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GLOBAL JUSTICE,
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Banana wars
The US brought an
action in the WTO against the EU because of its favourable quotas for
Caribbean bananas. By a curious coincidence, this action was initiated just
after a large donation to the US Democrats by the US fruit-growing transnational
Chiquita. Small Caribbean farmers are now faced with destitution if the EU
gives in. The WTO did not consider it relevant that Europe had historical
obligations to the Caribbean banana producers, nor that most bananas
exported from South America are grown on large plantations controlled by a
small number of transnational companies, nor that trade union activity on
many of these plantations is forbidden and workers' representatives
threatened, nor that pesticides are regularly used there in quantities and
conditions damaging to human health. |
5.1 Free trade agreements are administered by the
World Trade Organisation (WTO) according to the principle of
non-discrimination between domestic and imported goods. Under WTO rules there
are few exceptions to the principle that free trade takes precedence over
everything else.
5.2 In practice, even regulations to protect public health can, if they
reduce foreign company profits, be viewed as discriminatory and as
"restraints on trade". Governments who want to exclude a particular
import must prove their case to the WTO according to its own narrowly defined
criteria. No allowance is made for the precautionary principle.
5.3 A country can take a complaint against any such exclusion to a WTO
disputes resolution panel. The hearing is closed and the decision binding.
Countries with expensive teams of lobbyists have a clear advantage over poor
countries. If a country's complaint is upheld, it is allowed to impose
tariffs on unrelated products from the offending country. This works to the
advantage of large, wealthy nations, in that for example US sanctions on
goods from a small developing country like Bangladesh would do far more harm
than sanctions by Bangladesh on US goods.
6.1 Rule changes that are presented as technical and mutually
beneficial adjustments to promote economic efficiency and prosperity can have
profound anti-democratic implications. Contrary to the principle that no government
can bind its successor, many of the new trade measures are deliberately
designed to be irreversible by future governments.
6.2 Not everybody that thinks globally is an environmentalist. Most
international trade is dominated by large transnational corporations, some of
them with annual turnovers larger than the gross national products of
medium-sized countries. The fewer restraints there are on international trade
and investment, the easier it is for these companies to move where pickings
are richest, wages lowest and regulatory overheads least demanding, and to
repatriate their capital and declare their profits where the taxes are lowest
and the rules of disclosure weakest.
No accident
"The
globalisation process, and the trade rules that guide it, has been fuelled
over the past three decades by the world's leading business and government
elites regularly meeting in forums such as The Council on Foreign Relations
and The Trilateral Commission. They have secretly agreed on common
approaches such as global economic integration, deregulation, and an
economic philosophy of free trade and international competitiveness. They
have pushed for free trade agreements such as the General Agreement on
Trade and Tariffs (GATT) Uruguay Round (spearheaded by the International
Chamber of Commerce), the North American Free Trade Agreement (NAFTA,
pushed by the US Business Roundtable of TNCs... and Canada's equivalent,
the Business Council on National Issues), and in Europe for the Single
Market and Single Currency (via the European Roundtable of
Industrialists)." |
6.3 In a globalised economy, power inevitably passes from
national governments, most of them more or less democratically elected, to
unelected global corporations. The barriers between business and government
are increasingly blurred in many countries. In the words of George Monbiot: "Globalisation
was conceived and nurtured by major multinational companies and their trade
associations. By engineering a single, "harmonised" global market,
in which they can sell the same product or service under the same conditions
everywhere on earth, they hope to extract formidable economies of scale. They
are seizing, in other words, those parts of the global economy still
controlled by small and medium-sized businesses." [2]
6.4 "International competitiveness" means in practice that to win
the globalisation race, big business must be let off taxes, and companies
given huge handouts first to come and then to stay. This international race
for tax cuts and inward investment bribes means less money everywhere for
health, education, transport, pensions and the rebuilding of local
communities.
7.1 Outside the neoliberal mainstream, a growing
coalition of environmentalists, trade unionists, Third World activists and
those concerned with the erosion of democratic freedoms has come to recognise
that this emperor has no clothes - that economic globalisation according to
the WTO's prescription is neither inevitable nor desirable. The debate
suddenly leapt into public visibility with the massive protests in Seattle in
1999 against the WTO's proposed Millennium Round, which would have greatly
extended its power. There were similar protests at the International Monetary
Fund summit in Prague in 2000. It's perhaps unsurprising that the WTO has
chosen for its next summit Qatar, where political demonstrations would be
illegal.
8.1 Without the power to regulate foreign trade and
investment, national governments will become mere administrators; or (as
Peter Mandelson once said) "the era of pure representative democracy is
over." Governments that insist on companies paying a minimum wage, adhering
to decent safety standards and not polluting the environment with their waste
products find that the goods their companies produce have to compete with
imported goods produced much more cheaply without these constraints.
8.2 This is why free trade in the European Single Market is, at least in
theory, balanced by a common Social Chapter and common environmental
regulations. If the bodies that regulate international trade and investment -
or rather prohibit regulation of them by national governments - have their
way there will soon be a worldwide single market without even those gestures
towards social and environmental responsibility that we see in the European
Union.
Results of globalisation include:
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9.1 Although protectionism has become a dirty world in
today's political lexicon, cut-throat protectionism as practised in the 1930s
should not be confused with the right to protect vulnerable economies against
unrestrained market forces, or to protect businesses that pay fair wages and
observe high environmental standards against cheap imports produced without
environmental safeguards by an oppressed and exploited workforce. The
"old protectionism" demanded the opening of markets abroad whilst
simultaneously protecting domestic producers. Greens support
"localisation" which aims to protect and re-build local economies
everywhere, both here and abroad. This "new protectionism" is
directly opposed to the free-trade policies under which hard-won social and
environmental regulations are now being condemned as unfair "barriers to
trade" and overturned by WTO decisions.
10.1 The prototype for some more recent trade
agreements was the North American Free Trade Association (NAFTA) which
famously forced the Canadian government to withdraw product safety
regulations (and issue a grovelling apology) when an American manufacturer
sued it for anticipated loss of profit. The WTO, following in this tradition,
in 1999 ordered the EU to lift its ban on American hormone-treated beef,
which EU countries wanted to ban on health grounds - and threatened £550m
trade sanctions if the EU didn't comply. The US has also considered
challenging proposed EU food-labelling regulations that would show the
presence of GMOs.
11.1 Governments and local authorities are prohibited
by the WTO from supporting businesses important to the local economy and
vulnerable to the economies of scale achieved by big transnational companies.
Farmers and small manufacturers have gone out of business because they are
unable to compete with cheap imports that may be heavily subsidised by the
producer country. Unemployment has also resulted from local businesses being
swallowed up by transnational giants whose investment is more in capital than
in labour. Profit that once circulated to irrigate a local economy is now
often sucked out to enrich foreign investors. Globalisation also creates a
worldwide homogenisation of cultures, social and economic forms - a McDonalds
in every town centre.
11.2 Green Party policies offer a direct challenge to all these factors. But
it's important to stress that localisation doesn't mean the industrialised
countries pulling up the ladder on developing countries. Greens, as true
internationalists, want to encourage and assist economic development which truly
benefits the poorest people, which fosters social justice and which doesn't
compromise the wealth or well-being of future generations.
12.1 In a world of limited energy and resources, there
is something perverse about a system that deliberately promotes growth in
long-distance trade, and whose health is believed to depend on such growth.
The further a commodity has been transported, the more fuel has been burned,
the more carbon dioxide (CO2) released in getting it there. CO2 is the main
cause of climate change, the most serious threat facing the planet today.
Scientists say we need to reduce emissions by 60-80% to avert the worst
consequences of climate change. This will be impossible if we continue to increase
international trade.
12.2 According to Friends of the Earth International (FOEI):
"Sustainable economies, based on the principle of economic subsidiarity
and economic diversity, will still require multilateral rules and
inter-governmental institutions, but these institutions will not be based on
out-of-date neoliberal economics. Debates concerning the continued existence
of the World Trade Organisation are therefore academic. Either it adapts to
support sustainable economies, losing its mandate to promote free trade, or
it is replaced by a more suitable institution." [3]
13.1 A recent World Bank study found that greater openness to trade
does lead to income growth among the top 60% of the population, but has the
opposite effect among the poorest 40% [4].
Globalisation in practice leads to a "race to the bottom", in which
transnationals move their operations to the states with the lowest wages,
lowest environmental protection and weakest health and safety laws. The last
two decades of the twentieth century, during which globalisation has gathered
momentum, have seen a widening of the gap between rich and poor, both within
and between nations. The 1990s ended with 70 million more people in the
developing world (excluding China) in poverty than at the start of the
decade. [5]
An unforgiving process
"For good or
ill, an unforgiving capitalist process is driving wealth creation. It has
become increasingly difficult for policy makers who wish to practise, as
they put it, a more 'caring' capitalism to realise the full potential of
their economies. In a less competitive world, when trade barriers were
higher, governments were able to construct social safety nets and engaged
in policies intended to redistribute income. But today, as a result of
falling trade barriers and new technologies, international competitive
pressures are narrowing the choices for economies with broad safety nets:
The choice is of accepting shortfalls in standards of living, relative to
the less-burdened economies, or loosening the social safety net and
acquiescing in the greater concentrations of income that seem to be
associated with our high-tech environment." |
13.2 Poor countries saddled with impossible debt
repayments have been told by the World Bank and the International Monetary
Fund that they will only be regarded as responsible enough to qualify for
assistance if they develop their exports and "liberalise" their
economies - that is, open them up to foreign investment. They are told that
the solution to their problems is to use foreign investment to increase
productivity, export more, sell it more cheaply and so become internationally
competitive. As a result of this advice (since primary commodities are all
most of them have to export), the world markets have been flooded with these
commodities and their prices have dropped, leaving some countries worse off
than before.
13.3 To quote again from FOEI: "Developing sustainable economies will
mean changing the way in which the World Bank and the IMF operate.
Specifically, the introduction of new economic goals, the introduction of
economic subsidiarity and rebalancing trade would mean decision-making being
devolved in part to the regional and national levels; budgetary decisions
being taken on the basis of a significantly different set of priorities; an end
to involuntary export-led development and an end to market opening as a
condition of debt relief." [3]
13.4 Free speech and free markets have been regarded by most politicians and
media commentators as part of a single indivisible package. Countries newly
independent after the collapse of the USSR were told that a strong dose of
market liberalisation would soon put their economies on a sound footing.
Everybody would get rich by taking in everybody else's washing. As a result,
public assets were sold off cheaply, often to businessmen with criminal
links, wealth disparities rocketed and in some countries life expectancy
dropped by several years.
Deregulation versus democracy
According to George
Monbiot (whose book Captive State was refused entry into Switzerland and
whose anti-globalisation meetings around the UK have been interfered with
by pressures on several venues to cancel bookings) globalisation not only
makes it harder to protest effectively against human rights violations, but
is in itself a threat to freedom of expression: |
14.1 British firms in labour-intensive sectors of the
economy find it difficult to compete with those from newly industrialising countries
in the Third World, or from the former communist countries in Eastern Europe,
where wages are a fraction of ours. The pressure to be internationally
competitive forces employers in general to downsize their workforces, with
the remaining employees forced to work even harder to cover for redundant
colleagues, fearful that they will be in the next round of redundancies.
14.2 Job insecurity and pressure to work long hours are therefore two more of
the consequences of globalisation, and contribute to the epidemic of stress
and depression hitting our workforce. Family life is affected, as parents of
both sexes find it hard to spend time with their children. Financial
insecurity also contributes to domestic violence [6].
It is not surprising that there has been an exponential increase in violent
crime in the last few years.
15.1 One of the most dangerous aspects of
globalisation is the removal of controls on the movement of capital. The
Asian financial crisis, which began in Thailand in 1997 and plunged millions
of people into poverty, was a direct result of the removal of exchange
controls. The classic economic rationale for free trade (Ricardo's theory of
comparative advantage) requires that capital does not cross national
boundaries, yet this is exactly what the proponents of globalisation demand.
15.2 Capital movement needs to be re-regulated, not least because of the
lemming-like behaviour of international short-term investment money, which
can now switch almost instantly from one country to another, exaggerating and
accelerating economic vulnerability and making any sensible economic planning
much more difficult.
15.3 During the market collapses that punctuated the 90s, Chile was less
affected than some other South American countries because of its rule that
investors have to lodge a deposit with the Chilean Central Bank, which is
forfeited if the investment is withdrawn within a year.
15.4 Those setting the agenda for globalisation would like to ban such
limitations on what they see as the freedom to invest. Part of the EU
negotiators' mandate for the renewal of the Lome Convention (governing the
EU's relations with third world countries) in 2000 was "promoting
measures for making possible liberalisation of current account transactions,
convertibility of national currencies and free repatriations of foreign
direct investment and any profits stemming therefrom" [7].
16.1 One way in which human rights can be enforced is
through economic sanctions - this is what ended apartheid in South Africa.
Yet such sanctions are forbidden under the free trade rules of globalisation,
and the WTO has already forced some US states to abandon trade sanctions
against the oppressive regime in Burma.
Back-tracking on animal testing
At the time of
writing, the European Commission is back-tracking on the EU Cosmetics
Directive, which is supposed to ban the sale in the EU of cosmetics tested
on animals. The Commission is afraid that it might attract a challenge at
the WTO by a country citing it as a barrier to trade, and therefore want to
persuade the European Parliament to settle for a ban on animal testing in
the EU instead - which could of course allow the import of cosmetics tested
on animals. |
17.1 Regulations to prevent cruelty or protect
endangered species are threatened by WTO rules. For example, the WTO declared
illegal The US Marine Mammals Protection Act (banning the import of tuna fish
caught by a method that endangered dolphins) and forced its withdrawal.
17.2 In the UK pig farming industry, the British government rightly insisted
on farmers observing certain minimum standards of animal welfare in the
rearing of pigs, but was unable to enforce such standards on foreign
producers or to discriminate between imported meat produced according to
similar standards and that produced more cheaply but less humanely. The
economic effect of these imports on UK pig farmers has been catastrophic.
Deregulation may also have contributed to the recent outbreak of foot and
mouth disease.
Theft of resources
"Even now,
patents on life are being granted almost indiscriminately by patent
offices, mostly in the North. These patents distort a patent law system
that was originally intended for mechanical inventions, in order to grant
corporations and individuals private rights and ownership over biological
and genetic resources, traditional knowledge and genetically modified
organisms, in order to obtain monopoly profits. The patent system is being
used to facilitate the theft of biological resources and traditional
knowledge from the South. The monopoly control over such essential
resources will also have tremendous impact on food security and the
livelihoods of farmers and communities in the developing countries." |
18.1 The WTO Trade-Related Intellectual Property
Rights (TRIPS) allows the patenting of crops and seeds, often to the
detriment of the indigenous peoples whose traditional knowledge has been
hi-jacked by transnational corporations. Article 27.3(b) not only facilitates
but also makes it mandatory for all WTO member countries to patent certain life
forms and living processes
18.2 NGOs are supporting the demand of the African group that final
ratification of Article 27.3(b) be delayed until it can be modified to ensure
that plants, animals, micro-organisms and natural processes cannot be
patented, and to include provisions that "preserve traditional farming
practices (including the right to save, exchange and save seeds), and to
prevent anti-competitive rights or practices which may threaten food
sovereignty of developing countries".
18.3 The US is also taking action against Brazil for allegedly violating
TRIPS by manufacturing AIDS drugs for a fraction of the prices charged by the
big drugs companies.>
19.1 The WTO General Agreement on Trade in Services
(GATS) is an ongoing set of negotiations to apply free trade rules to
services such as water provision, health and education, allowing foreign
firms to compete for the provision of public services (at least those where a
profit can be made). As first agreed in 1994, GATS commits members of the WTO
to "achieve a progressively higher level of liberalisation" in
their service sectors. It applies to all levels of government, including
local authorities. A new round started in February 2000.
19.2 The British government is in the vanguard of this process, with public
services from air traffic control to local education authorities coming under
the hammer. The Department of Trade and Industry says that "as a major
global exporter of services, second only to the US, the UK strongly supports
the GATS negotiations." As this statement implies, the impetus for GATS
comes from large private companies in the service sector. According the World
Development Movement (WDM), "Corporations in the services industry want to
operate around the world, uninhibited by government law. For them, freeing up
the trade and investment in services is crucial and the GATS is designed to
do this." [7]
19.3 The UK's own public services are potentialially under threat from GATS.
The United States Coalition of Service Industries, which includes US
healthcare corporations in its membership, is intent on using GATS to break
into the British healthcare market. Public services are exempted from GATS
rules if they are "supplied neither on a commercial basis nor in
competition with one or more service suppliers", but the Labour
government's plans for Public-Private Partnerships will bring in the private
involvement that could put all our services under GATS rules.
19.4 As the WDM has pointed out: "Government commitments under GATS are
effectively irreversible. Once a sector has been liberalised, future
governments, however democratic, will find it virtually impossible to reverse
the decision. Certainly, the WTO Secretariat does not appear to give much
weight to the possibility of reversal, with senior officials describing
liberalisation under the GATS as 'irreversible'" [7].
The ultimate aim of GATS is the privatisation and commercialisation of all
services around the world. It is like a slow motion, low-profile MAI.
Business priorities
In 1998, the then
Minister for Trade, Peter Mandelson, presented a paper to UK industries
about the GATS 2000 agenda. In his own words, the purpose of the paper was
to "encourage views on the important negotiations on international
trade in services... We need your advice on trade barriers that concern you
most. Within the European Community we will be drawing up request lists
country-by-country and sector-by-sector. These negotiating priorities must
reflect UK business priorities. Your responses will of course be treated in
strict confidence." [7]
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20.1 Outside the specialised EU debate (which is
usually reduced to competing sets of vapid slogans), trade and investment
liberalisation has been almost invisible as an election issue. International
agreements with serious implications for jobs and the environment - and for
the democratic process itself - have been signed without having been
subjected to public scrutiny and debate.
20.2 UK governments of both dominant parties have been strong supporters of
both the WTO and the failed MAI. Yet Tony Blair refers to globalisation as if
it were an inescapable force of nature rather than a deliberately chosen
policy that his government continues to push forward.
21.1 The government's recent White Paper on
globalisation (published by the Department for International Development in
December 2000) proposes to help poor countries grow richer by attracting
foreign investment and increasing their export income.
21.2 The White Paper wants "to allow foreign investors the right to
invest in agreed defined sectors" of other countries' economies. Implicit
in this is the qualification that this right should be untrammelled by the
wishes of the government or the local population. Greens would reply that if
foreign investment is a good thing for a country, then its government can
allow it. But for a government to sign up to an agreement to be unable to
prevent a particular form of investment is to sign away part of its
sovereignty and to become accountable to the whim of foreign investors rather
than the will of its own electorate.
21.3 The Trades Union Congress, while welcoming some aspects of the White
Paper, believes that it "takes a blithely optimistic view of the effects
of foreign investment that does not explain the accelerating expansion in the
number of export processing zones (EPZs) around the world, where basic
workers' rights are violated in order to increase countries' attractiveness
to multinational companies." [8]
21.4 The White Paper also wants to "give high priority to the
multilateral liberalisation of agriculture". But agriculture is the area
where people most need local provision for their needs. The chief
beneficiaries of liberalisation of agricultural trade will be the
transnationals whose interest is to make entire countries dependent upon
their brand of seeds.
21.5 In the words of Green MEP Caroline Lucas, "If Clare Short really
thinks the future of Africa lies in increased exports of ever more cut
flowers and mange-tout to the West then it is extremely worrying. This trade
is unsustainable, inequitable and a nightmare for the environment". [9]
22.1 Labour, the Conservatives and the Liberal
Democrats all share the neoliberal consensus that economic growth is of
supreme importance and can best be delivered in a de-regulated market.
22.2 In addition to the proposals described in the previous section, Tony
Blair (together with his German counterpart) has stated that "the EU
should continue to act as a resolute force for liberalisation of world
trade". [10]
22.3 The Conservatives are even more enthusiastic than Labour on cutting
regulation to attract inward investment: "We will campaign for an
EU/North Atlantic free trade agreement and then global free trade by
2020" [11].
Tory Eurosceptics are concerned about loss of sovereignty to the EU but
indifferent to loss of sovereignty to transnational corporations and
unelected organisations like the WTO.
22.4 The Liberal Democrats "recognise that the WTO is a highly effective
organisation which needs to address concerns that it pursues trade
liberalisation at the expense of other objectives, such as environmental
protection, public health or labour standards". [12]
They want to re-start the Millennium round of free trade negotiations that
was aborted at Seattle. The voting record of the Liberal group in the
European Parliament shows it to be an enthusiastic supporter of the
neoliberal agenda, even voting for the MAI when most other groups rejected
it.
23.1 The Green Party, in stark contrast to these,
believes that the growth of trade per se is not a sensible policy objective,
and that there is already too much wasteful and polluting long-distance trade
in goods that can be produced locally. Greens want to replace the global
dependence on fickle and unaccountable markets with the dignity and security
of economic self-reliance.
23.2 New global agreements are urgently needed to regulate international
trade and investment in the interests of equity and sustainable development,
rather than in the interests of transnational corporations. In the long term,
the WTO should be replaced with a more accountable, decentralised body, which
aims to protect and enhance social and environmental conditions, and to
develop strong self-reliant regions where individual communities meet more of
their own needs.
23.3 The free-trade dogmas of the WTO must be reversed to allow import and
export controls on a national and/or regional bloc level, with the aim of
allowing localities and countries to produce as much of their food, goods,
and services as they can themselves - in the interests of economic stability,
local accountability, and environmental protection.
23.4 Where appropriate, industry and services should be subject to
site-here-to-sell-here policies to ensure localised production. Threats by
transnational corporations (TNCs) to relocate would then become less
plausible, as their market would be lost to existing or government-encouraged
new local competitors. Once TNCs were thus grounded, their domestic
activities and the levels of taxation paid would be back under democratic
control.
23.5 The export-promotion policies of the IMF and the World Bank should be
replaced with policies to promote community self-reliance through import
substitution where possible. It will be necessary to work with developing
countries to design and finance strategies to ease the transition. Other
Green policies, including debt cancellation, would help with this.
23.6 Obligations on developing countries to comply with higher workplace and
environmental standards should be linked to the provision of transitional
technical and financial support. This will require a substantial increase and
re-direction of the foreign aid budget.
23.7 Our medium-term objectives are:
24.1 Such a dramatic, radical change will of course
need to overcome the opposition of transnational companies and international
capital. Regional groupings of countries are most likely to be able to face
down and introduce controls on the corporate shapers and beneficiaries of
globalisation. The EU, for example, which has been a vehicle of corporate
control, needs to be turned in a different direction. The recently elected UK
Green MEPs are already working at the European level to start this necessary
process.
24.2 The UK should refuse to support a new round of trade liberalisation in
the WTO, and should add its voice to those countries, mostly in the third
world, that are calling for the reassessment of the effects of previous
rounds.
24.3 We should not co-operate in, still less initiate, any GATS-related moves
to pressure other countries to dismantle their public services for the
benefit of transnational service providers
24.4 We should demand that GATS be modified to include safeguards to ensure
that our own public services are protected from challenge under its rules.
24.5 When the EU is being pressured by the US and other countries to abandon
the precautionary principle and lower its standards of public health and
environmental responsibility in order to accept imports whose safety is in
doubt, we should not attempt the role of "honest broker" but should
align ourselves firmly with other EU nations on this issue.
24.6 The UK government should not think itself obliged to act as a marketing
and public relations consultant to British exporters. What increases company
profits is not necessarily of long-term benefit to ourselves as citizens, not
to mention our obligations to other countries, other species and future
generations.
24.7 The fight against globalisation is one we must win. Otherwise, history
will look back on the twentieth century as the high point of democracy,
before transnational corporations took over the running of the world for
their own benefit.