Wednesday, June 10, 2015

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- The Ottawa Citizen rightly slams Stephen Harper for failing to take climate change and energy policy seriously, while Mel Hurting points out Harper's general economic failures in relying on dirty resource extraction rather than trying to build a cleaner and stronger economy. And PressProgress exposes the Cons' laughable claim to have done anything at all to move toward renewable and sustainable energy.

- Peter Mazereeuw follows up on the work of Canadians for Tax Fairness in documenting tax evasion and calling for a crackdown on tax havens.

- David Dayen traces the history of corporate trade agreements in the U.S., including the role of the Office of the United States Trade Representative in placing short-term business interests over all other policy priorities. Michael Geist reminds us why we should be wary of the Trans-Pacific Partnership. And Claire Provost and Matt Kennard explore the history - and increasing danger - of investor-state dispute settlement, while pointing out that a willingness to sell out to corporate interests seems to have little effect on actual trade and investment:
Investors have used this system not only to sue for compensation for alleged expropriation of land and factories, but also over a huge range of government measures, including environmental and social regulations, which they say infringe on their rights. Multinationals have sued to recover money they have already invested, but also for alleged lost profits and “expected future profits”. The number of suits filed against countries at the ICSID is now around 500 – and that figure is growing at an average rate of one case a week. The sums awarded in damages are so vast that investment funds have taken notice: corporations’ claims against states are now seen as assets that can be invested in or used as leverage to secure multimillion-dollar loans. Increasingly, companies are using the threat of a lawsuit at the ICSID to exert pressure on governments not to challenge investors’ actions.

“I had absolutely no idea this was coming,” Parada said. Sitting in a glass-walled meeting room in his offices, at the law firm Foley Hoag, he paused, searching for the right word to describe what has happened in his field. “Rogue,” he decided, finally. “I think the investor-state arbitration system was created with good intentions, but in practice it has gone completely rogue.”

Other countries have already decided to cut their losses, and tried to get out of these trade treaties. Shortly after settling the lawsuit with foreign mining companies over its new post-apartheid mining rules, South Africa began to terminate many of its own investment agreements.

“What was concerning for us was that you could have an international arbitration – three individuals, making a decision – on what was in effect a legislative programme in South Africa that had been arrived at democratically, and that somehow this arbitration panel could potentially call this into question,” said Xavier Carim, a former deputy director-general in South Africa’s Department of Trade and Industry. “It was very, very clear that these treaties are open to such wide interpretations by panels, or by investors looking to challenge any government measure, with the possibility of a significant payout at the end of the day,” said Carim, who is now South Africa’s representative to the World Trade Organisation in Geneva. “The simple fact is that these treaties give you very little benefit and they just pose risk.”

Before moving to terminate its agreements, the South African government commissioned an internal study to help determine whether such treaties actually did help boost foreign investment. “There was no pattern between signing treaties and getting investment,” Carim explained. “We’ve had huge investments from the US and Japan and India and a number of other countries where we don’t have investment treaties. Companies don’t come and invest in a country or not because it does or doesn’t have a bilateral investment treaty. They invest if there is a return to be made.”

Brazil has never signed up to this system – it has not entered into a single treaty with these investor-state dispute provisions – and yet it has had no trouble attracting foreign investment.

Parada said it would take “a broad consensus of determined states” in order to truly rein in this system. “The states that created the system are the only ones that can fix it,” he said. “I have not seen a critical mass of states with the political will [to do this] … much less a broad consensus. But I still hope it happens.”
- Keith Leslie reports that Canada's provincial health ministers are increasingly calling for a national pharmacare plan - meaning that we're lacking only federal leadership to put one in place. And the Star argues that it's long past time to make pharmacare a reality.

- Finally, Robyn Benson is optimistic that there are winds of change set to clear the air for Canadians.

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