World Trade and Globalization

Delivered by Consumer Advocate Ralph Nader on April 8, 2003

Thank you very much President Lamkin, thank you, Reverend Sheppard, and members of the board of trustees, especially thanks to the members of the Green family for making possible this convocation through the John Findley Green lecture.

I appreciate very much this honorary degree in particular because it comes from a liberal arts schools. The liberal arts are really the core of higher education. Advocational education is an instrument, but the liberal arts represent the best of our values and the develop of critical thinking and they need to be kept vital because each generation has to learn the new why the liberal arts and the humanities and social sciences are so critical when higher education is often viewed primarily as vocational.

My charge this evening deals with the globalization and international commerce with some comments on citizenship. This, obviously, is not a very glamorous subject and the fact that it is a very important subject, in the last decade with the passage of NAFTA and the World Trade Organization and the updated treaty. The fact that it is not glamorous does not make it any less important, so I hope you will bear with me and I'll try to trace exactly why many of us in the environmental, human rights, consumer, and labor arenas oppose NAFTA as it was drafted and passed in the Congress and oppose the revised update of the GAP Treaty that created the World Trade Organization with headquarters in Geneva, Switzerland.

It wasn't that we were against lower trade barriers. Most of us took economics 101 in college or university and we did recognize that in many areas a comparative advantage tended to improve the well being of both parties although with often arduous adjustment period on the part of one party or more. It was that these new trade agreements went beyond trade. They represented the establishment of a system of international governments overlaying our respective countries processes. A system of international governments that was autocratic, secretive, and well beyond the range of accountability to the voters and even the elected representatives and judiciary of the signatory nations which now total over a 138 nations that belong to this international treaty.

This troubled us a great deal, because it's hard enough in this country to hold Jefferson City and Washington accountable without also having to hold Geneva, Switzerland accountable - the seat of the World Trade Organization. Unelected, unaccountable and closed to all but a very few representatives of the signatory nations. Our group which is called Global Trade Watch, and you can access it on Citizen.org, analyze these treaties very meticulously and went up to Capital Hill and tried to reason with members of Congress. We found something quite astounding. After months of going into one office after another of senators or representative, we never met a single senator or representative who had ever read 500 or so pages of the World Trade Organization agreement. They had a year to read it. It was in English. Our further astonishment occurred because we found very, very few assistants to these members of Congress who had ever read it. They were working off abbreviated memos summarizing the contents sent to them by either corporate lobbyists or by representatives of the White House. This was in the 1994 - 1995 period.

Having read it, we saw that it compromised our own local, state and national sovereignty in very serious and unaccountable ways because the mandate of WTO was trade uber alas. That is, it was not trade issues which had to get on our knees in Geneva, Switzerland and show that they are not harming consumer laws, environmental laws, worker safety laws, freedom of information laws. It was just the reverse. It was consumer laws and worker's safety laws and environmental laws and freedom of information laws that had to show the global officials of the World Trade Organization that they did not restrict international trade in their enforcement. Now, this to us was a complete reversal of how our country has progressed. The major social justice movements in our country represent the subordination of commercial values to civic values. The supremacy of civic values is illustrated when corporations have to obey environmental laws, safety laws, or in distant decades, the abolition of child labor. When Congress abolished child labor in the early part of the 20th century, they in effect told me that in the industries of those days, you will no longer be able to hire 8, 9, 10, 12, 13 year olds. They should be going to school. You'll have to hire adults. It's too bad you'll have to pay them more than children.

That was the subordination of the commercial value to the higher civic calling of providing an education and preserving the health of these children who often damaged their health because of the exposures in those terrible factory and mine conditions of those years. Of course, there's always a struggle is there not between the powerful forces of commercial values and the much more fundamental horizons of civic values, which include not just health and safety, they include democratic processes, they include respect for future generations, they include respect for our environment, they include due process, fairness, openness, academic freedom. Civic values in a university and college setting is another way of preserving the three principal pillars of higher educational incision: 1) a learned tradition, 2) independence from compromising external powers, and 3) a practice of public service linking knowledge to human value, for students, faculty, all who are related to the institution of higher education.

This conflict between civic value and commercial value has been going on for centuries, millennia. You see it in the Bible with the characterization of mammon. Every major religion in the world independently came to the same conclusion when they asked their people not to give too much power to the merchants, the moneylenders, to what we would call today, commercial interest. Commercial interest provide a very important function when they are kept within boundaries. They produce wealth. They create employment. They sometimes foster group technologies. But when they don't have to obey certain boundaries that we can call law and order, public expectations, respect for the decent sentiments of human beings, they become extremely destructive. The principle business in the South pre-Civil War involved cotton. The cotton plantations had slaves. They distributed families torn from the bosoms of their parents. Today, corporations of a multi-national character sees nothing wrong with subcontracting with companies in the third world who brutalize their workers, imprison them for trying to form trade unions, destroy their health, and pay them virtually nothing although they use modern capital equipment.

Corporations without boundaries will poison our air, water and soil. They will endanger workers. From 1890 to 1980, four hundred thousand coal miners died from Coal Miners' Pneumochroniosis and coalmine shaft collapses. Four hundred thousand coal miners died for their companies. That's more American deaths than all the Americans killed in World War II. Now, there are laws that prevent coalmine operators, or steel companies who own coal mines, from doing this kind of thing. The death rate has gone down. The disease rates have gone down because corporations were told they had to observe boundaries. A lot of companies used to sell cars they knew were defective coming off the assembly line. They covered it up. They told their dealers to cover up. People would be killed and injured and the accident report would never mention a sticking throttle, or collapsing brake or defective tire, or leakage of carbon monoxide. Now, the law says to the auto companies you have to obey certain standards.

What's interesting about commercial values when civic values dominates them, they have a tendency to adjust to them. Democracy is good for good business. It shouldn't be good for bad business. If the laws are not enforced, bad business will have a competitive advantage and drive out good business. Like companies that adulterate fruit juices illegally, or companies have more money for advertisement because they are short changing their customer in the quality of the product involving defects the people can't see. What happens, of course, is that when commercial values have to adjust the economy gets better for more people. Wealth is better distributed to those who work everyday for a living and deserve to be able to live on what they earn. But when civic values are compromised, or overwritten by commercial writers, which is the case of the World Trade Organization regime, the civic values don't adjust as well. They tend to be hampered, destroyed, weakened and stalled from growth. Our country under the Clinton Administration with the full support of the business lobbyists enacted a law which was called the Revised GAP Trade Agreement, which binds us to subordinating civic values to international commercial supremacy. That is, if our environmental standards are higher that most other countries, other countries who signed onto this treaty can take us to a court in Geneva, Switzerland called the Tribunal under the World Trade Organization and charge us with a law that restricts imports of a certain chemicals. They in effect say your law is a trade barrier and is violating the global WTO treaty. Since the mandates under WTO subordinates health and safety, and worker standards, for example, among others, we have a tendency to lose. We have had five challenges to our environmental standards including the Mammal Protection Act for dolphins and we've lost every one of those because the World Trade Organization does not go after countries that treat their workers or environment or consumers poorly, it goes after, at the request of a less developed nation, the countries that treat their people better and charge that the California Food Labeling Act, for example, is GAP illegal under WTO.

A whole variety of state and national laws in our country have been put on the target list by any reports issued by the European Union, Canada and Japan and we do the same to them. We put our reports showing that certain Japanese laws protecting their people, and Canadian laws and European laws. The net impact of this is that these trade agreements are pull down trade agreements. They pull standards down to lower levels abroad in order to provide what these multi-national corporations who help draft these agreements want most which is the cheapest possible labor costs in countries that don't require them to invest in environmental protection, consumer protection or have to adhere to possible challenges in courts of law or have to recognize the rights to form independent unions. And so hardly a week goes by in this country when a major company doesn't close down a factory and go to Indonesia, or Mexico, or Brazil, or Guong Dong Province in China, set up modern equipment, hire hard working people there, directly, or through subcontractors, and then ship the product back to this country including products made by child labor.

Now, all of this compromises our sovereignty because you can't buy here a product made by child labor in the United States. It's illegal. But, our country, because it is bound by the WTO Trade Agreement cannot ban the importation of products made by other countries using child labor because of a provision in the treaty which says, "No restrictions can be imposed on imports by signatory countries based on how they're manufactured except by prison labor." Child labor is perfectly okay. There are several million children working in areas that ship international trade already.

That's just one example of how these trade agreements are autocratic layovers on our democratic processes side stepping our courts, our legislatures, and our regulatory agency. Now this is just the beginning. There are far more laws in our country that are considered illegal under WTO by foreign countries that are being challenged in these closed tribunals in Geneva. Now, imagine, we are under a legal requirement to obey the decisions of a court under the WTO in Geneva, Switzerland, that is closed to citizens of all nations, that is closed to all the press, that has no public transcript, no independent appeal, and is decided by three trade judges who could be moonlighting with commercial interest in their other time. That's not the way our courts are run. Our courts are open. People come in and sit down. The press can be there. There are public transcripts. There are independent appeals. You may not like how they operate at times, but you can at least find out what's going on and you can examine the decisions, the majority, the minority decisions.

Now, it impressed us in the mid-90s why the education of students years ago in Economics 101 was never subjected to crucial examination 20, 30, 40 years later when these students became reporters and editorial writers for the New York Times and the Wall Street Journal and the Washington Post. They still thought this was all about British textiles and Portuguese wine. Where both countries traded where they comparatively advantageous to one another and both countries improved. There's still some of that in international trade. We don't have as much manganese as Russia does. And Russia doesn't have certain manufactured parts that we have. But, international trade and commerce is much more than that now. Mr. Ricardo could not foresee the mobility of capital where plants could be closed down in a week and opened up very quickly in other countries. Where costs can be dictatorially imposed downward, not by any markup mechanism in authoritarian and dictatorial countries. Wages in China are not living wages for these workers. They can't bargain for them. Those wages are dictatorially imposed. Dictatorially imposed wages and costs can never be part of a free trade arrangement. They bust the paradigm.

In a few years, there will almost nothing that China cannot manufacture that we are manufacturing. China is not expanding its domestic market first. It's expanding its export market. The most important way to improve economic well-being in nations all over the world is the expansion of domestic markets. First, China does not have that kind of policy. The export market is the most immediately lucrative and the most immediately inviting...of more than a little corruption. Daniel P. Monahan, the former Senator, once said, "You cannot have free trade with a country that's not free." I suspect that's what he meant in terms of dictatorially determined costs. We need trade agreements that pull up standards. Trade agreements that say there should be a living wage, the right to form trade unions, freedom of speech, due process, enforcement of contracts other than by detective goons. We need to have trade agreements where the western nations pull up standards of law through the abolition of child labor; through the expansion of international labor organization standards and environmental health.

What's the point of having trade agreements that pull down standards because they're instruments of corporate multi-national entities that have no allegiance to any country as they operate astride the globe pitting governments against each other. They have no allegiance to our country other than to control it, or to any other country. They are willing to cut deals with brutal dictators as long as they get mineral, oil, gas, timber, or other concessions. They're willing to hook hundreds of millions of youngsters in Africa, Asia and South America into a lifetime of tobacco addiction from which one out of every three will die. They're willing to indorse technologies that will endanger irrevocably in the not so distance future the environment. They're willing to avoid investing in research and development for third world diseases that are coming this way in drug resistant form not just AIDS, tuberculosis, malaria because there's not enough money in it. They'd much rather invest in Viagra, and hair restoration and alleged anti-obesity drugs.

Multi-national corporations, the way they are now structured having more power than they can responsibly exercise, are not going to be the leaders in solving the major problems of our planet. They are not going to be the leaders in anticipating. We can turn them into beneficial instruments, perhaps, but will they allow us to? Will they allow democratic processes, judicial processes, regulatory processes, anti-monopoly processes, to work their will so that commercial values can adjust to a higher order of civic values?

My assumptions behind the criticism in these trade agreements, which, by the way we can pull out of with six months notice and demand a revision of them since we are the largest economy in the world, so that they are pull out trade agreements, they are openly arrived at, the courts are opened, so that democratic processes can reflect the better practices of our open democracy. The assumptions that I bring to this are: 1) that I prefer self-reliance as a goal of an economic system for the maximum extend feasible. Next, I prefer community self-reliance. And, next I prefer democratic processes. All of them are jeopardized. When I say self-reliance to the individual, I mean an individual who is skilled as a consumer to maximize his or her health, his or her dollar, his or her consumption so it does not damage other people's interests in a negligent fashion - consumption that foster sustainable economies. Consumption that recognizes there are future generations that need to inherit the earth in better shape.

These trade agreements, and the extension of them, into intellectual property, protection of patented monopolies, are not all what they are cooked up to be even in terms of free trade. Imposing on third world countries twenty-year monopoly patents impeding them from having compulsory licenses of drugs so they can bring the price down so their people can afford them such as an AIDS medicine. That's not free trade. That's the brute power of western economies. Same to third world people if you can't pay $10,000 a year per AIDS patient, you're die... because it's more important for these drug companies to maximize their profits under an antiquated patent system that should be replaced with other kinds of incentives that do not compromise innocent lives of children, men and women in these countries with diseases that are not respecting no national boundaries and have a unique way of becoming resistant to existent drugs.

What all this comes down to is a very few people in New York and Washington, to use the symbols, pulled this off in the 1990s - NAFTA and WTO and we're still discovering the creative use of these complex provisions by the corporate law firms that advise these corporations. We're discovering that in Chapter 11 of NAFTA a Canadian or Mexican company can take an agency in our government to court that is trying to get a deadly chemical out of drinking water and take it to court saying that that chemical that that country is selling in this country and if it's going to be prohibited it has to be compensated for it's lost profits. There are several cases like that already in the courts.

The greatest surrender of local, state and national sovereignty are represented by those trade agreements because they represent federal law. The federal government is supposed to enforce this law against any state or local government that passes any kind of ordinance or statute protecting environment, worker, consumer that is deemed to be trade restrictive. Again, trade uber alas. This not only means that a lot of laws that protect us are slated for challenge in the next decades before those closed courts, it means it chills improvements in this country. We could not have gotten safety features in cars years ago if those trade agreements were enforced because we would have had to go to international harmonization committee procedures where countries got together and said let's agree on one uniform standard. And the more countries you have the more harmonization downward toward lowest common denominators. We couldn't have gotten air bags in cars. Any new proposals would have to go through these harmonization committees circumventing our private processes. So, these trade agreements are just beginning to bite. But the press doesn't describe the bite very often in vivid terms that people can readily relate to, which comes down to the extent of our own civic involvement here, in all these matters. Indeed, so frustrated we were in the mid-nineties, in congress, that we offered one day to give $10,000 to the favorite charity of any member of Congress asserting that he or she had read the WTO and would answer ten questions about it in public. The Friday deadline came and went and no one took up the offer, so we extended it another week.

4:45 p.m. that Friday, Senator Brown, Republican of Colorado, called me up. He said, "I'll take the challenge." This is about a month before the vote. He said, "I don't want $10,000 to my favorite charity. I'll do it without that. How much time do I have?" I said, "Well, how about two weeks?" He said, "All-right." He reserved the Foreign Relations Committee room . We were up where the Senators were, he was seated in the witness box, and we proceeded to ask him twelve questions about those 500+ pages and he answered every one of them perfect. He had such a command of that document, and we commend him and we were about to close out the session and he said, I have a statement to make. He said, "I'm a free trader and I voted for NAFTA three years ago. But after reading all of these pages in the WTO Agreement, I was so appalled by the autocratic and anti-democratic nature of this agreement that I announce today I'm going to vote against it. He was the only one who had ever read it in our Congress. Five hundred-thirty members who readily raise their pay that your taxes made possible, whose checks never bounce, who have health insurance that most people would drool to have, who have an inflation adjusted pension that is extraordinary who couldn't be bothered to read about a document that subverted our civic values to commercial values, reversing the tide of priorities that represented progress in our country for two centuries and did it with secret institutions that are completely antithetical to the way we expect our country's branches of government to operate.

Having said all that the coalition of labor, consumer, environmental, human rights, and religious groups almost defeated NAFTA, but when NAFTA passed the forces of the corporate supremacists really revved up and got WTO through, under comfortable margins. Where were we in all this? We're the ones who are going to pay the bills. We are the ones who are going to pay for the costs. As these trade agreements work their will, faster and faster, into our governmental fabric. It's quite clear that our society now, and our world, have become so complex that it is no longer for us to think we fulfill our civic duty by merely voting although that wouldn't be bad for half of the people who don't even vote in this country in presidential elections or 65% who don't vote congressional elections. But, it seems that in coming century, if we're going to hold onto our democracy, which is being run into the ground in so many ways.

Every month you read about it. They are making it more difficult for injured people to use the courts. They're making it more difficult for your vote to be counted because money is corrupting politics and nullifying your votes. Who are they? They are the same "they" in every society under different guard, the oligarchs. People who have too much wealth and too much power in too few hands, the few who make the decisions for the many. They're corporatizing many of our universities. They're commercializing childhood bypassing parents, directly marketing their products which are often violent and low grade sensuality and junk food and addictive to children undermining parental authority. The parents who are busy commuting and working longer, longer hours to make ends meet. They're keeping America down. They're increasing economic growth for themselves while the majority of American workers are making less in wages today, inflation adjusted, than they made in 1973 which was the peak wage in inflation adjusted text in the 20th century. Economic growth leaving the majority of workers behind. Pensions are being riddled. The corporate crime wave is spreading from the Enrons, to the Tycos, Adelphias, back to the Sunbeams, to the Health South. It's the corporate criminal of the day when you open up the Wall Street Journal. Looting trillions of dollars from millions of workers in their pensions and not one CEO have yet gone to jail of those companies, dozens and dozens of them. That's a challenge to us, to our own self-respect. To our own way that we use time. We simply cannot defend our democracy here at home by saying that we are otherwise predisposed and don't have time for our civic duties.

Democracy is like the Mississippi River. It's mighty, it's power, it's fast flowing, but it starts with one drop of water in northern Minnesota. It may become more drops of water and then rivulets and more rivulets and then a brook, and then more brooks, and then a stream and then more streams. And, then a river and more rivers and then the mighty tributaries flow into the Mississippi. Each and every one of has to have an increasingly higher estimate of our own significance to count, to matter, to make a difference. Whatever our cause, whatever our cause, whatever our future, hopes, we can choose. There are plenty injustices and problems and inefficiencies in this world of ours that we can work on the ones we choose.

The citizen groups all over the country are laboring at the local, state and national level, laboring under huge eyes and depleted budgets. They want your help, they want your contributions. They want your talent, your ideas, your stamina, your energy. As students, you are in an enormously auspicious position to lead lives of great significance because of the country you live in affecting the world. Where you learn how to wage peace instead of spending hundreds of millions of dollars training for war.

We learn how to lead with renewable energy, solar, to replace the planetary destructive impact of fossil fuel and nuclear waste. We learned how to hold bureaucracies accountable by holding bureaucrats accountable. We learned how to develop a tax system that doesn't have such as perverse incentives and such inequities where if you have an "Inc" after your name and you're big enough you can go to Bermuda while the workers in Toledo and San Diego pay more than their fair share. You learn how to give children an opportunity to fulfill their life's possibilities. You learn how to erase the hypocrisy that becomes the controlling process over our very horizons and imaginations with an authentic brand of patriotism, the kind of patriotism that says to people, "If you love your country, you will spend more time improving it and making it more lovable," as my mother told me when I was 10 years old.

You should remember our flag does not stand for war, for censorship, for covering up. It stands for the pledge of allegiance to the flags' last phrase, "with liberty and justice for all." That's what it stands for and you should never let anyone take that away from you. If you're twenty years old you've got fifteen thousand days, or so, before you turn sixty-five. A little over two thousand weeks. Did last week go quickly? You've haven't seen anything yet. Ask some of the people here or your parents how fast it goes at an accelerated pace in the 20s, 30s, 40s, 50s, 60s. Don't waste time. Don't spend your 20s dealing with problems you should have gotten over with when you were a teenager.

The highest calling of our country, as a Supreme Court justice once said, is the office of citizenship. Beyond the skills of parenting that's the most important skill you'll ever have. It's not accounting. It's not business administration. It's not engineering. It's not law. It's not marketing. It's developing citizen skills. And no college or university worthy of its liberal arts definition should have students go through its curricula without having courses that provide you with opportunities to develop your citizen skills; to connect the college with the community; to apply knowledge to action; to test theories from the crucible of your actual experience and to bring together the strands from the humanities, from history, from literature, from art, and from the social sciences - economics, psychology, anthropology - into a public philosophy. Whereby after you graduate you will not regret by the time you turn 65 that you missed the train of justice as it pulled out of the station. Justice Daniel Webster once said, "It's a great work of human beings on earth, where there is no community, there is crisis. Excessive individuation breaks down community, leaves people defenseless to the power structures."

Self-reliance, community, democracy - the sequence that allows you to engage in the pursuit of justice. Which is truly the pursuit of happiness. And, once you get involved with the pursuit of justice you will turn it around and say, "Verily, the pursuit of happiness is the pursuit of justice."

Thank you very much.

Admission

Free...Museum members, Westminster College Students and Callaway County Schools
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$4.50...Children (6-11)

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