Public Services International The global union federation of workers in public services

Today's trade deals have very little to do with lowering tariffs. Instead they are binding treaties that undermine national sovereignty and restrict government ability to pass the laws and provide the public services that you need.

These treaties make delivering public services and regulating corporate power harder, and provide legal rights to foreign multinationals that workers, consumers, the environment and citizens do not have.

Trade deals must never place profit before people.

They even allow foreign multinationals to sue governments in private courts for billions in tax payers money if their profits are not guaranteed. These provisions are at the heart of the global economic model that drives down wages and drives up massive economic inequality.

We need a global multilateral trade system that delivers for the economic, social and developmental needs of everybody.

We expose the secret deals that undermine workers and public services and fight for global rules that benefit everyone - not just the 1%.

More than just Free Trade

For decades, free trade has been promoted as the only route to economic development. Yet the most recent wave of trade and investment agreements are about far more than trade.

A US oil company is using ISDS to force Ecuador to pay over $1 billion: equivalent to the country's entire annual social welfare expenses

Deals such as the Trade in Services Agreement (TiSA), the Trans Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP) are designed to institutionalize the rights of investors and limit government action in a wide array of areas only incidentally related to trade. Trade is increasingly being used as a cover to create binding laws, away from democratic parliamentary institutions, which hand new rights to some of the largest investors and multinational corporations on the planet. For example, Investor State Dispute Settlement (ISDS) provisions, contained within many new agreements, give corporations the right to sue governments for public policy which might impede on their ability to extract future profits. These rules are enforced through secretive international tribunals and bind future governments to certain policy prescriptions, and make it difficult to withdraw from these agreements without paying massive compensation.

The ISDS system has become an icon of the shameless extent to which governments have pandered to corporate interests by giving foreign corporations rights that citizens and local businesses do not have.

As public sector unions, we have a direct interest in the ISDS debate as the punishing fines issued by these private tribunals bleed tax payer money away from quality public services to boost corporate profits.

The European Commision is now attempting to rebrand ISDS, and has created a number of new proposals including the Investment Court System (ICS) and the Multilateral Investment Court (MIC)

A recent PSI study shows that neither of these systems are judicially independent nor would they protect governments from having to pay compensation to corporations for making lawful, non-discriminatory laws to protect workers, health or the environment. Worryingly collective bargaining agreements amongst social partners could also become the target of law suits.

Unlike these enforcable investment and trade rules, large corporate interests have blocked attempts by unions and civil society to create binding human rights standards. Corporations consistently undermine global labour standards, environmental standards, tax enforcement and anti-corruption measures – yet demand strong enforceable sanctions when their own interests are at stake.

We reject any attempt to entrench the rights of corporations above the laws which workers and local businesses are held to.

Working with affiliates and civil society, we have already built a strong public opposition to ISDS.

Now we must ensure that re-packaged proposals are not allowed to sneak in to future trade agreements.

No Trade in Public Services

Public services are designed to ensure fundamental social and economic necessities are provided to the public affordably, universally and on the basis of need. They exist because markets will not produce these outcomes.

Trade agreements, by contrast, deliberately promote commercialisation and define goods and services in terms of their ability to be exploited for profit by global corporations and international service providers.

Treating public services as commodities undermines their social purpose. This is a deliberate attempt to privilege the profits of the richest in the world over those who have the greatest need.

Proponents of the TISA, along with the TTIP, TPP, GATS and RCEP and others, often argue that public services are protected by the so called “government services exemption”, a title which might lead the casual observer to conclude that government services are exempted from market liberalisation.

Yet these clauses often stipulate that services cannot be supplied “on a commercial basis” nor “in competition with one or more service suppliers”.

When does a patient co-charge for a health service or medicine constitute a service supplied on a commercial basis? It is not clear weather a public water, energy or transport authority charging fees that recover costs to supply services to business and consumers is exempt.

Almost all government education, transport and most health services are arguably in competition with at least one private provider and many have some degree of "commercial basis" and therefore be subject to the clauses and policy restrictions of a trade agreement.

In 2015, a Union led campaign in Uruguay succeeded in leading the government to withdraw from the Trade in Services Agreement negotiations.

PSI has drawn on their experience to create a union-campaigning toolkit on Trade in Services. Check it out here.

Winners and Losers

Even the most ardent supporters of trade agreements admit that there are winners and losers.

Estimates of benefits are often overstated but even where trade does facilitate rises in national wealth this wealth is not evenly distributed.

The winners are usually the large powerful countries who are able to assert their power, multinational corporations who are best placed to exploit new access to markets and wealthy consumers who can afford expensive foreign imports.

The losers tend to be workers who face job losses and downwards pressure on wages, users of public services and local small business who cannot compete with multinational corporations.

In this environment, the pressure to lower wages to maintain competitiveness has become a dogma. Countries respond by undermining workers’ rights, often breaching core labour standards and fundamental human rights.

These truths can be hidden because the negative effects are not always obviously linked to the trade deals; they creep in over time. By contrast the political pressure for immediate market access is intense as large corporate interests invest heavily in influencing the political process and promote the claimed benefits.

Democracy

Is there a democratic country in the world that would knowingly accept its government agreeing laws that so fundamentally shift power and wealth, bind future governments, bypass its domestic courts and restricts its own ability to provide for its citizens - entirely in secret?

The answer is clearly no. Which is perhaps why these trade agreements are negotiated in secret.

We are not opposed to trade.

However, after decades of globalisation, the benefits are spiraling upwards and power rests with wealthy elites who use it to influence governments and institutions.

They are shaping global trade rules to serve their interests, not the public interests.

We need to break the stranglehold which market orthodoxy holds over mainstream politics and advance new policies on trade and development which serve workers and our communities.