SOCIAL, ENVIRONMENT CLAUSES A 'POLITICAL DIVERSION'

4:51 PM Jul 21, 1995

SOCIAL, ENVIRONMENT CLAUSES A 'POLITICAL DIVERSION'
by Vandana Shiva*

New Delhi July (TWN) -- Environmental and social activists groups in the North favour and push for social and environment clauses in trade agreements, but a closer scrutiny shows they cannot function as instruments to ensure equity and ecological stability.

There are three possible reasons for introducing such clauses in a 'free trade' discourse:

* As a mechanism for reversing environmental and social deregulation of commerce that 'free trade' requires.

Such deregulation has severe social and environmental impacts while protecting people's livelihoods and environment needs mechanisms for regulating trade and commerce.

* As protectionist measure to block market access in industrial countries for exports from developing countries.

While 'free trade' treaties like the GATT are basically unequal treaties, social and environment clauses attached to them can make them completely one-sided. They will allow free market access for Northern corporations and products in the Third World, but deny market access for Third World products, especially primary commodities and labour-intensive products of small-scale sector.

* For deflecting and diverting attention from the environmental and social impact of free trade by creating divisions within social movements. Environmental and social activist groups in the North supporting social and environment clauses in free trade treaties see the first reason as the main one for such clauses.

But the fact that the issue of 'green' and 'blue' clauses was raised in Marrakesh, after the conclusion and adoption of the WTO/GATT texts, should make it clear to anyone that reversing deregulation is not the objective. In fact even as the environment/social clause discussion is getting intensified, environmental and labour laws are being weakened and dismantled worldwide.

The countries promoting the environment and social clauses are the very ones that pushed rules in new areas in the Uruguay Round - with serious impacts on environment and the Third World. Introducing agriculture and intellectual property into the GATT, taking them away from sovereign domestic policy-making, promotes monoculture and intensive resource use in agricultural production and trade.

The lack of real environment commitment is evident in the way the issue of domestically prohibited goods has been handled in the GATT. It was a work programme dating back to 1982, and revived in 1989 and taken up for discussion along with the Uruguay Round package. But the subject has been quietly buried because of the US - which wanted exemption for pharmaceuticals, pesticides and chemicals, and automobile parts.

This though is an issue of central importance to environmental movements and policy making in the South. Since 1989, there have been some 500 attempts at exporting toxic waste from the OECD countries which generate 90% of such wastes. And recently, the industrial countries have tried to undo the ban on toxic trade in the Basel Convention.

Similarly, even as social clauses are being discussed, thousands and millions of workers are losing their jobs and the entire work force is becoming a new reserve of part-time insecure workers competing with each other to push wages downwards. As US ecologist Jeremy Rifkin has put it, in some places in the US "the work place has become a virtual war zone, with laid-off employees shooting fellow employees and employers, and with homicide as the third major cause of death at the workplace.."

Social clauses would do nothing to provide job security in these "war zones", but divert energies of Northern trade unions -- from dealing directly with this crisis of work domestically and make them focus on conditions in the Third World. And instead of strengthening the movement to deal with unemployment crisis and job loss through enforcing social accountability on corporations and governments, social clauses make bedfellows of Northern trade unions and their corporations to jointly police and undermine social movements in the South. Thus the argument that environmental and social clauses will create a mechanism for controlling TNCs which are the main beneficiaries of 'free trade', is flawed.

Globalization is centred on the emerging information-technology industries, for whom the TRIPs agreement is crucial to ensure market monopolies. And IPRs are the mechanism to prevent biological and information free reproduction. Both these technologies are labour-displacing.

Biotechnologies (BT) are specially designed to displace Third World export crops like vanilla, sugar and cocoa and millions of farmers in the Third World will lose their livelihoods. Even where agriculture has not moved to BT, the corporatisation and globalization of agriculture threaten the survival of Third World farmers

Information technologies are at the heart of automation and dispensability of labour. ILO studies show that by thus reducing labour costs, automobile TNCs can triple their profits. The automation process in the steel industry has left thousands of blue-collar workers jobless.

And when production is globalized under TNC control, jobs don't move from high-wage countries of the North to the South. Jobs disappear from both North and South and social clauses don't touch this issue nor create any mechanism for social controls over emerging technologies.

The only group of commodities around which social clause discourse has been most concretely focused are those produced by the 'sunset' industries of the North and in which exports from the South, specially from the small-scale and unorganized sector, are competing effectively. But these sunset industries are not at the heart of the globalization.

A real intervention for social justice and employment security would require that General Motors, US Steel and other TNCs don't freely shed their workers. But the 'free trade' offers precisely the opposite - freedom from social accountability and responsibility. Instead of intervening to protect workers, Northern governments are intervening in trade to protect their sunset industries.

And the real reason why the 'social clause' discussion was started at Marrakesh was to deflect and divide social movements. Social clauses do not address the vital issues that social movements have been focusing on in the discourse on 'free trade': the social dislocation and disintegration, the destruction of sustainable livelihoods and the dismantling of workers rights taking place and social unaccountability of corporations. Social clauses address none of these issues. Even the ILO uses 'social clauses' and 'social dimensions' interchangeably.

The heart of the debate is how to ensure that 'free trade' is subservient to social and ecological objectives.

In the non-governmental sector, the debate is not about whether trade should be subject to the principles of justice and sustainability, but whether clauses on social and environmental standards in 'free trade' treaties are effective instruments for this.

But 'free trade', or freedom of commercial and trading interests to shed environmental and social responsibility, is a nice word for deregulation of commerce. Added as a postscript to treaties such as GATT and NAFTA, social and environmental clauses raise fundamental questions of how they can function in a context of deregulation. They can only function as instruments to be used selectively as trade barriers and as part of a politics of fragmentation.

Social movements are split on this issue. But it is not because of a split in political commitments to social justice and need to strengthen right to work and workers' rights, but because of a confusion in a gap in understanding of how 'free trade' treaties and trade institutions work. There is a confusion between the right to work and right to livelihoods, workers' right to organize, and 'trade-related' labour standards. Trade-related labour standards do not stop destruction of jobs, but are merely be activated when labour-standards can be used to ban imports. As part of trade treaties, they are inadequate instruments of social justice, do not reverse the logic of deregulation and do not address the issue of restructuring of production and dispensability of workers.

The social clause issue divert attention from the crisis of work and unemployment to 'labour standards', shifts the debate from 'right to work' to the 'right to organize' at a time when organized work itself is disappearing. The social clause is not a social policy instrument either. Trade treaties are between governments, not people, nor corporations that are pushing them; they function primarily as conditionalities pushed by the Northern governments on Southern governments. They do not empower civil society, in the North or the South, but empower northern commerce and Northern governments.

Social clauses do not challenge the logic of 'free trade' and globalization of every aspect of local and national commerce. They do not prevent investment of Northern capital in socially and environmentally destructive ventures in the South - e.g. the Dupont plant in Goa imposed by the US under threat of S.301.

Social clauses do not stop processes in the South causing Third World poverty - debt, constant reduction in commodity prices and terms of trade, and policies of the Bretton Woods institutions. They don't address the devaluation and structural adjustment programmes that reduce wages in the South.

NGOs working on the social clause speak of 'stopping social dumping', but don't address the wage reductions through devaluations and wiping out of organized labour that is part of the SAPs. In a world where global institutions create global apartheid, unfair wages in the Third World are inevitable. Social clauses in trade treaties, imposed as trade restrictions on Third World products in Northern markets, do nothing to stop the dumping of large numbers of Third World people. The real crisis is this dumping of people, not dumping of products of their labour on Northern markets.

And workers rights in India would be the first casualty of the use of US Super 301 and Special 301 and S.301. And when some citizens' groups in the North align themselves with use of unilateralism (for environmental and social objectives), the solidarity between the citizens movements of the South and the North are threatened.

For citizens movements in the South, there are two kinds of activities to make an impact on trade and economic activity. One is unilateralism by the powerful. But historically, unilateralism has never been used by the strong for the good of the weak, but for their exploitation. Unilateralism as a conditionality attached to aid, SAPs of the IMF and the World Bank, have all resulted in lowering health, educational, environmental and living standards of people all over the world. It has resulted in repressive control of Third World populations.

The other activity open to citizen groups in the South is things like boycotts, non-cooperation and civil disobedience. These build up pressures on States to change domestic policy and, if domestic policy space is shrunk by global institutions like GATT, use democratic processes to change multilateral institutions.

It is in this sphere that Northern and Southern groups need to support each other. Northern groups need to identify and mount public campaigns to control TNCs in their own countries.

Instead of a social clause, the WTO should have a social justice agenda -- a social audit of 'free trade' and empowering local communities to determine their patterns of trade and investment.

(* Dr. Vandana Shiva is a noted Indian ecologist, author and social activist. The above is excerpted from a longer article in Resurgence, a TWN monthly magazine)