Why Democrats May End Up on the Wrong Side of the Social Security Privatization War (AlterNet)

[marmar]

Why Democrats May End Up on the Wrong Side of the Social Security Privatization War

By Lori Wallach and Todd Tucker, AlterNet. Posted July 31, 2007.



The push to cover the planet in trade deals is intended to give foreign investors new "rights." Now these deals are being used to keep failed private retirement systems in corporate hands.

"Congress rejected Social Security privatization in 2005 and should reject it again in 2007 -- whether it's for Americans, Peruvians or Canadians. The promise of a secure retirement shouldn't stop at America's borders."

This was the reaction of William McNary, a leading Social Security activist, after finding out that some Democrats are supporting a Bush NAFTA expansion for Peru that would give Citibank, a major Democratic donor, the right to sue the country if it reverses its failed Social Security privatization.

Fair trade activists already knew that an important part of the push to cover the planet in trade deals is to give foreign investors new "rights," including the right to sue governments for compensation when public interest regulations wind up hurting their bottom line.

But the latest Bush trade proposal goes even further. Buried in the Peru pact's hundreds of pages are provisions that could empower foreign investors involved in Peru's privatized Social Security system to demand compensation from the Peruvian government (in U.N. and World Bank tribunals) if the privatization were reversed.

To top it all off, the only U.S. company involved in the lucrative "private retirement account" industry in Peru is Citibank, which has recently come under fire for its offshoring of U.S. service jobs, as well as its close ties to leading Democratic politicians. The amount that Citibank could demand under the "free trade agreement" (FTA) rules could be considerable. In fact, the corporation could make virtually unlimited claims for "lost" future profits, as the license to provide the private accounts is not time limited under Peru's privatization statute and can only be removed for cause. Not surprisingly, Citibank has stepped up its lobbying on trade in the new Congress. And the financial services industry has been in a mad push to support the Peru FTA, cheering the pact for providing a precedent for similar provisions in future trade deals. ......(more)

The complete piece is at: http://www.alternet.org/workplace/58089/

[Dhalgren]

1. And we wonder with big eyes why the rest of the world hates us?

This nation should be pushing for human rights, the lifting up of the down-trodden, the fair treatment of everyone - EVERYONE - but instead we exploit and crush the poor and feed their children to the rich. Yeah, we're hated and for good reason...