• To answer your direct question, the last time the US federal government was sued under a trade agreement in a foreign tribunal was 2009 – three new NAFTA cases filed by Canadian investors demanding government compensation via World Bank and UN tribunals over U.S. truck safety rules, mining rights and medicine patent issues. See http://www.citizen.org/documents/NAFTA_Investor_State_Chart_Nov_2010.pdf for the full list of NAFTA cases like this.

    There are also three under CAFTA – US firms attacking El Salvador’s new environmental laws related to arsenic leach gold mining are two of those, at World Bank.

  • It does not help Korean middle class. Ironically, UAW testimony from lo only Sept 2010 says it best:

    We know that that trade creates both winners and losers. In this case, the U.S. beneficiaries of the KORUS FTA will be the financial sector and large agricultural export companies. Neither of these sectors is likely to add many direct jobs n the U.S. The losers in the U.S. will include small businesses and workers in the already hard-hit manufacturing sector who would compete with cheaper Korean manufacturing exports. The losers in Korea will include Korean industrial workers, since KORUS eliminates existing disincentives for Korean manufacturers to use imported parts from lower-wage countries.

    Workers and their unions in Korea are opposed to the KORUS FTA, in part,
    because it would encourage Korean manufacturers to significantly increase the sourcing of production to low-wage nations of Asia, including China, which would result in the loss of Korean jobs and undermine living standards and working conditions.


  • Need to read the Korean FTA text – chapter 11. see http://www.ustr.gov. The foreign tribunals are specified – it is World Bank and UN. (ICSID and UNICTRAL) Under the Korea FTA rules, a private corporation or investor is empowered with rights to privately enforce the public treaty directly. ie they are elevated to equal status with soverign nations. (Note, no such rights for unions or workers or consumer – only foreign investors)

    Check out http://www.citizen.org/Page.aspx?pid=1218 investment for a lot of info on this. It is formally called “investor-state” enforcement. This is not you civil procedure New York Convention stuff. And, NOT appropriate at all, but certainly no excuse for it between developed countries with rule of law. US-Australia FTA does not have it. EU-Korea FTA does not have it.

    And, with Korea FTA it is a real problem because there are 300 Korean establishments in US who could use it to demand taxpayer compensation for costs of our generally applicable environmental, safety, health laws. That same site has a map of all of them so you can what states. State law can be challanged also. http://www.citizen.org/Page.aspx?pid=3967Only other US FTA with investor-state private corp enforcement with a net capital exporting country is Canada with NAFTA. US has spent tens of millions defending cases there – billions in compensation demands still pending. That site noted above has a list of all of the NAFTA cases – attacks on toxic bans, zoning, etc. $400 million paid by NAFTA govts to corps so far from the World Bank and UN tribunals.

  • Another one Alex – You’re touting NTBs being cut. And for sure Korea ha some that are intended to just keep out imports, But, do you know what the non-tariff barriers are that were “eliminated” in this deal today? U.S. gets a waiver on having to meet Korean fuel efficiency standards and auto safety regulations. Are you for THAT?

  • Alex – I take it you have not checked out the agreement’s text or the Intl Trade Commission reports on it. ITC says it will increase the U.S. trade deficit. If you plug the increased deficit into the jobs multiplier used by the USG, it would net out at 120K lost jobs. But, those estimates have always been much lower than actual job losses. US lost 5.5 million manufacturing jobs net – one out of every 4 – since NAFTA, CAFTA, China WTO. And as for the text: it is mainly a foreign investment agreement. It replicates the NAFTA provisions that actually provide special privileges if a firm relocates. Certainly you have seen the studies about U.S. job loss to Canada under NAFTA – despite Canada having higher wages in the industries that left? The special investor offshoring provisions provide special preferential treatment in the new host country AND allow claims for compensation for certain regulatory costs. And, then there are the medicine monopoly patent extensions and the financial deregulation rules. This aint no GATT. Adam Smith and David Ricardo are rolling in their graves to see these 900-page texts called ‘free trade.’ Ye olde theory of comparitive advantage its not…

  • Tradewonkette became a registered member

    2010-12-04 00:47:05View | Delete