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Comments to the Trade Policy Staff Committee, United States Trade Representative Carl Zichela, Director Sierra Club Midwest Field
Office Free trade was supposed to improve our quality of life. Instead, it is wrecking havoc on the job, at the kitchen table, and even in our backyards. For many Americans, trade policy is remote and abstract. My message today is that a new generation of international trade rules can profoundly affect the quality of our environment right here in the Midwest. Today, I will offer two examples showing how the World Trade Organization and NAFTA threaten to destroy the landscape of Illinois and Wisconsin. If these trade agreements can have such profound affects right here in the American heartland, no part of the country -- or the world -- will go untouched. The Asian Long-Horned Beetle The Chicago media has widely reported how an invasion of the Asian long-horned beetle from China has devastated the shady, tree-lined streets of the Ravenswood neighborhood. Hundreds of trees were chopped down and burned to stop this "alien invader." Already detected at 30 other sites around the country, the beetle could cause more than $41 billion in damage to our neighborhoods, parks, and forests if it spreads. Altogether, invasive pests that-out compete native species are the second leading cause of species extinction and cost the US economy $122 billion annually. For instance, the Formosan termite has caused billions of dollars in damage to houses in 14 states from Virginia to Hawaii. Eating wood nine times faster than native termites, Formosans have caused more property damage in New Orleans in the last ten years than hurricanes, tornadoes, and floods combined. The Clinton Administration’s free trade policies are partly to blame for the growing risks. Thanks to the WTO and to NAFTA, imports are up by 50 percent since 1990. As imports grow, more and more destructive wood-eating pests hitchhike into the country. The WTO and NAFTA then add insult to injury by tying the hands of federal officials from enforcing strong safety protections at our borders. The US Department of Agriculture (USDA), in charge of stopping dangerous pest invasions, even admits that it "cannot establish regulations that would contravene other laws and policies associated with trade" such as NAFTA and the WTO. So it has consistently chosen weaker protective standards than necessary for the wood shipping crates and other packing materials that harbor insects such as the Asian long horned beetle. When the USDA finally issued emergency rules to stop the Asian long-horned beetle after the Chicago outbreak, Hong Kong immediately threatened to file a complaint with the WTO that could override the new safeguards. Wisconsin’s Mining Moratorium My second example illustrates how trade rules could undercut the efforts of states to set tough environmental standards that exceed federal standards. In 19XX., Wisconsin adopted a moratorium on new mines in the state. Mines have a poor track record in Wisconsin. Moreover, citizens were concerned about new mining investment. In response to the threat from mines, Wisconsin voters fought for and won a ten year moratorium on mine construction until such time as the governor could prove that mines can operate without enviormental damage. But thanks to NAFTA, this hard won victory could be overturned. You see, the NAFTA allows foreign investors from Canada or Mexico to sue the federal government for lost profits from an investment. The suits are heard by a kangaroo court of trade lawyers in Paris. There is no due process and no appeal. If the federal government is sued by Canadian mining companies, the government could turn around and sue Wisconsin unless we rolled back our moratorium. Our mining moratorium treats all mining investors the same, whether foreign or domestic. Yet the NAFTA rules would apply regardless of whether the law is dicriminatory or not. If you think the threat to our laws sounds far fetched, think again. In 1997, Ethyl Corporation of Virginia used these same NAFTA rules to force Canada to roll back its ban on the gasoline additive MMT. MMT is a potential neurotoxin, but Eythl dragged Canada before the Kangaroo court in Paris to argue that the ban on MMT defamed Ethyl’s good name and harmed its profits. Rather than risk paying a quarter billion dollars in damages, Canada caved in and rolled back its law. Now Canadians will have to breath MMT in their air whether they like it or not. After the Ethyl case, we might hope that the Clinton Administration would be more careful in negotiating investor rules. Yet it attempted to negotiate a global version of NAFTA, the Multilateral Agreement on Investment, with these very same provisions. Naturally, I am deeply concerned that investor talks could be launched at the Seattle WTO Summit. The citizens of Wisconsin fought hard for our mining moratorium. I do not want trade agreements negotiated by my government to sabotage our hard won environmental victories. Conclusion In November, the United States will host a Summit of the WTO in Seattle. Rather than sign new trade agreements, the Clinton Administration should review and repair the WTO so that it no longer undermines our environmental, health, and safety laws. To ensure that Americans can effectively control invasive pests such as the Asian long-horned beetle, we must fix WTO rules that discourage preventive action that would stop environmental problems before they overwhelm us. To achieve this, WTO rules must be changed to recognize the precautionary principle. And to ensure that neither Wisonsin nor any other state ever faces a lawsuit by a foreign investor for taking legitimate action to protect the environment, the Administration should keep investment talks out of the WTO and repair the dangerous investor rules now incorporated in NAFTA. Thank you. Up to Top HOME | Email Signup | About Us | Contact Us | Terms of Use | © 2008 Sierra Club |
