Skip to comments.NAFTA Chapter 11 alarming
Posted on 06/20/2002 7:08:50 PM PDT by RFP
THE North American Free Trade Agreement has not helped US workers to the degree that its promoters, including former President Clinton, promised. Now, President Bush wants to expand the 1993 treaty to include 31 more Latin America countries. Currently, NAFTA includes only Canada, Mexico and the United States.
While changes are being considered, we hope Congress repairs some odious parts of NAFTA. The place to start is Chapter 11, a section of the 555-page agreement that lets corporations seek billions of taxpayer dollars - in secret.
Multinational corporations are using NAFTAs Chapter 11 "to claim compensation for unrealized profits," Bill Moyers said in a special public television broadcast. The chapter lets firms sue governments whenever laws or public policies reduce their profits.
Methanex, a Canadian company, is the worlds largest producer of an ingredient in methyl tertiary butyl ether, an additive that makes gasoline burn cleaner and reduces air pollution. MTBE also causes cancer. By 1995, it had polluted Lake Tahoe, Shasta Lake, 30 public water systems and 10,000 groundwater sites in California.
In 1999, California Gov. Gray Davis banned gasoline with MTBE. A few months later, Methanex invoked Chapter 11, demanding either that Californias ban be lifted or that US taxpayers give the company $970 million in economic damages.
No elected or appointed judges will decide the Methanex case. No citizen will be allowed to hear arguments. Everything will be done in secret before a three-member NAFTA tribunal. Methanex and the government of California will choose the judges from a pool of international lawyers.
Moyers says creation of Chapter 11 was "an end-run around the US Constitution. The terms were influenced by Washington lawyers and lobbyists - and the companies who employ them." NAFTA sets no caps on damages a private company can collect. If California loses, it cant appeal to any American court.
Consider these other cases:
The Loewen Group, a Canadian funeral conglomerate, wants the US government to pay $725 million in damages because a Mississippi jury harbored 'anti-Canadian biases' when it found Loewen guilty of contract fraud in a dispute with locally owned funeral homes. Metalclad, a California company, won $15.6 million from the Mexican government after San Luis Potosi residents barred the company from dumping toxic waste in their town. Metalclad is now building its poisonous dump. A NAFTA tribunal decided US border officials have no right to block Mexican trucks from crossing the border, even though Mexico has much lower safety standards. Whats next? Can Grupo Modelo sue US trucking companies if they pay union truck drivers decent wages to deliver Corona beer, thus increasing retail prices?
The stakes are high. Working behind closed doors, a handful of corporate lawyers undermined the Constitution. At the time, no one else realized it.
Sen. John Kerry, D-Mass., wants to amend the treaty. "NAFTA was never intended to infringe on US sovereignty in such a way," he said.
Kerry is right. Members of Congress should reform NAFTA so it cant be used to bleed hundreds of millions of dollars from taxpayers.
Completely untrue. That was what was exactly intended. Kerry wasn't listening.
| In 1999, California Gov. Gray Davis banned gasoline with MTBE. A few months later, Methanex invoked Chapter 11, demanding either that California's ban be lifted or that US taxpayers give the company $970 million in economic damages.
It is probably true that governments, and their taxpayers, ought to get whacked when they jerk around private companies the way they did with MTBE. I don't know what a scale plant costs to produce that stuff, but I'm sure it's in the tens of millions of dollars. When "the people" (read: the legislature) wanted this stuff added to the gasoline, private investors were there to build plants to make it. Now, a few years later, "the people" want to say, "Oops, never mind"? That is not real cool.
That said, a NAFTA proceeding is absolutely the worst way to handle such a situation. No U.S. company can use NAFTA courts to seek damages for any MTBE plants they built. Why should foreign-owned and situated companies have an advantage?
We do the awful sin of profiling our neighbors to the South because we don't like the way they trash up the laundromat or resent their use of their native language to vilify us without us being able to understand the insults. In short, we are awful people and if we just let the Feds put a ring in our nose and lead us to Utopia everything will be alright, by golly.
You couldn't be more wrong.
"The people" did NOT want "this stuff" added to our gasoline..."The people" were there at the Capitol (as was I) protesting the MTBE additive BEFORE it was rammed down our throats, but REPUBLICAN GOVERNOR PETE WILSON went against the will of the people and in favor of the oil companies and your so called "private investors" (no surprise there) and put it in our gas anyway.
Not sure it was entirely the legislature, Nick. IIRC, California was under Federal pressure via the AQMD to get oxygenates into the gasoline to reduce the amount of carbon monoxide produced. MTBE was the big cure-all.
Then it was found in our groundwater up and down the state, and it turns out to be a nasty carcinogen. We got hosed by the clean air nazis, and we have a law (Proposition 65) that says we've got to get the MTBE out of the water.
Hard to do if it's still in the gasoline.
HAHAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAH! All your jobs are belong to us!
Its too bad they didn't give the American worker the same privilege. We sure lost alot of profits!
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