I hired a boy to mow my lawn. At least I think I did. It was his idea. He knocked on my door and asked if he could mow my 1500 square feet of ratty turf. Ten dollars. His lawnmower. "Okay," I said "Start Monday." He did a good job. Every Monday he came. Every Monday, I paid.
About halfway through the summer, I received a birthday present, a shiny green power mower. Well, that should be an improvement, I thought. I'll save a hundred dollars over the summer and also benefit from some needed exercise. So when Danny came on Monday, I told hin that would be his last cut. I paid him, and added a $10 tip.
That evening Danny returned with his lawyer father, who told me that I could mow my own lawn, but I had to pay Danny another $120 for another twelve weeks of the season, plus another $10 tip. He used the phrase, "compensation for the loss of future profits." Keep that phrase in mind. We'll get back to it.
Neighbourly discussion followed, which got nowhere (though at one point he did attempt to twist my arm behind my back. I stepped on his instep, and he swore, but let go of my arm. Finally we hailed a passing neighbour and asked him if he would help resolve a dispute, acting as a third party we both trusted. He agreed, and we each stated our case. He thoughtfully turned it over and then said, "Well, if I am going to be a judge here, I'll have to charge you $10, plus a $10 tip, each."
To avoid an assault charge, I capitulated, and paid..
Does that phrase "compensation for loss of future profits" suggest what the next 200 words of this blog is about?
Part 2
Well, it's a new breed of international trade treaties, which began with Chapter 11 of NAFTA, the North American Free Trade Agreement, 1994, a deal between, Canada, the United States and Mexico.
NAFTA's Chapter 11 is not about trade; it was about investor protection. Essentially, it says that if an investor (read: "corporation") of one signatory country invested in another country, and that country's governments made any regulations or laws that affected the profits of "the investor", said investor could claim compensation from the offending national government for loss of profit, including loss of future profits. (You may want to read that sentence again.)
The lawsuit format is as follows:
Each party, the investing corporation and the national government that made the regulation, appoints one adjudicator, and the two appoint a third one. Two out of three is a win.
(I read a recent piece on the exorbitant fees charged by the three adjudicators.)
Every so-called free trade agreement since 1994 has contained these investor protection clauses.
From the corporations' point of view, all of the hundreds of pages of a treaty's trade provisions about tariffs on turnips and regiulations about raisins are mere window dressing. What counts is the investor protection clauses.
In the current global conflict between global corporations and national states, when this joker is in the pact, the deck is stacked. There are now, in fact, dummy corporations set up for the sole purpose of suing a national government for loss of future profits!
Time for the nation states to fight back?
Actually, they are. At least some peoples are - by turfing out corporate-friendly governments and electing... Well, you know who...
Okay.
Okay!
Well, at least I feel good about the exercise, and the green mower works well, too.
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