When the People Speak, the Corporations Squeak

[Robert Weissman <rob@essential.org>]

When the people speak, the corporations squeak.
	
Having learned from the South African divestment movement that local
actions can help stop egregious human rights abuses and bring democracy to
countries around the world, citizens across the United States are
increasingly mobilizing in support of state and local sanctions against
countries such as Burma, Nigeria and Indonesia, all of which are ruled by
brutal dictatorships.
	
These sanctions typically leverage the power of government agencies as
consumer, using "selective purchasing" laws to bar the government from
doing business with companies that do business in the targeted country.
Massachusetts and more than a dozen cities have adopted such laws.
	
The idea is to encourage corporations to stop doing business in
dictatorial countries, on the theory that income from their investments
help prop up autocratic regimes. The South African example -- where state
and local sanctions, along with university and private divestment
campaigns and national sanctions unquestionably helped speed the end of
apartheid -- lends strong credence to the theory.
	
Facing a rising tide of state and local sanctions, Big Business has banded
together into an outfit called USA*Engage to defeat and roll back
grassroots efforts to influence where multinationals do business.
USA*Engage has more than 600 members, including Aetna, Bechtel, Cargill,
Caterpillar, Exxon, Mobil, Monsanto, Pepsi, TRW and United Technologies.
	
In March, the state of Maryland was on the verge of enacting a selective
purchasing law that targeted Nigeria. Nigeria is ruled by a military
government that feeds of oil money (provided by companies like Shell and
Mobil) and drug money. The government annulled a democratic election held
in 1993, has jailed the victor in that election, allegedly killed his
wife, executed Ken Saro-Wiwa, a leader of the Ogoni people, murdered and
tortured thousands of citizens and jailed the nation's trade union
leadership. All in all, Nigeria is an excellent candidate for sanctions.
	
But not in the eyes of Big Business. It launched a furious campaign to
defeat the selective purchasing proposal, arguing that sanctions are
ineffective, unfairly disadvantage U.S. companies and undermine federal
authority to make foreign policy. At the last minute, the Clinton
administration intervened, saying Maryland's proposed law would violate
U.S. trade treaty obligations. This tipped the balance against the bill.
Big Business's lobbyists were smiling when they left Maryland.
	
Now, the same band of companies is seeking to roll back Massachusetts's
selective purchasing law which targets Burma, another military
dictatorship which has killed thousands, jailed the nation's rightfully
elected leader and thrives on oil money (especially from Unocal) and drug
money.
	
Late last month, the National Foreign Trade Council, another business
coalition, with 550 U.S. manufacturing company members, filed suit against
Massachusetts, claiming the state's selective purchasing law infringes on
the federal government's foreign policymaking power.
	
The lawsuit faces significant hurdles. It is not clear that the Trade
Council has legal standing to bring the suit, nor that local and state
sanctions interfere with federal powers in any constitutionally
significant way.
	
But while the suits winds its way through the federal courts, it sends a
powerful, chilling message to state and local officials considering
responding to citizen campaigns to adopt sanctions. The message: States
and localities that seek to enact selective purchasing proposals will face
unremitting pressure from politically powerful multinational corporations.
They should expect massive corporate lobbying campaigns, threats of
lawsuits, pressure from a federal government which is choosing to ally
itself with business interests on sanctions and the threat of suit at the
World Trade Organization and other trade bodies (indeed, the European
Union and Japan have both threatened to call for the formation of
penalty-wielding WTO dispute settlement panels to rule against
Massachusetts's Burma law).
	
The purpose of this corporate campaign of intimidation is clear: While
multinationals may or may not prefer to do business with dictators, they
certainly do not want citizens interfering with their commercial
operations in authoritarian countries -- even if those operations help
prop up dictatorships.
	
At root, the suit over Massachusetts's Burma law is a clash between
corporate internationalism and citizen internationalism.
	
The outcome of the clash will have huge consequences. As citizen
internationalists like to point out, if the corporate internationalists'
argument had prevailed in the case of South Africa, Nelson Mandela might
still be in jail.

(c) Russell Mokhiber and Robert Weissman

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime
Reporter. Robert Weissman is editor of the Washington, D.C.-based
Multinational Monitor.

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