Services trade pact locks out democracy

tisa-parties

The Obama administration is engaged in secret negotiations of new trade agreements that would limit the power of national governments to control international corporations.

The proposed Trans-Pacific Trade Agreement (TPP) is one; the proposed Trans-Atlantic Free Trade Agreement (TAFTA) is another.   Less well-known is the proposed Trade In Services Agreement (TISA), which is being negotiated among 50 countries, including the United States.

If the President were trying to negotiate agreements for control of global climate change, or nuclear disarmament, or standards for protecting labor and the environment, I would support him.  Even in these cases, though, I would not favor “fast track” procedures which force an up or down vote without full debate.

But, thanks to disclosures by Wikileaks of the financial services portion of the proposed agreement, we know that TISA would limit the powers of government concerning:

  • limits on the size of financial institutions too big to fail;
  • restrictions on activities, e.g., deposit taking banks that also trade on their own account;
  • requiring foreign investment through subsidiaries regulated by the host rather than branches regulated from their parent state;
  • requiring that financial data is held onshore;
  • limits on funds transfers for cross-border transactions e-finance; authorisation of cross-border providers;
  • state monopolies on pension funds or disaster insurance;
  • disclosure requirements on offshore operations in tax havens;
  • certain transactions must be conducted through public exchanges, rather than invisible over-the counter operations;
  • approval for sale of ‘innovative’ potentially toxic financial products;
  • regulation of credit rating agencies or financial advisers;
  • controls on hot money inflows and outflows of capital;
  • requirements that a majority of directors are locally domiciled;
  • authorization and regulation of hedge funds; etc.

via Jane Kelsey, University of Auckland.

In other words, TISA would handcuff governments in doing precisely those things that are needed to prevent the next financial crash.

And that’s just the financial services part.  Among the other topics of negotiation are telecommunications and e-commerce, domestic regulation and transparency, professional services, maritime services and international movement of people, and this may not be a complete list.

TISA is a bad idea for many reasons.

Democracy is eroded when decision-making about important sectors such as financial services including banking, accounting, insurance, etc., retail, shipping, telecommunications, transportation, and tourism, is transferred from citizens, local oversight boards, and municipal/county/provincial/state jurisdiction to unaccountable “trade” negotiators to further curtail regulation and prioritize corporate profits.

One need only to reflect on the recent impact that the deregulation of the financial sector had on spreading the negative impacts of the economic crises around the entire world, and the ongoing negative impacts being suffered in terms of unemployment and austerity, to realize that robust financial sector re-regulation is absolutely essential to forestalling another economic crisis, just to give one example.

free-tradeDevelopment is jeopardized when essential services such as health care, water and energy provision, postal distribution, education, public transportation, sanitation, and others are left to be taken over by foreign corporations to make profits rather than be provided at the service of the citizens of the home country.

Examples abound of states having privatized what were previously public services, and bringing in foreign corporations to take over the privatized services, only to find that the private corporation soon begins to charge increased prices for decreased services, and leaves both consumers and the government worse off.

The TISA would not contain provisions that foreign investment in services sectors should only be undertaken in a way that the benefits the public interest, or when there is a specific public plan including regarding ensuring accountability of private corporations to the development goals of the population.

The proposed TISA will be constructed instead to give “rights to profit-making” to foreign corporations.

Consequently, due to increased competition, employment and labor rights could also be seriously undermined.

Foreign investors would be granted protections through the TISA against what they deem to be trade-restrictive regulations even if these regulations were designed to protect the environment, health, safety, financial stability and the public interest.

Corporations may even become able to defend these “rights” to profit by directly suing their host country, if the proposal to include the nefarious Investor-State Dispute Settlement (ISDS) mechanism which allows foreign corporations to sue sovereign governments in an elite, secretive, three-person court, in which countries sometimes avoid losing but can never win becomes enshrined the proposed TISA.

via Our World Is Not For Sale.

The tenacity with which the President is pushing these secret negotiations shows where his true priorities lie.

LINKS

Wikileaks Exposes Destructive Financial Services Pact by Yves Smith for Naked Capitalism.

Why International “Trade in Services Agreement” (TISA) Is Dangerous to Democracy, Development and the Public Interest and Must Be Stopped! by Our World Is Not For Sale.

Analysis Article – Secret Trades in Services Agreement (TISA) – Financial Services Annex by Jane Kelsey, faculty of law, University of Auckland, New Zealand.

Many people, myself included, have referred to the Trans-Pacific Partnership Agreement as NAFTA on steroids.   The Trade in Services Agreement is TPP on steroids.

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One Response to “Services trade pact locks out democracy”

  1. thetinfoilhatsociety Says:

    This is exactly what the elites want. They don’t CARE about you, or I, or anyone we know. They care about themselves. And their money. That’s all. This is part of what the big push for disarming American citizens is about, I am utterly convinced. Whether you think certain gun carrying citizens is ridiculous or not, the fact that we have a right to carry scares the crap out of these elites. They WANT us disarmed so that they and their minions have the clear advantage, and can press that advantage without worrying about blowback.

    Like

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