A
copy of this hugely important paper, with comprehensive notes, is available from
its author or from me:
Linda
Kaucher
Researcher
on international trade
0207
265 9307
The NHS changes have
been both promoted and fought as a national issue. However, they are actually
part of the preparation for a corporate-interest US/EU Free Trade Agreement. David
Cameron has flagged this trade deal, due to be formally launched in the spring,
as his priority in his chairing of the G8 this year. Even though the NHS changes
have at this point been fixed in the complex legislative framework of the
Health and Social Care Bill, the relationship to this wider international
investment context has still not emerged as public information. What
opportunities does knowledge of this background provide?
I have been looking at
international trade agreement issues for about 12 years. Outside of big business, the small amount of UK
interest in international trade agreements has tended to focus on the effects
on developing countries, whereas I have focussed more on the effects on people
in the UK. I attend EU Trade
Commission civil society dialogue meetings in Brussels where some information is
given out, with the opportunity to ask questions. The other ‘civil society’ attendees
are overwhelmingly business group representatives.
In a 2010 civil society
dialogue meeting Trade Commission personnel flagged the intention to push
forward a US/EU Free Trade Agreement. In fact transatlantic
integration has been a priority since 2007 when a Transatlantic Economic
Council was set up for ongoing work and six monthly progress reporting. It was left
off the public agenda for a period because of the banking crisis. Financial service liberalisation, the primary
cause of the banking crisis, is a major part of this trade agreement. In the 2010 civil
society dialogue meeting I’ve referred to, the Trade Commission admitted:
- That while it would normally not be possible to get this agreement through, the economic crisis would now actually be used to push through the agreement as quickly as possible.
- That the important preparatory process would be regulatory ‘harmonisation’ before the launch of negotiations.
- That the first thing to be ‘harmonised’ would be health.
Since then we have had
the Health and Social Care Bill in the UK, preparing the sector for
transnational health investors. Liberalisation changes are
often in a two-step mode. In the UK, the establishment of privatised GP consortia
is being encouraged. In this segmented, privatised format, businesses can
easily be sold to investors. In such two-step processes, the end game is obscured. Although the focus of
this paper is health, some background explanation of the international trade
agenda is necessary.
Firstly ‘trade’, which
goes on all the time anyway, is not the same as ‘trade agreements’, which are
effectively irreversible commitments made at the level of international law,
i.e. beyond changes at the level of the UK government or the EU. Trade agreements are
negotiated by governments but on behalf of corporations, and in the interests
of transnational corporations. Although the pretence
is maintained that ‘trade’ is primarily about goods, most EU and UK trade is in
‘services’, in which financial services and investment play a major part. The trade agenda is
about liberalising. While liberalising trade-in-goods is about countries reducing
at-the-border taxes, when countries liberalise a service sector they open it to
transnational investors. (The UK always does this anyway, unilaterally, outside
of any agreements).
When countries commit
services to international trade agreements, the liberalisation of those
services is then locked in i.e. a commitment to keep the service open to
transnational investors. With aspects of public
services privatised, either via privatised contracting or sell-offs, the
privatisations underpinning the liberalisations also become irreversible. The categories of ‘trade-in-services’
are all-encompassing, but the financial services industry is a major force for the
liberalisation of services.
The City of London, made up of transnational
financial service corporations, is the main driver of commercial policy within
the EU and of EU external trade policy. In the UK, City of
London financial services dominate policy-making to ensure that national policy
both fits with that wider liberalisation agenda and provides an international model
for it. For financial services,
the transforming of the NHS is an exemplary model of how to turn a
globally-respected universal health service into a cash cow for transnational
investors.
Trade-in-services trade
commitments involve states giving transnational corporations rights to come in
and operate and to keep operating, without limits on their activities or on the
number of transnational corporations that enter the sector, with rights to the same
or better treatment than that which national companies receive (including any
subsidies), and rights to sue the government in an international jurisdiction if
there is any attempt, by any level of government, to limit those rights or to introduce any regulation
which might, even incidentally, limit corporations’
expected future profits.
As corporate rights are
thus increased via trade commitments, the rights of governments to control them
are correspondingly diminished and democratic control over the activities of
corporations is forfeited. When applied to health,
this means the whole emphasis of health care changes. The rights of
transnational corporations become the priority and health becomes primarily a
trade issue. Trade agreements are usually
conducted very secretly but David Cameron, led by the financial service
industry, has emphasised the US/EU Free Trade Agreement - though he hasn’t
spelt out what it involves. It is also being promoted by ‘business leaders’,
such as CEOs of banks.
Yet despite the front
page report of the Prime Minister’s speech and his focus on this trade
agreement, the media, including the publicly funded media, have failed to
analyse or question the implications of it or indeed what it has meant so far
for the NHS. There are as yet no
organised critical voices to take this up. Health is just the
starting point. Regulatory ‘harmonisation’ with the US will be much broader. For instance, until now
the EU has resisted the importation of genetically modified human foodstuff and
seeds (GMOs) which are the norm in the US. A push for a change in EU regulation
on GMOs, for ‘harmonisation’ with the US, is inevitable.
Another obvious target for
‘harmonisation’ is the European public broadcasting model. The US media model
is overwhelmingly corporate with public broadcasting marginalised. Recent
events undermining public trust in the BBC have increased its vulnerability to
calls to narrow its activities in favour of private media. At this point, the EU Commission is proposing a
‘harmonisation’ of media laws across the EU, monitored by the Commission, an
ominous start.
A major aspect of the
ongoing work of the weighty Transatlantic Economic Council, headed by the top-level
US Trade Representative and the EU Trade Commissioner, is to work pre-emptively
with regulators to ensure that any new regulation takes account of the intended
trade deal, so it is ready ‘harmonised’. With the UK taking the
lead in this trade agreement, albeit behind the scenes, and with the information
from the Trade Commission two years ago about harmonising health, we can assume
that the Health and Social Care Bill was prepared in this way, yet without public information to this
effect. The debate on the passage of the Bill was not properly informed.
The Trade Commission is
the most heavyweight part of the EU Commission and its work is driven to a
great extent by financial services based in the City of London. Yet neither the
existence of this part of the Commission, nor what its bureaucrats are signing
us up to in free trade agreements, are mentioned in current UK discussions on
the EU and the terms of UK membership. Without public knowledge of this major
function of the EU, any referendum would be misinformed. The failure of the
media to provide this information is partly due to the fact that there is so
little knowledge of the trade agenda among reporters except those who are
complicit, even among BBC senior economics reporters.
Summary and suggested
action
- It is in health that the effects of ‘harmonising’, towards this Free Trade Agreement, are already manifest. The fact that the NHS has been prepared for transnational investors as part of a planned US/EU free trade agreement should be made public.
- The similar threat to other areas should also be public.
- The activities of the EU Trade Commission on our behalf should be an important part of the debate about EU membership.
- There is a job to be done on disseminating information and demanding reporting and analysis of the implications of the US/EU Free Trade Agreement, so that it is not just the perspective of transnational capital that is being presented. (The BBC has a Business Unit presenting this perspective but has no such unit for workers or public service users). The nationwide concern about the NHS and established networks of concern could be the means for a strong, clear and concerted public voice on this.
- The juggernaut of the trade deal backed by business voice propaganda is unlikely to be questioned otherwise.
- The lack of public information on this broader context of the NHS changes is grounds for the Health and Social Care Bill to be repealed. The Opposition Labour Party needs to call for this.
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