Feb 222007

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The poor people of Cochabamba, Bolivia, victims of price gouging when Bechtel Corporation took over the privatized water system, protested in the streets against this assault by the globalist forces of “free trade.” And they won.

Bolivia, a partner in 24 Bilateral Investment Treaties, got a reality check of what trade agreements are really about when the World Bank provided aid for water development only after Bolivia privatized the water systems of El Alto/La Paz and Cochbamba, then gave the contract to the American company Bechtel, majority owner of Aguas del Tunari, the water provider (1997).

Shortly after the new company began operating in September of 1999, water rates increased by an average of over 50%, which took between 20 and 40% of the monthly household income of the residents of Cochabamba. By the end of 1999, the citizens took to the streets in protest. The president declared martial law. In the ensuing violence, one boy was killed and over a hundred people wounded. In April of 2000 the government of Bolivia agreed to the peoples’ demands and the water system was returned to public control. Bechtel was out.

But Aguas del Tunari (Bechtel and partner Abengoa) took their case before an unelected trade agreement tribunal in 2002, demanding $50 million from the Bolivian government for loss of future profits. Two of the tribunal members were named by the World Bank and Aguas del Turnari and the third by Bolivia.

Widespread press coverage of this outrage resulted in protests at Bechtel’s headquarters in the Netherlands and San Francisco plus Washington D.C. In 2003 over 300 organizations from around the world sent an International Citizens Petition “demanding that the case be transparent and open to citizen participation. The tribunal, ICSID, International Center for Settlement of Investment Disputes, rejected the petition and pressed on.

But the pressure on Bechtel continued and on January 19, 2006, “Bechtel and Abengoa agreed to drop their case for a token payment of 2 bolivianos (.30 USD).”

Bolivia’s Constitutional Court has agreed to consider “…a legal demand made by social movements arguing that placing the rulings of international tribunals such as ICSIC above Bolivian Law is unconstitutional.”

NAFTA’s Chapter 11, which allows tribunals to hear and rule on foreign corporations’ claims against NAFTA member states’ governments (including the United States) is clearly unconstitutional. [ see raykania.com ‘NAFTA: Stealing Sovereignty in Violation of the U.S. Constitution ]

Multinational corporations using trade agreements to take over public works (privatization) continue to cause damage to governments’ ability (at all levels) to meet the needs of citizens. What happened in Cochabamba is occurring around the world as multinational corporations move in with promises of better service and lower costs but often wind up with the opposite results.

Some examples from the USA:

Lee County, Florida, (October 2000) County officials took back control of the water and sewage systems because under the private contractor: “Equipment was not maintained in acceptable working condition. Hazardous waste was poorly handled and reported. Preventive maintenance was performed late and some work was not done at all.” The cost to citizens was over $8 million.

Atlanta, Ga. (1998) The city privatized the operation and maintenance of the water system. The city “…began receiving complaints of slow service, broken fire hydrants and brown drinking water flecked with debris…a growing maintenance backlog…company’s failure to meet its financial obligations…significantly lower training hours than required by the contract…experienced difficulties meeting performance standards for pH, turbidity, and phosphate at one of its plants,” The company also asked for “$38million of additional payments through change orders and sought to increase the contract by $80 million,” [ For more see; http://www.citizen.org/pressroom/pressroomredirect.cfm?ID=883 ]

Governments whose public entities have been privatized and run by foreign corporations are subject to claims for lost profits if a government decides to end the contract. All three member states of NAFTA have been affected adversely by unelected WTO and NAFTA tribunals. And these tribunals can review cases heard by the U.S. Courts and overturn their rulings, which is unconstitutional, according to former Supreme Court Justice, Sandra Day O’Conner.

Once again, a corporation’s only goal is to make a profit. That means cutting corners whenever they can. They have no interest in saving the customer money or providing good service, Trade agreements do not include people or the environment. The FTAA, the ultimate trading state of the Western Hemisphere and a continuing project of George Bush, even states that people (labor) and the environment will not be a binding part of that trade agreement.

The citizens of Cochabamba learned the hard way. We have a chance, albeit a slim one, of stopping this corporate/government assault on America and its citizens. Condoleeza Rice, Michael Chertoff and corporate CEOs are meeting with their counterparts from Canada and Mexico in Ottawa this week in order to work on the integration of the North American Union, with corporations (NACC) providing the plans which will be implemented by the leaders of the three nations, without the consent of the people. American citizens have no one to turn to for help. The government, those in power, will do nothing because they are the enemy of the people. And the people, human capital, are here to serve the interests of the ruling elite. That includes the illegal immigrants pouring across the border with their blessing.

The only solution is for Americans to unite, like the citizens of Cochabamba, and demand that this insanity stop.

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 Posted by at 11:15 am