CAFTA may come to the House floor for a vote soon, having already passed the Senate (with significant Democratic support.) One of the most dangerous provisions of CAFTA expands on the rights given corporations in the NAFTA treaty to sue foreign governments over laws that they consider restraint of trade. Spelled out in Chapter 11 of the treaty, these provisions have been used to attack a wide variety of laws.
The California-based Metalclad company successfully challenged the denial of a construction permit by a Mexican municipality for the building of a toxic waste facility despite the prresence of an ecological preserve outside the dump;
Environmental and health bans of suspected toxins have been challenged, with one case already resulting in reversal of a Canadian government ban on the gasoline additive MMT;
Canada’s implementation of two international environmental agreements has been successfully challenged, and Canada will soon be ordered to pay damages to U.S. investors in both cases;
Foreign corporations have taken two lawsuits they lost in U.S. domestic courts to be “reheard” in the NAFTA investor-to-state system, one challenging the concept of sovereign immunity regarding a contract dispute with the City of Boston and the other challenging the rules of civil procedure, the jury system and a damage award in a Mississippi state court contract case;
The American company, United Parcel Service (UPS), has filed a suit challenging the governmental provision of parcel and courier services by the Canadian postal service;
A Canadian steel fabrication company challenged a federal “Buy America” law for highway construction projects in the U.S.
Perhaps the most perverse case is that of Glamis Gold, a company based out of Reno, Nevada. Its mining projects in Honduras and Guatemala have produced extensive pollution, while the mines’ tremendous need for water has dried up rivers and ruined farmlands for the local indigenous populations. In order to take advantage of NAFTA’s chapter 11, Glamis officially incorporated in Canada, even though its presence there is little more than a post office box. Then, as a “Canadian” corporation, Glamis sued California over that state’s regulation requiring backfilling and restoration of open pit mines that would damage Native American sacred sites. The case is still pending.
CAFTA’s Chapter 10 provisions expand on those in NAFTA’s chapter 11, providing foreign investors operating within the United States property rights that extend beyond U.S. Constitutional dictates and permit foreign investors to sue the U.S. government in international tribunals to obtain compensation for policies that undermine these new rights.
It’s time to realize that the corporate economy is now an international entity that has no loyalty to the U.S. Treaties like NAFTA and CAFTA are little more than tools for internatonal capital to override national sovereignty; and the poltical class–particularly the Bush administration–are following policies that damage and diminish national sovereignty to the benefit of international capital.
Perhaps it is no coincidence that the only “winner” to come out of the Iraq war has been Haliburton.