The TPP Will Finish What Chiles Dictatorship Started
Published on
Friday, September 11, 2015
by
The Nation
The TPP Will Finish What Chiles Dictatorship Started
Salvador Allende warned against neoliberalisms disastrous effects just
before he was overthrown. He was right to be worried.
by
Greg Grandin
Crowds examine the debris outside the La Moneda government palace in
Santiago de Chile, on the morning of September 15, 1973. (Photo: AP)
This September 11th will be the forty-second anniversary of the US-backed
coup against the democratically-elected Chilean government, led by the
Socialist Salvador Allende, kicking off a battle that is still being fought:
in Chile, protests led by students, indigenous peoples, and workers to
rollback the neoliberalization, or Pinochetization, of society, are a
continuing part of everyday life.
Neoliberalism is hard to define. It could refer to intensified resource
extraction, financialization, austerity, or something more ephemeral, a way
of life, in which collective ideals of citizenship give out to marketized
individualism and consumerism.
But Allende offered a pretty good definition back in 1972, in a speech to
the United Nations given less than a year before his overthrow and death. He
said: We are faced by a direct confrontation between the large
transnational corporations and the states. The corporations are interfering
in the fundamental political, economic and military decisions of the states.
The corporations are global organizations that do not depend on any state
and whose activities are not controlled by, nor are they accountable to any
parliament or any other institution representative of the collective
interest. In short, all the world political structure is being undermined.
Like rust, neoliberalism never sleeps. The global rentier class that
enriches itself off the neoliberal property-rights regime had, a decade ago,
hoped to lock-down Latin America under the hemisphere-wide Free Trade
Agreement of the Americas (FTAA). In its original version, the FTAA was
meant to be a special carve-out for Washington and Wall Street, as global
free trade advanced under the umbrella of the Doha round of the WTO. Kind
of an economic Monroe Doctrine, whereby the US could maintain its regional
hegemony over Latin America while still promoting, when it suited,
globalization. But that scheme fell apart with the return of Latin Americas
post-Washington Consensus left, led at the time by Brazil, Venezuela, and
Argentina. And the Doha round stalled.
So Washington came back with the Trans-Pacific Partnership, a 12-country
treatyincluding Chile, Peru, and Mexicovigorously promoted by the Obama
administration. Its been described nicely by Lori Wallach as NAFTA on
steroids. As others have pointed out, the TPP isnt really about trade.
Rather, its a supra-national regulatory straitjacket that institutionalizes
Allendes 1972 warning. Among other things, the TPP has the effect of hiving
Brazil and Argentina off from Latin Americas Pacific Rim countries. South
Americas governing left is weakened and defensive, and the vitality with
which Lula, Chávez, and Kirchner pushed back on any number of US
initiativeswar on Iraq, trade, intellectual property, and so onis
dissipated. In Brazil, Dilma has recently capitulated on a number of issues
she had long resisted, including surveillance and the adoption of Patriot
Act-like anti-terror legislation (not to mention her recent visit to NYC
to genuflect before Henry Kissinger). The divide-and-rule TPP would, by
creating a divergent set of economic interests among neighboring countries,
further limit the possibility of political solidarity against economic and
security policies pushed by Washington (as this pro-TPP op-ed implies).
The TPP includes one provision that will, if activated, complete the 1973
coup against Allende: its Investor-State Dispute Settlement mechanism. ISDS
allows corporations and investors to sue governments directly before
tribunals of three private sector lawyers operating under World Bank and UN
rules to demand taxpayer compensation for any domestic law that investors
believe will diminish their expected future profits. You can read James
Surowiecki, in The New Yorker, here on the ISDS. And here is Elizabeth
Warren. And Public Citizen and The Atlantic.
The principle behind the ISDSthat corporations have an inherent right to
demand compensation for any regulation that might impinge on their expected
future profitsis a perfect negation of a major principle of Allendes
socialist program: that poor nations not only had a right to nationalize
foreign property but that they could deduct past excess profit from
compensation for that property, calculated as anything above 12 percent of a
companys value.
Allende and his Popular Unity coalition not only seized the operations of
the Anaconda and Kennecott mining companies but, once the sums were done,
handed them overdue bills for even more money. On September 28, 1971,
Allende signed a decree that tallied the excess profit owed by these
companies to be $774,000,000. (as might be expected, US and Canadian mining
companies, including the current version of Anaconda, are strong for the
TPP.) This decree was a turning point in the history of international
property rights, when Washington (which, since the Mexican Revolution, had
grudgingly accepted the idea of nationalization) decided that its tolerance
of Third World economic nationalism had gone on long enough.
In an October 5, 1971 meeting in the Oval Office, Treasury Secretary John
Connally complained to Nixon: Hes [Allende] gone back and said that the
copper companies owe $700 million. Its obviously a farce, and obviously,
hes ahe doesnt intend to compensate for the expropriated properties. Hes
thrown downHes thrown the gauntlet to us. Now, its our move.
Nixon then said he had decided were going to give Allende the hook.
Connally: The only thing you can ever hope is to have him overthrown.
In the 1970s, socialism was, for many, on the horizon of the possible, with
the principle of excess profit seen as a way for exploited countries to,
in Allendes words, correct historic wrongs. Today, forget
nationalization, much less socialism. If the TPP is ratified and ISDS put
into effect, countries wont be able to limit mining to protect their water
supply or even enforce anti-tobacco regulation.
This September 11th, as the Obama administration makes its final push for
the TPP, its worth taking a moment to realize why all those people in
Chileand in Uruguay, Brazil, Argentina, Guatemala, El Salvador, and
throughout Latin Americadied and were tortured: to protect the future
profits of multinational corporations.
© 2014 The Nation
Greg Grandin
Greg Grandin teaches history at New York University and is a member of the
American Academy of Arts and Sciences. His most recent book is, The Empire
of Necessity: Slavery, Freedom, and Deception in the New World. His
previous book, Fordlandia, was a finalist for the Pulitzer Prize in history.
The TPP Will Finish What Chiles Dictatorship Started
Published on
Friday, September 11, 2015
by
The Nation
The TPP Will Finish What Chiles Dictatorship Started
Salvador Allende warned against neoliberalisms disastrous effects just
before he was overthrown. He was right to be worried.
by
Greg Grandin
6 Comments
Crowds examine the debris outside the La Moneda government palace in
Santiago de Chile, on the morning of September 15, 1973. (Photo: AP)
This September 11th will be the forty-second anniversary of the
US-backed coup against the democratically-elected Chilean government, led by
the Socialist Salvador Allende, kicking off a battle that is still being
fought: in Chile, protests led by students, indigenous peoples, and workers
to rollback the neoliberalization, or Pinochetization, of society, are a
continuing part of everyday life.
Neoliberalism is hard to define. It could refer to intensified
resource extraction, financialization, austerity, or something more
ephemeral, a way of life, in which collective ideals of citizenship give out
to marketized individualism and consumerism.
But Allende offered a pretty good definition back in 1972, in a
speech to the United Nations given less than a year before his overthrow and
death. He said: We are faced by a direct confrontation between the large
transnational corporations and the states. The corporations are interfering
in the fundamental political, economic and military decisions of the states.
The corporations are global organizations that do not depend on any state
and whose activities are not controlled by, nor are they accountable to any
parliament or any other institution representative of the collective
interest. In short, all the world political structure is being undermined.
Like rust, neoliberalism never sleeps. The global rentier class that
enriches itself off the neoliberal property-rights regime had, a decade ago,
hoped to lock-down Latin America under the hemisphere-wide Free Trade
Agreement of the Americas (FTAA). In its original version, the FTAA was
meant to be a special carve-out for Washington and Wall Street, as global
free trade advanced under the umbrella of the Doha round of the WTO. Kind
of an economic Monroe Doctrine, whereby the US could maintain its regional
hegemony over Latin America while still promoting, when it suited,
globalization. But that scheme fell apart with the return of Latin Americas
post-Washington Consensus left, led at the time by Brazil, Venezuela, and
Argentina. And the Doha round stalled.
So Washington came back with the Trans-Pacific Partnership, a 12-country
treatyincluding Chile, Peru, and Mexicovigorously promoted by the Obama
administration. Its been described nicely by Lori Wallach as NAFTA on
steroids. As others have pointed out, the TPP isnt really about trade.
Rather, its a supra-national regulatory straitjacket that institutionalizes
Allendes 1972 warning. Among other things, the TPP has the effect of hiving
Brazil and Argentina off from Latin Americas Pacific Rim countries. South
Americas governing left is weakened and defensive, and the vitality with
which Lula, Chávez, and Kirchner pushed back on any number of US
initiativeswar on Iraq, trade, intellectual property, and so onis
dissipated. In Brazil, Dilma has recently capitulated on a number of issues
she had long resisted, including surveillance and the adoption of Patriot
Act-like anti-terror legislation (not to mention her recent visit to NYC
to genuflect before Henry Kissinger). The divide-and-rule TPP would, by
creating a divergent set of economic interests among neighboring countries,
further limit the possibility of political solidarity against economic and
security policies pushed by Washington (as this pro-TPP op-ed implies).
The TPP includes one provision that will, if activated, complete the 1973
coup against Allende: its Investor-State Dispute Settlement mechanism. ISDS
allows corporations and investors to sue governments directly before
tribunals of three private sector lawyers operating under World Bank and UN
rules to demand taxpayer compensation for any domestic law that investors
believe will diminish their expected future profits. You can read James
Surowiecki, in The New Yorker, here on the ISDS. And here is Elizabeth
Warren. And Public Citizen and The Atlantic.
The principle behind the ISDSthat corporations have an inherent right to
demand compensation for any regulation that might impinge on their expected
future profitsis a perfect negation of a major principle of Allendes
socialist program: that poor nations not only had a right to nationalize
foreign property but that they could deduct past excess profit from
compensation for that property, calculated as anything above 12 percent of a
companys value.
Allende and his Popular Unity coalition not only seized the operations of
the Anaconda and Kennecott mining companies but, once the sums were done,
handed them overdue bills for even more money. On September 28, 1971,
Allende signed a decree that tallied the excess profit owed by these
companies to be $774,000,000. (as might be expected, US and Canadian mining
companies, including the current version of Anaconda, are strong for the
TPP.) This decree was a turning point in the history of international
property rights, when Washington (which, since the Mexican Revolution, had
grudgingly accepted the idea of nationalization) decided that its tolerance
of Third World economic nationalism had gone on long enough.
In an October 5, 1971 meeting in the Oval Office, Treasury Secretary John
Connally complained to Nixon: Hes [Allende] gone back and said that the
copper companies owe $700 million. Its obviously a farce, and obviously,
hes ahe doesnt intend to compensate for the expropriated properties. Hes
thrown downHes thrown the gauntlet to us. Now, its our move.
Nixon then said he had decided were going to give Allende the hook.
Connally: The only thing you can ever hope is to have him overthrown.
In the 1970s, socialism was, for many, on the horizon of the possible, with
the principle of excess profit seen as a way for exploited countries to,
in Allendes words, correct historic wrongs. Today, forget
nationalization, much less socialism. If the TPP is ratified and ISDS put
into effect, countries wont be able to limit mining to protect their water
supply or even enforce anti-tobacco regulation.
This September 11th, as the Obama administration makes its final push for
the TPP, its worth taking a moment to realize why all those people in
Chileand in Uruguay, Brazil, Argentina, Guatemala, El Salvador, and
throughout Latin Americadied and were tortured: to protect the future
profits of multinational corporations.
© 2014 The Nation
/author/greg-grandin
/author/greg-grandin /author/greg-grandin
Greg Grandin teaches history at New York University and is a member of the
American Academy of Arts and Sciences. His most recent book is, The Empire
of Necessity: Slavery, Freedom, and Deception in the New World. His previous
book, Fordlandia, was a finalist for the Pulitzer Prize in history.
