News and Features
When NAFTA was adopted in 1993, Chapter 11 in the trade and investment agreement was too obscure to stir controversy. Eight years later, it's the smoking gun in the intensifying argument over whether globalization trumps national sovereignty. Chapter 11 established a new system of private arbitration for foreign investors to bring injury claims against governments. As the business claims and money awards accumulate, the warnings from astute critics are confirmed--NAFTA has enabled multinational corporations to usurp the sovereign powers of government, not to mention the rights of citizens and communities.
The issue has exquisite resonance with the present moment. On April 20 thirty-four heads of state gather in Quebec City to lead cheers for a Free Trade Area for the Americas. The FTAA negotiations are designed to expand NAFTA's rules to cover the entire Western Hemisphere. The Quebec meeting should provide good theater but not much substance. Tony Clarke of the Polaris Institute, in Ottawa, says the meeting is intended to be "a face lift for the whole global agenda, by portraying free trade as democracy." Protesting citizens will be in the streets, challenging 6,000 police and Mounties, with an opposite message: Democracy is threatened by the corporate vision of globalization.
Chapter 11 of NAFTA should become a defining issue for FTAA negotiations. Many, including Clarke, vice chairman of the Council of Canadians, believe corporate governance was and is the FTAA's intent. "There is a conquering spirit at the heart of all this," he says, adding that the corporations' attitude is: "We have to get into every nook and cranny of the world and make it ours."
Chapter 11 provides a model of how this might be accomplished. The operative principle is that foreign capital investing in Canada, Mexico and the United States may demand compensation if the profit-making potential of their ventures has been injured by government decisions--"tantamount to expropriation." Thus, foreign-based companies are given more rights than domestic businesses operating in their home country. For example:
§ California banned a methanol-based gasoline additive, MTBE, after the EPA reported potential cancer risks and at least 10,000 groundwater sites were found polluted by the substance. Methanex of Vancouver, British Columbia, the world's largest methanol producer, filed a $970 million claim against the United States. If the NAFTA panel rules for the company, many similar complaints are expected, since at least ten other states followed California's lead. The federal government would have to pay the awards. California State Senator Sheila Kuehl and others have asked the US Trade Representative to explain how this squares with a state's sovereign right to protect health and the environment.
§ In Mexico, a US waste-disposal company, Metalclad, was awarded $16.7 million in damages after the state of San Luis Potosí blocked its waste site in the village of Guadalcazar. Local residents complained that the Mexican government was not enforcing environmental standards and that the project threatened their water supply. Metalclad's victory established that NAFTA's dispute mechanism reaches to subnational governments, including municipalities.
§ In Canada, the government banned another gasoline additive, MMT, as a suspected health hazard and one that damages catalytic converters, according to auto makers. The Ethyl Corporation of Virginia, producer of MMT, filed a $250 million claim but settled for $13 million after Canada agreed to withdraw its ban and apologize.
§ The Loewen Group Inc., a Canadian operator of far-flung funeral homes, lodged a $750 million complaint against the United States, claiming that a Biloxi, Mississippi, jury made an excessive award of $500 million when it found Loewen liable for contract fraud against a small local competitor.
§ Sunbelt Water Inc. of California has filed the largest and most audacious claim--seeking $10.5 billion from Canada for revoking its license to export water by supertanker from British Columbia to water-scarce areas of the United States.
§ Canada's Mondev International is claiming $50 million from the United States because the City of Boston canceled a sales contract for an office building with a shopping mall. Boston invoked sovereign immunity against such lawsuits and was upheld by a local judge and the Massachusetts Supreme Court. The US Supreme Court declined to hear the appeal. So the company turned to NAFTA for relief.
"When just the threat of a Chapter 11 action may suffice to wrest a financial settlement from a government, investors have unprecedented leverage against states," Lydia Lazar, a Chicago attorney who has worked in global commerce, wrote in Global Financial Markets magazine. Mexico, Canada and the United States effectively waived the doctrine of sovereign immunity, she explained, when they signed NAFTA.
As many as fifteen cases have been launched to date, but no one can be sure of the number, since there's no requirement to inform the public. The contesting parties choose the judges who will arbitrate, choose which issues and legal principles are to apply and also decide whether the public has any access to the proceedings. The design follows the format for private arbitration cases between contesting business interests. With the same arrogance that designed the WTO and other international trade forums, it is assumed that these disputes are none of the public's business--even though public laws are under attack and taxpayers' money will pay the fines. The core legal issue is described as damage to an investor's property--property in the form of anticipated profits. The NAFTA logic thus establishes the "regulatory takings" doctrine the right has promoted unsuccessfully for two decades--a retrograde version of property rights designed to cripple or even dismantle the administrative state's regulatory powers. "NAFTA is really an end run around the Constitution," says Lazar.
The fundamental difference in Chapter 11, unlike other trade agreements, is that the global corporations are free to litigate on their own without having to ask national governments to act on their behalf in global forums. Clearly, some of the business complaints so far are more exotic than anyone probably anticipated. These initial cases will set precedents, however, that major global firms can apply later. If nobody stops this process, the national identity of multinationals will become even weaker and less relevant, Lazar points out, since they have status to challenge government as "an open class of 'legal equals.'"
In Canada a private lawsuit was filed recently challenging the constitutionality of Chapter 11, since Canada's Constitution states that the government cannot delegate justice to other bodies. The Canadian government, itself embarrassed by the cases against it, expressed doubt that Chapter 11 should be included in the hemispheric agreement, though it appears to be backing away from outright opposition. In US localities, the cases are beginning to stir questions, but lawmakers and jurists are only beginning to learn the implications.
Does George W. Bush understand what he is proposing for the Americas? Did Bill Clinton and Bush the elder understand the fundamental shift in legal foundations buried in NAFTA's fine print? They knew this is what business and finance wanted. As the public learns more, the smoking gun should become a focal point in this year's trade debate, confronting politicians with embarrassing questions about global governance. Who voted to shoot down national sovereignty? Who crowned the corporate investors the new monarchs of public values?
Angry over the Florida debacle, African-Americans may retaliate in 2002.
Remember the term "useful idiots"? Those were the well-meaning leftists who during the cold war couldn't distinguish between the beautiful dream of communism and the murderous reality of Soviet Stalinism. They blinded themselves to tyranny and weakened the democratic left by inviting redbaiting demagogues like Joe McCarthy and Roy Cohn to tar anticommunist socialists and liberals with the same Stalinite brush.
In the case of 28-year-old James Murdoch, chairman and chief executive of Star TV and the scion and possible heir to Rupert's massive media empire, the term "idiot" may be overly generous. Speaking to a Milken Institute gathering in Los Angeles shortly before the Chinese captured a US spy plane and held its crew, the onetime college dropout sang the praises of the Communist oppressors in Beijing in terms that might have made Mao blush. He attacked the global media for its coverage of Chinese human rights abuses, insisting that "destabilizing forces today are very, very dangerous for the Chinese government." He instructed Hong Kong's brave champions of democracy to accept the fact of an "absolutist" government. And he all but endorsed the persecution of what he called the "dangerous" and "apocalyptic" Falun Gong religious movement, which "clearly does not have the success of China at heart." (Some 150 adherents of the group have died in police custody and another 10,000 are currently in prison.)
The reason "idiot" is overly kind is that young Murdoch need only read his own publications to learn the truth about his beloved tyrants. According to the editors of the Murdoch-owned Weekly Standard, "China is the largest and most powerful despotism in the world" and a military threat to the United States, while "Communists, who cannot justify their dictatorial rule except by appeal to 'stability,' must inevitably behave this way: constantly inventing new 'instabilities'--and crushing them."
When I called various journalistic members of the conservative Murdoch fraternity--few of whom are ever at a loss for words--none were available to respond to the comments of young James. Over at Fox News, network president Roger Ailes and talk-show hosts Tony Snow and loudmouth Bill O'Reilly were unavailable. Mum was the word for New York Post editor in chief Ken Chandler as well as for Bob McManus, who edits the paper's editorial page, usually eager to scream at the top of its (metaphorical) lungs at the slightest provocation. Over at the Weekly Standard, editor and publisher William Kristol, executive editor Fred Barnes and senior writer Christopher Caldwell were apparently too busy to return my calls. Opinion editor David Tell was kind enough to point me to the article containing the above quotes but would say nothing about the magazine's proprietors. Senior editor and bestselling swami David Brooks was all charm and no information: "I'm sorry. I'm having some computer problems. At first I thought you were asking me to comment on the son of my employer. Must be some garble."
The issue is not exactly a new one for News Corp. employees. Rupert Murdoch has been the nation's most notorious Communist fellow-traveler for years. In hopes of protecting his considerable investments in China, he has proved willing to kick the BBC off his satellite network, cancel unfavorable books and pay millions to publish unreadable propaganda to curry favor with China's Communist gerontocracy.
Nevertheless, David Tell is correct when he points out that the Standard's editorial independence on the issue speaks for itself--and speaks pretty well. As Michael Kinsley has explained, it's just plain stupid to wait around for Slate "to give Microsoft the skeptical scrutiny it requires as a powerful institution in American society," and so it would be wishful thinking to hope that Standard editors would apply the same nasty epithets they like to trot out for honest liberals to the lying commie-boot-lickers who sign their checks. (Though now might be a good time for the magazine to apologize for the reprehensible slander it published, under Robert Novak's byline, attacking posthumously the good name of I.F. Stone, who denounced Soviet atrocities at considerable personal cost before most of its editors were born and, on his deathbed, defended the democratic dissidents in Tiananmen Square.)
Writing on his vanity website, Andrew Sullivan tsk-tsks the Standard's refusal to condemn the Murdochs, insisting, "A good test of any magazine's editorial integrity is its ability to criticize its proprietor." By that standard, The Nation should be Sullivan's favorite magazine, but I'll buy him dinner at Le Cirque if he can unearth a New Republic editorial attacking owner Marty Peretz's comically obsessive Jewish xenophobia and anti-Arab racism. And of course one doesn't read much about the dangers of cults that prey on confused young teenagers in the pages of Sun Myung Moon's Washington Times. Even Inside.com, which specializes in Talmudic real-time coverage of exactly the kind of deal its parent company, Powerful Media, recently made with Steven Brill, preferred to see its competitors break the news before publishing David Carr's terrifically Talmudic coverage of it.
When it comes to their owners, most publications find silence to be golden. The problem is not so much with the somewhat defensible hypocrisy of the Weekly Standard editors but with the larger picture it paints of the conservative movement. Whatdoes it mean for the right that its most generous patron openly sides not only with Communist totalitarians but also with the regime that these same conservatives have identified as the number-one security threat to the United States? The Wall Street Journal editorial page has acquitted itself honorably in this regard, publishing a blistering attack on the Murdochs by its deputy editorial features editor, Tunku Varadarajan. But where are the Buckleys and Bennetts of yesteryear? Has the fact that Murdoch shells out salaries for virtually the entire Podhoretz family managed to shut them up as apparently no other force in the universe can? Are the rabbis of redbaiting now stamping Communism kosher for Passover? Why is it so hard to find a good right-wing anti-Communist when you finally need one?
To put it all in a nutshell, come
the month of May Edward Said won't be traveling to Vienna; Susan
Sontag will be traveling to Jerusalem.
It's a backhanded
tribute to his effectiveness as a spokesman for the Palestinian cause
that the attacks on the Palestinian Said have, across the past couple
of years, reached new levels of envenomed absurdity.
latest uproar over Said concerns a trip to Lebanon he made last
summer, in the course of which he and his family took the opportunity
to travel to the recently evacuated "security zone" formerly occupied
by Israeli forces. First they visited the terrible Khiam prison and
torture center, then a deserted border post, abandoned by Israeli
troops and now crowded with festive Lebanese exuberantly throwing
stones at the heavily fortified border.
emulation of his son, Said pitched a stone and was photographed in
the act. You can scarcely blame the man for being stunned at the
consequences. Throw a rock at a border fence, and if you are a
Palestinian called Edward Said you'll be the object of sharply
hostile articles about the infamous stone toss in the New York
Times, face a campaign to be fired from your tenured job at
Columbia University and--this is the latest at time of writing--be
disinvited by the Freud Society and Museum in Vienna from a
longstanding engagement to deliver the annual Freud lecture there in
May. (To its credit, Columbia stands by him and says the calls for
his removal are preposterous and offensive.)
from being an articulate Palestinian, is Said's crime? As he himself
has written, while "I have always advocated resistance to Zionist
occupation, I have never argued for anything but peaceful coexistence
between us and the Jews of Israel once Israel's military repression
and dispossession of Palestinians has stopped." Perhaps that's the
problem. Said makes a reasoned and persuasive case for justice for
Palestinians. He doesn't say that the Jews should be driven into the
sea. These, not the fanatics, are the dangerous folks.
us now contemplate the role of Susan Sontag, another public
intellectual of large reputation. You can pretty much gauge a
writer's political sedateness and respectability in America by the
kind of awards they reap, and it is not unfair to say that the
literary and indeed grant-distributing establishment deems Sontag
safe. Aside from the 2000 National Book Award for her latest novel,
In America, she received in 1990 the liberal imprimatur of a
five-year (and richly endowed) "genius" fellowship from the MacArthur
Foundation, which once contemplated giving just such a fellowship to
Said but retreated after furious protests from one influential Jewish
board member, Saul Bellow.
Now Sontag has been named the
Jerusalem Prize laureate for 2001, twentieth recipient of the
biennial award since its inauguration in 1963. The award, worth
$5,000, along with a scroll issued by the mayor of Jerusalem, is
proclaimedly given to writers whose works reflect the freedom of the
individual in society.
Sontag was selected by a
three-member panel of judges, comprising the Labor Party's Shimon
Peres (now Ariel Sharon's foreign minister) and two Hebrew University
professors, Lena Shiloni and Shimon Sandbank. Peres approvingly cited
Sontag's description of herself: "First she's Jewish, then she's a
writer, then she's American. She lives Israel with emotion and the
world with obligation." When notified of her latest accolade,
Sontag's response was, "I trust you have some idea of how honored and
moved, deeply moved, I am to have been awarded this year's Jerusalem
Prize." Sontag is now scheduled to go to Jerusalem for the May 9
Why dwell on the mostly tarnished currency
of international literary backslapping? I do so to make a couple of
points concerning double standards. American intellectuals can be
nobly strident in protesting the travails of East Timorese, Rwandans,
Central American peasants, Chechens and other beleaguered groups. But
for almost all of them the Palestinians and their troubles have
always been invisible.
It can scarcely be said that Sontag
is a notably political writer. But there was an issue of the 1990s on
which she did raise her voice. Along with her son, David Rieff,
Sontag became a passionate advocate of NATO intervention against
Yugoslavia, or, if you prefer, Serbia. On May 2, 1999, Sontag wrote
an essay in the New York Times Magazine, "Why Are We in
Kosovo?" urgently justifying NATO's intervention. "What if the French
Government began slaughtering large numbers of Corsicans and driving
the rest out of Corsica...or the Italian Government began emptying
out Sicily or Sardinia, creating a million
Sontag cannot be entirely unaware of a
country at the eastern end of the Mediterranean from which at least
750,000 residents have been expelled. She has always been
appreciative of irony. Does she see no irony in the fact that she,
assiduous critic of Slobodan Milosevic, is now planning to travel to
get a prize in Israel, currently led by a man, Ariel Sharon, whose
credentials as a war criminal are robust? Does Sontag see no irony in
getting a prize premised on the recipient's sensitivity to issues of
human freedom, in a society where the freedom of Palestinians is
unrelentingly suppressed? Imagine what bitter words she would have
been ready to hurl at a writer voyaging to the Serb portion of
Sarajevo to receive money and a fulsome scroll from Radovan Karadzic
or Milosevic, praising her commitment to freedom of the
Yet here she is, packing her bags to travel to
a city over which Sharon declares Israel's absolute and eternal
control--in violation of international law--and whose latest turmoils
he personally provoked by insisting on traveling under the protection
of a thousand soldiers to provoke Palestinians in their holy
When the South African writer Nadine Gordimer was
offered the Jerusalem Prize a number of years ago, she declined,
saying she did not care to travel from one apartheid society to
another. But to take that kind of position in the United States would
be a risky course for a prudent intellectual. Said knows he lives in
a glass house, yet he had the admirable effrontery to throw his
In the clash over tax cuts and social programs, much of what progressives need to do is defensive. But it would be a mistake not to float new ideas, too.
In the words of
the old folk song, "When will they ever learn?" David Horowitz,
former radical who these days is in the business of promoting (1)
neoconservatism and (2) David Horowitz (although not necessarily in
that order), has done it again. A few weeks ago he placed an ad in
the Brown Daily Herald denouncing--in deliberately offensive
terms--the idea that black descendants of slaves should be paid
reparations. Instead of ignoring, answering or ridiculing the ad,
Brown student activists denounced the Herald and trashed most
of its 4,000-copy press run, thus giving the demagogic provocateur
undeserved high ground.
As our own Katha Pollitt put it in
a cyberconversation, "Publish it and then attack it, mock it, parody
it, I say. Use it as a springboard for a teach-in, discuss it in
classes.... Shutting down a discussion doesn't change anyone's mind
or introduce any new information--and the views Horowitz expresses
are held in whole or in part by many people. What message do they get
if a paper won't print them? That the real truth is too threatening
to publish. It's always better to promote speech than to silence
people. Force those views out into the open and have a debate. That's
how minds are changed."
As far as advertising policy goes,
we believe that it is the prerogative of the Herald and the
other college papers targeted by Horowitz to accept or to turn down
ads they consider repellent, at their discretion. At The
Nation, however, we start with the presumption that we will
accept advertising even if the views exposed are repugnant to some of
the editors. In fact, we go out of our way to refrain from making a
judgment based on our opinions of the views expressed in an
We are comfortable with this
policy--although it occasionally discomforts some of our
subscribers--because our editors are free to attack the views of our
advertisers and often do; because for the reasons Katha lists above,
we have confidence that our readers are more than capable of
determining for themselves what views to accept or reject; and
because we accept advertising not to further the views of The
Nation but to help pay the costs of publishing.
recognize that other papers can reasonably come to a different
conclusion about which ads go over the line, but in this case our
view is that if a right-wing propagandist like Horowitz is foolish
enough to put his money at our disposal, then it would be foolish for
us to turn it down.
A glance back to 1964 shows that predictions are always wrong and always political--and that the left's possibilities may be greater than they seem.
The arrest in France of James Kopp, the accused assassin of Buffalo obstetrician Barnett Slepian, could not have come at a more awkward time for the Bush Administration. Bush inaugurates himself by blocking aid to international family planning agencies and by nominating antiabortion fanatics to run the Justice Department. Then fugitive Kopp surfaces to remind the American public of where
these bottom-line commitments lead.
In 1994 Bill Clinton's Justice Department initiated a grand jury inquiry into
abortion-clinic violence. But FBI agents grumbled that Justice was
wasting their time, and the grand jury folded its tent in January of
1996 after finding no evidence of a national conspiracy. Five years
later, it's clear that Kopp--accused in three nonfatal shootings in
Canada and the United States in addition to the murder of Dr.
Slepian--had a lot of help, the kind of help for which "conspiracy"
is the operative legal term.
So far, investigators have
arrested two antiabortion felons in Brooklyn--Dennis Malvasi,
convicted of a 1987 clinic bombing in Manhattan, and Loretta Marra,
who blockaded clinics with Kopp. They sent Kopp money and stayed in
touch with him through a Yahoo drop box. The circle is almost
certainly wider--and transnational. For the past year Kopp lived in
Ireland, bunking in hostels and mingling with the fundamentalist
breakaway Catholic sect founded by excommunicated Archbishop Marcel
Lefebvre. Kopp managed to acquire at least two separate Irish
identities and passports for himself and a blank Irish passport and
birth certificates for his New York friends, and someone in Ireland
vouched for his references for an employment agency--all of which
makes it obvious that his was not a solo act. Ireland's right-to-life
leaders deny any connection to the assassin, and it's entirely
possible that his support network was American. In the last
half-decade US antiabortion campaigners have moved on Ireland in a
big way, introducing a militancy previously unknown
Speculation necessarily swirls around the followers
of the Rev. Patrick Mahoney of the Washington-based Christian Defense
Coalition. In March 1999 Mahoney led a brigade of forty Americans to
Dublin, where they occupied the offices of the Irish Family Planning
Association and taught their Irish counterparts all-American
blockade-and-intimidation techniques. Indeed, only a day before
Kopp's arrest, Mahoney was slapped with an Irish court injunction
prohibiting him from further harassing the IFPA. Mahoney had tolerant
words in 1997 after Slepian's shooting, and responded to Kopp's
arrest by warning the Bush Administration not to "harass and
intimidate the pro-life movement."
It can't escape notice
that the Kopp conspiracy began to unravel just as the Court of
Appeals for the Ninth Circuit overturned a jury verdict and
injunction on the Nuremberg Files website, which displays
photos of abortion providers and a list with a strike through the
names of assassinated physicians. On March 28 the Ninth Circuit
unanimously found, in the words of presiding Judge Alex Kozinski,
that if the website's rhetoric "merely encouraged unrelated
terrorists," it is protected by the First Amendment.
Michelman of NARAL called the ruling "a major setback for a woman's
right to choice," and along with Planned Parenthood vowed to pursue
the case to the Supreme Court. To me, Kopp's overdue arrest suggests
a different conclusion. There can be no doubt that the Nuremberg
Files website contributed to a climate of fear--that the website
is the theory and James Kopp's rifle is the practice. Yet the
emerging facts of Kopp's flight make it clear that keeping The
Nuremberg Files off the Internet would not have saved Dr. Slepian
or brought the shooter to justice. The important thing is to
investigate real antichoice gangsterism, real shootings, real escape
routes. The important thing is to insist on the continuity between
Kopp and the "respectable" antiabortion agenda of the White House.
Bush and Ashcroft have been assiduously working to accomplish by
executive order what Kopp attempted with a gun: diminishing the
availability of abortion and thus undermining a civil right. This,
and the climate of fear generated by clinic violence, must be fought
with politics, not censorship. And the recent rise of police
surveillance aimed at antiglobalization protesters only makes more
clear the danger of prosecuting an inflammatory publication as if it
were the hand that smashed the windowpane or pulled the
Kopp's arrest is full of ironies. The most
antichoice Attorney General in US history is now stuck prosecuting an
antichoice assassin; an Administration wild about the death penalty
must forgo capital punishment to secure Kopp's extradition because
France opposes it. It would be a final, and tragic, irony if
prochoice advocates permit antiabortion thugs like Mahoney to play
the martyr--drawing attention away from the very violence they have
While most of the 1,500 people who traveled to Albany from all over New York
State last Tuesday endured freezing winds outside the legislature to tell
stories of families torn apart and chant s
When the FDA recently released its proposed new rules regarding
genetically engineered foods Greenpeace and the Center for Food
Safety didn't like the taste.
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