El Salvador is worth more consideration that Carter is able to
devote in his article. In early 2009, the multinational firm Pacific Rim
Mining Corporation filed suit against San Salvador for its refusal to allow
exploitation of gold deposits in El Salvador's rural north. The corporation
claimed that the government violated its Chapter Ten responsibilities under
the Central American Free Trade Agreement (CAFTA) by refusing to issue
exploitation permits after Pacific Rim filed an Environmental Impact
Assessment in accordance with El Salvador's national law.

The stakes for Pacific Rim were potentially quite high. The corporation had
began exploring for gold in El Salvador years earlier, and in fact was given
the green light by a previous administration to map out possible sites where
the country's deposits could be exploited to greatest profit.
Pacific Rim subsequently identified some 25 sites where they believed gold
could be successfully mined. But as exploration efforts expanded, so to did
the worries of environmentalists and social activists. Critics of Pacific
Rim's intentions argued that mining operations would contaminate the
country's water channels and arable soil with the cyanide-laced water used
to extract gold from subterranean rock. A sustained protest movement formed
around the issue which succeeded in moving public opinion against the
corporation's presence in the country.

But the stakes for El Salvador are even higher. If the tribunal finds in
Pacific Rim's favor, the country would be forced to pay out damages it
cannot afford. While the country's economic situation is not nearly as dire
as some of its regional neighbor's, its fiscal health is far from secure.
Just recently, the country's economic minister stepped down after the
International Monetary Fund shut the tap on a $750 million dollar loan and
budget numbers took a turn for the worse. The Wall Street Journal reports
that "El Salvador's economic growth of 1.5 percent last year was lower than
projected, while public spending and debt soared past expectations" {5}.
Another possible outcome from the tribunal's deliberations is a negotiated
settlement. The most likely outcome would involve amending El Salvador's
environmental and mining laws which in turn could open the door to foreign
corporations and ease access to the country's natural resources.

Barack Obama was a staunch opponent of CAFTA before he was president, which
makes the leaked trade document especially upsetting. The Obama
administration, despite its rhetoric to the contrary, has largely failed to
curb the power of multinationals to hold sway in domestic policies. But the
documents published by Public Citizen last night suggest that the White
House is actively in league with them - a revelation that should give even
Obama's staunchest supporters pause and offer incontrovertible evidence that
on this issue, at least, the president and his challenger Mitt Romney hold
the same policy preference. Thus, regardless of the electoral outcome later
this fall, supposed allies of the United States can expect to receive a raw
deal.

Links:

{1}
http://www.citizenstrade.org/ctc/wp-content/uploads/2012/06/tppinvestment.pd
f

{2} http://www.citizen.org/Page.aspx?pid=183

{3}
http://www.huffingtonpost.com/2012/06/13/obama-trade-document-leak_n_1592593
.html

{4}
http://www.citizenstrade.org/ctc/wp-content/uploads/2011/01/2008DemocraticPl
atformbyCmte_08-13-08.pdf

{5}
http://www.reuters.com/article/2012/04/28/us-salvador-minister-idUSBRE83R00J
20120428

http://www.fpif.org/blog/multinationals_use_international_tribunals_to_overp
ower_nation-states

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