Category Archives: Trade

A Historic Opportunity To Transform Trade When We Stop NAFTA II

Donald Trump was right when he said that the North American Free Trade Agreement (NAFTA) has been a disaster for the United States and promised to renegotiate it when he became president. However, the renegotiated NAFTA-2 is worse than the original NAFTA and should be rejected.

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On December 1, NAFTA-2 was signed by President Trump, Prime Minister Justin Trudeau of Canada, and Mexican President Enrique Peña Nietos. This started the process of approval by the legislatures of each country.

Our movement for trade that puts people and planet first now has two synergistic opportunities: We can stop NAFTA II and replace corporate trade with a new model that raises working conditions and protects the environment.

Join our No More Rigged Corporate Trade campaign and take action now.

No NAFTA -2 from Popular Resistance

Stopping NAFTA-2

When NAFTA became law on January 1, 1994, it began a new era of trade – written by and for transnational corporations at the expense of people and planet. President George H.W. Bush failed twice to pass NAFTA. During Bush’s re-election campaign, independent Ross Perot described NAFTA as the “giant sucking sound” that would undermine the US economy.

President Clinton was able to get it through Congress. The Los Angeles Times described that vote as “a painfully divided House of Representatives” voting a 234-200 for NAFTA. A majority of Democrats 156-102 opposed NAFTA. During the debate, protesters were ejected when they showered fake $50 bills that said “trading pork for poison” from the visitors gallery.

In the 2016 election, President Trump showed he understood what the United States experienced — NAFTA was bad for the people undermining manufacturing and agriculture. People want it repealed. Unlike Hillary Clinton, Trump had his finger on the pulse of the population.

NAFTA-2 is another trade agreement designed for corporate profit. Trump trade fails to provide enforceable protections for workers or the environment. In this time of climate crisis, it does not mention climate change. It fails to protect the food supply and will result in increased cost of medicines.

Citizen’s Trade Campaign writes, there are positive labor standards “but only if currently absent enforcement mechanisms are added.” As the Labor Advisory Committee states: “Unenforced rules are not worth the paper they are written on.”

The Sierra Club reports NAFTA-2 takes a significant step backward from environmental protections included in the last four trade deals by failing to reinforce a standard set of seven Multilateral Environmental Agreements that protect everything from wetlands to sea turtles.

NAFTA-2 allows intensely-polluting oil and gas corporations involved in offshore drilling, fracking, oil and gas pipelines, refineries, or other polluting activities to challenge environmental protections in rigged corporate trade tribunals. Trump Trade preserves a NAFTA rule that prevents the US government from determining whether gas exports to Mexico are in the public interest. This creates an automatic gas export guarantee, which will increase fracking, expand cross-border gas pipelines, and increase dependency on Mexican climate-polluting gas.

Food and Water Watch summarizes:

The energy provisions will encourage more pipelines and exports of natural gas and oil that would further expand fracking in the United States and Mexico. The text also provides new avenues for polluters to challenge and try and roll back proposed environmental safeguards, cementing Trump’s pro-polluter agenda in the trade deal.

NAFTA-2 undermines food safety and health by making it more difficult to regulate and inspect foods. It limits inspections and allows food that fails to meet US safety standards to be imported. NAFTA-2 serves Monsanto and other giant agro-chemical corporations by allowing unregulated GMOs, rolling back Mexico’s regulation of GMOs, and letting chemical giants like Monsanto and Dow keep data on the risks of their pesticides secret for 10 years. NAFTA-2 is designed for agribusiness, not family farmers and consumers.

NAFTA-2 increases the cost of pharmaceutical drugs through intellectual property protections that go “significantly beyond” NAFTA. Trump’s NAFTA-2 gives pharmaceutical companies a minimum 10 years of market exclusivity for biologic drugs and protects US-based drug companies from generic competition, driving up the price of medicine at home and abroad.

All the ingredients that led to a mass movement of movements that stopped the Trans-Pacific Partnership  exist to stop NAFTA-2. Citizens Trade Campaign sent a letter signed by 1,043 organizations to Congress outlining civil society’s shared criteria for a NAFTA replacement. The requirements outlined in this letter have not been met.

Just as it became impossible across the political spectrum to support the TPP, we can make it impossible to support NAFTA-2. Democrats are signaling NAFTA-2 is not going to pass in its present form. After Robert Lighthizer met with Democratic Leader Nancy Pelosi last week, she described NAFTA-2 as “just a list without real enforcement of the labor and environmental protections,” that would be unlikely to pass in its present form. We can stop NAFTA-2.

No Ne NAFTA protest, Fair Deal or No Deal from Green Watch

Defeat of NAFTA-2 Creates the Opportunity to Transform Trade

The defeat of NAFTA-2 will show that corporate trade will no longer be approved by Congress.  Trade must be transformed to uplift workers, reduce inequality, confront climate change and improve the quality of our food and healthcare. The defeat NAFTA-2 opens the space to make transforming trade a major issue in the 2020 presidential campaigns.

President Trump has signaled that he will withdraw from NAFTA to pressure Congress to ratify NAFTA-2. Trump’s threat to withdraw from NAFTA should not be feared but embraced. It will create an opportunity for trade transformation.

A smart presidential campaign will use the defeat of NAFTA-2 as an opportunity to begin a new era of trade transformed for the public good, serving the many, not the few. Politicians running for president in 2020 can put forward a vision of trade that the people will support.

Already, Senator Elizabeth Warren (MA) has taken initial steps in this direction. In a speech to American University, Warren said she opposed Trump’s NAFTA-2 agreement, challenged the bipartisan embrace of “free” trade, and called for starting “our defense of democracy by fixing” corporate trade. In discussing trade she said, “Wow. Did Washington get that one wrong.”  She described trade as delivering “one punch in the gut after another to workers…” She urged, “We need a new approach to trade, and it should begin with a simple principle: our policies should not prioritize corporate profits over American paychecks.” This is a start, if she adds the environment, climate change, healthcare, food safety, sovereignty and Internet freedom, she will put forward a vision of smart trade that will bring millions to support her.

Warren is not alone, Senator Sherrod Brown (OH), who easily won re-election in Ohio and is considering a presidential run, has been a longtime advocate for trade that lifts up workers and challenged agreements that failed to do so. Brown sent a letter to the president eight days after the 2016 election urging Trump to keep his trade promises. Brown voted against NAFTA in one of his first acts as a member of Congress in 1993 and wrote a book entitled “Myths of Free Trade: Why American Trade Policy Has Failed.”

Transforming trade, by rejecting corporate trade, creates an opportunity for candidates to turn a negative issue into a positive one. The movement needs to demand candidates put forward a new vision for 21st century trade.

Source Bilaterals.org

A Vision for Trade for People and Planet

We must put forward the vision for trade we want to see as part of the campaign to stop NAFTA-2. Trade in the 21st entury needs to confront multiple crisis issues made worse by trade designed for corporate wealth. Transformed trade needs to focus on the public interest.

Pubic interest includes shrinking inequality within the United States and between nations. It means workers having a livable wage, encouraging worker-ownership of businesses so they grow their wealth not just their incomes. Trade should strengthen the rights of workers to organize, create unions and adhere to International Labor Organization standards.

Trade should aid in preventing transnational corporations and wealthy individuals from avoiding taxes. Trade should end tax havens and require transparency, end banking abroad or locating corporate charters offshore to ensure wealthy individuals and corporations pay their taxes. Countries can negotiate a global tax collected to solve global problems like poverty, homelessness, lack of healthcare and environmental degradation.

There are numerous environmental crises that trade needs to address. Three reports, the dire October 2018 IPCC report, warning we have 12 years to transform the energy economy to prevent climate catastrophe, the November 23, 2018 4th National Climate Assessment, which warned of the serious impacts of the climate crisis and the Global Carbon Project which reported carbon emissions are at record highs, show climate change must be central to trade policies.

International trade needs to be re-formulated to protect the labor, human rights, economy, environment and domestic industry of partner and recipient nations so local industry and agriculture has the advantage over foreign corporate domination. Trade needs to guarantee people their right to public ownership and control of their own resources. Trade agreements must protect the rights of nations to establish stricter standards for health, safety, human rights and environmental protections.

Take action now to stop NAFTA-2.

US Trade War with China: Desperate Move to Save Western Empire

Most of those who have had a chance to witness Chinese internationalist mega-projects, clearly understand that the West is near to collapsing; it will never be able to compete with tremendous enthusiasm and progressive spirit of the most populous country on earth, which on top of it, is built on socialist principles (with Chinese characteristics).

Writing this essay in rural Laos, I just saw literally an entire army of Chinese engineers and workers in action, building huge bridges and tunnels, connecting one of the poorest countries in Asia, to both China and Southeast Asia, erecting hospitals and schools, small factories for the rural population, airports and hydro-electric power plants or in brief: putting the great majority of Laotian people out of poverty by providing them with both livelihood and infrastructure.

China does precisely this all over the world, from the tiny South Pacific island nations to African countries, plundered for centuries by Western colonialism and imperialism. It helps Latin American nations that are in need, and while it does all that, it is also quickly growing into a middle class, ecologically and culturally responsible nation; a nation which is likely to eradicate all extreme misery very soon, most likely by the year 2020.

The West is horrified!

This could easily be the end of its global order, and it could all actually happen much earlier than expected.

And so, it antagonizes, provokes China, in all imaginable ways possible, from the US military buildup in Asia Pacific, to encouraging several Southeast Asian countries plus Japan to politically and even militarily irritate the PRC. Anti-Chinese propaganda in the West and its client states has lately been reaching a cacophonic crescendo. China is attacked, as I recently described in my essays, from literally all sides; attacked for being ‘too Communist’, or ‘for not being Communist enough’.

The West, it seems, despises all the economic practices of China, be it central planning, ‘capitalist means for socialist ends’, or the unwavering desire of the new Chinese leadership to improve the standard of living of its people, instead of enriching multi-national corporations at the expense of the common citizens of the PRC.

It looks like a trade war, but it actually is not: like the ‘West versus Russia’, the ‘West versus China’ is an ideological war.

China, together with Russia, is effectively de-colonizing part of the world which used to be at the mercy and disposal of the West and its companies (as well as the companies of such client-states of the West as Japan and South Korea).

However it is being labelled, de-colonization is clearly taking place, as many poor and previously vulnerable countries worldwide are now seeking protection from Beijing and Moscow.

But to ‘add insult to injury’, parallel to de-colonialization, there is also ‘de-dollarization’, that is inspiring more and more nations, particularly those that are victims of Western embargos, and the unjust, often murderous sanctions. Venezuela is the latest such example.

The most reliable and stable ‘alternative’ currency that is being adopted by dozens of countries, for international transactions, is the Chinese Yuan (RMB).

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The prosperity of the entire world, or call it ‘global prosperity’, is clearly not what the West desires. As far as Washington and London are concerned, the ‘surrounding’, peripheric world is there predominantly to supply raw materials (like Indonesia), cheap labor (like Mexico), and guarantee that there is an obedient, indoctrinated population which sees absolutely nothing wrong with the present arrangement of the world.

In his recent essay for the Canadian magazine Global Research titled “IMF – WB – WTO – Scaremongering Threats on De-Globalization and Tariffs – The Return to Sovereign Nations” a distinct Swiss economist and a colleague of mine, Peter Koenig, who used to work for the World Bank, wrote:

As key representatives of the three chief villains of international finance and trade, the IMF, World Bank (WB) and the World Trade Organization (WTO) met on the lush resort island of Bali, Indonesia, they warned the world of dire consequences in terms of reduced international investments and decline of economic growth as a result of the ever-widening trade wars initiated and instigated by the Trump Administration. They criticized protectionism that might draw countries into decline of prosperity. The IMF cuts its global economic growth forecast for the current year and for 2019.

This is pure scaremongering based on nothing. In fact, economic growth of the past that claimed of having emanated from increased trade and investments has served a small minority and driven a widening wedge between rich and poor of both developing and industrialized countries. It’s interesting, how nobody ever talks about the internal distribution of GDP growth…

Peter Koenig further argues that globalization and ‘free trade’ are far from desirable for the majority of the countries on our planet. He is giving an example of China:

Time and again it has been proven that countries that need and want to recover from economic fallouts do best by concentrating on and promoting their own internal socioeconomic capacities, with as little as possible outside interference. One of the most prominent cases in point is China. After China emerged on 1 October 1949 from centuries of western colonization and oppression by Chairman Mao’s creation of the People’s Republic of China (PRC), Mao and the Chinese Communist party first had to put a devastated ‘house in order’, a country ruined by disease, lack of education, suffering from hopeless famine as a result of shameless exploitation by western colons. In order to do that China remained practically closed to the outside world until about the mid- 1980’s. Only then, when China had overcome the rampant diseases and famine, built a countrywide education system and became a net exporter of grains and other agricultural products, China, by now totally self-sufficient, gradually opened its borders for international investments and trade. And look where China is today. Only 30 years later, China has not only become the world’s number one economy, but also a world super power that can no longer be overrun by western imperialism.

To be self-sufficient may be great for the people of every country on our planet, but it is definitely a ‘crime’ in the eyes of the West.

Now China is not only independent, but it dares to introduce to the entire world a totally new system, in which private companies are subservient to the interests of the state and the people. This is the total opposite to what is happening in the West (and its ‘client states’), where the governments are actually indebted to private companies, and where people exist mainly in order to generate huge corporate profits.

On top of it, China’s population is educated, enthusiastic, patriotic and incredibly productive.

As a result, China competes with the West, and it is easily winning the competition. It does it without plundering the world, without overthrowing foreign governments, and starving people.

This is seen by the United States as ‘unfair competition’. And it is being punished by sanctions, threats and provocations. Call it a ‘trade war’, but it actually isn’t.

And why unfair competition? Because China is refusing to ‘join’ and to play by the old imperialist rules dictated by the West, and also readily accepted by countries such as Japan and South Korea. China does not want to rule. And that scares the West.

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In a way, both President Trump and the present leadership of China want to make their countries ‘great again’. However, both countries see greatness differently.

For the United States, to be ‘great’ is to control the world, once again, as it did right after WWII.

For China, to be great is to provide a high quality of living for its citizens, and for the citizens of most of the world. It also means, to have great culture, which China used to have for millennia, before the ‘era of humiliation’, and which was rebuilt and greatly improved from the 1949, onward.

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A leading US philosopher, John Cobb Jr., in a book which we are writing together, recently pointed out:

Ever since World War II, what the United States has done has been widely copied.  Hence this country has had a great opportunity to lead the world.  For the most part, it has led in the wrong direction.  The United States and the whole world, including China, are paying, and will continue to pay, a high price.  But the days of American leadership are ending.  I would still like for the U.S. to engage in major reforms, but it is too late for these to change the world. We can rejoice that the American century is giving way to the Chinese century.

Many do, but some don’t. The end of the American leadership, or call it the “American Century”, may scare people in various Western countries, particularly in Europe. Rightly so! Those days of unopposed Western economic dictatorship are over. Soon, perhaps, Europeans will have to really compete, and work hard for their money, instead of living high life relying on plunder of natural resources and cheap labor in their semi or neo-colonies.

While many in the West are scared, the situation is simultaneously rising hopes in all other parts of the world.

For China, not to yield to the US pressure, is to show that it is serious when it comes to its independence. The most populous nation on earth is ready to defend its interests, its people and its values.

It is far from being alone. From Russia to Iran, from Venezuela to South Africa, new and newer nations are going to stand by China, and by doing so, they will be defending their own independence and freedom.

• First published by International Daily News in China

Unnecessary Fussing: China, the United States and APEC

The parents on the global stage of power are bickering and now, such entertainingly distracting forums as APEC (the Asia-Pacific Economic Cooperation Forum) are left without a unifying message.  This should hardly matter, but the absence of a final communiqué of agreement is being treated in some circles as the preliminary perturbations to conflict between Beijing and Washington.

Often forgotten at the end of such deliberations is their acceptable irrelevance.  APEC as a forum was already deemed by former Australian foreign minister Gareth Evans in 1993 to be “four adjectives in search of a noun.”  Charles E Morrison of the East-West Centre in Hawaii noted another view.  “Some wag described it as an international dating service for leaders.”  On this occasion, the dates failed to reach a merry accord.

Such gatherings provide distractions and fodder for the global press corps to identify trouble, brewing or actual.  They can also supply the converse: that the state of adherence to international norms, whatever they may be, is better because of such meetings.  But in Port Moresby, coarseness emerged with tartness.  China and the United States were jostling.

US Vice President Mike Pence, who revealed his interest in the summit by basing himself in Australia rather than staying in Port Moresby, threw down what must have been a gauntlet of sorts.  At the Hudson Institute in October, he was moodily accusing Beijing of pilfering military blueprints, “using that stolen technology” to turn “ploughshares into swords on a massive scale”.

A puzzled Pence seemed to be gazing at a mirror, accusing Beijing of “employing a whole-of-government, using political, economic and military tools, as well as propaganda, to advance its influence and benefit its interests in the United States.”

At the APEC gathering itself, Pence made it clear that there would be no warming of relations with Beijing.  Rather amusingly, he insisted that, “The United States deals openly, fairly.  We do not offer a constricting belt or a one-way road.”  China’s Xi Jinping, for his part, was also in a mood to impress. “Unilateralism and protectionism will not solve problems but add uncertainly to the world economy.”

The forum was filled with more rumours than a village from the middle ages.  Chinese officials, went one well flighted suggestion, supposedly forced their way into the office of Rimbink Pato, PNG’s foreign minister, being most insistent on discussing the wording of a section of the proposed communiqué.  A suggested sentence featured in the agitated encounter: “We agreed to fight protectionism, including all unfair trade practices.”  So worded, it was clear what the intended meaning was: Beijing was being singled out as a possible purveyor of unfair trade practices.   These were deemed “malicious rumours” by the Chinese delegation.

At the conclusion of the summit, Papua New Guinea, as host, expressed its concerns through a rattled Prime Minister Peter O’Neill: the “giants” had disagreed; the “entire world” was worried.  Other delegates bore witness to the Beijing-Washington tension, and were similarly left disappointed.  New Zealand’s Jacinda Ardern was tepid in suggesting that there were “some minor differences in the international trade environment”.  She claimed, as did others, that “it was disappointing that we were unable to have a communiqué issued at the conclusion of the APEC meeting… but it shouldn’t diminish from the areas of substantive agreement.”

Former US Treasury Secretary Hank Paulson is one who is pessimistic about such “minor differences” between the powers, insisting that nothing less than an “Economic Iron Curtain” risks coming down upon the globe.  Given Paulson’s stint at that rogue-of-rogue banks Goldman Sachs, such warnings should be treated with due caution, largely because they fly in the face of the ideology of, to use Paulson’s own words, the “free flow of investment and trade”.

Commentators such as veteran journalist Tony Walker did not spare the drama, peering into the implications with the keenness of a history student in search of parallels.  “Port Moresby may not be Yalta, nor, it might be said, is it Potsdam.”  (Highly tuned, is Walker’s embellishing antennae.)  “But for a moment at the weekend the steamy out-of-the-way Papua New Guinea capital found itself at the intersection of great power combustibility.” Yet no bullets were fired, nor vessels launched.

The disagreement is merely the consequence of initiatives that are grating on both powers.  China is getting bolder with its global investment and infrastructure strategy, wooing states with no-strings financing. It is huffing in the South China Sea.  The United States can no longer claim to be the primary occupant of the world’s playgrounds, the bully of patronage, sponsorship and cant haloed by that advertising slogan, “the American way of life”.  Building sand castles is a task that will have to be shared, but bullies tend to eventually let the punches fly.

The result, at the moment, is a trade war of simmering intensity that continues to govern relations between Beijing and Washington.  APEC was meant to supply a forum of diffusion but merely affirmed the status quo. (On January, US tariffs on $250 billion worth of Chinese goods will increase from 10 per cent to 25 per cent.)

Countries keen to back both powers find themselves facing split loyalties, though that point is often exaggerated.  China knows where many countries in the South East Asian-Australasia region will turn to if the beads of sweat start to show.  Singapore’s Prime Minister Lee Hsien Loong was trying to make the obvious sound simple.  “It’s easiest not to take sides when everybody else is on the same side.  But if you are friends with two countries which are on different sides, then sometimes it is possible to get along with both, sometimes it’s more awkward if you try to get along with both.”

The next show takes place in Buenos Aires, and that November 30 gathering of the G20 promises another re-run of tensions.  On that occasion, President Donald Trump will be bothered to turn up.  Again, such a summit is bound to yield to the law of acceptable chaos and modestly bearable tension.

It Is a New Era, But China’s Balancing Act Will Fail in the Middle East

Although ties between Washington and Tel Aviv are stronger than ever, Israeli leaders are aware of a vastly changing political landscape. The US’ own political turmoil and the global power realignment – which is on full display in the Middle East – indicate that a new era is, indeed, in the making.

Unsurprisingly, this new era involves China.

China’s Vice President, Wang Qishan, arrived in Israel on October 22 on a four-day visit to head the fourth China-Israel Innovation Committee. He is the highest-ranking Chinese official to visit Israel in nearly two decades.

In April 2000, the former president of China, Jiang Zemin, was the first Chinese leader to ever visit Israel, touring the Yad Vashem Holocaust Museum and paying diplomatic dues to his Israeli counterparts. At the time, he spoke of China’s intentions to cement the bond between the two countries.

Wang Qishan’s visit, however, is different. The “bond” between Beijing and Tel Aviv is much stronger now than it was then, as expressed in sheer numbers. Soon after the two countries exchanged diplomatic missions in 1992, trade figures soared. The size of Chinese investments in Israel also grew exponentially, from $50m in the early 1990s to a whopping $16.5bn according to 2016 estimates.

China’s growing investments and strategic ties to Israel are predicated on both countries’ keen interest in technological innovation, as well as on the so-called “Red-Med” Railway, a regional network of sea and rail infrastructure aimed at connecting China with Europe via Asia and the Middle East. Additionally, the railway would also link the two Israeli ports of Eilat and Ashdod.

News of China’s plan to manage the Israeli port of Haifa has already raised the ire of the US and its European allies.

Times have changed, indeed. Whereas in the past, Washington ordered Tel Aviv to immediately cease exchanging American military technology with China, forcing it to cancel the sale of the Phalcon airborne early-warning system, it is now watching as Israeli and Chinese leaders are managing the dawn of a new political era that – for the first time – does not include Washington.

For China, the newfound love for Israel is part of a larger global strategy that can be considered the jewel of China’s revitalized foreign policy.

Qishan’s visit to Israel comes on the heels of accelerated efforts by Beijing to promote its mammoth trillion-dollar economic project, the Belt and Road Initiative (BRI).

China hopes that its grand plan will help it open massive new opportunities across the world and eventually guarantee its dominance in various regions that rotated, since World War II, within an American sphere of influence. BRI aims to connect Asia, Africa, and Europe through a “belt” of overland routes and a maritime “road” of sea lanes.

The China-US competition is heating up. Washington wants to hold on to its global dominance for as long as possible while Beijing is eagerly working to supplant the US’ superpower status, first in Asia, then in Africa and the Middle East. The Chinese strategy in achieving its objectives is quite clear: unlike the US’ disproportionate investments in military power, China is keen on winning its coveted status, at least for the time being, using soft power only.

The Middle East, however, is richer and, thus, more strategic and contested than any other region in the world. Rife with conflicts and distinct political camps, it is likely to derail China’s soft power strategy sooner rather than later. While Chinese foreign policy managed to survive the polarizing war in Syria through engaging all sides and playing second to Russia’s leading role at the UN Security Council, the Israeli Occupation of Palestine is a whole different political challenge.

For years, China has maintained a consistent position in support of the Palestinian people, calling for an end to the Israeli Occupation and for the establishment of an independent Palestinian state. However, Beijing’s firm position regarding the rights of Palestinians, seems of little consequence to its relationship with Israel, as joint technological ventures, trade and investments continue to grow unhindered.

China’s foreign policymakers operate with the mistaken assumption that their country can be pro-Palestine and pro-Israel at once, criticizing the Occupation, yet sustaining it; calling on Israel to respect international law while at the same time empowering Israel, however unwittingly, in its ongoing violations of Palestinian human rights.

Israeli hasbara has perfected the art of political acrobats, and finding the balance between US-western discourse and a Chinese one should not be too arduous a task.

Indeed, it seems that the oft-repeated cliché of Israel being “the only democracy in the Middle East”, is being slightly adjusted to meet the expectations of a fledgling superpower, which is merely interested in technology, trade and investments. Israeli leaders want China and its investors to think of Israel as the only stable economy in the Middle East.

Expectedly, Palestinian priorities are wholly different.

With the Palestinian struggle for freedom and human rights capturing international attention through the rise of the Boycott, Divestment and Sanctions (BDS) movement, more and more countries are under pressure to articulate a clear stance on the Israeli Occupation and apartheid.

For China to enter the fray with an indecisive and self-serving strategy is not just morally objectionable, but strategically unsustainable as well. The Palestinian and Arab peoples are hardly interested in swapping American military dominance with Chinese economic hegemony that does little to change or, at least challenge, the prevailing status quo.

Sadly, while Beijing and Tel Aviv labor to strike the needed balance between foreign policies and economic interests, China finds itself under no particular obligation to side with a well-defined Arab position on Palestine, simply because the latter does not exist. The political division of Arab countries, the wars in Syria and elsewhere have pushed Palestine down from being a top Arab priority into some strange bargain involving “regional peace” as part of Trump’s so-called “Deal of the Century”.

This painful reality has weakened Palestine’s position in China, which, at least for now, values its relationship with Israel at a higher level than its historical bond with Palestine and the Arab people.

Lessons from Switzerland

Almost forty years ago I invented direct democracy – or so I thought at the time. I had been raised in Rhodesia, a racist and mostly fascist country, and had just moved to England. Although England considered itself a fine example of democracy (and still does), I was puzzled how such a fine democracy could have an unelected head of state, and a parliament where more than half its members are unelected. There must be a better way, I thought, so I invented direct democracy and set about writing a political novel based on the idea of a southern African country having a revolution and creating a government that worked in such a way.

The novel was terrible and never saw publication, but the concept of a new democracy stayed with me, and is still with me today. Of course, I now know that I did not invent direct democracy. Some years after my first awful novel I learnt that Switzerland had been using direct democracy for over a hundred years. Far from being disappointed that I was not the inventor of this wonderful concept, I was delighted. It totally validated my belief that such an idea was not only possible, it was already working, and working pretty well. After all, here was Switzerland, one of the most successful and stable countries in the world, that had been using it for ages. It was a country wholly controlled by its people, with high standards of social welfare and enlightened environmental awareness. And it had kept out of wars for almost two hundred years – even when completely surrounded by war, twice. So ever since finding out about Swiss democracy I’ve yearned to visit the place, and see it in action. But Switzerland is an expensive place to visit, and if you ain’t loaded, that ain’t easy.

Then a few months ago we learnt of a cut-price holiday to Chateau D’Oex (pronounced “day”), and I just had to go for it. Although I knew that Switzerland must have its problems, just like anywhere else, I wanted to try to get a feel for what Swiss people think about their country and its relatively exemplar democracy.

I wasn’t especially interested in the beautiful scenery, and it is very beautiful. Many other countries also have beautiful landscapes, and I’ve been fortunate enough to see some of them before. What I wanted was to speak to Swiss people. This is not the easiest thing to do. First of all, although most Swiss people have various levels of competence with the English language, English is not an official language. Swiss children are taught to speak the main language spoken in their region, which means German, French or Italian, and then one of the other two. Romansch, the sort of native Swiss language, is hardly taught at all, which is a bit sad. English is sometimes available to school children as an optional extra.

But the fact that some Swiss people are not very fluent in English was only part of my problem. Mainly I’m always deeply humiliated when visiting foreign countries because I’m so incompetent at speaking their language, or some other mutually understandable language other than English (which obviously instantly associates me with one of the most vile and repressive regimes of all time), so I always feel very uncomfortable about trying to have conversations with people in non-English-speaking countries: I always feel I have to apologise for being English, and say how ashamed I am of our history. However, I did manage to overcome my discomfort a few times whenever I came upon someone who was clearly quite happy to speak English. Fortunately my wonderful wife Lorraine was with me, and she is usually less inhibited than I am about talking to people, and because she is very good at this she initiated many of the conversations we had with local folk.

So my impressions of modern Swiss life were obtained mainly from discussions with three young Swiss people (one of whom said she would rather live in England!). I’ll call them Belinda, Martina, and Stan.

Referendums

The Swiss provide direct democracy through continual national referendums, which they hold more often than any other country in the world, and now have them about once a month. Contrast that with the fact that the UK has only ever had three national referendums, and the US has never had a single one. Swiss attitudes to their government are possibly similar to many other Europeans about their governments. Whereas Martina said she always voted in every referendum, Stan said he never did, and appeared to have a similar casual indifference to politics that is very common in many young people. I asked him if he trusted the information that came with every referendum question, about whether arguments for and against were equally weighted. He said he thought they were, so that obviously wasn’t the main reason for his indifference to the system – although he possibly wasn’t the best person to ask.

Good information is clearly a vitally important condition to the success of any vote, and I didn’t learn enough to form an opinion on the quality of public information in Switzerland. But according to a recent report by Reporters Without Borders, Switzerland has the fifth most independent press in the world; compared with Britain, at 40, and the US at 45. So presumably the Swiss do get pretty reasonable information about the issues they get to vote on.

However, there do seem to be some glitches in the system, admitted by this fine free press. Here we learn, for example, that there are at least seven weaknesses to how referendum results are implemented. It’s basically a list of tricks that the government has learnt whereby it can either minimize the effect of a people’s referendum, or ignore it altogether if it wants to. It can do this, according to another article on the subject, through the fact that Swiss courts are not specifically required to implement the constitution.

The genius Tom Paine clearly identified this problem over two hundred years ago:

A man, by his natural right, has a right to judge in his own cause… But what availeth it him to judge, if he has not power to redress?1

This crucial point about the difference between having civil rights and having the means to enforce them was highlighted in the landmark legal dispute William B Richardson v The United States of America, where Mr Richardson tried, but eventually failed, to force the US government to make public the money spent on the CIA – as required in the US constitution. But it was decided that as a mere citizen Mr Richardson “lacks standing” to actually enforce the constitution.2 So as far as Switzerland is concerned, it appears the people may indeed have this wonderful democracy where citizens are invited to be directly involved in government decision-making, but there may be a big difference in what the people say they want, and what the people actually get. It could be that Swiss referendums are sometimes little more effective than large opinion polls.

Trade Unions

We asked Martina and Stan about Swiss trade unions, and received blank looks on both occasions. I remember Martina saying she thought there were some, but she knew nothing about them. The tour guide we had, Dave, was pretty knowledgeable about Switzerland, and told us that we were his one hundred and twenty fifth tour there. He told us quite a bit about Swiss life but never mentioned trade unions. So when she had the chance Lorraine asked him that question. Dave is the sort of guy who doesn’t like to admit that he doesn’t know something – especially if it’s about Switzerland, but he had to admit that he knew nothing about Swiss trade unions.

This is quite interesting.

Coming from England, which still has a pretty good trade union movement (albeit it a shadow of its former self) it seemed almost incomprehensible to us that a modern western society would have no significant trade union movement – because given the fact that no one we asked seemed to know anything about it that must be the obvious conclusion to be drawn. And if there’s no significant trade union movement, who looks after workers’ rights? Although there are trade unions in Switzerland, as a percentage of population, membership is only about half of what it is in Britain or the US — both of which countries currently have considerably depleted numbers of trade union members from what they once had.

It could be that the Swiss constitution helps the Swiss out quite a bit in this regard. Because although it may not be exactly user-friendly, it does at least establish clear principles of right and wrong. Its opening words, for example, include this line: “The strength of a people is measured by the wellbeing of its weakest members” ((The Swiss Constitution – Preamble.)), and it begins with a fairly comprehensive section on “Fundamental Rights”. In other words, a pretty high ethical standard of society is clearly defined in the country’s single most important document, reducing the requirement for trade unions.

National Service

All young men leaving full time education are required to do national service – unless, one of our informants told us rather cryptically, they’re rich enough to buy their way out. National service can take the form of joining the armed forces, or doing some form of social service. Girls do not have to do it at all, but may do so if they want.

The initial commitment is spread over five years with different types of training taking place in three or four month blocks once a year. After that every Swiss man joins a unit of reservists and is issued with a rifle which he must keep secure at home.

I asked Martina about the boys she knew when she left school, and how many of them joined the army, or social service. She said she didn’t know of any boy doing social service in preference to the army. But she says there is some public resentment to the practice, and a general feeling that too much money is spent on military training, instead of more important public services. That’s probably true of almost every country in the world.

I had the impression from both Martina and Stan that although they both loved Switzerland, they also felt it was too conservative, and that new ideas and innovation were seldom welcome. It was Martina who said she would rather live in England, because it seemed a freer society, and Stan appeared to have a hankering to move to Amsterdam, where he’d once spent a few months working.

Thinking about this very conservative nature for which the Swiss are quite well known, I wondered how much of it might be down to the fact that so many of them do five years of national service. After all, there are few institutions more conservative than the military, who are also extremely good at brainwashing. Forcing a young mind through such a regime is bound to have long-lasting effects on most. So how much, I wonder, of Swiss conservativeness is a product of military brainwashing?

The Economy

Another main reason I had for visiting Switzerland was to get a feel for how their economy works. I have strong socialist leanings, but Switzerland is an unashamedly capitalist country. But unlike so many other capitalist countries, Switzerland does not appear to have slums and ghettoes. No one appears to go hungry or homeless. There is clearly something different about Swiss capitalism, and I wanted to find out what.

Obviously this is not a scientific report, it’s just a short record of superficial impressions, points I picked up which appear different to the capitalism I’m used to.

Minimum wage

Switzerland is an expensive country to live in, therefore wages have to be pretty high. So the minimum wage is about $23 an hour. This is more than two and a half times higher than minimum wage in Britain. Although prices are definitely higher in Switzerland, the prices of most basics are not two and a half times higher than British prices. Petrol, for example – a vital driver of costs – is only about 20% higher than British prices. Apparently the minimum wage is only a very recent innovation in Switzerland. As I have always been deeply suspicious of the principle of a minimum wage, I would not be surprised to see the purchasing power of those who receive it in Switzerland start to fall – just as it did in Britain.

Although taxes are relatively modest, every Swiss resident is obliged to have private health insurance. Martina, who was probably on minimum wage, told us that her health insurance cost her SF350 a month (about US$350). She did not seem happy with the arrangement, and told us that it was about the cheapest insurance she could find, and wouldn’t cover everything. Dental care is apparently very good, but so expensive that many Swiss people travel to other countries to have it done.

So it comes back to the same basic point as always. Although $23 an hour might seem pretty good, money is only as good as what you can buy with it – and in Switzerland you need quite a lot to buy not very much.

Self-sufficiency

Unlike many capitalist countries, Switzerland does not appear to buy into the concept of globalisation with quite as much enthusiasm as most western countries. Although its banking system has long been an important asset to its economy (arguably the most important), the Swiss have never been huge fans of international trade. Both Britain and the US, for example, who both market themselves as champions of capitalism, have both had negative trade balances for many years (i.e. imports exceeding exports), but the Swiss have nearly always shown the opposite trend, with exports usually exceeding imports. In pure business terms, this is like saying Switzerland is a viable business, whereas both Britain and the US are technically bankrupt.

It would seem the key to Switzerland’s success in this regard is the fact that they value self-sufficiency extremely highly. They resist importing almost anything they could produce for themselves. Given that it has precious little in the way of natural mineral resources this is a singularly fine achievement. A brief glance at almost any set of statistics comparing Swiss trade with the rest of the world shows a remarkably healthy economy.

Swiss Cheese

Directly linked to the Swiss economic principle of self-sufficiency is the fact that they take huge pride in home-produced foods and drinks. Consistent with the notion that imported products should be avoided where there are good local alternatives, Swiss farm products too are usually preferred to imported farm products. A fine example of this in practice is the cheese industry.

Dairy farming is huge in Switzerland. The many beautiful mountainsides are invariably adorned with dairy cattle, seemingly happy to graze the plentiful greenery in one of the most beautiful landscapes in Europe. So dairy products are plentiful. However, consistent with the Swiss principle of subsidiarity, local is always preferred to products from somewhere else – even if the somewhere else is in Switzerland. So almost every rural town has its own small dairy producing milk, butter and cheese. As we were quite close to Gruyere, an internationally recognised Swiss brand, we had the opportunity to visit the cheese factory. But as this is not of much interest to vegans, we didn’t bother. We would far rather have visited the local bakery, because unsurprisingly bread-making is something else the Swiss do very well, and something else they do locally in many areas – once again preferring local to some cheap mass-produced rubbish.

Possibly because the Swiss are so protective of their farming industry, vegans can have a fairly bleak time of things. Although our hotel knew we were vegans, and said beforehand they could cater for us, it took them three days to obtain some soya milk, even though it was easily available at a local co-op almost across the road; and all they could produce for our evening meal was rice and vegetable stew, varied on two occasions with a few added mushrooms.

Switzerland is well-known for its cow-bells, which are something of a national symbol, and cows grazing the beautiful hillsides to the sound of clanging cow-bells is supposedly an image of the perfect rural idyll. But walking nearby to such a scene you can’t help but notice how bloody loud those bells are, and my heart went out to the poor animals that are forced to wear the damn things – mostly unnecessarily.

But pigs fare much worse. Dave commented several times on the beautiful rural idylls but observed that you never see pigs in Switzerland, which is very odd, he thought, given that the Swiss apparently eat a lot of pork. It’s not that odd. You don’t see pigs because they’re factory-farmed on a fairly large scale, and the poor creatures seldom see the light of day.

However, the principle of subsidiarity applies to almost everything else in Switzerland – from small local timber mills, to breweries and wine-makers. Wherever local products can be used in preference to goods from anywhere else – even other Swiss goods – the Swiss use them. And providing you’re not a vegan, or a pig, it works extremely well.

One of the most interesting points about all this is that the Swiss policies of subsidiarity and self-sufficiency, which clearly do it no harm whatsoever, could also be called protectionism which, according to the technically bankrupt nations of Britain and the US, is no way to run an economy. But the hard evidence provided by Swiss success shows that their economic policies, coupled to their direct democracy, is a much sounder way to manage a country than Britain or the US manage their countries.

Banking

Switzerland has been known as a haven for dodgy offshore banking and financial services for a very long time, and most infamously for laundering Nazi gold during WW2. But there is a very huge difference between Swiss offshore banking and the basically criminal enterprises operated by other capitalist giants such as Britain and the US. The Swiss National Bank is in full control of money supply, and is also under direct control of the state – which is itself largely controlled by the people through their system of routine referendums. Article 99 of the Swiss constitution states that “A minimum of two thirds of the net profits made by the Swiss National Bank shall be allocated to the cantons.” (My emphasis) In other words, unlike British and American banks, vast quantities of bankers’ profits are distributed throughout Swiss cantons for local development.

Model of capitalism

No self-respecting socialist would put up an argument for capitalism as the best way to manage a country’s economy. However, there’s no escaping the fact that Switzerland is both a capitalist country, and a very successful economy, and has high levels of social care, and has high standards of environmental protections. In other words, if anyone wanted to present a reasonable argument for the virtues of capitalism, they would be hard-pressed to improve on the Swiss example. And yet this is not the model most preferred by the self-appointed champions of capitalism, Britain and the US. Why might that be?

Unlike Britain and the US, Switzerland appears to try to run itself like an honest business enterprise, whereas Britain and the US both manage their economies in much the same way as if they were being run by Al Capone. Adam Smith, credited as the father of capitalism, would most likely approve of the Swiss model, but would certainly abhor the economic practices of Britain and the US. In fact, the two economic systems are so different they really should have different names.

How is it then that Swiss capitalism has managed to escape the traps that British and US capitalism have fallen into? Why have Britain and the US turned into the biggest criminal enterprise on the planet whilst the Swiss tick along as a comparatively decent, honest, solvent society? The answer, surely, lies in the fact that Switzerland is, relatively speaking, a real democracy.

Whilst there’s no doubt there are some glitches with Swiss democracy, it’s leaps and bounds better than the British and American models. Whereas British and American so-called democracies are thoroughly corrupt, basically criminal enterprises wholly controlled by the world’s wealthiest gangsters, the Swiss people have a fine national constitution which provides them with a mechanism whereby they could easily control their government if they had to. In Britain or the US the super-rich controllers of politicians know they can literally get away with murder because there’s no mechanism to stop them, but in Switzerland there is, therefore super-rich Swiss must be far more careful in what they try to get away with.

The British academic R.H. Tawney once observed:

That democracy and extreme economic inequality form, when combined, an unstable compound, is no novel doctrine.3

In other words real democracy and extreme economic injustice are not compatible. You can have one or the other, but not both. Britain and the US resolved this problem by ensuring that real democracy does not exist, which allows extreme economic inequality to thrive. The Swiss on the other hand, with their very different version of democracy, are not only relatively free from economic injustice, they also have a highly successful economy.

So it seems fairly obvious to me that extreme constitutional reform of western so-called democracies – to provide real direct democracies – is the essential first step for eliminating global economic injustice.

Here’s Tawney once more,

Democracy is unstable as a political system as long as it remains a political system and nothing more, instead of being, as it should be, not only a form of government but a type of society, and a manner of life which is in harmony with that type. To make it a type of society requires an advance along two lines. It involves, in the first place, the resolute elimination of all forms of special privilege which favour some groups and depress others, whether their sources be differences of environment, of education, or of pecuniary income. It involves, in the second place, the conversion of economic power, now often an irresponsible tyrant, into a servant of society, working within clearly defined limits and accountable for its actions to a public authority.4

Socialists are unlikely, with good reason, ever to trust any form of capitalism. But the inescapable fact is that when capitalism is managed in the way the Swiss do it it is a reasonable and perfectly workable model. It helps to see that Swiss democracy and the version of so-called democracy that’s practised by most western countries is as different as socialism and capitalism. For me the most perfect economic model is one where the state, directly controlled by the people, is wholly responsible for providing all essential public services, but where the private sector (properly regulated by the state) is free to provide non-essential services for whatever profit it can make.

But the Swiss model is a reasonable alternative.

  1. Rights of Man, Tom Paine, p. 120.
  2. Blank Check, Tim Weiner, p. 226.
  3. The Vote – how it was won, and how it was undermined, Paul Foot, p. 340.
  4. The Vote – how it was won, and how it was undermined, Paul Foot, p. 306.

Trump Trade Revealed: Another Rigged Corporate Deal

Since the Clinton era, when the North American Free Trade Agreement (NAFTA) was created, global trade has been written by and for big corporations at the expense of people’s health, worker’s rights and the environment. Trump Trade – through the renegotiation of NAFTA – continues that approach.

In some areas, people might argue the new United States-Mexico-Canada Agreement (USMCA) makes improvements over NAFTA, although many details are still being withheld. From what we do know, overall, it is a step backward for people and planet. And it undermines the US’ relationship with Canada and Mexico, as Geoffrey Getz of the neo-liberal Brooking’s Institution writes, “Trump’s aggressive, threatening approach succeeded in eliciting modest concessions from two of its closest trading partners.”

Trump is claiming a political victory merely by reaching an agreement, but it is not a victory for people or planet, as will be described below. Trump Trade should be rejected. If we are to achieve a new model of trade that protects the environment, workers and democracy, we need to demonstrate that rigged corporate trade will be rejected every time it is brought forward. The time to organize to stop this agreement is now.

Energy and the Environment

Trump withdrew from the Trans Pacific Partnership (TPP) because a mass social movement made it unacceptable and it could not pass in Congress. Some of the provisions in the TPP are included in the USMCA.

Like the TPP, the USMCA contains polluter-friendly non-binding terms on the environment; e.g., the text “recognizes that air pollution is a serious threat to public health,” but includes no single binding rule to reduce air pollution.

The Sierra Club reports the USMCA takes a significant step backward from environmental protections included in the last four trade deals by failing to reinforce a standard set of seven Multilateral Environmental Agreements that protect everything from wetlands to sea turtles. The absence of environmental enforcement continues the failed corporate trade of the Clinton-Obama eras.

Trade agreements could be designed to reduce greenhouse gas emissions, but climate change is not even mentioned in the USMCA. Greenhouse gas emissions will increase. The Sierra Club reports the deal’s lack of binding environmental standards allows corporations to evade US environmental laws by shifting jobs and toxic pollution to Mexico where environmental policies are weaker. It reinforces the US’ status as the world’s largest outsourcer of climate pollution.

Some keys to preventing greenhouse gas emissions are ‘Buy American’ and ‘Buy Local’ laws that provide incentives for locally-produced goods. The USMCA negates those laws, requiring that industries based in Canada and Mexico be given equal access to US government contracts.

The USMCA exempts oil and gas corporations that have, or may have, government contracts for offshore drilling, fracking, oil and gas pipelines, refineries, or other polluting activities from reforms to Investor State Dispute Settlement (ISDS) provisions. These intensely polluting corporations would be allowed to challenge environmental protections in rigged corporate trade tribunals.

Trump Trade preserves a NAFTA rule that prevents the US government from determining whether gas exports to Mexico are in the public interest. This creates an automatic gas export guarantee, which will increase fracking, expand cross-border gas pipelines, and increase dependency on Mexican climate-polluting gas.

The USMCA gives corporations extra opportunities to challenge proposed regulations before they are final, and to repeal existing regulations. This makes it harder to put in place environmental regulations or rollback the pro-polluting regulations of the Trump era.

Food and Water Watch summarizes:

The energy provisions will encourage more pipelines and exports of natural gas and oil that would further expand fracking in the United States and Mexico. The text also provides new avenues for polluters to challenge and try and roll back proposed environmental safeguards, cementing Trump’s pro-polluter agenda in the trade deal.

Food and Health

The USMCA undermines food safety and health by making it more difficult to regulate and inspect foods. It limits inspections and allows food that fails to meet US safety standards to be imported. Food and Water Watch states that it requires the US to “accept imports from Mexico with less scrutiny than from other countries. The deal even creates new ways for Canada and Mexico to second-guess US border inspectors that halt suspicious food shipments, which would have a dangerously chilling effect on food safety enforcement.”

USMCA does not require Country Of Origin Labeling (COOL), nor dolphin-safe labeling and makes GMO labeling more difficult. It uses the requirement that food labels reflect ‘sound science’ to prevent accurate labeling.

USMCA serves Monsanto and other giant agro-chemical corporations by allowing unregulated GMOs, rolling back Mexico’s regulation of GMOs, and letting chemical giants like Monsanto and Dow keep data on the safety of their pesticides secret for 10 years. USMCA is designed for agribusiness, not family farmers and consumers.

Like the TPP, the USMCA increases the cost of pharmaceutical drugs through intellectual property protections that go “significantly beyond” NAFTA. USMCA gives pharmaceutical companies at minimum 10 years of market exclusivity for biologic drugs and protects US-based drug companies from generic competition, driving up the price of medicine at home and abroad.

Worker Rights and Jobs

The Labor Advisory Committee on Trade Policy and Trade Negotiations (LAC) explained they do not oppose trade, but, “We oppose a set of rules made largely by and for global corporations that reward greed and irresponsibility at the expense of hardworking families across the globe.” They describe the USMCA as moving backwards from the original NAFTA in many areas important to working families:

including with respect to ‘Good Regulatory Practices’ (code for using this trade agreement to attack important consumer, health, safety, and environmental protections), Financial Services (providing new tools for Wall Street to attack efforts to rein in its continuing abuses), and affordable medicines (extending monopolies for brand name pharmaceuticals at the expense of affordability).

Similar to the environment sections, the labor sections do not provide enforcement mechanisms. Citizen’s Trade Campaign writes:

“There is a ground breaking labor annex that could help eliminate Mexican protection contracts and boost labor rights there — but only if currently absent enforcement mechanisms are added.”

As the Labor Advisory Committee states, “Unenforced rules are not worth the paper they are written on.”

Summarizing the impact of USMCA, Citizen’s Trade Campaign states:

Mexican workers will continue to be horribly exploited, American jobs will continue to be outsourced, the environment will continue to be degraded and the wages for workers in all three NAFTA countries will continue to decline.”

Corporate Trade Tribunals

A major area of concern has been ISDS, trade tribunals where corporations can sue governments if new laws or regulations undermine their profits. ISDS empowers corporations to attack environmental and health laws in trade tribunals made up of three corporate lawyers and receive monetary judgments worth billions from tax dollars. The USMCA reduces but does not eliminate the unjustifiable and indefensible ISDS settlement mechanism, which privileges foreign investors over communities regarding access to justice.

After three years, ISDS would be eliminated with Canada and dramatically scaled back with Mexico with some unacceptable exceptions. After that, US and Canadian investors would use domestic courts or administrative bodies to settle investment disputes with another government. Are there workarounds to this ISDS reform that protect investors; e.g., will domestic courts seize assets within their country to repay investors, as a US court did for a Canadian mining company this year?

Regarding Mexico, the new process is designed to protect oil and gas industry investors from the privatization of Mexico’s oil and gas sector. Global Trade Watch writes, “several additional sectors were added, including railways and infrastructure. . . followed by an open-ended list, which could provide problematic flexibility for investors to argue that their investments qualify.” In other words, what looks like ISDS reform contains a giant loophole for corporations to continue to sue governments.

Under NAFTA, corporations can receive exorbitant awards for “expected lost profits.” Under USMCA, investors can only be compensated for losses that they can prove on the “basis of satisfactory evidence and that is not inherently speculative.” How this is interpreted is up to the courts.

USMCA Continues US Imperialism and Corporatism

Popular movements in Mexico urge the incoming government to reject USMCA in an Open Letter To Andrés Manuel López Obrador And The Legislators Of MORENA. They decry the secret nature of the negotiation and the agreement as an attack on Mexico’s sovereignty. They argue the agreement will “further open up our economy for the sole benefit of the large U.S. transnational corporations, with an even greater subordination of our government to the dictates of U.S. foreign policy and its measures of internal security and migration.”

The letter describes the election of MORENA and Obrador as the people voting “to expel the oligarchy that has governed us, along with their paid servants.” The incoming government was given a clear mandate that includes rejecting corporate trade agreements. To create the transformation promised in the election requires Mexico to have full control of its resources and wealth to ensure the well-being of the population, with full rights and liberties. They see rejection of USMCA as a “first step toward reclaiming our nation.”

They urge incoming President Obrador to see this as part of the “mafia of power” that he ran against. They describe how Trump pressured the weakest negotiator, Mexico, with the right wing Peña Nieto administration, and used that to threaten Canada with exclusion and 25% tariffs if they did not agree.

Roger Jordan writes, the new agreement is an act of corporate imperialism by the United States:

Under the new deal, both Mexico, a country historically oppressed by US imperialism, and Canada, a lesser imperialist power that has long been a key US ally, made significant concessions in the face of US demands that the continental pact be refashioned to make it an even more explicit US-led protectionist trade bloc.

As the US struggles to retain power as a global empire, UMCA shows that “through ‘America First’ economic nationalism and the ruthless assertion of its interests against ostensible allies and rivals alike,” it will do what it must “to prevail in the struggle for markets and profits.”

Just as the TPP was President Obama’s attempt at economic domination of Asia, USMCA is part of President Trump’s economic war against China, which has already included “tariffs on $250 billion worth of Chinese goods.” Jordan explains how USMCA sent a message to China, writing:

It grants the US effective veto power over any attempt by Canada or Mexico to negotiate a free trade pact with a ‘non-market economy,’ a clear reference to China. This includes the right to transform USMCA into a bilateral agreement, excluding the third member if it has ratified such a free trade deal.

Stop Corporate Trade

There is still time to stop USMCA. Leaders are expected to sign the deal on December 1 at the G-20 meeting. Then President Trump has 60 days to report to Congress on changes to US law that are required by the agreement. Within 105 days of the agreement being signed, the US International Trade Commission (ITC) must complete a study of the agreement’s economic impact. Congress will have to pass legislation to implement USMCA.  After Congress receives the final bill from the president, it has 90 days of being in session to act on it under Fast Track rules. It is unlikely that all this can be accomplished before the 2019 legislative session.

Now that we know more about the contents of the new NAFTA, we need to mobilize to stop its ratification and implementation by Congress. If we are to win a new model of trade that raises the bar on protection of workers, the environment and democracy, we must show, as we did with the TPP, that rigged corporate trade will be stopped by a popular movement.

US Trade Sanctions Against China

PressTV Interview – Transcript

Background

New Trade Sanctions by the US in the form of tariffs on US$ 200 billion Chinese exports to the US – China in a tit-for-tat move imposed new tariffs on 60 billion of US goods to China

China’s prime minister speaks out about the rise of unilateralism, saying the approach to trade will not solve any problems.

Li Keqiang made the comment at the World Economic Forum in the Chinese city of Tianjin. He said multilateralism should be upheld and the basic principle of free trade should be maintained. The Chinese premier said the trend of globalization is unstoppable, even though there are flaws in the process. Li’s comments come amid heightened trade tensions between China and the United States. Beijing imposed tariffs on 60 more billion dollars-worth of American imports in a tit-for-tat response to Washington’s levies on 200-billion dollars of Chinese goods.

PressTV: What is your take on this?

Peter Koenig:  These are indeed “trade sanctions”. US-imposed trade sanctions.

Of course, the Chinese are right. In a world that strives for free trade – unilateralism as demonstrated by the Trump Administration’s-imposed tariffs – is working in the opposite direction.

Two comments, if I may:

First, personally, I have been doubting from the beginning that globalization — and especially globalization in terms of “free trade” — is a good thing. There is nothing FREE.

Free trade among equals is one thing, but “free trade” American style, where they call the shots is, of course, not what is intended. The weaker always suffers, and I am not referring to China.  China doesn’t really suffer, they dominate the entire Asian market, having overtaken the US in Asia about three years ago, but I’m talking in general about developing countries that have to accept highly subsidized US and EU goods in order to stay within these “free trade deals”.

And we see that the west cannot be trusted; i.e., President Trump. He is making his own rules. Therefore, free trade and the related globalization is in my opinion not a good thing. It has hurt too many people of mostly poor countries over the past 30-some years, when neoliberalism started driving the agenda of “globalized free trade”.

Trading among friendly nations, nations that share the same objective, the same political and economic ideology, would be a much preferable alternative. There, nobody can bully another nation into accept his conditions.

This is something we may want to move back to — trading among friendly and culturally aligned nations, where trading is a win-win for both parties.

The second point I wanted to make is maybe more important: These tariff impositions have nothing really to do with trade. The Chinese know it and the US Administration knows it.

They, the tariffs, have everything to do with pulling down, weakening the Yuan, the very strong Chinese Yuan, and by doing so, the Chinese economy. The Yuan is an officially declared reserve currency recognized by the IMF and is fast replacing the dollar as the key reserve currency in the world.

That is what Washington is afraid of — and rightly so. Once the dollar ceases being the main reserve currency, the demand for the dollar will decline, and the hegemonic role for the dollar is gone – which may mean the collapse of the dollar-empire — and in the end the end of the empire altogether.

Already the biggest hydrocarbon producers and consumers in the world, China, Russia, Venezuela and Iran are no longer using the dollar for their trade deals, but local currencies or the gold-convertible Chinese Yuan.

So, the end of the dollar hegemony is coming sooner or later, but Washington wants to delay it as long as possible, hoping for a miracle, or actually even preparing for a military intervention to save the dollar.

Trump Threatens WTO Exit

Transcript: PressTV Skype Interview with Peter Koenig
31 August 2018

Introduction

U-S President, Donald Trump, has threatened to withdraw from the World Trade Organization.

Trump, in an interview with Bloomberg News, said he will pull out from the organization if it “does not shape up”. The U-S president warned that he could even take action against the WTO. Trump has complained that the US is being treated unfairly in global trade and has blamed the World Trade Organization for allowing it to happen. Regarding tariffs, Trump said he will enact import duties on 200-billion dollars-worth of Chinese goods as early as next week. Following his remarks, Asian stock markets dropped and partially erased gains made in this week’s global rally. Trump has ignited a global trade war by slapping sharp tariffs on goods from the EU, Canada, Mexico, and China.

PressTV: What is your take on this?

Peter Koenig: Well, it looks like this latest threat to exit WTO goes into the same direction as his trade war with the EU and with China, and also with the new NAFTA Agreement – which so far was negotiated only with Mexico and does not include Canada; it eventually would have another name.

The new trade agreement with Mexico was negotiated like all trade agreements with the US, behind closed doors. Canada was invited to also join, but as far as I know, no decision has been taken yet. At the outset it looks like the new “draft” agreement with Mexico is worse than the original – with all the rights and benefits going to big US corporations.

In the case of Mexico, it is really only a “draft”; nothing has been accepted yet. It will be subject to Mexican approval once the new President, Andrés Manuel López Obrador is sworn-in in December 2018.

What Trump is doing – or attempting to do – with tariffs and with sanctions is dividing the world, breaking up alliances; i.e.. trade alliances in the case of WTO. It’s the old rule: “Divide to Conquer” – and conquer in this case means that when alliances like WTO, in the creation of which – by the way – the US and the EU were instrumental, are broken up, the US will engage in bilateral agreements with individual nations, like in the case of the “new NAFTA”, negotiating with Mexico alone, dictating her terms to weaker nations. If Canada will be ready again for a NAFTA-like agreement, the process will be similar, with Washington in the driver’s seat.

What transpires from these negotiations, or tariff impositions – like China and the EU, or even the reneging of the Iran Nuclear Deal – is Make America Great Again, meaning really American Corporatism, not the people.

New bilateral trade deals will continue to allow bilateral outsourcing to cheap labor countries, for example, between the US and Mexico, and the export of highly subsidized US goods. In the case of agriculture, NAFTA killed hundreds of thousands of small farming businesses in Mexico which was one of the key reasons for the massive increase of illegal migration to the US.

This will hardly be different in a new agreement. That’s why nothing is done yet. The progressive new President, López Obrador, may not easily submit to a flagrant one-sided agreement.

The case of tariffs on China for 200 billion worth of merchandise – has a different purpose, namely, to degrade the value of the Chinese currency, the Yuan, which is emerging rapidly as one of the world’s foremost reserve currencies, to the detriment of the US dollar. The Trump move is meant to discourage countries to adopt the Yuan among their reserve currencies. Some success was indeed registered by Trump’s announcement – the Asian markets dropped drastically wiping out much of the gains made during last week’s rally. This, however, will be short-lived, as investors realize the hot air behind the threat and that these tariffs will really make hardly a dent in China’s economy which is dominating the Asian market and doesn’t really depend on exports to the US.

If the US would indeed exit WTO – which is by no means sure, since Trump likes to play god, threatening, fearmongering – and then negotiate under conditions of intimidation and coercion – so, if the US would actually get out of WTO, they – the US – might set themselves up as sort of a competitor to WTO, negotiating individual bilateral deals with nations, especially weaker ones. They would no longer be under the oversight of WTO – and as with the International Court of Justice – to which the US does not belong – complaining would be meaningless.

But we are not there yet.

Trump’s Threat of New Tariffs on Chinese Imports and Possible Consequences

Introduction

The US Chamber of Commerce warns against the consequences of new tariffs on Chinese imports proposed by the administration of President Donald Trump.

The top business lobbying group said the tariffs dramatically expand the harm to American consumers, workers, businesses, and the US economy. It said the Trump administration lacks a coherent strategy to address QUOTE China’s theft of intellectual property and other harmful trade practices. The chamber also demanded that Washington hold serious discussions with Beijing. Trump has threatened 25 percent tariffs on 200 billion dollars of Chinese imports. He says this is in response to China’s retaliatory tariffs on 50 billion dollars-worth of US products.

PressTV: What is your take on this?

Peter Koeing: The key word is “threatened”. Trump has threatened an additional 25% import tariffs on 200 billion worth of Chinese imports to retaliate for China’s retaliation, so to speak. Chinese retaliation was to be expected and is fully justified. It is clear that China will not reverse their import tariffs for US goods. Why would they?

China is poised to negotiate a one-to-one even level, but not on the basis of the US dictating the rules. Trump and his “masters” must realize that.

Then the additional reason of “China’s theft of intellectual property…” is today more a joke than reality. In many areas of technology development – especially certain precision electronics and foremost alternative energy – China is worlds ahead of the United States. But nobody talks about it. China will soon be number one in alternative energy production, which China will be exporting to the world, to the detriment of the US-led petrol industry.

Maybe that’s what Trump is focusing on — attempting to detract from what is really threatening a big junk of the US economy, the notorious dependence on hydrocarbon energy, the number one polluter an environmental destructor today.

And there is another factor, perhaps the number ONE target of Trump’s ever-increasing tariffs for Chinese exports, or rather US imports of Chinese goods:

That’s the Chinese currency, the Yuan.

It is known since long to many treasuries of countries around the world, that the Chinese Yuan is a much safer investment or reserve currency than the US dollar which is based on hot air, or not even, while the Yuan is based on a solid Chinese economy and on gold.

Not only has the Yuan been admitted officially in the IMF’s basket of SDRs – Special Drawing Rights, which consists of the five key reserve currencies – US Dollar, UK pound, Japanese Yen, Euro – and now also the Chinese Yuan.

The yuan is not only for most countries around the globe a very interesting investment currency, not a bullying currency as is the US dollar, always with severe strings attached, but the yuan is also growing rapidly as a reserve currency replacing the dollar.

Levying tariffs to hurt China’s exports and economy and the Yuan’s strength, may be the key reason behind this deconstructive tariff game Trump is playing.

However, China has a strong market dominance in Asia and tariffs will do limited harm; besides, China has many other means to further retaliate, for example, devaluating the Yuan vis-à-vis the US dollar.

So, keep tuned. There will probably be more to come.

Trump: The De-Globalizer?

Looks like Trump is running amok with his “trading policies”. Not only has he upset the European Union, which doesn’t deserve any better, frankly, for having been and still being submissive vassals against the will of by now 90% of Europeans; but he has also managed to get China into a fury. Well, for China it is really not that important, because China has plenty of other markets, including basically all of Asia and probably increasingly also Europe, as Europe increasingly feels the need for detaching from the US.

What is striking, though, is that even at the outset of the G20 Summit now ongoing in Buenos Aires, Argentina,Trump’s Ministers have made it clear that unless Europe cancels all subsidies – referring primarily to agricultural subsidies – and eliminates the newly imposed retaliatory import duties, new trade deals are not going to be discussed. Never mind that the US has the world’s highest farm subsidies.

From afar this looks like the most wicked and non-sensical trade war the US via Trump is waging against the rest of the world – à la “Make America Great Again”. Will it work? Maybe. One can never predict dynamics, especially not in a neoliberal western world that is used to live on linearism, which by definition is always wrong. Knowingly and deliberately the west and its financial key institutions, IMF, World Bank, FED, European Central Bank – trick the public at large into believing their statistics and predictions – which, if one goes back in history, have always been off, way off.

All life is dynamic. But to understand this it takes independent thinking which the west has long given up, unfortunately. So, in response to the latest Trump-promoted trade fiasco at the G20 in Argentina, the IMF is up in arms, saying this might lower world GDP by at least 0.5%. Even if true, so what?

In reality, there is a totally different scenario that nobody dares talk about. Namely, what renewed local production and monetary sovereignty can bring to the world economy; precisely what Mr. Trump says he wants to propagate for the US of A – local production for local markets and for trade with countries that respect mutual benefits. The latter is, of course, a question not easily achieved by any trade deal with the US. But the former is an enormous economic power keg. The stimulation of local economies through internal credit is the most commanding means to boost local employment and GDP.

Then there is the sanctions game. It’s getting ever more aggressive. New sanctions on Russia, new sanctions on Venezuela, and new heavy-heavy sanctions on Iran. And the European puppets still follow suit, although they are the ones that most suffer from US sanctions imposed on others, especially because out of ‘stupidity’ or fear, they cannot let go of the destructive empire, hobbling away on its last breath. Or is it perhaps, that those fake leaders of the Brussels construct are bought?  Yes, I mean bought with money or with favors? It’s not out of this world, since those of the European Commission who call the shots are not elected, thus, responsible to no one.

Take the case of Iran.  Trump and his peons, Bolton and Pompeo, have threatened every oil company around the globe with heavy sanctions if they keep buying hydrocarbons from Iran beyond November 2018. Particularly concerned are the European Petrol giants, like Total, ENI, Repsol and others. As a consequence, they have canceled their literally of billions of euros worth of contracts with Iran to protect themselves, and, of course, their shareholders. Just recently I talked to a high executive from Total. He said, we have no choice, as we cannot trust our people in Brussels to shield us from Washington’s sanctions. So, we have to look elsewhere to fulfill our contractual obligations vis-à-vis our clients. But, he added, we did not buy the American fracking stuff; we are negotiating with Russia. There you go.

The European market for Iran’s hydrocarbon is estimated at about 20% of Iran’s total production. An amount easily taken over by China and others which are too big (and too bold) to be sanctioned by the empire. Some may actually resell Iranian hydrocarbons through their backdoor to the otherwise sanctioned European oil corporations.

Iran has another strong weapon which they already made clear they will use, if the US attempts seriously to block anyone from buying Iranian oil and gas. Iran can block the Gulf of Hormuz, where daily about 30% of all hydrocarbon used by the world is being shipped, including about half to the United states. This might increase the price of petrol exponentially and ruining many countries’ economies. However, higher prices would also benefit Russia, China and Venezuela, precisely the countries that Washington wants to punish.

Would such a move by Iran provoke a direct US aggression?  One never knows with the war profiteers of the US. What’s for sure, such an intervention would not pass without a commensurate response from China and Russia.

On the other side of the scenario – imagine – countries mired in this global mess, made in the US of A, start looking for their own internal interests again, seeking their own sovereignty, independence from the globalist dependency. They are embarking on economic policies furthering self-sufficiency, self-reliance; first foodwise, then focusing on their scientific research to build their own cutting-edge technology industrial parks. A vivid example is Russia. Since sanctions were imposed, Russia has moved from a totally import-dependent country since the collapse of the Soviet Union, to a food and industry self-sufficient nation. According to Mr. Putin, the sanctions were the best thing that happened to Russia since the fall of the Soviet Union. Russia has been the world’s largest wheat exporter for the last two years.

Europeans have started quietly to reorient their business activities towards the east. Europeans may finally have noticed – not the elitist puppets from Brussels, but Big Business and the public at large – that the transatlantic partner cannot be trusted, nor their self-imposed EU central administration of Brussels. They are seeking their own ways, each one of these nations are seeking gradually to detach from the fangs of Washington, eventually detaching from the dollar dominion, because they notice businesswise the dollar-based economy is a losing proposition.

There is BREXIT, the most open move away from the ‘freedom limiting’ European dictate which is nothing else but a carbon copy of the economic dictate of the dollar. As practiced in the United States and everywhere the dollar is still the main international contract and reserve currency.

The Five Star Movement in Italy was created on similar premises – breaking out from Brussels, from the Euro-policy handcuffs. In a first attempt towards sidelining the Euro, they received a spanking from the euro-friendly Italian President, Sergio Mattarella, when he refused to accept the 5-Stars coalition partner’s, Lega Norte, proposed Eurosceptic Minister of Finance, Paolo Savona, who called Italy’s entry into the eurozone a “historic mistake”. This thrive by Italy to regain monetary sovereignty has by no means ended. To the contrary, it has taken strength and more determination. Germany moves in the same direction – quietly opening doors to Moscow and Beijing.

Unfortunately, these moves have little to do with a new more human and peace-loving consciousness, but rather with business interests. But perhaps conscious awareness – the reconnecting with the original spark of a humanity solidified in solidarity is a step-by-step process.

What if, considering the motion towards peoples’ new self-determination, Trump’s amok run, his jumping from chaos to more chaos, to the sanction game no end – punishing, or threatening friends and foes alike, will lead to a genuine de-globalization of the world?

If this were to happen then, we the 90% of the globe’s population, should be very grateful to Mr. Trump who has shown and created the path to enlightening – the enlightening of de-globalization.