Not Only in America
After I gave a talk on these ideas a couple of years ago, a Swede asked me why I placed so much emphasis on the United States. Surely countries like Sweden were more balanced.
Maybe so, I replied, but for how long? The United States may be leading the march to imbalance, but it is hardly marching alone. A great many countries are being thrown out of balance by the spreading influence of the economic dogma in cahoots with a globalization movement that is suppressing so many things local. In a surprising number of countries, the rich are getting exponentially richer while income levels for the rest are stagnating and social problems are festering. My own country, Canada, long known for its balance and benevolence, has become another cheerleader for this one-sided view of development. There is a creeping meanness in my country that I find alarming, led by, but not restricted to, our current government. If Canada has succumbed, can Sweden be far behind? (See the accompanying box.)
So no matter where you live, if you wish to sustain whatever balance remains in your own country and help stop what could be the end of our history, I suggest that you understand what is happening in the United States—especially if you are American. (A section at the end of the appendix presents some evidence about the state of democracy in America twenty-five years after this triumph of capitalism.)
Public Rights or Private Profits?
A number of recent bilateral trade pacts have included special courts of arbitration that enable private companies to sue sovereign states whose laws or regulations—even in matters relating to health, culture, and environment—they see as having reduced “the value of [their] profits or expected future profits” (Nace 2003: 257). Some corporations have used these courts not to sue states so much as to threaten them with such suits, which has had a “chilling effect on legislation” (Monbiot 2013).
In December 2013, the New York Times ran an article as well as an editorial discussing how “big tobacco” had been using such litigation to “intimidate” and “bully” poor countries around the world into rescinding regulations intended to control the use of tobacco. The health minister of Namibia reported receiving “‘bundles and bundles of letters’ from the industry about its attempts to curb smoking rates among young women” (Tavernise 2013). In reference to the North American Free Trade Agreement, one Canadian official likewise reported seeing “the letters from the New York and DC law firms coming up to the Canadian government on virtually every new environmental regulation and proposition in the last five years.” One pharmaceutical company even “demand[ed] that Canada’s patent laws be changed” (Monbiot 2013).
In his article about these courts of arbitration, referred to in the title as “a Full-frontal Assault on Democracy,” George Monbiot wrote:
The rules are enforced by panels which have none of the safeguards we expect in our own courts. The hearings are held in secret. The judges are corporate lawyers, many of whom work for companies of the kind whose cases they hear. Citizens and communities affected by their decisions have no legal standing. There is no right of appeal.
One NGO labeled this “a privatized justice system for global corporations,” while a judge on these courts was quoted as saying that “it never ceases to amaze me that sovereign states have agreed to [such] arbitration at all.”
As I write this, the European Union is negotiating a trade pact with the United States. As a consequence, the lopsided lobbying so prevalent in the United States has come to Brussels with full force, a good deal of it from U.S. law firms (Lipton and Hakim 2013).
If they succeed in installing such a court of arbitration, these “negotiations could … become de facto global standards” (Hakim and Lipton 2013), given that the European Union and the United States account for almost half the world’s trade.
If, however, the Europeans stand their ground, this could become a turning point that puts an end to such courts and encourages national courts to dismiss them as outrageous violations of their citizens’ rights.