An Eight-Ton Gorilla Called MAI

By William Lucy

Still another report finds that the income gap between the rich and everybody else continues to grow. While Bill Gates of Microsoft is making about $100 a second (that’s right, $100 a second); while Michael Eisner of Disney just cleared $565 million on stock options; while corporations report record profits; the family paycheck continues to limp along, barely staying ahead of inflation. Why is this? What’s causing this growing gap between the few on top and the many who do the work? Simply put, Sisters and Brothers, we are being had.

In my last column I described the growing clout of Corporate America and particularly its plan to extend the North American Free Trade Agreement (NAFTA). When voters got a smell of what that deal meant they raised such a stink that President Clinton tabled his "Fast Track" proposal for the time being. But when Big Money gets out of control, you can’t turn your back for a minute.

Now we learn that the people who control most of the world’s money have dreamed up another scheme, and this one makes NAFTA look like a pussycat. It’s called the Multilateral Agreement on Investment (MAI), and for almost three years the State Department has been leading a secret effort to negotiate an MAI treaty among the 29 richest nations.

The deal would give the fat cats of the world a free hand to do just about anything they want — and anywhere, including your own back yard. Multinational corporations and financial institutions could buy, sell, locate or move anywhere — without control or regulation by national, state or local governments.

As in NAFTA, the protections for workers and the environment are little better than non-existent, and there’s no way to enforce even these.

But the attack on the authority of state governments is truly breathtaking. The treaty would forbid state (and national) governments from "discriminating" against foreign investors. Here’s what that means:

• States could not restrict the ownership or sale of real estate, the use of public lands, and licenses based on residency or citizenship. Foreign corporations could acquire water rights or operate casinos or fish commercially anytime, anywhere.
• States could not limit or control the sale of public lands or use of public resources. This opens the door to foreign corporations mining, cutting timber, drilling for oil, or using water rights on state (public) lands.
• States could not set aside coastal areas, wetlands, or any other lands to protect natural resources or the environment against developers.
• States could not require corporations to reclaim lands they have strip-mined or polluted. States would be restricted in offering incentives against pollution, for employment, and for recycling.
• States would be severely limited in "economic development" and wouldn’t be able to offer tax breaks or other incentives for job creation, for industrial development, job training, enterprise zones, or small business.
• States could not require "buy domestic" programs or small business set-asides, nor could they launch boycotts of products from tyrant regimes such as in Burma and apartheid South Africa. Foreign corporations would be free to join in the rush to privatize public services.
• States could not enact or encourage "living wage" laws.

Under the treaty, foreign investors could consider any of these actions discriminatory and would be able to seek monetary damages for past and future losses. They could even bypass U.S. courts and take their complaint to an international trade panel which would have the power to override state law.

The effects of all this on public-sector employment and state governance — the effects on budgets, taxation, control of land use, environmental protections, workers’ rights — would be disastrous.

This all sounds so bad that you may find it hard to believe, but you’d better believe it. The White House supports the Multilateral Agreement on Investment. So does Big Business. If the Senate agrees, the only losers will be government of the people — and the people themselves.