New World Order, Inc.

[peristaltor]

Just yesterday, I read that the belief "that we could have utopian prosperity if we got rid of private businesses and had the government run everything" should be marked down to "stubborn stupidity." Fair enough. As hyperbolic and Straw Manned-up as that statement is, thwarting all independent economic activity would be a bit delusional, given

Comments

[il_mio_gufo]

Sounds to me like we could learn a thing or two from what has happened there in Egypt and El Salvador. Maybe the word should be spread to other countries . . . when allowing a corporation to do business in your country be sure to have them sign the statement detailing how they (the corporation) cannot sue the government and/or people in the case the business venture is not fruitful, doesn't yield as high a profit as anticipated, does not meet any projected productivity as predicted by internal/external analysts.

All business is a gamble. There is no way around it. If a corporation cannot comprehend this factoid, then that is problematic. Unrealistic goals will be set, and the tracks for greed lain.

[harry_beast]

Business risk is one thing, but arbitrary and malicious actions by a government are quite another.
What if governments change the rules after the investment has been made? Or, what if they apply one set of rules to foreign companies, and another to domestic companies? Or, what if the venture is profitable, and the government decides to sabotage the business so that investors are forced to sell the business at a loss, for example, to friends of the government?
Clauses that allow companies to seek redress if they feel that they have been treated unfairly are in important part of international agreements related to foreign trade and investment.

[peristaltor]

If by "arbitrary and malicious actions" you mean the ability for citizens to seek redress for injustices committed in the name of profit, then I'm afraid we do not agree on this statement of yours.

People died in El Salvador preventing the mine from opening simply because many of those people would be out of a livelihood if it did open. The mine would claim all the water people needed and pollute the remaining rivers, often with cyanide (used in gold mining). If the option is death, why not die trying to stop it?

I thought about including in the OP the What If scenario where the US is home to the foreign corporation and cannot stop the extraction/destruction because it signed the damned trade agreement. What if your well was poisoned, your children hired in sweatshops?

[harry_beast]

The company is playing by the rules established by El Salvador's own 1999 mining law. El Salvador's president in 2008 publicly stated that he was willing to pay $90 to cancel the project. The government of El Salvador, if it really didn't want the mine, could have turned down the project before accepting $77 million of the company's money. If someone took your money and then refused to give you what you paid for, or to return the money, you might seek redress too. Cheating foreigners may play well to the local crowd, but if you call it justice, I suppose we won't agree.

As for your hypothetical scenario, the United States has a long record of breaking trade deals. Its economic heft usually ensures that Americans can tilt the playing field in their favour. If there is a threat of poisoned wells and children in sweatshops, I would be more afraid of domestic companies and governments than of foreign ones.

[peristaltor]

If there is a threat of poisoned wells and children in sweatshops, I would be more afraid of domestic companies and governments than of foreign ones.

Ah, but a domestic company wouldn't be able to appeal to an arbitration court. . . .