The Enron Stage
of Capitalism
The Reckless
Terrorism of GATS
by Vijay Prashad
Dissident Voice
November 9, 2002
The Enron Stage of Capitalism is
represented by GATS.
GATS is the
General Agreement on Trade in Services, an agreement of the powers launched in
Geneva, Switzerland, just a few months after the smoke cleared from the Battle
of Seattle (December 1999). The powers first broached GATS in 1994 and hoped to
get it into place by the end of 2002 - they are on track.
But what is
GATS? Early in the deliberations, the US specified, "The mandate of the
negotiations is ambitious: to remove restrictions on trade in services and
provide effective market access, subject to specific limitations. Our challenge
is to accomplish significant removal of these restrictions across all service
sectors." Or, in English, to open all those areas hitherto protected for
the public good to the profit motive.
Enronistas
worldwide salivate before the enormous market of services: $1 trillion in water
services, $2 trillion in educational services and $3.5 trillion in health
services. And then there is power generation and other utilities.
Here is another
push by capitalist forces to entrap areas of economic life that had once been
outside the sway of the commodity form. During the era of social democracy from
the 1930s to the late 1970s, capitalist relations did not overwhelm the realm
of water, air, energy, health and education. But for over three decades,
especially since the 1990s, during neoliberal times, these protected zones have
come under pressure from transnational corporations and international finance
institutions arguing that unproductive zones need to be opened to the
efficiency of the profit-driven marketplace. Governments, so the argument goes,
cannot protect their right to deliver these services to their citizenry at a
subsidized rate. To do so "discriminates" against the right of a
transnational corporation to underbid the state and offer its own paltry
services instead. Government effort and regulation crowds out private
enterprise, and must therefore be minimized.
Enronism is here
to stay, even as Enron is now gone.
All
international bodies prior to the World Trade Organization (WTO) only had an
advisory function, with very constrained powers to force sovereign nations to
do the will of the planet. Although states can use an adjudication process for
disagreements, the WTO is a governmental body with multi-national power to sanction
states that do not follow its rules. In the process that produced the WTO, the
Uruguay Round of the General Agreement of Trade and Tariffs (GATT), there was a
broad discussion of various multi-national agreements such as the Multilateral
Agreement on Investments (to formulate "rules" for finance markets, a
measure defeated in December 1998 due to strong protests across the world), the
Trade Related Intellectual Property Rights or the TRIPS regime, and finally
GATS (the General Agreement in Trade in Services) formed in 1994 by one hundred
and forty nations as a part of the WTO. The overall framework of GATT was to
"liberalize" the traffic in goods, to open markets to transnational
corporations and to cutback on the right of states to levy tariffs as a means
to manage economic development and equity. It appears that these can be
violated by the US, when it suits it, as made clear by its 2002 tariff on
imported steel.
GATS sought to
"liberalize" the international trade in services, from banking
regulations to real estate brokerage services to rules for accountancy. GATS
arose to manage the most vibrant growth sector in the international economy:
services. This sector, which has outgrown merchandise trade for the past two
decades, accounts for twenty percent of all cross-border trade and totals, in
1999, $1.35 trillion. While hotels, travel agencies and others are popularly
associated with the service sector economy, this arena also includes those
services traditionally provided by the government. One of the biggest ones
across the planet is health care. GATS takes aim at this juicy target,
attempting to privatize it through the export--and forced import -- of the
disastrous US model around the planet.
Far from being
mere opportunists of a global context created by the fall of the USSR and other
changes, these global firms do more than just privatize services by purchasing
them or building new facilities. They also supersede the democratic process of
many countries by taking over the function of writing the rules.
Both Enron and
Arthur Andersen were in the thick of the 1990s GATS discussions, even as
anti-globalization protests paid little heed to these deliberations. Andersen
formed part of the team that drafted the new rules for GATS on accountancy
procedures. There is no indication that its role in the Enron scandal that
brought it disgrace and dissolution will provoke any reconsideration of those
rules.
The main group
that lobbies for "liberalization" in GATS is the US Coalition of
Service Industries, all of whose members hoped to gain immeasurably from the
privatization of services across the planet. Enron was a member -- and a top
sponsor -- of the 1999 World Services Congress in Atlanta that set in motion
the GATS 2000 round of lobbying. Enron has also been a major player in the two
umbrella groups that work almost full-time on GATS - US Trade (the strongest
proponent of Fast Track, or Trade Promotion Authority, for the President) and
USTR Industry Consultation Program - Industry Sector Advisory Committee on
Energy. Enron is on the board of the National Foreign Trade Council and a
member of the US Council for International Business - both major forces within
US Trade. As a mark of how seriously Enron takes these issues, for USTR, Enron
deputized its Executive Vice President Terry Thorn to be its representative. In
addition, Enron was part of the US Energy Service Coalition whose mandate is to
ensure that oil and gas drilling is seen as a service within GATS.
These
instruments of globalization are filled with Enron/Andersen staff, and it is
likely that many of the things they wanted prior to their bankruptcy phase will
continue to form the agenda of the overdeveloped world through GATS and GATT.
These policies will be an important part of Enron's legacy. Policies that
enable the second enclosure movement. A movement of money dealers addicting the
world to dollars and nonsense, just as they snatch their livelihood from it.
Enron has
collapsed. We won that battle. Let the war against this "reckless
terrorism" continue.
Vijay Prashad is Associate Professor and
Director of the International Studies Program at Trinity College, Hartford, CT.
He is the author of Fat Cats and Running Dogs: The Enron Stage of
Capitalism (Common Courage, 2002), Everybody Was Kung Fu
Fighting (Beacon Press, 2001), and The Karma of Brown
Folk (Univ. of Minnesota, 2000). Email: Vijay.Prashad@trincoll.edu