Vol. IX, Bulletin No.5                                                      May 11, 2004 

BLOODLETTING AS TRADE POLICY

In rejecting the AFL-CIO's worker rights petition against China last month, the Bush Administration did not reject the petition's twin charges, namely:
A plausible rebuttal to these charges would have been impossible, because they are undeniable. Instead, in an unusual press conference at the Commerce Department on April 28, four Bush cabinet members extolled the virtues of its "engagement" with China, as opposed to going "down the path of economic isolationism" -- a phantom policy that nobody advocates.

In the longest of the four cabinet members' statements presented on the value of U.S. engagement with China, U.S. Trade Representative (USTR) Robert B. Zoellick said: "While some would prefer to litigate for litigation's sake, our Administration is focused on producing real results, in real time." 

What is the Bush Administration's idea of producing real results, in real time?

Presenting A Track Record of Paper Results

Take a look at the USTR document, "A Track Record of Results," which covers three areas (none in labor): opening China's agricultural markets, removing China's barriers to U.S. manufacturing exports, and leveling China's playing field for U.S. service providers.  The April 21 statement lists 11 specific "results" achieved (such as adopting U.S.-proposed changes in meat labeling) in those three areas. Each list begins with the same heading: China has agreed to...." "China has agreed to...." "China has agreed to...." Thus, in Zoellick's vocabulary, if China has agreed to something, it is a real result.

No wonder that the U.S. trade deficit with China last year ballooned to a record high: $123,960,600,000, the largest deficit with one country in U.S. history.  The arithmetic on this 2003 trade imbalance works out this way:

U.S. Imports from China:    $  152,379,100,000
U.S. Exports to China:               28,418,500,000
Deficit:                                -   123,960,600,000
In other words, for every one billion dollars of goods that the United States exports to China, we import more than five billion dollars worth of TVs, radios, tape decks, jewelry, chemicals, wallboards, generators, steel, industrial machinery, computers, computer accessories, telecommunications equipment, office machines, hospital and medical equipment, automobile tires and tubes, footwear, camping equipment, furniture, kitchen appliances, clocks, toys, bicycles, wearing apparel, books, art supplies, tractors, and countless other products, large and small, made by working men and women in China.

Anti-Worker Bias in U.S. Trade Policy

The U.S. government keeps very detailed statistics on the volume of imports, but not on the number of people who make them, although in China those workers now constitute a de facto U.S. labor  force larger than that of most U.S. states. 

"This Administration," AFL-CIO President John  J. Sweeney said in a statement, "will only enforce U.S. trade laws when corporate profits and concerns are at stake, but will not go to bat to protect the fundamental human rights of workers."  He called the Administration's rejection of the AFL-CIO petition "an outrage and an insult to American and Chinese workers."

The rejection is indeed an outrage and an insult to the workers of the United States and China. It openly excludes workers from the kinds of global protection routinely granted to multinational corporations as institutions and to international business men and women as persons.  This is globalized class bias against workers.

U.S. on Path to Becoming a Third World Country, Economist Says

Moreover, the rejection is part of a policy of economic bloodletting. The crazy practice of bodily bloodletting reigned for centuries because physicians and surgeons believed it was healthful for the sick and the well. It killed George Washington and many others, rich and poor, before the medical profession gradually abolished it, though as late as 1923 a British medical text still recommended it.  Today, economic textbooks and the practitioners of U.S. economic policy routinely prescribe economic bloodletting -- the unfettered global flow of goods, services, and money, no matter what it does to the economic health of nations, including the United States.

Paul Craig Roberts, an economist who has devoted his long journalistic, think tank, and governmental career to fostering free trade in thought, word, and deed, has recently reevaluated his position. Because of radical transformations in the global economy, highlighted by the mass movement of jobs from the United States to China and other low-cost countries, Roberts now predicts that "the United States will be a Third World country in 20 years" (see "U.S. on Slippery Slope, Economist Says"). In language less clear, some economists in various think tanks, such as the Levy Institute of Bard College, are expressing their alarm that, because of our vast public and private debts, national and international, U.S. economic growth is not "sustainable" (i.e., can't last). 

Meantime, most government economists exude confidence about the economy and their management of it. No need to worry. It can't happen here. The mood is akin to the safe comfort that we felt before 9/11.

Testing Olympic Games' Fair Play

"Celebrate Humanity," the promotional campaign for the 2004 Olympic Games to be held in Athens in August, highlights "the Olympic values of hope, dreams, and inspiration, joy in effort, friendship, and fair play."  At the same time this summer, "Play Fair" is the theme of an international campaign to eradicate sweatshops in the sportswear industry.

The Olympic Games are not designed to deliver Olympic values to the workers who are making shoes and clothes for the Athens Olympiad and other sports events. To the contrary. Because of  the highly competitive sportswear industry, the upcoming Games are intensifying the drive to cash in on the Olympic image, and are thereby intensifying pressures on hundreds of thousands of vulnerable workers, most of them women, in Asia, Eastern Europe, Africa, and Latin America.

Wages are already so low that workers usually can only dream of owning the sportswear they make. Now many companies are cutting costs by further squeezing wages, to make sure they get their share of pre-Olympic profits. On top of that, the rush orders they place with factories result in compelling workers to work more overtime than usual.

Play Fair, a joint effort of three international organizations, is targeting not only individual companies but also the International Olympic Committee, which licenses the use of the Olympic image on products.  For details on the campaign and what you can do to help, check the Play Fair Website at http://www.fairolympics.org/en/index.htm, as well as those of the allied organizations, Oxfam International, Global Union Federations, and the Clean Clothes Campaign. 

UN Global Business Norms Barely Alive

What are the obligations, if any, of multinational corporations under international law? 

That controversial question was sidestepped by the UN Commission on Human Rights at its annual meeting in Geneva last month. The commission had before it a report on "Norms on the Responsibilities of Transnational Corporations and other Business Enterprises with Regard to Human Rights" adopted in August last year by a subcommission of the UN commission (see "Business Norms on UN's Agenda").

According to the Financial Times, several governments, including those of the United States, the United Kingdom, Saudi Arabia, Egypt, and India, sought to remove the norms permanently from the commission's agenda.  That effort, supported by the lobbying of organized business, did not succeed.

Instead, the commission declared that the subcommission's Global Norms report "has no legal standing," referred it to the Office of the High Commissioner for Human Rights, and asked the Office

"to compile a report setting out the scope and legal status of existing initiatives and standards relating to the responsibility of transnational corporations and related business enterprises with regard to human rights, inter alia, the draft norms [of the subcommission]" and to submit the  report to the Commission's session next year "in order for it to identify options for strengthening standards on the responsibilities of transnational corporations and related business enterprises with regard to human rights."

Amnesty International, one of 15 national and international organizations strongly supporting the Global Norms, said that "it is very pleased to note that the issue of corporate responsibility for human rights is now firmly on the Commission's agenda." Its statement added that "Amnesty International continues to be firmly supportive of the norms as a framework for informing the human rights responsibilities of business enterprises."

Intensive debate on the pro's and con's of adopting the norms preceded the commission meeting.  A major issue: whether only states (national governments), and not private businesses or other non-state actors, have obligations under international law.

Two Global Business Organizations Blast Norms

In a joint presentation summarizing how the draft norms would "undermine human rights, the business sector of society, and the right to development," the International Chamber of Commerce and the International Organization of Employers argued (as their first objection): "States are the duty-bearers of obligations under the international human rights law. Not private actors -- including private businesses."  (For a lengthier exposition of IOE/ICC views, check the Website of the Business & Human Rights Resource Center.)

An international attorney and businessman, Chip Pitts, as an advisor to the Business and Human Rights Resource Center, prepared a detailed response to the IOE/ICC position.  As his primary point, he challenges the argument that businesses are in no way bound by international law:

"If leading global employers and business organizations are ignorant of the fact that non-state actors in general, and corporations in particular, have established legal obligations to avoid complicity in violating human rights, then the education and clarification furthered by the Norms takes on even more importance.... Businesses have existing liabilities for human rights violations: businesses and their officers involved in genocide, slavery, torture, and the like can hardly hope to escape liability merely because they act under the corporate form."

Norms Called 'More Than Voluntary"

In another commentary, Sir Geoffrey Chandler, founding chair of the Amnesty International UK Business Group and a former director of Shell International, said that the "Norms are not legally binding, other than for those issues, such as the prohibition of slavery, already the subject of international and national law," but they are "more than voluntary -- they provide a template against which corporations can measure their own codes and the basis for a level playing field so that the better performers are not undermined by the worse."

The UN High Commissioner for Human Rights, Sergio Vieira de Mello, was killed last August in Iraq, where, on a leave of absence, he was serving as the UN Special Representative. Hopefully the Office of the Commissioner will not bury the Norms. They deserve more discussion and more attention. They were ignored by the media in the United States, where the subject has particular relevance (see below).

U.S. Human Rights Law Under Attack

A U.S. law protecting victims of gross human rights abuses, such as torture, genocide, and slavery, is now under review by the U.S. Supreme Court, with a decision expected in June.  Leading the attack against that law, the Alien Tort Claims Act (ATCA), is the U.S. Justice Department, prodded by a coalition of business organizations.

Thanks to the pressure of ATCA litigation in 1996-97, the U.S. government persuaded Swiss banks to pay $1,250,000,000 to Holocaust survivors. Now the Justice Department's position against ATCA "would roll back 20 years of judicial rulings for victims of human rights abuse," according to Human Rights Watch.

In a "friend of the court" brief filed early this year, the U.S. Chamber of Commerce, the International Chamber of Commerce, and seven other business organizations joined the Justice Department to ask the U.S. Supreme Court to nullify ATCA. A major reason, the brief said, is that it puts "U.S. companies, and multinationals with a U.S. presence, at a unique competitive disadvantage in the international marketplace."

Labor Rights Fund Counters Business Brief

"The business community is up in arms because several multinationals have been sued under ATCA," says Terry Collingsworth, director of the International Labor Rights Fund, which is counsel in some of those cases.  Collingsworth rebutted the business brief with a brief  filed by the ILRF and 12 other non-governmental organizations united as the corporate social responsibility (CSR) movement.

"The ACTA applies only to slavery, torture, extrajudicial killing, genocide, war crimes, crimes against humanity, and abitrary detention," Collingsworth points out. "With that objectively verifiable clarification, we are left with the U.S. business community's naked position that in order to compete in the global economy, they need to be free from the constraints of the ATCA, which prevents them from using slaves and torturing workers."

For further information, see "The Allen Tort Claims Act: What's At Stake," an analysis by Human Rights First, formerly called the Lawyers Committee for Human Rights.

Finding Sites To Avoid 'Competitive Disadvantage'

Here, then, is the global context of organized business's position on international human rights and the law:
In Defense of Anti-Sweatshop Activism
 
Here's another letter of mine that the New York Times did not print. It is a response to a column that attacked students and others for engaging in anti-sweatshop and anti-child labor activism and for not engaging, instead, to good work like feeding the hungry and agitating for universal primary education .

To the Editor:

Well, there he goes again. In his 4/3/04 op-ed piece, Nicholas D. Kristof returns to his crusade of many years: besmirching anti-sweatshop and anti-child labor activists. In the process, he as usual distorts the truth, this time by, for example:
The charities that Kristof praises for providing school meals in places like Toukoultoukoult in Chad do good and necessary work, but, dear Lord, they barely scratch the surface. To help make a dent in the problems faced by small children in the Third World, changes are needed in how our global trade and investment system now works. Globalization can and must be made to work better.

It should, for example, set down rules that forbid the transfer of ancient agricultural customs (like child bondage)into modern-day factories that mass-produce goods for wealthy Western nations. Kristof may disagree, okay, but the least he could do is to stop venting his self-righteous indignation against students and others whom he accuses of self-righteous indignation.
    -- Robert A. Senser

 

Human Rights for Workers: Bulletin No. IX-5     May 11, 2004
http://www.senser.com
Robert A. Senser, editor
Copyright 2004
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