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Critics of the Multilateral Agreement on Investments oppose it on a variety of grounds, the main one being that any economic regime should give rights to all people, not (only) the small class of investors and large corporations. One percent of enterprises already account for fifty percent of foreign direct investment, and two thirds of trade is amongst multinationals, and yet they want expanded powers and even greater capital mobility via the MAI, writes the author.

A new way to rob your piggybank

By Brian Hammer

People in all developed countries have been indoctrinated to believe that private investors, including financial groups and corporations, are the mainstay of the economy. So why would a treaty that expands their rights cause concern?

This paper first presents a brief summary of what the MAI will do, the OECD's reasons in support of the MAI, opponents' criticisms of it, and alternative proposals to the MAI (at least the ones that could be discovered by the author). Understanding the MAI will in turn show in greater detail how the modern economic system works (and fails to work).

The paper then evaluates some of these same anti-MAI proposals. Part of the problem with many anti-MAI alternatives is that they want to keep investment rules at more or less the same level they are now prior to signing the MAI - without seeing the injustice perpetuated in those rules or seeing how self-defeating such compromise proposals will inevitably be. Other proposals, however, are far-reaching and can serve as rallying points for activist resistance to the MAI, and capitalism in general, for its opponents. As living standards decrease, economic conditions worsen, and consciousness of alternatives expands, this resistance is bound to increase.

It is not hard to agree that the ongoing expansion of free market rights and its associated worldview is the most serious threat facing humanity, as well as the environment and other species, today. It affects us economically, culturally, socially, psychologically and even spiritually, though the economic sphere, where it has its power base, will be the main focus here. Not only socialists, but populists, small farmers, women's organizations, labor unions, intellectuals, students and even some nationalists agree about this threat.

In the end, all choices about the economy are people's choices, and for this, detailed knowledge of the MAI, counterproposals and the rationality (or lack of it) behind them is a vital necessity. As Herbert Marcuse said over 30 years ago, "the prevailing mode of freedom is servitude", and "All liberation depends on the consciousness of servitude...". Understanding the MAI and its implications will show part of what that means.

What MAI will do

Countries that sign the MAI will be required to:
(1) Denationalization. Open all economic sectors, including production, services, real property, broadcasting, and natural resources to foreign ownership.
(2) National treatment. Treat foreign investors no less favorably than domestic firms (a non-discrimination principle), which would eliminate preferential tax, loan and other treatment for small locally oriented enterprises and suppressed ethnic groups, though there is scope for foreign investors to be treated more favorably than domestic firms.
(3) Performance requirements. As originally drafted, remove "Performance Requirements", which are laws that require investors to behave in certain ways in exchange for market access, such as, for example, requirements to use local suppliers, take on local partners, hire a minimum number of local employees, provide a living wage, and observe existing environmental protection laws. Under pressure PR requirements relating to levels of employment, production, investment and sales have recently been removed.
(4) Capital mobility. Remove restrictions on the movement of capital, including restrictions governing the end use of profits, such as reinvestment, and currency speculation, as well as requirements that investment be long term and thus stable and sustaining.
(5) Expropriation. Compensate investors in full when their assets are expropriated, either through seizure, nationalization or "unreasonable" regulation such as environmental or health regulations and laws aimed at punishing businesses that operate in brutal regimes like Burma.
(6) Disputes. Accept a dispute resolution process allowing investors to sue governments for damages before international panels comprised of narrowly qualified, unelected "trade experts" when investors believe a local, state/provincial or national government¹s laws violate MAI rules; ordinary people and elected government representatives are excluded from these panels.

Arguments for the MAI

MAI advocates present a number of defenses for it. The sole purpose of the MAI can be summed up in one sentence, taken from a ministerial declaration of the OECD, dated May 26, 1997:  "Ministers are convinced of the importance of international investment and the need for fair, transparent and predictable rules for investors and investments." That is, the MAI's purpose and benefits concern the relatively small number of serious investors only, and have no stated relevance to the needs of the billions of people in society at large, such as decent and increasing standards of living, health and safety, education, the environment, or democratic influence over investment and production decisions. It is an agreement for people with money, not people who need money. However, MAI supporters claim that certain advantages will flow to countries that sign the treaty, including:
1. Competition. Competition will increase.
2. Efficiency. Resources and capital will be allocated more efficiently.
3. Expansion. Economies will expand.
4. Jobs. New jobs will be created, especially in some circumstances export-oriented jobs that earn foreign exchange.
5. Consumer prices. Consumer prices will drop.
6. Trade. Trade will increase, resulting in more capital mobility.
7. Capital development. There will be a greater inflow of capital and advanced technology for poorer countries.
8. Market distortions. Regulations such as Performance Requirements, which often distort market forces, will be eliminated or simplified.
9. Global governance. A supranational legal institution will be established, which is needed to enforce codes and settle disputes and replace the current practice of allowing peer pressure and voluntary compliance to settle disputes surrounding investment; challenges to non-economic regulations like health and safety codes will be rare, and focus instead on environmental and other regulations that are said to be pretexts for protectionism.
10. Level playing field. Investors of every nationality will be assured of equal treatment where they invest, i.e., National Treatment will be afforded to both domestic and foreign investors.
11. Public policy and democracy. Country-specific reservations and exceptions (there are over 600 pages of them) allowed by the MAI are said to be adequate to meet the concerns of critics as to public policy and democratic participation.

Criticism of the MAI

Opponents of the MAI are very vocal and firm in their opposition, but not all opposition stems from the same kinds of reasons. Some want reform of the MAI, others want total restructuring of the economic system and its values. The partial list of criticisms below shows both what harms the MAI will bring about as well as the serious flaws in MAI supporter arguments.

1. Inequality, lowered standards and distribution of wealth. The MAI will result in increased inequality, unemployment and bidding down wages and labor standards as corporations try to relocate to the lowest cost production sites. Also, there is no explicit mechanism for distribution of economic gains from the MAI such that everyone benefits and not just private investors, corporations and their stockholders.

2. Dismantled regulations. Regulatory safeguards for the environment, worker safety, and consumer rights will be progressively dismantled either as a direct condition of signing the MAI or as a result of pressure to attract investors, though some countries support strong binding labor and environmental protection clauses in the MAI.

3. Governmental policy-making rights. Giving virtually unlimited rights to private investors will reduce governmental ability to pursue fiscal, monetary, industrial or planning policies that once assured relatively stable growth and widely distributed benefits.

4. Performance requirements and corporate/investor obligations. The MAI will at best contain recommended, not binding, provisions regarding corporate responsibilities and obligations regarding anti-competitive practices, treatment of employees, and environmental protection, though the issue is still undecided.

5. Openness and parties to the negotiations. MAI negotiations are being conducted in secret, with non-involvement, except for a few token labor and environmental organizations, of key public sectors at every stage. Business and investment associations have secured themselves a privileged role in influencing negotiations and in access to information. In addition, most countries are excluded from the negotiations, as only the 29 OECD members are participants.

6. Protective clauses. The country-specific reservations and exceptions that MAI supporters claim will protect various national interests and regulations will, say MAI opponents, be subject to challenge in MAI tribunals, and are thus somewhat illusory preservations of what remains of national sovereignty and its policy-making ability.

7. Level playing field for foreign investors. The National Treatment rule will allow governments to establish Performance Requirements for domestic businesses, but not require foreign investors to follow them. So while MAI proponents claim it will create a "level playing field" for businesses and investors of all countries, it will in fact create an advantage - we could even say "bias" - for foreign investors.

8. Incentives for foreign investors. Because a level playing field will eventually have more or less global reach, countries, especially developing countries, may feel pressured to offer additional incentives to stand out from the crowd and attract foreign investment. This could further reduce labor or environmental etc. standards and any benefits these foreign investment may offer; there is no binding clause in the MAI to prevent this downward pressure.

9. Appropriation of assets. Expansion of the practice of compensation for expropriated assets to include compensation for actions that are said to be "in effect" expropriation may include compensation for "losses" due to environmental and other regulations in the public interest.

10. Capital stability. The ban on restrictions and delays in repatriation of profits and movement of capital can easily destabilize domestic markets and currencies, as the Mexican and Southeast Asian currency crises have already proven, though monetary and exchange rate policies may be exempt.

11. Disputes and democracy. The unprecedented right of investors to sue national governments and seek monetary compensation in an international tribunal will be biased in favor of corporations and investors. Neither individuals, communities, social, environmental or labor organizations, or governments are given the power to countersue corporations. Proponents say these challenges will be rare, but that is only an assertion and is begging the question.

12. Security and opportunity. (a) "Roll-back" and (b) "standstill" provisions if made binding would require governments to (a) eliminate laws that violate MAI rules and to (b) refrain from passing such laws in the future, except for country-specific reservations. Such provisions will provide long-term security and opportunity for investors, but no one else. In addition, reservations will probably subject to future liberalization negotiations, though there is a trend now toward inclusion of open-ended exemptions.

13. Participation of developing countries. Developing countries will in effect be pressured to sign the MAI in spite of its theoretically voluntary nature in order to get foreign investment more easily.

14. Capital development. Trade deficits have grown under similar liberalization agreements in the area of trade in goods and services. Mobility of capital is no guarantee of a net increase in national or local capital either, nor is it any guarantee that capital will benefit all countries, as 70 percent of international investment in developing countries goes to just 12 countries.

15. Time frame and reconsideration rights. The MAI will require that countries allow corporations and investors to operate for a minimum of 20 years before they have to leave, even if governments change their decisions about the wisdom of their initial decision to let them in. This further isolates investors from democratic processes and can easily bind nations and peoples to unfair, harmful and impoverishing investor practices.

16. Need for the MAI. If governments establish investment priorities and conditions, investors and corporations can still decide on the viability of an investment. Thus, the MAI is said to be unnecessary if traditional government-private investor practices are retained as the norm.

17. Work and freedom. Because of downward pressure on purchasing power, many people are forced to work more than before to maintain their living standards. Impoverished people must work just to stay alive. This binds people more tightly to work as a necessity and represses their desires for expansion into other areas. Personal, cultural and spiritual development suffers as a consequence. The MAI could very well eliminate freedom from work even more.

Aside from the economic injustice that will become more acute under the MAI, the MAI is, according to some opponents, further evidence that the economy is being "centrally planned by global mega-corporations" and large private investors who are in practice becoming a non-democratic quasi-world government.

Alternative proposals to the MAI

Proposals for what could serve as a just "investment regime" are abundant and varying. And they range over several viewpoints, which may make a coherent and unified strategy to modify or replace the MAI, should it ever be enacted, more difficult. Many of them go beyond simple investment issues to a fundamental social and economic restructuring. These are the raw materials out of which this strategy - and a new world - may be hammered however.

1. Expansion of social insurance. Even though globalization is proceeding rapidly, adequate social insurance policies might counter its negative welfare effects. This is not a revision of MAI investment rules, but a proposal for reducing their negative effects.

2. Revising the terms of debate. Given the sharply divergent views over the merits and demerits of the MAI, there must be public disclosure of the MAI's terms, public discourse including citizens' groups and labor organizations, consultation, accountability, stay of negotiations for one year, and social and environmental assessments.

3. Sovereign rights. Sovereign rights over general economic policy, including conditions, priority sectors and performance requirements for corporations and investors, should be preserved at the national and sub-national levels of government, leaving investors free to decide on the feasibility of their investments.

4. Provision for development of local economies. The MAI should take into account the interests of local economies and community development. 5. Enforcement and adjudication. Enforcement of MAI terms and dispute settlement authority should be granted to objective panels of experts who monitor and enforce measures that will meet the environmental and human rights standards of the host nation or nation of origin of investors, whichever is higher.

6. Capital flight. The threat of capital flight should be decreased in accordance with fair labor negotiating principles, which means that corporations should not use the threat of plant closures and moving production out of country in labor negotiations.

7. Common property and distributive justice. Commonly owned natural resources and technology inherited from previous generations should be held as public trusts and leased out rather than sold to private interests. The income from these trusts should be distributed fairly to all residents in a given territory. Some MAI opponents say that renewable resources such as fisheries and forests should come directly under democratic community control and management.

8. Environmental law. National environmental protection rights, treaties and agreements should take legal precedence over trade or investment agreements.

9. Nationalism. Assure, like Japan has done, widespread ownership of land and capital assets by a country's citizens and a strong domestic market for domestically produced goods, which can serve as a foundation for export success, as opposed to allowing global rights to investors and corporations.

10. Exports, technology and capital development. Export only natural resources that are surplus to local needs, and invest a portion of the proceeds into acquiring control of technologies that will reduce dependence on those resources. An international investment fund could place these technologies in the public domain.

11. Imports. Control imports so that foreign exchange is not expended for luxuries and so that imports do not disrupt local small producers.
12. Distribution and ownership of capital. Assets and ownership of capital should be widely distributed to the "working people who create real wealth", which can mean an economic structure composed primarily of small businesses and worker-owned cooperatives.

13. Economy-ecology alignment. Every community should be aligned with a distinctive local ecology, such that economic development is defined as increasing a community's capacity for economic output, present and future, implying economic sustainability as well as growth. This will replace national measurements as the focal point of economic analysis.

14. Business size. Government must limit the size and growth of businesses operating locally so that none can dominate the others and so that local capital is protected from outside predators. Larger transnational corporations should be dismantled into enterprises serving predominantly local markets through worker and community buyouts.

15. Automation and freedom. Gains from mechanization and automation should be converted into a 20-hour workweek so that people can be freed from work for more meaningful activities.

Analysis of anti-MAI proposals

A few restraints on and alternative proposals to the MAI are simply unworkable, many others contain assumptions that themselves need to be examined. This section looks at what should, if all aspects are understood, be rejected and what should be adopted. Being against the MAI has many meanings, not all of which are sound, humane or just.

1. Expansion of social insurance. Because of corporate and capital mobility, the tax base of many communities that have historically relied on taxation to protect people from the free market is being steadily if not drastically eroded. This proposal is thus unrealistic except perhaps at the national level, but many national governments support globalization and weakened local controls.

2. Regulation, history and psychology. Most of the anti-MAI proposals discussed here aim at perpetuating the same form of property ownership that has led to the creation of the MAI in the first place. Their only goal is to restrain or modify it, leaving the basic structures and values intact - a "partial liberalization" strategy.

The danger here is that at any time in the future these restraints can again be broken asunder. Economic irrationality, injustice and impoverishment like we are seeing today would then reign again, and a new battle would again have to be fought.

Why this outlook? The main goal of key advocates of the private property system of ownership - those who benefit most from it - is the accumulation of wealth for themselves, and their main demand is freedom to pursue this goal. They are dynamic and aggressive, even ruthless, in defense of their interests, as we can see from the numerous wars, violence against movements for workers¹ rights and threats of factory closure that they have used in the past and use in the present.

Any references to "responsible and accountable business", "maintaining environmental and labor standards", allowing investors to decide on "viability", "performance requirements", and, depending on the more explicit meaning, "preferences to small-scale, local economic activity" fall within the partial liberalization strategy. So do "public accountability" and "preserving government policy-making rights" if this means the accountability of private investors and corporations and an alliance between the same and governments on any level. If parliaments and other law-making bodies do reject the MAI in whole or in part they will inevitably rely on this strategy.

3. Domination and cooperation. The third reason why restraints on investors, and the business class in general, are inadequate goes beyond history and investor psychology to the structure of the modern economy itself. Capitalism - as partial liberalization or otherwise - is, in a nutshell, a system of domination. Except in worker-owned cooperatives, the relation of employees, no matter how well paid or friendly, to employers is one of subordination ("bossism"-"employeeism2), not one of coordinated cooperation. Coercion may be veiled, rather than overt as in political dictatorships, but it exists nevertheless. To this extent working people are unfree, even in so-called "free" nations with a democratic form of political governance.

Domination is also a characteristic at the investor and firm level of the economy, as corporations grow to engulf small businesses and dominate communities etc.

Trying to keep businesses small ("populist capitalism") through government restrictions, as some MAI opponents propose, will still fail to uproot the logic of domination that characterizes an economy based on private ownership. Governments would still have to fight the ambitions of private business owners who do not want to remain small, and their sympathizers could easily find a place in government. Indeed, the present economic system itself began with small business.

Constitutional restraints on private business size could help, but they would not eliminate an economic form that encourages domination. The ethic of cooperation - the antithesis to domination and competition - requires its own economic forms. Without an economy providing a living counterexample to private enterprise, the latter will always win out simply through being most prevalent. Capitalism is not the antithesis to the free market and small business, but grows out of them.

What MAI opponents who aim for a redistribution of ownership into small business hands fail to realize is that the cooperative model of democratic worker ownership extends the same benefits and virtues of individual worker-ownership to far more people. Worker ownership is thus superior to small business ownership alone, and without its drawback as the root of the private property mentality.

4. Dehumanization. Advocates of the partial liberalization model fail to recognize that capitalism reduces people economically and thus socially to the status of commodified labor, whether manual or intellectual, and commodity consumers, whether well-fed or otherwise. This is little different in essence from the level of oxen, who can also work if they are trained and fed.

Higher, human faculties - including the abilities to think, discuss and decide, which are part of being human - are banished from other economic activities, particularly those involved in ownership and control of capital. Capitalism is not dehumanizing only because it perpetuates poverty or lowers living standards.

Capitalism is dehumanizing also because it establishes relatively artificial distinctions among people based on the superficial criterion of physical wealth rather than a culture in which genuine human relations, natural distinctions of personality and all-round ability are allowed to develop more fully and with due socioeconomic reward.

5. Economic justice. The justifications for basing measures such as restraints on investment on an expectation of "economic justice" are weak. The poverty and lowered living standards that afflict great masses of people in every country under liberalization regimes are intuitively wrong to anyone with a conscience, but historically the private property economy has never guaranteed increases in the standard of living or freedom from poverty. To criticize the MAI and the free market economy for failing to guarantee economic justice is an argument based on false premises, like criticizing apples for not being oranges or Christians for not believing in Mohammed.

The current failure of center-left and social democratic regimes to protect welfare benefits in the face of globalization can be traced to this same ideological defect.

Trade union, center-left and social democratic successes in obtaining economic justice have come through bargaining, strikes and politics. These methods are not intrinsic to the economic system itself, and fail so often that they are an unreliable method of obtaining justice. True economic justice is planned, not left to contingencies or the arbitrary trickle-down effects of a free market economy.

Anti-MAI references to inequality, egalitarianism, living wages and people's rights, if given without deeper justification, fall into this trap. This weakens the stand against the MAI and capitalism in general, for those who oppose it.

6. Democracy. Several MAI opponents claim that investment agreements require "due democratic deliberation and openness", including "public comment and cooperation". Economic policies have of course especially in this century involved democratic deliberation, at least on the national level. But, like economic justice, democracy has never been intrinsic to private investment principles. This lack is now being exposed in the MAI, as investors try to remove all democratic constraints on their activities. The internal culture of the private investment, production and service organization - which is built upon domination of other human beings and centralized in pursuit of material goals, no matter what its size - reflects the true, inner value system of this economic system.

7. Nationalism. Many MAI opponents take national boundaries and national/sub-national governments as reference points for public policy regarding private investment. "Make capital national" is one slogan in this regard. Nationalism has some merit because it recognizes existing sovereignty and political structures.

The nation unit is somewhat arbitrary, however. It violates the unity and often the economic self-reliance of ethnic groups that straddle political boundaries, such as the Kurds, Bengalis, Germans and Inuit; overplays the importance of political divisions among ethnically and culturally similar groups like the Scandinavians; and may tolerate and overlook exploitation and suppression of ethnic groups by other ethnic majorities or minorities, as is happening in Indonesia, among other places, today.

The anti-MAI nationalist paradigm may also fail to raise consciousness about or eradicate the problems and inequities of capitalism as a domestic model, and deny significant local economic freedom in the face of large national corporations and absentee investors.

8. Need for foreign investment. In concert with MAI advocates, some MAI opponents agree that foreign investment can be useful, especially in developing nations, as long as it is regulated and raises the local standard of living. The argument for foreign investment ignores several factors, including history, however.

Much of the money that returns as foreign capital was previously extracted from developing countries in the form of raw materials that are sold cheaply on the commodities markets. These raw materials are then used to manufacture items that are sold back at relatively high cost to developing countries. Without being able to sell high value-added products on the international market due to the loss of unprocessed natural wealth, developing countries are never able to accumulate enough of the capital that they need for domestic development. Thus the - contrived – "need" for foreign investment. If they had been allowed to develop their own natural resources, developing countries would not need so much foreign investment.

9. Preference to local economy. The more advanced critics of the MAI want to restructure the whole economy so that local economies receive preference, in direct contradiction to the ³globalization is good² slogan being pushed so relentlessly by big private investors and corporations and their political allies.

Localization, rather than globalization of the economy, will, these critics argue, bring economic benefits and even control to people directly, not as the sparse trickle-down effect so condescendingly promoted by their opponents. Localization can occur through scripting local benefits into investment regimes or by transferring ownership of capital directly to enterprises that operate on and serve the local level. This is an intuitively good goal, but like economic justice, "localization of the economy" at this point is not much beyond the stage of being a slogan, with about as little substance. If economic justice had been justified to mean that people have economic rights, it could serve as a basis for economic localization, but this nearly all MAI critics have failed to do.

a. One justification for locally based economy comes from the Sustainable Development camp. Anti-MAI proposal 13 above states: "Every community should be aligned with a distinctive local ecology, such that economic development is defined as increasing a community's capacity for growth." The strength of this proposal comes from a respect for nature as a living force full of non-human species that are necessary for natural ecosystems, as well as a need for nature as a finite economic resource that must be husbanded if it - and we - are to last. These are bio- and geo-economic givens, and are easier to observe if an economy is dependent on the local ecology and resources.

The weakness of this argument is that it does not give strong justification for localization of the economy over, for example, national sustainable development-type regulations that merely curb the private economy rather than break up its corporate Leviathans into local entities.

b. The more potent justification for localization comes in anti-MAI proposal 12, "Distribution and ownership of capital". It states that "Assets and ownership of capital should be widely distributed to the 'working people who create real wealth', which can mean an economic structure composed primarily of small businesses and worker-owned cooperatives". If this is done, the economy will surely be localized, as capital, including company stock, factories, offices and equipment will be decentralized to where people live and work, which is in villages and towns; finance capital will not be concentrated in a few big centers like we find today. This would include distribution of farmland and fishing and forestry rights.

Most people, in advanced as well as developing countries, are thoroughly indoctrinated in the belief that the private enterprise economy is based on natural rights, if not rights given by God. Mainstream religions support this belief. This indoctrination is historical and incomplete however, as capitalists were suppressed by societies in their classical period, have been resisted since its beginning, and even now find opponents amongst small farmers, people¹s movements like the Zapatistas, socialists, populists and those who feel that something is wrong but cannot articulate it in depth. Therefore, a brief exposure to the justification for worker ownership of capital is needed.

Aside from automation, the transformation of raw materials, components and information etc. into finished goods and services always requires the work of people. Without people, nothing would get done and the economy would stop. Wealth is thus at least in part created by people¹s labor, so it is only natural that they have a right to at least some of the benefits of the market - ie, a guaranteed percentage of the profits. One corollary of this is that workers should have rights of representation on a company¹s board of directors - if not control over the board - since they have a claim to company profits also. More explanation is needed, but this is an introduction to the idea.

Automation is also only the result of human work, not a refutation of the argument that the work of people increases wealth, and so workers should receive continual benefits from automation also.

Worker ownership based on rights is of course a politically explosive issue. However, the fight for economic liberation will inevitably involve some degree of political turmoil, and is the price of progress.

Moreover, until the public consciousness is ready to accept the need and justice of worker ownership as a right, social and political leaders who have the common good foremost in their minds can promote worker ownership through setting up worker-owned businesses; providing them financial, tax and media support; and making their development an object of research. A number of institutes dedicated to this research already exist, though they are a drop in the bucket compared to what is needed to establish worker ownership as a superior socio-economic program. Some countries provide financial incentives also though the current globalization of the private economy has made many politicians with limited intellects and herd instincts ignore worker ownership - if they ever bothered considering it at all.

The capital that is currently exported from sites of production via the mechanism of free movement of capital would in an economy dominated by worker ownership stay at home where it was made, to be used according to worker and community dictates. Worker ownership is thus the primary means of establishing economic localization. This would include the use of and profits from natural resources like minerals and timber, which currently are often exported as raw materials that bring little benefit to local economies because of the low value added, a particularly merciless drain on the long-suffering Third World. Because natural resources tend to be vital to a local economy, it would be more appropriate to put them in local government hands.

Economic measurements that focus on household and community purchasing power rather than gross domestic product, another anti-MAI proposal, will help the focus on local economies.

10. Imports, exports and capital development. Limiting exports to natural resources that are surplus to local needs (anti-MAI proposal 10) is in effect selling at bargain prices, since unprocessed natural resources bring in little profit. It is better for capital development to export only finished consumer commodities - which have higher value added - that are surplus to local needs, as well as surplus agricultural products. Investing a portion of the proceeds into acquiring control of technologies that will reduce dependence on those resources will be necessary or not depending on the abundance of local natural resources and other factors. Investing in technologies that free people from imports might be a better strategy, at least until there is no trade deficit or drainage of capital.

Similarly, restricting imports so that foreign exchange is not expended for luxuries and so that imports do not disrupt local small producers (anti-MAI proposal 11) will help maximize the utility of foreign exchange and protect the local capital base and local jobs. Free trade should be allowed between equally placed regions and countries, however, to take advantage of the principle of comparative advantage.

References
1. Das, Bhagirath Lal. "A Critical Analysis of the Proposed Investment Treaty in the WTO". The author is former Director of UNCTAD’s Trade Programme and former Indian representative to GATT.
2. Jones, Roy. ³The OECD Multilateral Agreement on Investment: Key Concepts and the Trade Union Response², OECD Trade Union Advisory Committee, Jan. 1998, http://www.tuac.org/news/indmaitu.htm. 3. Korten, David C. "A New Day’s Coming," In Context #40, Spring 1995. 4. Korten, David C. "A Not So Radical Agenda for a Sustainable Global Future," People-Centered Development Forum.
5. Korten, David C. "Let’s Try Something Radical. Like a Market Economy," plenary presentation to the People’s Summit, Denver, Colorado, USA, June 20, 1997.
6. Marcuse, Herbert. One-Dimensional Man: Studies in the Ideology of Advanced Industrial Society, Routledge, London 1994.
7. McCandless, Henry and Cottam, Terry. Petition: "Stay of Negotiations & Call for Accountability," Communications for a Sustainable Future, http://csf.colorado.edu/sustainable-economics/mai/.
8. Organization for Economic Cooperation and Development, "Ministerial Statement on the Multilateral Agreement on Investment."
9. Preamble Cooperative. "The Multilateral Agreement on Investment: Basic Facts".
10. Public Citizen’s Global Trade Watch. "Factsheet on the MAI," http://www.citizen.org/gtw/.
11. Roxas, Sixto K. "Community-Centered Capitalism: An NGO Alternative," People-Centered Development Forum.
12. Sarkar, P.R. Proutist Economics: Discourses on Economic Liberation, Ananda Marga Publications, Calcutta 1992.
13. Storza-Roderick, Michelle, Nova, Scott and Weisbrot, Mark. "Writing the Constitution of a Single Global Economy: A Concise Guide to the Multilateral Agreement on Investment - Supporters’ and Opponents’ Views," Preamble Cooperative.
14. Vallianatos, Mark and Durbin, Andrea. "Ten Reasons to Be Concerned About the MAI," Friends of the Earth (U.S.), http://www.essential.org/monitor/mai/contents.html

Recommended reading/alternative to private investor economy:
Developmental Planning: A Proutistic Perspective, by Acarya Krtashivananda, Prout Research Institute, Copenhagen, 1995. Available through Global Times, c/o People’s News Agency.

Copyright The author 1999