Sound CAFTA alarm bells
Monday, April 25, 2005 - Bangor Daily News
International trade agreements are boring. Mention the North American Free Trade Agreement (NAFTA) or the Central American Free Trade Agreement (CAFTA) in most social settings and people’s eyes glaze over. The pros and cons of NAFTA, and now CAFTA, debate trade-offs between tariffs, consumer prices and job growth or loss. Since most of us are not economists, these discussions seem tedious and complicated.
If you have lost your job or know people who have because a Maine factory relocated to avail itself of cheap wages elsewhere, it’s easier to take an interest, and have a negative opinion. If your business exports to Central America, or sells items made by Latin Americans cheaper than Maine workers can produce them, you might think CAFTA’s a good idea. For most of us, our minds are elsewhere.
So here’s what piqued first my interest, then alarm, even though I’m an oncology physician’s assistant and not an international trade expert. Much of the text of CAFTA is devoted not to taxing products as they cross borders, but to "eliminating non-tariff barriers to trade," an opaque five word phrase which is a lot more worrisome than it sounds.
It turns out "nontariff barriers to trade" is all about who can sell what to whom, and who can or can’t stop them. The "what" isn’t about shirts, bananas or toaster ovens, but items we never imagined could be for sale. The "barriers" in question are current laws that assume that goods and services essential to all of us shouldn’t be privately owned and priced out of range of those who need them. Those needs include public education, fire departments, water supplies, sanitation services, roads, libraries, parks and whatever else you may have thought should belong to a community and not an individual. Under CAFTA, most any such basic service is fair game for privatization.
Eliminating such "nontariff barriers to trade" is a pretty scary Pandora’s box, and this threat is not hypothetical: In Bolivia, for example, the Bechtel Corporation bought water rights to the city of Cochabomba, then charged its residents fees for collecting rainwater from their roofs. In our own country, school systems whose funds-starved schools already have Coke vs. Pepsi contracts could find themselves wholly owned and operated by community-minded corporations pleased to provide education services to future consumers of its products.
Just as there is here is no CAFTA provision titled "Pandora’s Box," the title "Trojan Horse" nowhere appears in CAFTA’s table of contents. Instead, it is simply called Chapter 10. This section permits private corporations to sue governments for passing laws that protect people, but jeopardize profits. Once ushered by Congress inside our legislative gates, this creature of CAFTA will subvert the capacity of our own legislative and judicial systems to protect its citizens’ health and safety.
This threat is not theoretical, either. For example it’s possible that the pharmaceutical industry, which just lost its case to overturn the Maine Rx law in a federal court, could complain to an unelected trade tribunal that our law unfairly infringes on its profit margin. (Infringing on drug company profit margins, of course, is exactly what the Maine Rx law was intended to do.) If the trade panel agrees, its decision will over-ride U.S. law and the drug companies can exact millions of dollars from U.S. taxpayers in damages for "lost anticipated future profits."
Under a similar provision in NAFTA, the Canadian Methanex company sued the state of California for close to a billion dollars for banning the additive MTBE in its gasoline as a groundwater-polluting carcinogen. MTBE continues to be sold at every Maine gas pump in part because of fear of litigation, not in U.S. courts, but via the unelected trade tribunal that trumps our laws.
Other examples abound. CAFTA could legally invert the "precautionary principle" written into U.S. food safety law, which states that companies must prove products to be safe before selling them. The preferred industry alternative requires the government to not just worry but prove, for a pertinent example, that mad cow hamburgers are dangerous before keeping them off the market.
A final CAFTA chapter again sounds mythical but is quite real. In what could have been called the golden fleecing chapter, large corporations have inserted language that reads like legalized extortion. Instead the provisions are more blandly entitled "Intellectual Property Rights." CAFTA forces countries to permit drug companies to sell generic drugs at patented brand name prices if the drug has not been sold in that country before. Why? Because in that country, the medicine is new. Otherwise put: Because their lobbyists wrote it in.
Or this: Under CAFTA the Monsanto Corp. can sue a Latin American peasant for saving seed from his harvest of Monsanto-bred corn for next year’s planting. His crime: infringing on the company’s intellectual property rights to that corn seed.
So to translate some bland but stealthy legalese: Under CAFTA, "eliminating a nontariff barrier to trade" often just means neutralizing the government’s ability to protect vulnerable citizens from predatory corporate practices. Woody Guthrie put it more simply: "Some rob you with a six gun, some with a fountain pen."
Shortly, the Bush administration will bring CAFTA to Congress for an up-or-down vote wrapped in images of help for hard-working entrepreneurs and relief for hard-pressed consumers. Beneath this wrapping paper are a Pandora’s Box, a Trojan Horse and a golden fleecing of all of us who need affordable basic services, decent employment and a government still capable of protecting the health and safety of its citizens. Which sounds like most Mainers, to me.
Yes, international trade agreements sound boring, but CAFTA should trigger some blaring alarm bells. Sens. Olympia Snowe and Susan Collins can make the difference in whether CAFTA passes. Let them know what you think.
Dennis Chinoy of Bangor is a member of Peace through Interamerican Community Action.