Issue 233 of SOCIALIST REVIEW Published September 1999 Copyright Socialist Review


Debt crisis: who pays?

Trading places

Trading places
Susan George says the dice are loaded against the poor when it comes to world trade--and it's going to get worse

In my view, the World Trade Organisation (WTO) is the greatest threat to democracy we now face, and should be a prime target for militants. What is this animal?

The WTO emerged from 50 years of negotiations by the General Agreement on Tariffs and Trade (Gatt) and particularly the last eight years of those negotiations, called the Uruguay Round because they were launched in Montevideo. The outcome was an agreement that the WTO would be founded on 1 January 1995. The WTO was set up in Geneva in exactly the same building and with largely the same secretariat as Gatt. But there are crucial differences, because the WTO now encompasses a large number of different kinds of agreements about trade. Also, whereas Gatt mostly dealt with purely industrial tariffs, the WTO's scope is far broader and is now dealing with virtually every sphere of human activity. The talks scheduled to take place in Seattle at the end of this year have been labelled by Britain's gift to humanity, Sir Leon Brittan, as the 'Millennium Round'. You have undoubtedly heard this term, but the Millennium Round in fact has no legal existence. Let me tell you Sir Leon's plan. He has, like nobody else, really taken on board the agenda of the transnationals. Previous WTO ministerial meetings decide which topics should be discussed at future WTO ministerial meetings, so there are three main topics on the so called built in agenda for the Seattle talks. The first of them is agriculture--a very serious matter for small farmers everywhere because this great liberalisation of agriculture would open everybody's farming sector, including that of small peasantries in the South, to widescale imports with non-existent or very low import duties. Small farmers could be wiped out because no small producer can compete with the heavily capital intensive, highly mechanised agriculture of Europe or the US, or even of the big latifundia in some of the Latin American countries. That means much more expensive food after wiping out the small peasantry. It would also mean vast outmigration to already overcrowded cities which would have totally catastrophic effects.

Another huge area is services. This is a fairly innocent term, but actually included in this term are distribution, wholesale, retail and franchising; construction; architecture; decoration; maintenance; civil, mechanical and other types of engineering; financial services, including banking and insurance; research and development; real estate services; rental, credit and hire purchase; communications; postal services; telecommunications and audio-visual; information technologies; tourism and travel; hotels and restaurants; environmental services, including road construction and maintenance, rubbish collection, sewage disposal, water delivery, protection of the landscape and urban planning; recreational, cultural and sports services, including entertainment, libraries, archives and museums; publishing, printing and advertising; transportation by every imaginable conveyance including space travel; education, including primary, secondary, tertiary and adult education; and human and animal health. The US energy corporations want energy to be classed as a service, and they have set up their own lobbying coalition to push that agenda.

One of the most dangerous of these issues is going to be health. The US healthcare industry is very interested in older people, because obviously they are greater consumers of health services than younger ones. So they want to break in, particularly to the geriatric, senior care area. Let me quote the section on health from a paper delivered to the US Special Trade Representative by the US Coalition of Service Industries. They say that up to now, 'Healthcare services in many foreign countries have largely been the responsibility of the public sector, making it difficult for US private sector healthcare providers to market in foreign countries.' So for them, health is largely a question of marketing. But the WTO offers a way out. Among the barriers they want demolished in Seattle are the following: 'restricting licensing of healthcare professionals'--in other words, any US healthcare professional ought to be able to come right in and not even bother to get a licence--and what they see as 'European excessive privacy and confidentiality regulations.' The more general objectives of the healthcare industry and other service industries are to 'encourage more privatisation and promote pro-competitive regulatory reform', as well as 'allowing majority foreign ownership of all healthcare facilities.' You should be beginning to get an idea of why I consider this an extraordinarily dangerous animal.

The third part of the agenda is the Trade Related Intellectual Property (Trips) agreement. The most dangerous part of this is that it covers such aspects as genetically manipulated organisms. It includes the patents on life. Up to now the Southern countries had exemptions for agriculture and Trips. But this year they are supposed to give up those exemptions, and we will see more and more bio-piracy in the South of substances--for example fruits, flowers, leaves, trees and grains--that people have been using for generations. If they are taken by transnational corporations, the genes are sequenced, they are turned into products, and they will then be sold back to the very people whose knowledge has been taken from them. That will he made absolutely legal with the Trips agreement. The US also wants what would in effect be a global logging and deforestation agreement which would encourage many more imports of wood products and would work very much against the conservation of forests.

In addition to agriculture, services and Trips, which already make up a huge agenda, the US, Europe and Japan, to differing degrees, want to add new items. The whole package would then be called the Millennium Round. They want to add government procurement, among other things. This would mean that it would no longer be possible for a local or national government to give preference to a local supplier. You would have to put all bids up on the internet and anybody from anywhere in the world, if they were a partner to the WTO agreement, would be able to bid for any of those contracts. Since government procurement represents upwards of 15 percent in any country's GNP, you can see that putting it under the jurisdiction of the WTO would be extremely lucrative for transnational businesses. Some governments also want to discuss the environment, for the very good reason that there is often a clash between the WTO dispute resolution mechanism and international agreements on the environment. The dispute resolution mechanism is like the embryo of a world constitution, of a world government. The WTO is making international law, jurisprudence, through its disputes resolution mechanism. When a WTO panel makes a decision on a trade dispute, it makes it behind closed doors. The panel's decision is binding, and it is without appeal. Some of the recent decisions have been on bananas--the WTO has said to Europe, you can't have an agreement with the African, Caribbean and Pacific countries, you've got to import bananas on the same terms from Central America and Ecuador. This suit was brought by the US on behalf of Chiquita brands, which is among the most exploitative companies in the world. That dispute was won by the US, and it is basically telling Europe you do not have the right to have a foreign policy. Another very important decision is the beef hormone decision, which tells us in Europe that we've got to import beef raised on hormones and milk products from Canada and the US. The sanctions on that one are about to be put into place. They can pick whatever products they want from Europe and slap duties on them in the US and Canada. It could affect Scottish cashmere, Danish ham, French cheese or wine. The US can pick and chose what products they want to slap 50 or 100 percent duties on in order to raise the fees that Europe is considered by the WTO to owe them.

Right after the banana decision the US tabled 11 more grounds for dispute it wanted judged by this mechanism. Up to now, without the new 11, the US had tabled 44 complaints, of which 22 have been judged. Twenty of them, strangely enough, have been judged in favour of the US. The US Special Trade Representative Office is like a war room. According to an article in the New York Times written nearly ten years ago, the ultra-secret National Security Agency--the US government's $10 billion a year international eavesdropping apparatus--drafted a plan to shift its efforts from monitoring the Soviet Union to spying on world trade. 'When trade policy becomes a US national security issue,' says Mark Ritchie, who is involved in the anti-WTO movement, 'then countries that try to defend their workers or their environment become the enemy. And the people who fight for their rights here are labelled criminals or spies.' These decisions of the WTO do go against the rights of working people. It was decided in Singapore that there would be no discussion of workers' rights inside the WTO. Those have all to be sent back to the International Labour Organisation, which has not taken a binding decision in 60 years. There is now a kind of legal no man's land over the multilateral agreements on the environment, on climate change, biodiversity, the ozone layer, and the trade in endangered species. Nobody quite knows what is legally supposed to supercede what. Meanwhile the WTO dispute resolution mechanism is ploughing ahead and abrogating a great many of these conventions through its decisions.

This is a very grave threat to working people and to the environment, but also to democracy, because there is no control over this organisation. Decisions are made by 'consensus' of the 134 member governments, but what happens in reality is that the US, Canada, the EU and Japan--called the 'Quad'--meet every day to decide what issues to deal with and how. Then they come back to the general meetings and say, we've got consensus, you agree don't you? It is a steamroller tactic. The problem for the South is that many of these countries, particularly the smaller, weaker ones, do not even have an embassy to the WTO, or they might share one with several countries. But even the very large countries like India are not going to be able to follow simultaneous highly complex negotiations if the Millennium Round actually takes off, whereas the US will have at least its usual 250 negotiators on the job. Now, what does Sir Leon actually want? He wants to have a multitude of issues on the agenda as a single undertaking. I deeply fear that in Europe in particular and in individual European countries, it's going to be the farmers, pitted against the audio-visual cultural people, pitted against the healthcare workforce, pitted against the energy people or the broadcasting people. This is going to be the most enormous dogfight. We should not be fighting each other. That is why we must stop this Millennium Round until there has been a thorough evaluation of the World Trade Organisation--all its works, its past impact, and its likely impact on the future--with full democratic citizen participation. That agenda is being sent round by Friends of the Earth. There are now 700 organisations from 73 different countries that have signed it. We want to stop this because we believe it's going to be a disaster for the environment, a disaster for working people, and a disaster for democracy.

I think that this can be done. I am more optimistic than I have been in 30 years of engagement in politics. People can mobilise against what might have seemed immensely technical, immensely difficult issues even two or three years ago. Once you explain it to people they understand what the stakes are and they don't say, this is an international, technical thing, it hasn't anything to do with me, or my life, or my community. They catch on just like that. The coalitions are growing in the European countries and the US. We've just had an enormously successful meeting in Paris with 1,500 people from over 70 countries. People understand that this is an emergency, this is for the end of the year, and that it's right now that we've got to try to stop our governments for this Millennium Round. It is only signing on for the transnational corporations, it's only signing on for those who control world trade already.

I would like to end with a quote that you might recognise:


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