The Multilateral Agreement on Investments (MAI):
A New Way to Rob Your Piggybank
By Brian Hammer
On 27-28 April the 29 members of the Organization for Economic Cooperation
and Development were to meet in Geneva, Switzerland for what will prove to
be the second significant expansion of free market rights since the
breakup of the Soviet Union. This meeting has been postponed because of
negotiation obstacles, but it is still expected that the agreement that
was to be discussed will eventually be signed with most of its main
The first free market expansion established the World Trade Organization
in 1994 as a supranational forum for the resolution of trade disputes.
Some say the WTO is the first step in the creation of a world government
that enshrines the property rights of big corporations and wealthy
investors at the expense of the general population and environment.
With the expected signing of the Multilateral Agreement on Investments,
enormously expanded rights could be given to investors, including the
second department in a world government - a court in which only they can
bring lawsuits. The extent of this expansion is still under negotiation,
MAI critics oppose the MAI on a variety of grounds, the main one being
that any economic regime should give rights to all people, not (only) the
small class of investors and large corporations. One percent of
enterprises already account for fifty percent of foreign direct
investment, and two thirds of trade is amongst multinationals, and yet
they want expanded powers and even greater capital mobility via the MAI.
People in all developed countries have been indoctrinated to believe
private investors, including financial groups and corporations, are the
mainstay of the economy. So why would a treaty that expands their rights
This paper first presents a brief summary of what the MAI will do, the
OECD¹s reasons in support of the MAI, opponents¹ criticisms of it, and
alternative proposals to the MAI (at least the ones that could be
discovered by the author). Understanding the MAI will in turn show in
greater detail how the modern economic system works (and fails to work).
[The editor regrets that because of space limitations, some points in each
category had to be excluded here.]
The paper then evaluates some of these same anti-MAI proposals. Part
the problem with many anti-MAI alternatives is that they want to keep
investment rules at more or less the same level they are now prior to
signing the MAI - without seeing the injustice perpetuated in those rules
or seeing how self-defeating such compromise proposals will inevitably be.
Other proposals, however, are far-reaching and can serve as rallying
points for activist resistance to the MAI, and capitalism in general, for
its opponents. As living standards decrease, economic conditions worsen,
and consciousness of alternatives expands, this resistance is bound to
It is not hard to agree that the ongoing expansion of free market rights
and its associated worldview is the most serious threat facing humanity,
as well as the environment and other species, today. It affects us
economically, culturally, socially, psychologically and even spiritually,
though the economic sphere, where it has its power base, will be the main
focus here. Not only socialists, but populists, small farmers, women¹s
organizations, labor unions, intellectuals, students and even some
nationalists agree about this threat.
In the end, all choices about the economy are people's choices, and
this, detailed knowledge of the MAI, counterproposals and the rationality
(or lack of it) behind them is a vital necessity. As Herbert Marcuse said
over 30 years ago, "the prevailing mode of freedom is servitude", and "All
liberation depends on the consciousness of servitude...". Understanding
the MAI and its implications will show part of what that means.
WHAT WILL THE MAI DO?
Countries that sign the MAI will be required to:
(1) Denationalization. Open all economic sectors, including production,
services, real property, broadcasting, and natural resources to foreign
(2) National treatment. Treat foreign investors no less favorably than
domestic firms (a non-discrimination principle), which would eliminate
preferential tax, loan and other treatment for small locally oriented
enterprises and suppressed ethnic groups, though there is scope for
foreign investors to be treated more favorably than domestic firms.
(3) Performance requirements. As originally drafted, remove "Performance
Requirements", which are laws that require investors to behave in certain
ways in exchange for market access, such as, for example, requirements to
use local suppliers, take on local partners, hire a minimum number of
local employees, provide a living wage, and observe existing environmental
protection laws. Under pressure PR requirements relating to levels of
employment, production, investment and sales have recently been removed.
(4) Capital mobility. Remove restrictions on the movement of capital,
including restrictions governing the end use of profits, such as
reinvestment, and currency speculation, as well as requirements that
investment be long term and thus stable and sustaining.
(5) Expropriation. Compensate investors in full when their assets are
expropriated, either through seizure, nationalization or "unreasonable"
regulation such as environmental or health regulations and laws aimed at
punishing businesses that operate in brutual regimes like Burma.
(6) Disputes. Accept a dispute resolution process allowing investors to
sue governments for damages before international panels comprised of
narrowly qualified, unelected "trade experts" when investors believe a
local, state/provincial or national government¹s laws violate MAI rules;
ordinary people and elected government representatives are excluded from
ARGUMENTS FOR THE MAI
MAI advocates present a number of defenses for it. The sole purpose of the
MAI can be summed up in one sentence, taken from a minsterial declaration
of the OECD, dated May 26, 1997: "Ministers are convinced of the
importance of international investment and the need for fair, transparent
and predictable rules for investors and investments." That is, the MAI's
purpose and benefits concern the relatively small number of serious
investors only, and have no stated relevance to the needs of the billions
of people in society at large, such as decent and increasing standards of
living, health and safety, education, the environment, or democratic
influence over investment and production decisions. It is an agreement for
people with money, not people who need money. However, MAI supporters
claim that certain advantages will flow to countries that sign the treaty,
1. Competition. Competition will increase.
2. Efficiency. Resources and capital will be allocated more efficiently.
3. Expansion. Economies will expand.
4. Jobs. New jobs will be created, especially in some circumstances
export-oriented jobs that earn foreign exchange.
5. Consumer prices. Consumer prices will drop.
6. Trade. Trade will increase, resulting in more capital mobility.
7. Capital development. There will be a greater inflow of capital and
advanced technology for poorer countries.
8. Market distortions. Regulations such as Performance Requirements, which
often distort market forces, will be eliminated or simplified.
9. Global governance. A supranational legal institution will be
established, which is needed to enforce codes and settle disputes and
replace the current practice of allowing peer pressure and voluntary
compliance to settle disputes surrounding investment; challenges to
non-economic regulations like health and safety codes will be rare, and
focus instead on environmental and other regulations that are said to be
pretexts for protectionism.
10. Level playing field. Investors of every nationality will be assured of
equal treatment where they invest, i.e., "National Treatment" will be
afforded to both domestic and foreign investors.
11. Public policy and democracy. Country-specific reservations and
exceptions (there are over 600 pages of them) allowed by the MAI are said
to be adequate to meet the concerns of critics as to public policy and
CRITICISMS OF THE MAI
Opponents of the MAI are very vocal and firm in their opposition, but not
all opposition stems from the same kinds of reasons. Some want reform of
the MAI, others want total restructuring of the economic system and its
values. The partial list of criticisms below shows both what harms the MAI
will bring about as well as the serious flaws in MAI supporter arguments.
1. Inequality, lowered standards and distribution of wealth.
The MAI will
result in increased inequality, unemployment and bidding down wages and
labor standards as corporations try to relocate to the lowest cost
production sites. Also, there is no explicit mechanism for distribution of
economic gains from the MAI such that everyone benefits and not just
private investors, corporations and their stockholders.
2. Dismantled regulations. Regulatory safeguards for the environment,
worker safety, and consumer rights will be progressively dismantled either
as a direct condition of signing the MAI or as a result of pressure to
attract investors, though some countries support strong binding labor and
environmental protection clauses in the MAI.
3. Governmental policy-making rights. Giving virtually unlimited rights to
private investors will reduce governmental ability to pursue fiscal,
monetary, industrial or planning policies that once assured relatively
stable growth and widely distributed benefits.
4. Performance requirements and corporate/investor obligations. The MAI
will at best contain recommended, not binding, provisions regarding
corporate responsibilities and obligations regarding anti-competitive
practices, treatment of employees, and environmental protection, though
the issue is still undecided.
5. Openness and parties to the negotiations. MAI negotiations are being
conducted in secret, with non-involvement, except for a few token labor
and environmental organisations, of key public sectors at every stage.
Business and investment associations have secured themselves a privileged
role in influencing negotiations and in access to information. In
addition, most countries are excluded from the negotiations, as only the
29 OECD members are participants.
6. Protective clauses. The country-specific reservations and exceptions
that MAI supporters claim will protect various national interests and
regulations will, say MAI opponents, be subject to challenge in MAI
tribunals, and are thus somewhat illusory preservations of what remains of
national sovereignty and its policy-making ability.
7. Level playing field for foreign investors. The National Treatment rule
will allow governments to establish Performance Requirements for domestic
businesses, but not require foreign investors to follow them. So while MAI
proponents claim it will create a "level playing field" for businesses and
investors of all countries, it will in fact create an advantage - we could
even say "bias" - for foreign investors.
8. Incentives for foreign investors. Because a level playing field will
eventually have more or less global reach, countries, especially
developing countries, may feel pressured to offer additional incentives to
stand out from the crowd and attract foreign investment. This could
further reduce labor or environmental etc. standards and any benefits
these foreign investment may offer; there is no binding clause in the MAI
to prevent this downward pressure.
9. Appropriation of assets. Expansion of the practice of compensation for
expropriated assets to include compensation for actions that are said to
be "in effect" expropriation may include compensation for "losses" due to
environmental and other regulations in the public interest.
10. Capital stability. The ban on restrictions and delays in repatriation
of profits and movement of capital can easily destabilize domestic markets
and currencies, as the Mexican and Southeast Asian currency crises have
already proven, though monetary and exchange rate policies may be exempt.
11. Disputes and democracy. The unprecedented right of investors to sue
national governments and seek monetary compensation in an international
tribunal will be biased in favor of corporations and investors. Neither
individuals, communities, social, environmental or labor organisations, or
governments are given the power to countersue corporations. Proponents say
these challenges will be rare, but that is only an assertion and is
begging the question.
12. Security and opportunity. (a)"Roll-back" and (b)"standstill"
provisions if made binding would require governments to (a) eliminate laws
that violate MAI rules and to (b) refrain from passing such laws in the
future, except for country-specific reservations. Such provisions will
provide longterm security and opportunity for investors, but no one else.
In addition, reservations will probably subject to future liberalization
negotiations, though there is a trend now toward inclusion of open-ended
13. Participation of developing countries. Developing countries will in
effect be pressured to sign the MAI in spite of its theoretically
voluntary nature in order to get foreign investment more easily.
14. Capital development. Trade deficits have grown under similar
liberalization agreements in the area of trade in goods and services.
Mobility of capital is no guarantee of a net increase in national or local
capital either, nor is it any guarantee that capital will benefit all
countries, as 70 percent of international investment in developing
countries goes to just 12 countries.
15. Time frame and reconsideration rights. The MAI will require that
countries allow corporations and investors to operate for a minimum of 20
years before they have to leave, even if governments change their
decisions about the wisdom of their initial decision to let them in. This
further isolates investors from democratic processes and can easily bind
nations and peoples to unfair, harmful and impoverishing investor
16. Need for the MAI. If governments establish investment priorities and
conditions, investors and corporations can still decide on the viability
of an investment. Thus, the MAI is said to be unnecessary if traditional
government-private investor practices are retained as the norm.
17. Work and freedom. Because of downward pressure on purchasing power,
many people are forced to work more than before to maintain their living
standards. Impoverished people must work just to stay alive. This binds
people more tightly to work as a necessity and represses their desires for
expansion into other areas. Personal, cultural and spiritual development
suffers as a consequence. The MAI could very well eliminate freedom from
work even more.
Aside from the economic injustice that will become more acute under
MAI, the MAI is, according to some opponents, further evidence that the
economy is being "centrally planned by global mega-corporations" and large
private investors who are in practice becoming a nondemocratic quasi-world
ALTERNATIVE PROPOSALS TO THE MAI
Proposals for what could serve as a just "investment regime" are abundant
and varying. And they range over several viewpoints, which may make a
coherent and unified strategy to modify or replace the MAI, should it ever
be enacted, more difficult. Many of them go beyond simple investment
issues to a fundamental social and economic restructuring. These are the
raw materials out of which this strategy - and a new world - may be
1. Expansion of social insurance. Even though globalization is
rapidly, adequate social insurance policies might counter its negative
welfare effects. This is not a revision of MAI investment rules, but a
proposal for reducing their negative effects.
2. Revising the terms of debate. Given the sharply divergent views over
the merits and demerits of the MAI, there must be public disclosure of the
MAI's terms, public discourse including citizens¹ groups and labor
organisations, consultation, accountability, stay of negotiations for one
year, and social and environmental assessments.
3. Sovereign rights. Sovereign rights over general economic policy,
including conditions, priority sectors and performance requirements for
corporations and investors, should be preserved at the national and
subnational levels of government, leaving investors free to decide on the
feasibility of their investments.
4. Provision for development of local economies. The MAI should take into
account the interests of local economies and community development.
5. Enforcement and adjudication. Enforcement of MAI terms and dispute
settlement authority should be granted to objective panels of experts who
monitor and enforce measures that will meet the environmental and human
rights standards of the host nation or nation of origin of investors,
whichever is higher.
6. Capital flight. The threat of capital flight should be decreased in
accordance with fair labor negotiating principles, which means that
corporations should not use the threat of plant closures and moving
production out of country in labor negotiations.
7. Common property and distributive justice. Commonly owned natural
resources and technology inherited from previous generations should be
held as public trusts and leased out rather than sold to private
interests. The income from these trusts should be distributed fairly to
all residents in a given territory. Some MAI opponents say that renewable
resources such as fisheries and forests should come directly under
democratic community control and management.
8. Environmental law. National environmental protection rights, treaties
and agreements should take legal precedence over trade or investment
9. Nationalism. Assure, like Japan has done, widespread ownership of land
and capital assets by a country's citizens and a strong domestic market
for domestically produced goods, which can serve as a foundation for
export success, as opposed to allowing global rights to investors and
10. Exports, technology and capital development. Export only natural
resources that are surplus to local needs, and invest a portion of the
proceeds into acquiring control of technologies that will reduce
dependence on those resources. An international investment fund could
place these technologies in the public domain.
11. Imports. Control imports so that foreign exchange is not expended for
luxuries and so that imports do not disrupt local small producers.
12. Distribution and ownership of capital. Assets and ownership of capital
should be widely distributed to the "working people who create real
wealth", which can mean an economic structure composed primarily of small
businesses and worker-owned cooperatives.
13. Economy-ecology alignment. Every community should be aligned with a
distinctive local ecology, such that economic development is defined as
increasing a community¹s capacity for economic output, present and future,
implying economic sustainability as well as growth. This will replace
national meaurements as the focal point of economic analysis.
14. Business size. Government must limit the size and growth of businesses
operating locally so that none can dominate the others and so that local
capital is protected from outside predators. Larger transnational
corporations should be dismantled into enterprises serving predominantly
local markets through worker and community buyouts.
15. Automation and freedom. Gains from mechanization and automation should
be converted into a 20-hour workweek so that people can be freed from work
for more meaningful activities.
ANALYSIS OF ANTI-MAI PROPOSALS
A few restraints on and alternative proposals to the MAI are simply
unworkable, many others contain assumptions that themselves need to be
examined. This section looks at what should, if all aspects are
understood, be rejected and what should be adopted. Being against the MAI
has many meanings, not all of which are sound, humane or just.
1. Expansion of social insurance. Because of corporate and capital
mobility, the tax base of many communities that have historically relied
on taxation to protect people from the free market is being steadily if
not drastically eroded. This proposal is thus unrealistic except perhaps
at the national level, but many national governments support globalization
and weakened local controls.
2. Regulation, history and psychology. Most of the anti-MAI proposals
discussed here aim at perpetuating the same form of property ownership
that has led to the creation of the MAI in the first place. Their only
goal is to restrain or modify it, leaving the basic structures and values
intact - a "partial liberalization" strategy.
The danger here is that at any time in the future these restraints can
again be broken asunder. Economic irrationality, injustice and
impoverishment like we are seeing today would then reign again, and a new
battle would again have to be fought.
Why this outlook? The main goal of key advocates of the private property
system of owership - those who benefit most from it - is the accumulation
of wealth for themselves, and their main demand is freedom to pursue this
goal. They are dynamic and aggressive, even ruthless, in defense of their
interests, as we can see from the numerous wars, violence against
movements for workers¹ rights and threats of factory closure that they
have used in the past and use in the present.
Any references to "responsible and accountable business", "maintaining
environmental and labor standards", allowing investors to decide on
"viability", "performance requirements", and, depending on the more
explicit meaning, "preferences to small-scale, local economic activity"
fall within the partial liberalization strategy. So do "public
accountability" and "preserving government policy-making rights" if this
means the accountability of private investors and corporations and an
alliance between the same and governments on any level. If parliaments and
other law-making bodies do reject the MAI in whole or in part they will
inevitably rely on this strategy.
3. Domination and cooperation. The third reason why restraints
investors, and the business class in general, are inadequate goes beyond
history and investor psychology to the structure of the modern economy
itself. Capitalism - as partial liberalization or otherwise - is, in a
nutshell, a system of domination. Except in worker-owned cooperatives, the
relation of employees, no matter how well paid or friendly, to employers
is one of subordination ("bossism"-"employeeism"), not one of coordinated
cooperation. Coercion may be veiled, rather than overt as in political
dictatorships, but it exists nevertheless. To this extent working people
are unfree, even in so-called "free" nations with a democratic form of
Domination is also a characteristic at the investor and firm level of
economy, as corporations grow to engulf small businesses and dominate
Trying to keep businesses small ("populist capitalism") through government
restrictions, as some MAI opponents propose, will still fail to uproot the
logic of domination that characterizes an economy based on private
ownership. Governments would still have to fight the ambitions of private
business owners who do not want to remain small, and their sympathizers
could easily find a place in government. Indeed, the present economic
system itself began with small business.
Constitutional restraints on private business size could help, but they
would not eliminate an economic form that encourages domination. The ethic
of cooperation - the antithesis to domination and competition - requires
its own economic forms. Without an economy providing a living
counterexample to private enterprise, the latter will always win out
simply through being most prevalent. Capitalism is not the antithesis to
the free market and small business, but grows out of them.
What MAI opponents who aim for a redistribution of ownership into small
business hands fail to realize is that the cooperative model of democratic
worker ownership extends the same benefits and virtues of individual
worker-ownership to far more people. Worker ownership is thus superior to
small business ownership alone, and without its drawback as the root of
the private property mentality.
4. Dehumanization. Advocates of the partial liberalization model
recognize that capitalism reduces people economically and thus socially to
the status of commodified labor, whether manual or intellectual, and
commodity consumers, whether well-fed or otherwise. This is little
different in essence from the level of oxen, who can also work if they are
trained and fed.
Higher, human faculties - including the abilities to think, discuss
decide, which are part of being human - are banished from other economic
activities, particularly those involved in ownership and control of
capital. Capitalism is not dehumanizing only because it perpetuates
poverty or lowers living standards.
Capitalism is dehumanizing also because it establishes relatively
artificial distinctions among people based on the superficial criterion of
physical wealth rather than a culture in which genuine human relations,
natural distinctions of personality and all-round ability are allowed to
develop more fully and with due socioeconomic reward.
5. Economic justice. The justifications for basing measures such
restraints on investment on an expectation of "economic justice" are weak.
The poverty and lowered living standards that afflict great masses of
people in every country under liberalization regimes are intuitively wrong
to anyone with a conscience, but historically the private property economy
has never guaranteed increases in the standard of living or freedom from
poverty. To criticize the MAI and the free market economy for failing to
guarantee economic justice is an argument based on false premisses, like
criticizing apples for not being oranges or Christians for not believing
The current failure of center-left and social democratic regimes to
protect welfare benefits in the face of globalization can be traced to
this same ideological defect.
Trade union, center-left and social democratic successes in obtaining
economic justice have come through bargaining, strikes and politics. These
methods are not intrinsic to the economic system itself, and fail so often
that they are an unreliable method of obtaining justice. True economic
justice is planned, not left to contingencies or the arbitrary
trickle-down effects of a free market economy.
Anti-MAI references to inequality, egalitarianism, living wages and
people¹s rights, if given without deeper justification, fall into this
trap. This weakens the stand against the MAI and capitalism in general,
for those who oppose it.
6. Democracy. Several MAI opponents claim that investment agreements
require "due democratic deliberation and openness", including "public
comment and cooperation". Economic policies have of course especially in
this century involved democratic deliberation, at least on the national
level. But, like economic justice, democracy has never been intrinsic to
private investment principles. This lack is now being exposed in the MAI,
as investors try to remove all democratic constraints on their activities.
The internal culture of the private investment, production and service
organization - which is built upon domination of other human beings and
centralized in pursuit of material goals, no matter what its size -
reflects the true, inner value system of this economic system.
7. Nationalism. Many MAI opponents take national boundaries and
national/subnational governments as reference points for public policy
regarding private investment. "Make capital national" is one slogan in
this regard. Nationalism has some merit because it recognizes existing
sovereignty and political structures.
The nation unit is somewhat arbitrary, however. It violates the unity
often the economic self-reliance of ethnic groups that straddle political
boundaries, such as the Kurds, Bengalis, Germans and Inuit; overplays the
importance of political divisions among ethnically and culturally similar
groups like the Scandinavians; and may tolerate and overlook exploitation
and suppression of ethnic groups by other ethnic majorities or minorities,
as is happening in Indonesia, among other places, today.
The anti-MAI nationalist paradigm may also fail to raise consciousness
about or eradicate the problems and inequities of capitalism as a domestic
model, and deny significant local economic freedom in the face of large
national corporations and absentee investors.
8. Need for foreign investment. In concert with MAI advocates,
opponents agree that foreign investment can be useful, especially in
developing nations, as long as it is regulated and raises the local
standard of living. The argument for foreign investment ignores several
factors, including history, however.
Much of the money that returns as foreign capital was previously extracted
from developing countries in the form of raw materials that are sold
cheaply on the commodities markets. These raw materials are then used to
manufacture items that are sold back at relatively high cost to developing
countries. Without being able to sell high value-added products on the
international market due to the loss of unprocessed natural wealth,
developing countries are never able to accumulate enough of the capital
that they need for domestic development. Thus the - contrived - "need" for
foreign investment. If they had been allowed to develop their own natural
resources, developing countries would not need so much foreign investment.
9. Preference to local economy. The more advanced critics of
the MAI want
to restructure the whole economy so that local economies receive
preference, in direct contradiction to the "globalization is good" slogan
being pushed so relentlessly by big private investors and corporations and
their political allies.
Localization, rather than globalization of the economy, will, these
critics argue, bring economic benefits and even control to people
directly, not as the sparse trickle-down effect so condescendingly
promoted by their opponents. Localization can occur through scripting
local benefits into investment regimes or by transferring ownership of
capital directly to enterprises that operate on and serve the local level.
This is an intuitively good goal, but like economic justice, "localization
of the economy" at this point is not much beyond the stage of being a
slogan, with about as little substance. If economic justice had been
justified to mean that people have economic rights, it could serve as a
basis for economic localization, but this nearly all MAI critics have
failed to do.
a. One justification for locally based economy comes from the Sustainable
Development camp. Anti-MAI proposal 13 above states: "Every community
should be aligned with a distinctive local ecology, such that economic
development is defined as increasing a community¹s capacity for growth."
The strength of this proposal comes from a respect for nature as a living
force full of non-human species that are necessary for natural ecosystems,
as well as a need for nature as a finite economic resource that must be
husbanded if it - and we - are to last. These are bio- and geoeconomic
givens, and are easier to observe if an economy is dependent on the local ecology
The weakness of this argument is that it does not give strong
justification for localization of the economy over, for example, national
sustainable development-type regulations that merely curb the private
economy rather than break up its corporate Leviathans into local entities.
b. The more potent justification for localization comes in anti-MAI
proposal 12, "Distribution and ownership of capital". It states that
"Assets and ownership of capital should be widely distributed to the
("working people who create real wealth¹, which can mean an economic
structure composed primarily of small businesses and worker-owned
cooperatives". If this is done, the economy will surely be localized, as
capital, including company stock, factories, offices and equipment will be
decentralized to where people live and work, which is in villages and
towns; finance capital will not be concentrated in a few big centers like
we find today. This would include distribution of farmland and fishing and
Most people, in advanced as well as developing countries, are thoroughly
indoctrinated in the belief that the private enterprise economy is based
on natural rights, if not rights given by God. Mainstream religions
support this belief. This indoctrination is historical and incomplete
however, as capitalists were suppressed by societies in their classical
period, have been resisted since its beginning, and even now find
opponents amongst small farmers, people¹s movements like the Zapatistas,
socialists, populists and those who feel that something is wrong but
cannot articulate it in depth. Therefore, a brief exposure to the
justification for worker ownership of capital is needed.
Aside from automation, the transformation of raw materials, components
information etc. into finished goods and services always requires the work
of people. Without people, nothing would get done and the economy would
stop. Wealth is thus at least in part created by people¹s labor, so it is
only natural that they have a right to at least some of the benefits of
the market - ie, a guaranteed percentage of the profits. One corollary of
this is that workers should have rights of representation on a company¹s
board of directors - if not control over the board - since they have a
claim to company profits also. More explanation is needed, but this is an
introduction to the idea.
Automation is also only the result of human work, not a refutation of
argument that the work of people increases wealth, and so workers should
receive continual benefits from automation also.
Worker ownership based on rights is of course a politically explosive
issue. However, the fight for economic liberation will inevitably involve
some degree of political turmoil, and is the price of progress.
Moreover, until the public consciousness is ready to accept the need
justice of worker ownership as a right, social and political leaders who
have the common good foremost in their minds can promote worker ownership
through setting up worker-owned businesses; providing them financial, tax
and media support; and making their development an object of research.
A number of institutes dedicated to this research already exist, though
they are a drop in the bucket compared to what is needed to establish
worker ownership as a superior socio-economic program. Some countries
provide financial incentives also though the current globalization of the
private economy has made many politicians with limited intellects and herd
instincts ignore worker ownership - if they ever bothered considering it
The capital that is currently exported from sites of production via
mechanism of free movement of capital would in an economy dominated by
worker ownership stay at home where it was made, to be used according to
worker and community dictates. Worker ownership is thus the primary means
of establishing economic localization.This would include the use of and
profits from natural resources like minerals and timber, which currently
are often exported as raw materials that bring little benefit to local
economies because of the low value added, a particularly merciless drain
on the long-suffering Third World. Because natural resources tend to be
vital to a local economy, it would be more appropriate to put them in
local government hands.
Economic measurements that focus on household and community purchasing
power rather than gross domestic product, another anti-MAI proposal, will
help the focus on local economies.
10. Imports, exports and capital development. Limiting exports
resources that are surplus to local needs (anti-MAI proposal 10) is in
effect selling at bargain prices, since unprocessed natural resources
bring in little profit. It is better for capital development to export
only finished consumer commodities - which have higher value added - that
are surplus to local needs, as well as surplus agricultural products.
Investing a portion of the proceeds into acquiring control of technologies
that will reduce dependence on those resources will be necessary or not
depending on the abundance of local natural resources and other factors.
1. Das, Bhagirath Lal. "A Critical Analysis of the Proposed Investment
Treaty in the WTO," http://www.twnside.org.sg/souths
/twn/title/ana-ch.htm. The author is former Director of UNCTAD's Trade
Programme and former Indian representative to GATT.
2. Jones, Roy. "The OECD Multilateral Agreement on Investment: Key
Concepts and the Trade Union Response", OECD Trade Union Advisory
Committee, Jan. 1998, http://www.tuac.org/news/indmaitu.htm.
3. Korten, David C. "A New Day's Coming," In Context #40, Spring 1995.
4. Korten, David C. "A Not So Radical Agenda for a Sustainable Global
Future," People-Centered Development Forum,
5. Korten, David C. "Let's Try Something Radical. Like a Market Economy,"
plenary presentation to the People's Summit, Denver, Colorado, USA, June
20, 1997, http://iisd1.iisd.ca/pcdf/archives.
6. Marcuse, Herbert. One-Dimensional Man: Studies in the Ideology of
Advanced Industrial Society, Routledge, London 1994.
7. McCandless, Henry and Cottam, Terry. Petition: "Stay of Negotiations &
Call for Accountability," Communications for a Sustainable Future,
8. Organization for Economic Cooperation and Development. "Ministerial
Statement on the Multilateral Agreement on Investment,"
9. Preamble Cooperative. "The Multilateral Agreement on Investment: Basic
10. Public Citizen's Global Trade Watch. "Factsheet on the MAI,"
11. Roxas, Sixto K. "Community-Centered Capitalism: An NGO Alternative,"
People-Centered Development Forum, http://iisd1.iisd.ca/pcdf/archives.
12. Sarkar, P.R. Proutist Economics: Discourses on Economic Liberation,
Ananda Marga Publications, Calcutta 1992.
13. Storza-Roderick, Michelle, Nova, Scott and Weisbrot, Mark. "Writing
the Constitution of a Single Global Economy: A Concise Guide to the
Multilateral Agreement on Investment - Supporters' and Opponents' Views,"
Preamble Cooperative, http://www.rtk.net/preamble.
14. Vallianatos, Mark and Durbin, Andrea. "Ten Reasons to Be Concerned
About the MAI," Friends of the Earth (U.S.),
Recommended reading/alternative to private investor economy:
Developmental Planning: A Proutistic Perspective, by Acarya
Krtashivananda, Prout Research Institute, Copenhagen, 1995. Available
through Global Times, c/o People's News Agency.
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