Re: FW/fw-l Book Review of Multilateral Agreement on Investmentfwd
Ed, You undoubtly saw the posting on Linda McQuaig's article re: the Tobin tax if you missed it in The Toronto Star March 22. As I understand it, the argument goes that "by scooping a tiny percentage of the enormous sums traded daily on foreign exchanges, the Tobin tax could help reduce the volatility in world currencies and collect billions of dollars for good causes". Ontelevision and elsewhere on paper McQuaig is among those who believe that the rapid exchange of money across currencies tends to destabilize national currencies, making it hard for countries to conduct international trade. This, it has been argued, is also one of the major factors that contributedto the Asian money crisis. Rose Dyson On Mon, 6 Apr 1998, Ed Weick wrote: Hi Ed, a few months ago you and I had an exchange following a posting of my book review on the MAI. What are your thoughts on the matter these days? You are probably aware that the City of Waterloo has passed a resolution calling more a halt on negotations and further public disussion. Rose Dyson Hello Rose, From all I've read recently, the MAI - at least in its present incarnation - is dead. There are many reasons for this: The OECD was not the right organization to put it together; countries wanted too many exceptions to it; the process of negotiation was not "transparent" enough; and it raised a lot of grass-roots opposition from people who felt that the autonomy of their governments would be undermined. In a variety of posting to several different lists - often at the risk of being drawn and quartered - I've said that I didn't see too much wrong with the MAI. I argued that, given the enormous importance and growing scale of international investment, a common set of rules applying equally to all signatories, was a good idea. I still think it's a good idea. If a MAI had been in place during the past decade, the Asian meltdown might not have happened, and would almost certainly not have been as severe as it now appears to be (provided, of course, that the Tigers were signatories). In my mind, we need rules for something as big as international capital flows. The question then is, who will set those rules? Will they be imposed by the banks of big creditor nations on small debtors? Will they be imposed in a typical one-size-fits-all manner by the IMF following each crisis? Or will they be established by international negotiation and national ratification, as was supposed to have happened in the case of the MAI? The latter approach, while not perfect, appears preferable to me. I'm copying this to the Futurework list. Someone on the list may still want to tell me of the error of my ways. Best regards, Ed Weick
Re: FW/fw-l Book Review of Multilateral Agreement on Investmentfwd
Ed, You undoubtly saw the posting on Linda McQuaig's article re: the Tobin tax if you missed it in The Toronto Star March 22. As I understand it, the argument goes that "by scooping a tiny percentage of the enormous sums traded daily on foreign exchanges, the Tobin tax could help reduce the volatility in world currencies and collect billions of dollars for good causes". Ontelevision and elsewhere on paper McQuaig is among those who believe that the rapid exchange of money across currencies tends to destabilize national currencies, making it hard for countries to conduct international trade. This, it has been argued, is also one of the major factors that contributedto the Asian money crisis. Rose Dyson Rose, I'm aware of Tobin tax proposals, though I did miss the McQuaig article. I have a lot of respect for Linda McQuaig as a journalist, not an economist. I agree that the rapid flight of capital may have been a factor in the Asian crisis, but would argue that it was an effect, not a cause. When capital perceives itself to be in trouble in any country, it does what it can to get out, and these days it can get out fast. From what I've read, the problem with the Tiger economies was the widespread overinflation of property and productive asset values combined with an overcrowding of the foreign markets for the goods which those countries produced. Relying on export lead economics and easily available credit, the Tigers had grown very rapidly, but in the process far too many bad investments were made. From what I've read, it wasn't foreign capital that moved out first, it was capital invested by wealthy nationals, who were in the best position to see what was coming. I believe that a MAI could have gone some distance toward preventing the Asian crisis because the same rules would have applied to both national and foreign investors. This would have made it more difficult for favouritism, cronieism and corruption to flourish. Ed Weick
Re: FW/fw-l Book Review of Multilateral Agreement on Investmentfwd
Hi Ed, a few months ago you and I had an exchange following a posting of my book review on the MAI. What are your thoughts on the matter these days? You are probably aware that the City of Waterloo has passed a resolution calling more a halt on negotations and further public disussion. Rose Dyson Hello Rose, From all I've read recently, the MAI - at least in its present incarnation - is dead. There are many reasons for this: The OECD was not the right organization to put it together; countries wanted too many exceptions to it; the process of negotiation was not "transparent" enough; and it raised a lot of grass-roots opposition from people who felt that the autonomy of their governments would be undermined. In a variety of posting to several different lists - often at the risk of being drawn and quartered - I've said that I didn't see too much wrong with the MAI. I argued that, given the enormous importance and growing scale of international investment, a common set of rules applying equally to all signatories, was a good idea. I still think it's a good idea. If a MAI had been in place during the past decade, the Asian meltdown might not have happened, and would almost certainly not have been as severe as it now appears to be (provided, of course, that the Tigers were signatories). In my mind, we need rules for something as big as international capital flows. The question then is, who will set those rules? Will they be imposed by the banks of big creditor nations on small debtors? Will they be imposed in a typical one-size-fits-all manner by the IMF following each crisis? Or will they be established by international negotiation and national ratification, as was supposed to have happened in the case of the MAI? The latter approach, while not perfect, appears preferable to me. I'm copying this to the Futurework list. Someone on the list may still want to tell me of the error of my ways. Best regards, Ed Weick
Re: FW/fw-l Book Review of Multilateral Agreement on Investmentfwd
Hi Ed, Thanks for your detailed response to my book review. I cannot take the time now to respond to all the valid and important points you make but here are a few thoughts.(I'm in book writing mode and must get back to meet a deadline) To me and many others, the mere fact that foreign investors will be treated the same as domestic companies by a country under the provisions of the MAI is a clear and obvious problem. Barlow and Clarke point out in their book - a view I share - that there is a need for some kind of an agreement to regulate international flows of capital but there must be adequate provision for the protection for social programs, health, education, culture, labour, the environment etc. That is why it is so important to resurrect and focus attention on existing UN Convenants and Declarations such as the one on the rights and duties of states. The MAI as it is currently drafted is not compatible with the provisions of the latter yet many of the same countries are signatories. Surely that is an obvious problem if we believe there is a role for the UN at all in international affairs. Are we to, instead, put all our trust and confidence into the WTO? We are all, I think, well aware that many transnational agreements are already in place or being negotiated but frequently in ways that do not live up to their original promise. Some how enforcement of rules and regulations either domestically or internationally always seems to take a back seat to economic considerations. For a glaring example one has only to look at the headline in the Arts section of the Globe and Mail today. The ratings for the Howard Stern radio talk show is deemed of paramount importance. The fact that it has been found in violation of the industry run code of ethics (conduct) set out in the Canadian Broadcast Standards Council appears irrelevant. In desparation (I hope) Gary Slaight of Standard Broadcasting said that if Stern isn't off the air in 6 mo.s he is going to bring the Stern show into the Ottawa region. I understand his frustration with both the CBSC and the CRTC who are doing nothing but collecting their salaries (Francoise Bertrand at our personal taxpaying expense) while allowing business to continue as usual and violation of existing agreements in order to pave the way for corporate greed, both domestic and international. Since writing and posting the book review I've obtained and read the sub-committee report on the MAI tabled in the House of Commons by the Standing Committee on Foreign Investment and Trade chaired by Bill Graham in December, 1997. It's a good update on where we are at in Ottaw on this issue. Access to it is already on the Internet, posted this a.m. by Bob Olsen. [EMAIL PROTECTED] Rose Dyson
FW/fw-l Book Review of Multilateral Agreement on Investmentfwd
Date: Thu, 1 Jan 1998 16:37:59 -0500 From: Eric Fawcett [EMAIL PROTECTED] To: s4p all lists [EMAIL PROTECTED], [EMAIL PROTECTED], [EMAIL PROTECTED], [EMAIL PROTECTED] Subject: Book Review of "Multilateral Agreement on Investment" MIME-Version: 1.0 Sender: [EMAIL PROTECTED] Precedence: bulk Content-Type: TEXT/PLAIN; CHARSET=US-ASCII Content-ID: [EMAIL PROTECTED] From: Rose Dyson [EMAIL PROTECTED] Book Review of MAI THE MULTILATERAL AGREEMENT ON INVESTMENT AND THE THREAT TO CANADIAN SOVEREIGNTY by Tony Clarke and Maude Barlow (Stoddart 1997, 206 pages, $19.95) Corporate invasion into the lives of ordinary people is nothing new but the incredible pace at which it is accelerating is clearly illustrated in this probing analysis of the latest and most wide sweeping of global investment treaties ever contemplated. Written by Tony Clarke, director of the Polaris Institute of Canada and chair of the committee on corporations for the International Forum on Globalization and Maude Barlow, national volunteer chair of the Council of Canadians, it is required reading for everyone committed to the preservation of our basic freedoms and fundamental rights. The Multilateral Agreement on Investment was drafted by the 29 industrial countries of the Organization for Economic Co-operation and Development (OECD) for the purpose of establishing rules for all global investors. Approval in principle is expected in May, 1998. Few ordinary Canadians, Europeans, Americans or other citizens of the global community who will be drastically affected by it are even aware of its existence. What it amounts to is a global charter of rights for transnational corporations with Canadian government officials among its most ardent promoters. The book is a tool for public education on how this Agreement is a systematic attack on democratic governments at all levels - national, provincial and municipal. For the first time in history, corporations will be granted equal legal standing with nation states along with access to domestic courts. They will be able to challenge any legislation such as labour laws, copyright protection, environmental regulations, Canadian content rules - literally anything that would be seen to be contrary to the interests of foreign investment. Barlow is no stranger to the pernicious spread of corporate rule. She helped to spearhead citizen opposition to the U.S./Canada Free Trade Agreement, followed by the North American Free Trade Agreement (NAFTA). Having closely monitored both the promises that preceded these agreements and the dismal outcomes which followed, she is in a unique position to, once again, help mobilize Canadian opposition to this assault on our economic, human and democratic rights. The authors give us a brief historical review of events leading up to the birth of the MAI. Since World War II, several United Nations Human Rights Covenants, Declarations and Conventions have been adopted, such as the one on the Rights of the Child in 1990. All of these have contributed to Canada's social programs and transformation into a "social" nation state with a regulatory framework to protect our resources, culture and social programs. Other developing nations have followed suit. Parallel to this process, Clarke and Barlow explain, additional trends were launched by the financial elites of the world involving economic globalization with a different vision for humanity. These began in 1944 with the Bretton Wood institutions. Plans for post war recovery which gave rise to the World Bank and the International Monetary Fund, apart from stated goals for alleviation of poverty, included an underlying mandate for expansion and integration of a global financial system and market mirrored on the U.S. economic model. In the 1970's pressure from developing nations resulted in a Code of Conduct enshrined in the United Nations Charter of Economic Rights and Duties of States which gave member nations the "inalienable right" to regulate and exercise authority over foreign investment. Conversely, at about the same time a global forum for CEOs called the "Trilateral Commission", now known as the "Washington Consensus", met to discuss what records show was referred to as "an excess of democracy". Since then, the collapse of communism has fuelled the ideology that puts the needs of capital and transnational corporations ahead of the needs and rights of nation states and their citizens. Chilling statistics in the book, gathered by the United Nations, underscore the urgency of the problem. Twenty years ago there were 7,000 transnational corporations in the world. Today there are more than 40,000. The top 200 have annual sales which are larger than the combined economies of 182 of the 191 countries in the world. Up until 1983, according to Canadian University Services Overseas (CUSO), the amount of capital
