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FEATURE

Secret Trade Deal
is the Enforcer for
the New World Order

"NAFTA on Steroids?"

"A dagger through the heart of democracy!"

Think we're kidding? Exaggerating?
Think again
.

Business Week calls the Multilateral Agreement on Investment (MAI) "The most explosive trade deal you've never heard of." 

Enforcing the New World Order
CONTENTS:

Enforcing the New World Order

mai_bkg.gif (1455 bytes)Written by and for transnational corporations, the Multilateral Agreement on Investment (MAI) has been called "the constitution of a single global economy." It threatens the rights of every citizen in every signatory nation. MAI would also ...

... Keep Human Rights Behind Bars

... Allow Corporations to Overrule Governments

... and Threaten Our Hopes for the Future

mai-squeeze.gif (7600 bytes)Imagine this:

  • A local union goes on strike. The employer successfully sues the town to recover lost profits, costing taxpayers (including union members) millions of dollars.

  • A county government blocks a toxic waste dump, citing the potential health risks and negative impact on property values. Investors file suit; an international tribunal overrules the county supervisors.

  • The U.S. government is powerless to prevent wholesale purchase of the American news media, banks and utilities by foreign interests.

Impossible? Apparently not.

A treaty, negotiated in secret by government officials and corporate executives, would give transnational corporations sweeping new rights and overrule decision-making by democratically-elected legislatures.

Meet the Multilateral Agreement on Investment (MAI).

MAI is more sweeping in scope than NAFTA or GATT. Business Week calls it "The most explosive trade deal you’ve never heard of."

It’s been called "NAFTA on steroids," a coup in slow motion, "a dangerous and audacious power grab," and "a dagger through the heart of democracy."

Big business, of course, has a different view. "When concluded, the MAI will become the next pillar in the global system of trade, finance, and investment," says the United States Council for International Business.

"We are writing the constitution of a single global economy," says Renato Ruggerio, director general of the World Trade Organization (WTO).

The problem is, this "constitution" would override the U.S. Constitution, and that of every other signatory nation. MAI would nullify the checks and balances of our constitutional system and overawe our Bill of Rights.

And the new constitution is a creation of, by and for transnational corporations.

"Behind the scenes, big business is pushing for the MAI and helping to draft its language," says journalist David Moberg. The U.S. Council for International Business, representing more than 300 transnational corporations and global law firms (and including foreign-based corporations, like Matsushita and Nestle), is prime force behind the treaty.

The goal of MAI, simply put, is to finish what GATT (the General Agreement on Tariffs and Trade) started. MAI would deregulate investment in manufacturing and services, currency trading, trade in stocks and bonds, and ownership of land and natural resources — world-wide. But while the rules would come off big business and banks, new rules would be slapped on government at every level.

WORLD-WIDE NAFTA

mai_bkg.gif (1455 bytes)MAI is designed to make it easier for individual and corporate investors to move assets, either money or production, across international borders. It’s a NAFTA of global proportions.

MAI would force signatory nations to:

  • Open all economic sectors, including real estate, broadcasting and natural resources, to foreign ownership.

  • Treat foreign investors no less favorably than domestic firms.

  • Remove performance requirements — those laws that require investors to behave in a certain way in order to achieve market access. These might include paying a living wage, using local suppliers, hiring minority contractors or investing in impoverished areas.

  • Remove restrictions on movement of capital.

  • Compensate investors in full when their assets are expropriated, either through seizure or "unreasonable" regulation.

  • Hold taxpayers responsible for compensating corporations for profits lost as a result of strife — boycotts, public protests, strikes.

  • Allow corporations and investors to sue governments directly for alleged violations of MAI rules — and for cash compensation in relation to almost any government action that undermines profits.

  • Submit to a dispute-resolution process involving international panels, not domestic courts.

  • Force states, counties, cities and towns to comply with MAI.

The rights granted by this treaty go only to foreign investors and corporations. The responsibilities (and potential burden and liabilities) affect only the people, through their elected governments.

MAI would tie the hands of any government at any level to choose their own social and economic policies.

A leading environmentalist worries, "We’re concerned about [MAI’s] deregulation aspects on the environment... and there’s no balance in it. Corporate rights are not balanced with corporate responsibility."

And there won’t be any balance, if the prime movers of the treaty have their way. "We will oppose any and all measures to create or even imply binding obligations for governments or business related to the environment or labor," says the United States Council for International Business (USCIB).

Not even voluntary guidelines are acceptable to the would-be dictators of the global economy. "We will resist efforts to impose new ‘voluntary’ guidelines or codes of conduct on the operations of multinational corporations," the USCIB says.

SECRET NEGOTIATIONS

mai_bkg.gif (1455 bytes)Negotiations began in May 1995 under the auspices of the Organization for Economic Cooperation and Development (OECED), the elite club of the 29 wealthiest nations. The Clinton Administration, a strong supporter of the treaty, is represented by the U.S. Trade Representative and the U.S. State and Treasury Departments. The USCIB helps shape U.S. negotiating positions and has direct access to the chairman of the OECD’s MAI negotiating group.

The talks have been kept tightly under wraps. U.S. government officials denied the existence of MAI until late January 1997 when citizens’ groups obtained a copy. To the chagrin of the State Dept., the text is now posted in full on Public Citizens’s website at www.citizen.org.

MAI’s original completion date was May 1997, when only a very few legislators in any of the countries involved in the talks knew anything about the treaty. Most members of Congress had no idea of MAI’s existence — and many may not yet fully understand its terms.

FIGHT BACK

mai_bkg.gif (1455 bytes)Unions and citizens’ organizations pulled off an important victory last fall by blocking renewal of fast track authority, the special presidential power to side-step Congress in trade negotiations. Awareness of the effects of NAFTA fueled public opposition to fast track. The understanding that MAI is a vast, global NAFTA that threatens national sovereignty could weld together a coalition powerful enough to stop this assault on our living standards and rights as citizens.

"The more people learn about this, the more scared they get," says Alan Tonelson, a research fellow at the U.S. Business and Industrial Council, an organization of small and medium-sized businesses. "And they should, because it is a dangerous and audacious power grab that must be stopped."

(This article is based, in part, on material prepared by Public Citizen’s Global Trade Watch and the International Forum on Globalization.)

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MAI Would Keep
Human Rights Behind Bars

If the Multilateral Agreement on Investment (MAI) had been in effect twenty years ago, Nelson Mandela would still be in prison, and not the president of a democratic South Africa.

Labor-backed sanctions against investment in South Africa aided the democratic forces in that country which toppled the apartheid system of racial segregation and oppression.

MAI would make it illegal for government to distinguish between foreign investors based on a country’s human rights, or labor rights, record. So government sanctions and boycotts, like those against investment in South Africa, would be prohibited.

"Under MAI, worker protection laws might be challenged as an obstacle to investment," writes Jonathan Tasini of the National Writers’ Union.

"For example, living wage laws could be challenged by multinational corporations as imposing a cost of doing business that threatens investment. No longer would governments be able to ban or restrict investments in countries that violate human or workers’ rights — giving a bigger boost to the spread of global sweatshops and the suppression of labor unions around the world. Many laws already on the books that contradict the MAI’s provisions would have to be eliminated."

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mai_bkg.gif (1455 bytes)

Foreign Bosses Would
Overrule U.S. Government

Corporations filing suit when government does its job? The bizarre scenario threatened by the Multilateral Agreement on Investment (MAI) world-wide is already a reality in the nations covered by the North American Free Trade Agreement (NAFTA).

The Ethyl Corporation has filed suit against Canada because the Canadian government banned the gasoline additive MMT — an Ethyl Corp. product —- as a public health risk and a pollutant. (MMT is believed to be a poison that attacks the human nervous system.)

As it happens, some states also ban MMT. When the U.S. Trade Representative’s office refused to pursue the case, using NAFTA’s governmental dispute resolution system, Ethyl Corp. filed its own direct suit against Canada — for $251 million.

Citing a provision of NAFTA which guards corporate assets against "expropriation," Ethyl is claiming that the very act of the Canadian parliament in debating an MMT ban constituted an expropriation of the company’s assets.

MAI’s provisions are even broader. Investors could sue government to recover losses from a "lost opportunity to profit from a planned investment."

These provisions would give every foreign investor or corporation the power to challenge nearly every government action or policy — the 40-hour week, the minimum wage, occupational safety and health requirements or environmental controls, for example.

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Threatening Our
Hope for the Future

Suppose our wishes came true. Suppose the Labor Party won a majority in Congress and began working on behalf of working people.

Celebration would quickly turn to frustration if the Multilateral Agreement on Investment (MAI) was in effect.

MAI would be a straight-jacket preventing any movement by government to expand the people’s rights or social benefits. MAI would drastically limit the ability of any government to shape economic or social policy in the interests of working people.

MAI represents a pre-emptive strike against any future progressive governments, here or abroad.

Sound far-fetched? Consider this: Any country having second thoughts about MAI can not get out of the treaty until after completing five years of membership — but then a country remains bound to all of its obligations to foreign investors and corporations for an additional 15 years!

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