18 March 2014

The Koch Suckers at the Cato Institute Just Came Out Against Investor-State Dispute Settlements

Yes, Cato has come out against the the ISDS, that secret court that allows private entities to sue countries under arbitrary rules slanted in favor of investors.

This is kind of like Ford recommending General Motors pickup trucks for consumers:
Faced with an increasingly vocal opposition to a landmark EU-US trade agreement, a growing number of backers of the deal are starting to ask a simple question: might the future of transatlantic trade be better served if one of its most controversial provisions was simply dropped?

Almost nine months after negotiations opened with great hope and fanfare, opponents of the mooted Transatlantic Trade and Investment Partnership, or TTIP, are rallying against a plan that would allow private investors to use the pact to sue governments if they felt local laws threatened their investment.
Environmentalists worry that it would allow big US oil companies to challenge France’s anti-fracking laws and other environmental regulations, while consumer groups fret that it would open the EU’s sacrosanct ban on genetically modified organisms to a challenge from American agribusiness.

The concerns in Europe over the inclusion of an “investor-state dispute settlement”, or ISDS, mechanism grew so loud earlier this year that Karel De Gucht, the EU’s trade commissioner, announced he would suspend negotiations on the relevant text to hold public consultations.

But in recent weeks, as both sides have been preparing for Monday’s resumption of negotiations in Brussels, the opposition has spread beyond the traditional sceptics.

In a paper released last week, Daniel Ikenson, director of the trade programme at the conservative Cato Institute, argued that the investor protection measure had become too toxic. And that in order to defuse the growing opposition, negotiators should simply drop what seemed like a superfluous provision.

“ISDS is not even essential to the task of freeing trade. So why burden the effort by carrying needless baggage?” Mr Ikenson wrote in his paper, which called for the US to drop ISDS provisions from its push for a 12-country Pacific Rim deal, the Trans-Pacific Partnership, as well.
Cato, and the Kochs, are all about enforcing the primacy of the holders of capital over that of democratically elected government, so this turn around is a big deal, and it's a good thing.

In an era of historically low tariffs, these increasingly anti-sovereignty provisions in trade deals are being viewed with well justified suspicion.

The old argument, "Because ……… Free Trade," is simply no longer enough to justify trade deals with draconian IP and investor protections.

It's a welcome side effect of the financial meltdown.


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