Friday, September 19, 2014
Go To Original
An Australian mining company insists its “right” to a guaranteed profit is superior to the right of El Salvador to clean drinking water — and an unappealable World Bank secret tribunal will decide if that is so.
Drinking water is the underdog here. It might be thought that Salvadorans ought to have the right to decide on a question as fundamental as their source of water, but that is not so. It will be up to a secret tribunal controlled by corporate lawyers. And as an added bit of irony, the hearing began on El Salvador’s Independence Day, September 15. Formal independence, and actual independence, alas, are not the same thing.
The case, officially known as Pac Rim Cayman LLC v. Republic of El Salvador, pits the Australian gold-mining company OceanaGold Corporation against the government of El Salvador. OceanaGold is asking for an award of $301 million because the Salvadoran government won’t give it a permit to open a gold mine that would poison a critical source of drinking water on which millions depend.
OceanaGold — or, more specifically, its Pacific Rim subsidiary, which it bought in November 2013 — has spent only a small fraction of the $301 million. That sum isn’t an attempt to recover an investment; it represents the amount of profits the corporation alleges it would have pocketed but for El Salvador’s refusal to give the company a permit. (El Salvador has had a moratorium on new mining permits since 2008.)
So here we have an increasingly common scenario under “investor-state dispute mechanisms” — environmental laws designed to safeguard human and animal health are challenged as barriers to corporate profit. Not simply to recover an investment that didn’t pan out, but supposed future profits that a company claims it would have earned. Should El Salvador prevail, it would still have lost because it will spend large sums of money to defend this case, money that could have been used for the welfare of its people.
An added insult in this case is that it is being heard not under one of the “free trade” agreements that elevate corporations to the level of (or above) a country, but under an El Salvador law passed by the former Right-wing government that has been since reversed. Pacific Rim originally sued El Salvador under the Central American Free Trade Agreement, but the case was dismissed because Canada, where Pacific Rim had been based before its acquisition by OceanaGold, is not a party to CAFTA. But the tribunal allowed the suit to be re-filed under an El Salvador law that granted corporations the same right to sue in secret tribunals ordinarily found only in “free trade” agreements.
Lawyers for corporations sit in judgment
The tribunal judging El Salvador is known as the International Centre for the Settlement of Investor Disputes (ICSID) — an arm of the World Bank. Neither the public nor the press are allowed to witness ICSID hearings and there is no appeal to its decisions. Under the “investor-state dispute mechanism,” governments legally bind themselves to settle “disputes” with “investors” in the secret tribunals. Cases are decided by a panel of three judges selected from a roster. The judges are appointed to the roster by the national governments that have signed on to ICSID.
Because ICSID, similar to other arbitration panels, does not have rules against conflicts of interest, most of the judges are corporate lawyers who specialize in representing corporations in these types of disputes. To provide just one example, one of New Zealand’s selected judges is David A.R. Williams, who is currently representing Philip Morris in its suitseeking to force Australia to overturn its tobacco regulations, which were ruled legal by Australia’s High Court.
The three judges in this week’s hearing are V.V. Veeder of Britain, Brigitte Stern of France and Guido Santiago Tawil of Argentina. Mr. Veeder and Mr. Tawil are veteran corporate lawyers; the former has carefully omitted any mention of who his clients are in his CV, while the latter’s bio page boasts he has assisted in the privatization of Argentina’s assets while representing corporations in several industries. To put that in some perspective, an austerity program was imposed in the early 1990s in conjunction with selling off state enterprises at below-market prices. This fire sale yielded $23 billion, but the proceeds went to pay foreign debt mostly accumulated by the military dictatorship — after completing these sales, Argentina’s foreign debt had actually grown.
The third member of the tribunal, Ms. Stern, is an academic regularly called on to arbitrate investor-state disputes. One of her previous rulings awarded Occidental Petroleum Corporation $2.3 billion against Ecuador because Ecuador had canceled an Occidental contract over a dispute in which the tribunal agreed that Ecuadoran law had been violated. The oil company was in the wrong but was given a windfall anyway!
Among the precedents these three ICSID judges will consider are separate rulings ordering Canada to reverse bans on PCBs and on the gasoline additive MMT, both dangerous to human health, because the bans hurt corporate investments.
Didn’t meet its obligations, but so what
The former Right-wing Arena government of El Salvador in 1999 passed a law enabling “investors” to sue the country in ICSID, thereby circumventing the local judiciary, as part of its effort to encourage foreign investment. A subsequent Right-wing government yielded to public pressure in 2008 by issuing the mining-permit moratorium, and the Farabundo Martí National Liberation Front (FMLN) administrations of Mauricio Funes (elected in 2009) and Salvador Sanchez Ceren (elected in 2014) have kept the moratorium in place.
In addition to the general moratorium, the Salvadoran government cites not only environmental and health concerns specific to the mine, but also says Pacific Rim has failed to meet its legal obligations nor has it secured more than a small fraction of the local permissions it must have to develop the land it seeks to mine. Some observers fear that a ruling in favor of OceanaGold could lead to violence in a country in which 70,000 were killed in a civil war a generation ago. Luke Danielson, a researcher with the Sustainable Development Studies Group, told the Inter Press Service news agency:
“This mining project was re-opening a lot of the wounds that existed during the civil war, and telling a country that they have to provoke a civil conflict in order to satisfy investors is very troublesome.”
Local communities are shut out of arbitration forums like ICSID, but it is community organizing that is responsible for the, so far, successful pushback against environmentally destructive mining. The National Roundtable Against Metallic Mining, or “La Mesa,” is an organization of civil society groups that has led the opposition to OceanaGold. Several corporations have prospected in El Salvador’s inland highlands areas since the Right-wing Arena government passed the law allowing investors to sue in ICSID.
A now closed mine in the area, on the San Sebastian River, operated by the U.S. company Commerce Group, left behind water too dangerous to touch, never mind drink. The El Salvador Ministry of the Environment and Natural Resources tested the river and found cyanide levels nine times above the maximum allowable limit and iron levels more than 1,000 times the maximum allowable limit. So polluted is the river that it runs yellow, orange or red at times.
Mining for gold is a process that uses large amounts of dangerous chemicals in the extraction. A National Geographicblogger, Vladimir Pacheco, writing about OceanaGold’s proposed mine, reports:
“The cyanide-leach processes at the company’s El Dorado mine will use approximately 900,000 liters of water a day. In comparison, it would take 30 years for an average Salvadoran family to use that amount of water. … Will water needed for the project aggravate the already perilous state of water access in the country? A study by the Ministry of Environment found that only two percent of the rivers contain water that can be made fit for human consumption, or used for irrigation or recreational activities and in another study the Global Water Partnership warns that water supply in El Salvador is hovering on the threshold of 1,700 cubic metres of water per person per year, the upper limit for the definition of water stress.”
Fighting back but at a cost
La Mesa has continued its struggle against mining and for the ability to decide its own pattern of development despite the violence that often seems to accompany mining. Three anti-mining activists were murdered in a six-month span in 2009. A report on Salvadoran activists published last year by Common Frontiers, a Canadian coalition, said:
“The fact that the government of El Salvador stopped issuing mining permits to companies was a real boost for their movement but at the same time it brought a significant shift in Pacific Rim’s tactics towards them. The company is accused of utilizing kidnapping, intimidation and even murder against community members opposed to the mining project.”
OceanaGold, which now owns Pacific Rim, did not address these charges in its glossy Fact Book 2014, but did have this to say:
“We have a staunch commitment to making sure our operations enrich, empower and improve the lives of our stakeholders, by creating a positive, long-lasting legacy that respects human rights and delivers enduring benefits and opportunities beyond the life cycle of our operations.” [page 28]
The Philippines Commission on Human Rights might beg to differ. In 2011, the commission recommended that the Filipino government revoke OceanaGold’s license to operate because of “alleged violation of the rights of the indigenous people of Barangay Didipio in Kasibu, Nueva Vizcaya,” including forced evictions. (The license was not revoked, and the mine is operating.)
La Mesa calls OceanaGold’s suit “a “direct attack against the sovereignty and legitimate right of the Salvadoran population to reject an industry that is a threat to our lives.”
This history is not likely to be under consideration by the ICSID tribunal. It is not known when it will hand down a decision, although it is likely to be at least several months. Two fundamental questions that can’t be avoided are: Does a community have the right to make decisions on its own development? Do multi-national corporations have the right to a guaranteed profit without regard to the cost imposed on communities?
That such questions must be asked — and that “no” to the first question and “yes” to the second are increasingly common answers — is emblematic of dictatorship, not democracy.
Go To Original
At a hearing of the Senate Armed Services Committee on Tuesday, US Defence Secretary Chuck Hagel and Joint Chiefs of Staff Chairman Gen. Martin Dempsey set the stage for a massive and protracted expansion of US military operations in Iraq and Syria.
“This will require a sustained effort over an extended period of time. It is a generational problem,” Dempsey told the committee.
In his opening testimony, Dempsey contradicted President Obama’s pledge last week that there would be no American troops engaged in combat in Iraq or Syria. “To be clear,” he stated, “if we reach the point where I believe our advisers should accompany Iraqi troops on attacks against specific ISIL [Islamic State of Iraq and the Levant] targets, I will recommend that to the president.”
Obama has already authorised the deployment of 1,600 American military personnel in Iraq, including the placement of US troops with Kurdish peshmerga militia and Iraqi army forces fighting ISIL, more commonly known as ISIS (Islamic State of Iraq and Syria). Speaking on behalf of the US military hierarchy, Dempsey made clear that such advisers could not be confined to headquarters, but would be needed to provide “close combat advising” in complex operations such as dislodging ISIS from urban areas like Mosul.
In remarks bordering on insubordination, Dempsey implicitly criticised Obama when he explained that the president had already turned down the recommendation of Central Command chief, General Lloyd Austin, to deploy American troops as spotters to call in air strikes during last month’s offensive to retake the Mosul Dam from ISIS.
Dempsey’s public disagreement points to tensions with the White House and the degree to which the military and intelligence apparatus are calling the shots in the new US-led war in the Middle East. The real purpose of the military intervention, a revival of plans shelved last year, is the ouster of Syrian President Bashar al-Assad. This will necessarily require a far greater American military commitment than currently acknowledged.
In the space of just over a month, what was initially announced as limited air strikes to protect the Yazidi minority in Iraq has been transformed into a full-blown war in Iraq and Syria involving the US and some 40 allies. Both Dempsey and Hagel reaffirmed yesterday that the air war that has already begun in Iraq would be taken into Syria. “This is an Iraq-first strategy… but not an Iraq-only one,” Dempsey said.
Hagel told the Senate Committee that Obama will meet with General Austin today at the Central Command headquarters in Tampa for a briefing on the war preparations. “The plan includes targeted actions against ISIL safe havens in Syria—including its command and control, logistics capabilities, and infrastructure,” he stated.
Hagel dismissed any notion of Syrian national sovereignty, declaring that “our actions will not be restrained by a border in name only. As the president said last week, ‘if you threaten America, you will find no safe haven.’”
As was the case in the 2003 invasion of Iraq, the Obama administration is launching an illegal war of aggression over the vocal opposition of the Syrian government, which is well aware that it is the real target.
While maintaining the pretext of destroying ISIS, Hagel put Assad squarely in the US cross-hairs. “As we pursue this program,” he declared, “the United States will continue to press for a political resolution to the Syrian conflict resulting in the end of the Assad regime. Assad has lost all legitimacy to govern, and has created the conditions that allowed ISIL and other terrorist groups to gain ground and terrorise and slaughter the Syrian population.”
The cynicism is staggering. For the past three years, the Obama administration and its allies, especially Saudi Arabia and the Gulf states, have backed, financed and armed the anti-Assad militias to overthrow the Syrian government. Having turned a blind eye to atrocities carried out in Syria by ISIS and other reactionary Islamist forces, Washington has seized on the beheading of two American journalists to justify the launching of a war to oust Assad.
Along with US air strikes in Syria, Hagel detailed plans to “train, equip and resupply more than 5,000 [Syrian] opposition forces over one year. The package of assistance that we initially provide would consist of small arms, vehicles, and basic equipment like communications, as well as tactical and strategic training.”
Hagel’s claims that there will be “a rigorous vetting process” to ensure that “weapons do not fall into the hand of radical elements of the opposition” have no credibility. The very fact that the training will take place in Saudi Arabia, one of the chief backers of Islamist militias in Syria, including ISIS, makes clear that the “vetting” will be to ensure that the overriding commitment of these forces is to oust Assad.
In his remarks, Dempsey spoke of the need to “destroy ISIL in Iraq,” where it threatens the stability of the US puppet regime in Baghdad. But he set a more modest goal for Syria, where the Islamist organisation could still be called on as part of the regime-change operation against Assad. There he said the aim was to “disrupt ISIL.”
Dempsey also indicated that the US was pressuring unnamed Sunni Arab nations with “very considerable” Special Forces to commit troops to assist anti-Assad militias on the ground in Syria. While he did not name specific countries, they likely include Qatar and Saudi Arabia, whose intelligence agencies have undoubtedly been active inside Syria.
A revealing exchange in the Senate hearing involving Republican Senator John McCain with Hagel and Dempsey underscored the purpose of the unfolding war. After declaring that it was a “fundamental fallacy” to rely on the Syrian opposition to prioritise fighting ISIS ahead of fighting Assad, McCain asked whether these militias would receive American air cover if attacked by the Syrian military.
The question came too close to the truth—that such an attack, real or fabricated, would provide a convenient pretext for unleashing devastating air strikes against the Syrian military. Responding to McCain, Hagel did not rule out the possibility, simply saying: “We’re not there yet, but our focus is on ISIL.”
Dempsey was more open, stating that “if we were to take [fighting] Assad off the table, we’d have a much more difficult time” persuading the Syrian opposition to join the US-led war. He said the administration had an “ISIL-first strategy”—meaning an open assault against Assad would soon follow.
Behind the backs of the American people and without even the fig leaf of congressional authorisation—which both parties would overwhelming provide, if asked—the Obama administration is embarking on a reckless and illegal war of aggression aimed at securing US hegemony over the Middle East and beyond. While Assad is the immediate target, the US is preparing for a confrontation with his backers—Iran and Russia—that threatens to trigger a far more devastating war.
Go To Original
The ruling class conspiracy against Detroit workers, implemented by an unelected “emergency manager” and overseen by a federal bankruptcy judge, is entering its final stage. Over the last several days, settlements have been reached involving key players who previously objected to the city’s financial restructuring plan.
New York-based bond insurer Syncora has been paid off with choice riverfront property, a piece of the Detroit-Windsor tunnel, and a guaranteed flow of millions of dollars in parking fees from a publicly owned garage near the city’s planned entertainment district.
A separate deal will end the city’s control over the Detroit Water and Sewerage Department, which dates back to 1836. A new regional authority, run by unelected commissioners, will operate the system, which generates $1 billion a year in revenues. This paves the way for the privatization of the third largest municipally owned water system in the US.
The differing financial and political interests in the bankruptcy proceedings have been battling over the spoils from the carve-up of a modern American city. Whatever the conflicts, however, they have been united behind one demand—that the working class pay for the city’s financial crisis.
The settlements set the stage for the confirmation of the city’s Plan of Adjustment. Under the plan, drawn up by Emergency Manager Kevyn Orr, the pensions, health benefits and life savings of 32,000 current and retired city workers will be gutted. Tens of thousands of low-income residents will be turned into urban refugees as water and other essential services are discontinued and poor neighborhoods are razed to the ground. Enormous sums of money and valuable public assets will be laid at the feet of billionaire developers and private investors who are overseeing the city’s “revitalization”.
From the beginning, the we warned that the bankruptcy proceedings were an anti-democratic conspiracy against the working class, involving the courts, the emergency manger, the Democratic Obama administration, Republican Governor Rick Snyder, the media and the trade unions.
In the 14 months since Orr brought the city into bankruptcy, this evaluation has been confirmed. In a column celebrating the end to what he called the courtroom “drama,” Detroit News columnist Daniel Howes pointed to the lineup of forces behind the bankruptcy.
“Banks and bond insurers, unions and pension funds, elected officials and Michigan lawmakers, all but the most willfully deluded are implicitly recognizing that Detroit’s financial collapse is not some fantasy concocted by a Republican governor, his hand-picked emergency manager and their collection of hired hands.”
The financial crisis, Howes continued, is “as real as it is an opportunity to shed $7 billion in debt, to restructure and reinvest in city operations, to make a more attractive investment case for would-be investors, including even Syncora.”
In lauding the carve-up of the city by various groups of financial vultures, Howes omitted any discussion of the real causes of the crisis in Detroit—the shutdown of auto production and related manufacturing by the banks and auto companies and impoverishment of the former “Motor City”.
The trade unions, including the American Federation of State, County and Municipal Employees (AFSCME) and the United Auto Workers (UAW), have played a critical role in this process, culminating in their suppression of working class opposition to the bankruptcy. Far from opposing the gutting of health benefits, pensions and basic public services, they have thrown their support behind the bankruptcy in return for control of billions of dollars in city employee health care trust funds.
The effort to smother opposition has received critical support from phony “left” organizations, including the Workers World Party and its Moratorium Now! front group, which urged workers to place their confidence in the unions, the courts and the Democratic Party. Workers World promoted figures such as Congressman John Conyers, who told workers that the Obama administration would intervene to defend them.
When anger erupted over mass water shutoffs, Bankruptcy Judge Steven Rhodes brought Workers World and other pseudo-left organizations into talks with the water department to dissipate opposition. The outcome of these talks was the inclusion of a token Water Residential Assistance Program in the scheme to end the city’s control of the water department, allowing shutoffs to continue.
These political forces are completely tied to the big business political establishment. They play their assigned roles in imposing attacks on the working class.
The only political force that has opposed the bankruptcy process is the Socialist Equality Party. Last October 4, the SEP organized a demonstration of hundreds of workers and youth at the Detroit Institute of Arts (DIA) to oppose plans, as part of the bankruptcy, to sell off the museum’s art treasures. This was the only genuine expression of the widespread popular opposition to the bankruptcy that exists in the metropolitan Detroit region and across the country.
The demonstration in defense of the DIA was followed in February by the Workers Inquiry into the Detroit Bankruptcy and the Attack on the DIA & Pensions, convened by the SEP to expose the official lies, arm workers with the truth about the crisis in Detroit and the bankruptcy conspiracy, and outline a political program to fight.
In recent weeks, the SEP has formed the Detroit Workers Action Committee (DWAC), which has initiated a campaign for mass action by the working class against the attacks being carried out under the restructuring plan.
The line-up of political forces in Detroit reflects a broader national, and, indeed, international process. Six years after the financial collapse of 2008, social inequality has reached new heights. Trillions of dollars have been handed to the banks, while the ruling class has deepened its offensive against the social rights of the working class. Detroit is at the center of a social counterrevolution aimed at returning the working class to conditions of industrial slavery and poverty not seen since the 19th century.
There is deep opposition among workers and youth to these attacks, but this opposition must be organized and given conscious political expression. The working class must be mobilized as an independent political force. The most burning issue is the building of a new, revolutionary leadership and to arm the working class with a program.