(THIS ARTICLE IS MACHINE TRANSLATED by Google from Norwegian)
But why demonstrated 30.000 against this deal?
Behind the demonstrations was most of the trade union movement in the United States – and otherwise the same communities that filled the streets of Seattle in the late fall of 1999.
The criticism of the FTAA (Free Trade Agreement of the Americas) is powerful. Critics see disadvantages and dangers both in the north and south of the American continent:
In the US and Canada, the FTAA will threaten jobs, push wages down, and weaken many unions:
In South and Central America, the FTAA will stifle important approaches to national industrial investment and offer hundreds of thousands of workers unequal pay and working conditions.
Hysterical criticism?
Will not at least some countries profit from it?
It is not all trade that means the downfall of the world. And, of course, we should look with skepticism at the form of instinctive protectionism that strong forces in the United States so easily fall for.
Nevertheless, there is one factor that can be decisive for the effects the FTAA will have. The FTAA will increase competition from abroad in a situation where the trade union movement is already weak in all countries in both North and South America – and where the increased competition will further weaken the trade union movement – both in the north and the south. At least in the short term.
In such a situation, tougher competition will force employers and business executives to find solutions that reduce costs. The choice may be to slim down the workforce, cut wages, trade unions, move to countries with lower wages and even weaker trade unions.
From NAFTA to FTAA
Experience with NAFTA, the North American Free Trade Agreement signed in 1994 between the United States, Canada and Mexico, is behind when the protests against the FTAA become so fierce
The cross-border campaign against the FTAA states that one million jobs have been lost in the US and Canada as a result of NAFTA, that Mexican workers' wages have dropped by 21 percent, that rivers and communities in Mexico are being poisoned by emissions from new factories working for export north .
I have not had the opportunity to check such figures. But after 1994, unemployment in the United States has fallen, and it is now lower than in over 20 years. We can hope that those who lost a job because of NAFTA have had something else to do. But perhaps with lower wages and fewer rights in the workplace. And if Latin American countries do not have to export to the United States and Canada, it must be cleared for it in some way. Brutal for those who become unemployed, but in the long run good for Latin Americans.
What provokes
Nevertheless, there is much that is provoked by the proposal for a free trade agreement for the whole of America.
- It is dictated by the United States.
- It is secret – despite being discussed at meetings between 34 governments.
- The demonstrators are nevertheless cautious and reckon that it is screwed over the same arrogant read as NAFTA: that governments and workers lose their rights and power, and that everything is arranged for the group and employers.
- In that case, it contains investment rules that give you compensation if a foreign government invents something that reduces your "future income".
If you want to sell nerve agent…
You cannot refuse to sell gasoline with nerve poison if the nerve poison is produced abroad. That was the startling conclusion on a case between the US company Ethyl and Canada.
Ethyl had, with reference to the North American free trade agreement NAFTA, filed a lawsuit against the Canadian government because Canada had banned a chemical substance that the company produced for environmental reasons. The manganese compound MMT (abbreviation for methylcyclopentadienyl manganthricarbonyl!) Is suspected to have effects that make it a neurotoxin. If inhaled, it can lead to memory loss, psychosis and, in the worst case, death – it is claimed. These health effects are, of course, disputed by Ethyl Corporation.
The company litigated that the prohibition was to be regarded as an expropriation of future income and that, according to NAFTA, it was entitled to compensation.
Settled with Ethyl
In April 1997, the Canadian Parliament decided to ban MMT.
Within NAFTA, Ethyl filed a lawsuit against the Government of Canada for expropriating the Company's property without compensation, "property" within the meaning of "future income." In addition, the debate in parliament had damaged the company's "good reputation".
The case was brought before NAFTA's jury which works without public scrutiny. When the Canadian government realized that it would lose the case in the jury, it agreed to Ethyl.
The settlement meant that Canada lifted the ban on MMT and Ethyl received $ 13 million in damages for torture and injury!
Expropriation of future income
Chapter 11 of the NAFTA Agreement provides the legal basis for such a case. Any financial disposition that could lead to future revenues in other countries is considered an investment that the NAFTA rules aim to protect.
The NAFTA rules do not only interfere with the expropriation of real estate, but also if a government introduces rules or makes decisions that cause a foreign company to lose "future income". It doesn't matter if these are new tax rules, increased taxes, environmental regulations or requirements. The rules allow for compensation even if the return is weakened because public authorities are unable to prevent "social unrest", e.g. prolonged strikes, boycotts or riots.
These rules on expropriation in the NAFTA agreement of 1994 later appeared in the proposal for a multilateral investment agreement, the so-called MAI agreement. The Ethyl case was used in the debate as an example of where powerless governments came to be if the MAI agreement was approved.
At that time, the Ethyl case was the only example. Later, within NAFTA a series of cases with similar content have been raised.
More than Ethyl
The US company SDMyers has brought a case against Canada because it was not allowed to export PCB waste to Canada for a year and a half. The Judgment Committee has determined that the NAFTA agreement has been breached. The amount of compensation has not been determined.
Sun Belt Water has sued Canada for not allowing large quantities of water to be exported from Canada to California. The company claims compensation of "between $ 1 and $ 10,5 billion".
To protect forest resources, Canada has set quotas for timber exports from the various forest areas. The US company Pope and Talbot has gone to court with reference to the NAFTA agreement. In a preliminary opinion, the sentencing committee denied that such quotas involve expropriation.
United States UPS (United Parcel Service), with reference to NAFTA, requires Canada Post, the public mail monopoly, not to use the same mailboxes, cars, and mailing system that has a monopoly on distributing and parcel mail and door-to-door deliveries as it does not have a monopoly.
Cases against the United States and Mexico
The Canadian company Methanex has filed suit against the United States because the California authorities have demanded that the chemical substance MTBE (methyl tertiary butyl) should not be added to gas after 2002. MTBE has been found in groundwater 10.000 sites in California. It can cost tens of billions of dollars to get it away. But Methanex obviously expects the NAFTA rules to compensate the polluter.
The US company Metalclad has brought a case against Mexico because it has lost its license to continue operating a waste facility. Geological surveys showed that the facility could pollute rivers and groundwater in a large area. But Metalclad claims $ 90 million in damages.
Other US companies have also raised similar claims against Mexico.
Canada regrets
It is Canada that has received the most NAFTA cases against it, and the Canadian government regrets that it has agreed to the investment rules in Chapter 11.
It has tried in vain to persuade the United States to change the rules so that companies cannot claim compensation if environmental regulations are tightened.
It is therefore hoped that Canada will go against such investment rules in the FTAA, the All-American Free Trade Agreement. But there are US companies that have so far had the most to gain from the NAFTA rules, and NAFTA does not disappear because of the FTAA addition.
