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November 20, 2003

The Other News

While the media go goofy over yet another "Michael Jackson, accused pedophile" scandal, and mostly fall over themselves to show everything about Bush's visit to London except the thousands of protesters, there are actually some other pretty big things going on in our little world.

Did you hear about this little thing called the Free Trade Area of the Americas (FTAA)? If you think NAFTA was bad, you ain't seen nothin' yet; FTAA wants to be NAFTA on steriods:

Like NAFTA's Chapter 11, the FTAA's rules of investment would additionally allow corporations to sue governments for future profits lost (a recent example of this was when Canada's Methanex Corp. sued the state of California for almost a billion dollars for banning the use of MTBE in its gasoline, due to its high toxicity. Should Methanex win, California either has to pay out or significantly lower its environmental standards). A poor nation like Bolivia would have virtually no protection against the might of U.S.-based multinationals in a case like this. And the FTAA would also include services, which means that everything ranging from water to education to hospitals would be up for privatization.

Giving corporations the ultimate power to dictate everything from health policy to environmental standards? Sounds great to me!!

You may have heard a bit about this recently because FTAA negotiators are currently meeting in Florida amid more protests (also here w/out the subscription hassle). Don't be misled; the dispute here is not between "free traders" and "isolationists" or "protectionists." Those who support agreements like FTAA want unfettered rights to exploit the environment and the world's workers in order to make as much money as they possibly can. Those who oppose these agreements are simply demanding that business respect the environment and human rights. The protesters do not oppose trade, they oppose exploitation. There's a big difference. But you wouldn't know much about that from reading the mainstream news, now would you?

L pointed out the other big story that's getting a lot less coverage than it should: the arrest of 47 Wall Street currency traders. (You can't beat this headline: "Nightmare on Wall Street".) Why were these people arrested? Well gee, turns out they were stealing from thousands of people:

The scheme, known among the defendants as "the game" or "points for cash," involved bogus currency trades that included kickbacks paid to those who arranged them, Comey said.

In some cases the improper trades were converted into cash that would be delivered to people in diners, he said.

The charges allege that thousands of investors were ripped off. The Securities and Exchange Commission and the Commodity Futures Trading Commission also are expected to file charges.

The important part to remember here is that "thousands of investors were ripped off." That could have been you, or your neighbor. Yet, here's a diagram (PDF) that suggests that the "victims" were banks. Um, I don't think so: "thousands of investors were ripped off." Isn't it likely that these were largely investors with the least to lose? I mean, if you have a lot of money, can't you afford to get good advice about how to invest it, and wouldn't that advice largely protect you from scams like this?

Who knows. We'll probably learn little about who the real victims are in these cases because, just as was the case with the Enron and Worldcom and and and scandals, the banks and investment and trading firms involved here are going to do everything they can to make sure we don't care about this. Just another bunch of suits stealing, move along please.

Oh, but wait, it's really important that Michael Jackson got arrested again, right?

Posted November 20, 2003 06:55 AM | general politics

I am just writing to see if I cant start a discussion regarding the fears that seem to prevade a large segment of our population regarding the subject of free trade. As you seem to be gripped by this free trade paranoia I would like to better understand what exacty it is that frightens you so much.

As a Floridian at ground zero of the anti-FTAA demonstrations i must say i find alot of what protestors bemoaning, although concerning in nature, completely unfounded by the articles set forth in the trade agreement. Your concerns regarding NAFTA's chapter 11 similarly seem to disregard reality. Corporations are NOT given the ultimate power to dictate everything from health policy to environmental standards as you claim. NAFTA's Chapter 11 article 1114 in fact makes this very clear.

Article 1114: Environmental Measures

1. Nothing in this Chapter shall be construed to prevent a Party from adopting, maintaining or enforcing any measure otherwise consistent with this Chapter that it considers appropriate to ensure that investment activity in its territory is undertaken in a manner sensitive to environmental concerns.

2. The Parties recognize that it is inappropriate to encourage investment by relaxing domestic health, safety or environmental measures. Accordingly, a Party should not waive or otherwise derogate from, or offer to waive or otherwise derogate from, such measures as an encouragement for the establishment, acquisition, expansion or retention in its territory of an investment of an investor. If a Party considers that another Party has offered such an encouragement, it may request consultations with the other Party and the two Parties shall consult with a view to avoiding any such encouragement

Of course coporations like citizens must be given the ability to seek legal redress against arbitray government action taken in the name of "environmental protection". Without it governments could simply raise protectionist barriers under the guise of environmental concerns which would in effect undercut free trade.

Similarly I would like to understand the inconsistency in empirical data regarding jobs and free trade. Since the inception of the NAFTA treaty this country has had some of the lowest unemployment rates in history. Yet all I hear from anti free traders is how free trade robs us of jobs. I dont get it...

Posted by: Anonymous at November 24, 2003 01:45 PM

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