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Scenarios:

Factory Fire in Fabrikistan

Fabrikistan is a country in Southeast Asia with a population that is 90% Muslim. The current government is run by a nominally Muslim but predominantly secular, modernizing elite. Its president is a former general, who while still in his thirties, seized power with military support "to restore order" about 20 years ago. Subsequently, he has received more than 99% of the vote in government run plebiscites. The government is proud of the country’s high public order and low crime rate in its capital city and attributes it to the success of its draconian punishments for even minor disruptions of public order.

No opposition parties are legal but the government is faced with sporadic acts of violence, led by the Fabrikistan Islamic Jihad, which condemns the government as corrupt and as puppets of international bankers, and calls for its replacement by a government committed to Islamic law and upholding the values of the Koran. The government has used a substantial amount of its revenue to purchase arms from the United States to suppress this movement. It has little revenue to support programs to alleviate malnutrition, inadequate shelter, and disease. It does, however, provide subsidies to keep the purchase of rice and one or two other basic foods affordable.

Fabrikistan has attracted large amounts of foreign investment. It earlier had a government agency to inspect factories but, in an effort to reduce spending to meet International Monetary Fund (IMF) guidelines, and to avoid discouraging foreign investors with harassing regulations, it eliminated this agency about five years ago. Nevertheless, Fabrikistan has been experiencing a debt crisis. It has recently filed notice with the IMF that its debt is unsustainable and that it is in danger of defaulting on its debt payments unless it can negotiate new terms with its creditors.

Chic Duds International (CDI) manufactures over 70% of its athletic shoes and youth apparel in Fabrikistan factories, generally by sub-contracting with domestic companies. Many of these local companies are run by people who have close family connections with the government and its allies. CDI still maintains one large factory in the United States where it manufactures some of its apparel but it is considering closing it down and transferring its production to a factory in Fabrikistan.

Background of Case

Six months ago, 211 people, most of them women and children, died in a fire in an apparel factory in Fabrikistan and another 500 people were injured. The actual death toll may have been considerably higher since the four-story building collapsed in the intense heat and many bodies were incinerated. The fire started on the ground floor but quickly spread upward. The structure had been cheaply built, without concrete reinforcement, and crumpled easily in the heat.

Many details of this case are based on the May 10, 1993 fire at the Kader Toy Factory in Bangkok, Thailand. See William Greider, One World, Ready or Not (Simon & Schuster, 1997). The factory was located in a building that is owned by the brother of the President of Fabrikistan. It had been leased to a local contracting firm, Fabrikistan Productions, which operated it as a factory to produce goods for CDI. About 3000 workers were employed there. The fire was investigated by a United Nations Committee who issued a report documenting the following facts:

  • The factory had a series of blatant health and safety hazards, had little ventilation, inadequate escape routes, and generally unsanitary conditions. These same conditions are present in most factories in Fabrikistan.
  • The factory was run by a local contractor, Fabrikistan Productions, who cut corners on health and safety conditions wherever they could.
  • Many exit doors had been locked and many windows were barred to prevent pilfering by employees. As a result, hundreds of the workers were trapped on upper floors of the burning building and were forced to jump.
  • Flammable raw materials were stacked everywhere, on walkways and next to electrical boxes. Neither fire alarms nor sprinkler systems were provided.
  • Lint, fabric, dust, and animal hair filled the air on the production floor. Noise, heat, congestion, and fumes were reported by many.
  • An estimated 20% of the people who died in the fire were children under the age of 16.

The factory was producing apparel for Chic Duds International (CDI) and the same local contractor, Fabrikistan Productions, runs several other CDI factories in Fabrikistan. The prevailing wage for this kind of factory work in Fabrikistan for a 72 hour, six-day work week is about one-third below the subsistence level for a family of four -- defined as the minimum income necessary to meet subsistence needs. The average number of children for a Fabrikistani family is 4.5.

Existing Health and Safety Standards for Factories

No international body has established any minimum health and safety standards for factories. The International Labor Organization (ILO) has a convention (#155: The Occupational Health and Safety Convention of 1981) and recommendations but they say only that countries should establish guidelines for employers without specifying any standards. In any event, the government of Fabrikistan has not signed ILO convention #155.

Biopiracy in Plantanoguay

Background

Plantanoguay is a large country in South America that has twice, in the past 125 years, been occupied for brief periods by U.S. military forces. Until the late 1970’s, it was ruled by a military junta supported by the U.S. but has had a democratically elected government with competing political parties since then. In its most recent election, the ruling Conservative Party, supported primarily by middle class and wealthier voters, was defeated by the Worker and Peasant Party (WPP), led by a charismatic former worker and labor union leader. The WPP has announced that it will try to forge a new relationship with the United States, based on equality and a true partnership in which the U.S. accepts Plantanoguayan independence and does not treat it like a "banana republic."

Plantanoguay is a major exporter of agricultural products and is the leading world supplier of coffee, sugar, and bananas. In addition, it has substantial oil reserves and is a major source of U.S. oil imports. It also has a number of rare native plants that may have important medicinal uses.

Natural Plus is a U.S. based subsidiary of HAZMAT with its corporate headquarters in Delaware. It is a generous contributor to political campaigns of incumbents, having contributed over $800,000 in the past five years, divided almost equally among Democrats and Republicans.

Current Situation

The U.S. government has filed three complaints with the WTO against Plantanoguay, charging it with violations of WTO agreements on free trade.

The first case involves a medicinal herb, kahote, which grows naturally only in a region of Plantanoguay inhabited by an indigenous population, the Azmaya, who have used it for centuries. Kahote acts as an immune system booster which offers protection against a number of diseases and mitigates the effects of others. The government of Plantanoguay has started a program among the Azmaya, creating a producers’ cooperative, for the cultivation and distribution of kahote to the rest of Plantanoguay and for export.

HAZMAT’s Natural Plus subsidiary became interested in the medicinal properties of kahote and its scientists were able to identify the active agents and to produce a synthetic version, patented and marketed under the brand-name, Kahotium™. The U.S. government has brought a complaint to the WTO that the encouragement and distribution of kahote by Plantanoguay is a violation of HAZMAT’s intellectual property rights under WTO Trade-Related Intellectual Property (TRIPS) agreements about respecting patents. Plantanoguay claims that this constitutes "bio-piracy."

HAZMAT’s Natural Plus is also the main protagonist in a second dispute. It produces an infant formula, marketed under the name, Better Than Nature™. The government of Plantanoguay has recently passed a law that prohibits infant formula and baby food advertisements from making what they regard as the medically dubious claim that these products are more healthful than breast milk. Since Natural Plus’s infant formula implicitly makes this claim in its very name, the law would in effect ban advertising Better Than Nature™ in the Plantanoguay market. The U.S. Government has brought a complaint to the WTO that this law is a restraint on free trade that violates WTO rules.

The third dispute involves a version of what is called eco-labeling — identifying products that are produced under conditions that are environmentally friendly or supportive of labor and human rights. The government of Plantanoguay has begun a pilot program, organizing selected consumer export products into a system of self-managed cooperatives and worker-run factories. A well-known Plantanoguayan artist has designed a distinctive logo for such products. The products are labeled with the logo and the words, "Produced by Worker Cooperatives." The U.S. Government has filed a complaint with the WTO charging that this labeling violates WTO rules against distinguishing among physically similar products on the basis of how they were produced.

The WTO has appointed three panels of experts to consider the case: (a) the Kahotium™ panel, (b) the Infant Formula panel, and (c) the Labeling panel. The three panels must report to the WTO ministers meeting in Toronto, Canada later this year, with final decisions to be announced at the end of this meeting.

Cancer Alley

Background

"Cancer alley" is the nickname for an 85 mile industrial corridor running along the Mississippi River from Baton Rouge to New Orleans, Louisiana. Before it became an industrial corridor, this stretch along the river was a site of large plantations which sold agricultural products generated by slave labor. Rice, sugar cane, and cotton were exported to a variety of domestic and international destinations.

After the Civil War, former slaves pooled their limited resources and bought land near the plantations on which they had worked. They formed towns, established schools and churches and made a living from farming small plots on the fertile land, fishing, and small businesses. The population of the area along Cancer Alley remains heavily African-American.

The shift from agriculture to industry began in the mid-20th century. Today, more than 100 large corporations run oil refineries, petrochemical plants, medical waste facilities, solid waste landfills, and plastics factories. These companies were attracted by two kinds of government subsidies from the State of Louisiana — Industrial Property Tax Exemptions for a ten year period, and an energy subsidy which pegged the industrial rate at one-fourth of the residential energy rate. Louisiana’s petrochemical industry manufactures one-quarter of America’s petrochemicals, including plastics and fertilizers.

Most of these facilities are located in close proximity to African-American residential communities but few residents are employed in any of the permanent, technical jobs that the plants offer. Some of the facilities have been cited for repeated violations of state and federal environmental laws. One company, for example, failed to report that it was disposing of radioactive materials in its landfill.

The U.S. Environmental Protection Agency (EPA) has conducted various tests of the soil and water in the area. They found high levels of lead, arsenic, dioxin, chlordane, polyvinyl chloride (PVC), and other toxins. Louisiana has one of the highest toxic air and water pollution levels in the nation. Communities in Cancer Alley report high cancer mortality rates, respiratory problems, burning eyes, and other symptoms.

Unemployment rates in the communities along the industrial corridor remain very high, well above national averages. In addition, because of the pollution of the land and water, people can no longer grow food or fish in the Mississippi River which, in the past, provided basic subsistence for them.

The HAZMAT corporation is a transnational company with headquarters in Brussels. Its stock is traded on the New York Stock Exchange. Corporate motto: "Science for a Better Future." HAZMAT is composed of subsidiaries that specialize in the safe disposal and conversion of toxic waste and bio-solids (sludge from sewage), and in the production of fertilizers, electrical equipment, herbicides, and petrochemicals. It owns and operates several nuclear reactors in France, the United States, and Banglabush, selling the electrical power it generates to various utilities.

The Current Situation

HAZMAT has proposed several new projects in Cancer Alley. Its petrochemical subsidiary has proposed a major new petrochemical plant on a large tract of land along the Mississippi that borders on a community of 20,000 people, about 85% of whom are African-Americans. The plant would be adjacent to the largest elementary school and the regional high school. HAZMAT applied to the U.S. Environmental Protection Agency for required permits.

HAZMAT’s nuclear power subsidiary applied to the U.S. Nuclear Regulatory Commission for a permit to build a hazardous uranium enrichment plant located between two communities, totaling 12,000 people, over 90% of whom are African-Americans. Its waste disposal subsidiary plans to build a large waste-disposal plant adjacent to the uranium enrichment plant to dispose of radio-active and other toxic waste, including that generated by the petrochemical plant up the river.

On February 11, 1994, President Clinton signed an Executive Order (#12,898) that directs all federal agencies to address pollution burdens that fall disproportionately on communities of color and poor people and to ensure that they have meaningful participation in government decision-making. This order asks each Federal agency to make environmental justice part of its mission by identifying and addressing disproportionately high and adverse human health or environmental effects of its programs, policies, and activities on minority populations and low-income populations. The EPA is designated as the coordinator of an interagency Federal Working Group on Environmental Justice.

The U.S. Nuclear Regulatory Commission denied HAZMAT a license for its hazardous uranium enrichment plant on the grounds that "the negative impacts of the facility on the African-American residents were not considered and should have been closely scrutinized as directed by the President’s Executive Order and the National Environmental Policy Act." The U.S. EPA rejected HAZMAT’s application for its petrochemical plant, citing the President’s Executive Order and the Clean Air Act.

The U.S. Government is a signatory to various trade agreements that contain an "investor rights clause" — for example, Chapter 11 of NAFTA (see Investor Rights Clauses, Resource Kit for details). These are agreements that allow a private company to sue governments if these governments take actions that change the original conditions under which investments were made. Companies are allowed to sue for increased costs or lost revenue resulting from such government actions. The purpose of such clauses is to encourage investment by assuring investors that, if the rules of the game change, they will be compensated for any negative effects.

HAZMAT is suing the U.S. Government under such a clause in a trade agreement between the United States and Belgium, signed in the mid-1980s, several years before the President’s Executive Order. The company is asking for $10 million dollars in damages on the grounds that the provisions of the Clean Air Act, the National Environmental Policy Act, and Executive Order #12,898 -- cited by the U.S. EPA and by the U.S. Nuclear Regulatory Commission in denying permits to the HAZMAT Corporation — have changed the original conditions under which their planned investments were made. Under the terms of the U.S.-Belgian Free Trade Agreement, all disputes are to be settled by a hearing of the International Center for Settlement of Disputes (ICSID), an agency of the World Bank and thus part of the A-Team.

Race to the Bottom

Disputes have arisen between the United States and the European Union involving trade in two different commodities: bananas and beef.

The Banana Dispute

The European Union imports about one-third of all traded bananas — about the same amount as the United States. It is the only major banana market that does not allow bananas to trade freely. The U.S. and Japan, for example, allow bananas to be imported with no limits on where they are imported from or on volumes imported. About 80 percent of the bananas consumed in the European market are imported.

The dispute in this scenario is a simplified version of the dispute in the real world (the actual case is described in an appendix to the Coordinator’s Manual for Race to the Bottom, Appendix A: “Going Bananas”). The European Union distinguishes between two different types of imported bananas, based on their country of origin: Caribbean bananas and "dollar bananas." Caribbean bananas are produced on small farms in hilly areas and are usually owned and worked by local family farmers. Dollar bananas are produced on large, mechanized plantations in Central and South America, some of them unionized and some of them non-union. The nickname of "dollar bananas" reflects the fact that they are produced on plantations that are either owned or their product is marketed by U.S.-based, transnational companies such as the Poquita Banana Company (see below).

The European Union allows Caribbean bananas to enter the European market in unlimited amounts and duty free; in contrast, dollar bananas pay a stiff tariff of 250 euros per metric ton. The costs of producing Caribbean bananas are often double that of dollar bananas but the tariff allows them to compete successfully in the European market. The result of this system is that European consumers pay about 80 percent more for bananas than consumers in the United States.

Three giant transnationals grow two-thirds of dollar bananas; the rest are grown on plantations owned by local elites, known as "national producers." The transnationals have for many years been moving away from direct production, selling their plantations to these national producers, and then buying the bananas they produce to distribute and market. The transnationals maintain effective control over these sub-contractors since they control the land transportation, the docks, the ships, and the contracts with importers that are needed for distribution.

Dollar bananas vary considerably in their production costs from country to country, mostly depending on whether the banana workers are unionized or not. The Coalition of Latin American Banana Unions, known by its Spanish acronym as COLSIBA, works collaboratively with other unions, including the AFL-CIO, and is the central member of the Campaign for Labor Rights (CLR) in this scenario.

Ecuador is the major source of non-unionized dollar bananas. By 2002, it produced 28 percent of all export bananas in the world market and one-fourth of all bananas consumed in the United States. "Its over 250,000 workers receive as little as one-fifth the wages and benefits of banana workers elsewhere in Latin America… Those who try to unionize are fired, threatened at gunpoint, blacklisted, or all three" (Frank, 2005, pp. 10 and 66).

The Poquita Banana Company has been a central player in the banana trade throughout its history. It is a well-connected U.S. company which owns several huge plantations in Latin America and in Plantanoguay. It is the dominant company in the U.S. banana market, accounting for some 70% of bananas consumed in the United States. The company maintains a large lobbying operation in Washington, D.C. and was the third largest contributor to the campaign committee of the incumbent U.S. President.

Poquita Banana has changed its policies during the last several years. Once it had a reputation among labor and human rights activists as a notorious violator of workers’ health and labor rights. But in recent years, it has signed labor contracts with COLSIBA and other unions and worked cooperatively with corporate responsibility activists. Poquita has higher labor costs; its unionized workers generally earn good wages and receive extensive benefits compared to their non-unionized competitors.

Poquita Banana has sought SA8000 and EUREPGAP certification for its banana production (see Resource Kit). About one-third of its banana operations are currently certified and it has applications pending for most of the remainder. The company has announced a goal of having at least 80 percent of its operations certified within the next two years.

The Current Situation. The United States, Ecuador, and Plantanoguay have filed complaints against the European Union over its banana policies. They charge that the tariffs on dollar bananas, while Caribbean bananas are exempted, violate WTO rules because they give preference to some WTO members and not others. The WTO has appointed a dispute resolution panel to hold hearings and decide whether the EU policies violate WTO rules and, if so, what should be done about it.

The removal of the tariff is likely to lead to the flooding of the European market with cheaper, non-union bananas, grown on large, mechanized plantations. Small producers in the Caribbean will not be able to compete and will be forced to explore economic alternatives — one of which is the cultivation of illegal drugs for the U.S. market. It will also encourage a flood of illegal immigrants from the Caribbean into the United States.

The Government of Plantanoguay has asked that the tariff only be applied to dollar bananas from Ecuador and other non-unionized producers that fail to meet SA8000 and EUREPGAP certification. It has warned that the complete elimination of the tariff for all exporters will set off a "race to the bottom" as producers try to compete with non-union plantations that fail to meet adequate certification standards.

The Government of Plantanoguay has recently made an offer to Poquita to buy its banana plantations in Plantanoguay, contracting with the company to continue to act as a distributor and marketing agent. If the offer is accepted, the government plans to make the plantations part of an extensive land reform program. Previously landless banana workers would be resettled on the land and organized into producer cooperatives with the exports aimed at the European market. Because the banana workers are unionized and receive wages and benefits at the high end of the scale, the cost of these bananas will be more than twice the cost of Ecuadorian bananas.

The dominant banana producer in Ecuador is a national producer, Noboa, that has had a falling-out with the U.S.-based banana company that has been distributing and marketing its bananas. They have made a "take-it-or-leave-it" counter-offer to Poquita which is on the table for a limited time only before it pursues other alternatives. It will sell bananas to Poquita for export to the European market at less than one-half of the price offered by Plantanoguay. Its "non-negotiable" conditions are that the company must accept the non-union nature of its banana production and will not seek SA8000 and EUREPGAP certification for the way the bananas are produced.

The Plantanoguay Popular Movement (PPM) has been urging the Government of Plantanoguay to adopt an alternative approach to the problem — to shift production away from banana exports and toward greater self-sufficiency and food sovereignty (see Resource Kit, Food Sovereignty, for further detail). They have urged the Government to make this an essential part of its land reform program and to use the land purchased from Poquita and/or to expropriate the HAZMAT cattle farms (see below) for this purpose.

The Beef Dispute

The HAZMAT Corporation has a U.S. subsidiary, Natural Plus, that has developed a special breed of cattle, raised on large, factory-like farms. Several of these farms are in Plantanoguay. The cattle are treated with growth hormones that substantially shorten the length of time to reach a size where they can be slaughtered and marketed. The European Union has adopted a policy that bans the import of poultry and animals raised with artificial growth hormones—on the grounds that the long term safety of such foods has not been established. The U.S. government, on behalf of Natural Plus, has filed a complaint with the WTO against the European Union ban on beef raised in such a manner, claiming in particular that it violates WTO rules against distinguishing among substantially similar products on the basis of how they are produced.

WTO Panels

The WTO has appointed two panels of experts to consider the cases: the Banana panel, and the Beef panel. The panels must report to the WTO ministers meeting in Toronto, Canada later this year, with final decisions to be announced at the end of this meeting.

Strip-mining Banglabush

Banglabush, formerly a colony of Belgium, is in central Africa and has been independent since the mid-1970s. For the past 20 years, it has been ruled by the three Gumba brothers who lead the Party of the Revolution (the POR). There is a parliament but it is strictly controlled by the POR.

Banglabush is an extremely poor country with a per capita income less than one-twentieth of the United States. It qualifies as a Heavily-Indebted Poor Country (HIPC) under World Bank and IMF criteria and is eligible for debt relief under their HIPC Initiative (see Resource Kit, A-Team Special Programs for details). Most of the wealth in the country is controlled by members of the Gumba family and their close friends and allies, or by Europeans who settled there during the colonial regime and remained after independence. Most of the arable land is owned by Europeans, some of them living abroad. The population of the more urbanized northern section of the country is predominantly Christian and heavily concentrated in townships ringing the capital city of Bushville. The southern part of the country is more heavily dispersed over a wide geographical area and the population is divided on religious lines with 40% Muslim, 20% Christian, and the remaining 40% following different tribal religions.

Banglabush has severe public health problems. Diseases associated with malnutrition are rampant and in the past 20 years, AIDS has become pandemic with the proportion of the population that is HIV positive approaching 30%, more than half of whom are women and children. This is especially true in the southern, heavily rural section of the country.

The primary export commodities in Banglabush are precious gems, particularly diamonds and rubies. It also has substantial uranium deposits which are mined to fuel its four nuclear reactors, built and run by the HAZMAT Corporation. These plants provide more than enough electric power for its domestic needs, and have made it an energy exporter as well. It has no known oil reserves. Banglabush has been the recipient of several substantial World Bank loans as well as loans from the European Union. A large portion of the government budget goes to interest and repayment of this debt.

President Gumba maintains a private charity, the Discretionary Fund for Improving Life in Banglabush. Decisions on the use of this money are at the discretion of a Board, consisting of the President and his two brothers. HAZMAT, the largest foreign investor in Banglabush, makes regular, substantial contributions to this Fund.

The Banglabush Popular Movement (BPM) is an extra-parliamentary, popular movement which engages in a variety of actions aimed at weakening and eventually replacing the Gumba regime. Since it is outlawed by the government, the BPM must operate underground, except in areas where the government doesn’t have control. The BPM engages in armed struggle against the government both for self protection against government repression and in order to destabilize the current regime. The ability of the government to police or repress the BPM is weak in the south where the government is generally unable to enforce its laws.

The BPM recently announced that it is prepared to renounce armed struggle in favor of non-violent protest and substantial areas of autonomy for those parts of the country where it has popular support. It seeks legalization from the Government of Banglabush and international recognition as a legitimate opposition party. The BPM is an umbrella organization which includes the leaders of various tribal groups in the predominantly rural south and has a strong following of urban workers in and around Bushville in the north.

The Current Situation

Banglabush is in an economic crisis. A large and increasing share of government revenue is devoted to debt payments on loans and it has reached a point where it is, in effect, bankrupt and unable to sustain its loan payments. It has applied for new loans from the World Bank and the European Union to cover its existing loan payments but these will increase its debt service and decrease its long term ability to repay what it owes. It has also applied for debt forgiveness and relief under the HIPC (Heavily-Indebted Poor Countries) Initiative. It has also applied for a separate development loan to cover its investment in the Uranium Compact.

A few years ago, under pressure from the World Bank and IMF to privatize its economy and in order to raise much needed cash, the government-run water company was sold to the HAZMAT company. The World Bank, through its affiliated International Finance Corporation (IFC), provided HAZMAT with a loan to finance the projected development of Banglabush’s water resources. The government had provided potable water to the population at less than cost. In the last few years, under HAZMAT management, the price of water has more than tripled and large portions of the population can no longer afford it. Under the agreement, HAZMAT even has the right to charge people for rainwater gathered in cisterns on the roofs of their houses — and the company has exercised this right. As a result, many people have resorted to the use of untreated and unsafe water for daily use and this has further increased the already high rate of disease. The so-called "water crisis" has been a major plank in the BPM campaign which has called the provision of safe drinking water to the public a basic human right. It has demanded that the government take back the water company from HAZMAT.

Unrelated to the water privatization issue, the HAZMAT Corporation and the Government of Banglabush are proposing a joint-venture, called the Uranium Compact, with the profits to be equally divided between the two partners. Banglabush has applied to the A-Team for a development loan to finance its part of the project. Under the proposal, HAZMAT’s nuclear power subsidiary would build two new nuclear reactors and would fuel them by mining Banglabush’s extensive uranium deposits.

The Uranium Compact would undertake the mining, conversion, uranium enrichment, and fuel fabrication operations on a large tract of land in the southern part of the country. HAZMAT’s engineers and scientists have determined that, given the location of the uranium deposits, the only cost-effective method of extracting the ore involves a combination of strip-mining and, in one area, mountain-top removal. The proposal would require that the government clear the land and relocate its present inhabitants, totaling about 3000 people, members of the Qutsi (pronounced "cutesy") tribe. The mountain-top that would be removed contains the major ancestral burial ground of the Qutsi people — for them, a sacred place where they frequently hold religious ceremonies. The BPM has made autonomy for the Qutsi people a central demand in its political program for Banglabush.

Under the proposal, the government would be required to provide security for the construction of the nuclear reactors and for the strip-mining and mountain top removal operation. The government would provide a resettlement allowance of $500 per person, about 1.3 times the average annual income in Banglabush. HAZMAT would make an annual contribution to reimburse the government for the extra cost of providing security.

Banglabush, with its four existing nuclear reactors, is already an energy exporter and this proposal would allow it to greatly increase such exports. As part of its proposal, HAZMAT has asked for a tax abatement for the first five years that the new plants are in operation.

The annual meeting of the World Bank and the IMF is scheduled to take place in Washington, D.C. in a couple of months. At about the same time, the European Union will be meeting in Brussels, Belgium.

Selling Green in Fabrikistan

Fabrikistan is a country in Southeast Asia with a population that is 90% Muslim. The government has been run by a nominally Muslim but predominantly secular, modernizing elite. Its president was a former general, who while still in his thirties, seized power with military support "to restore order" about 20 years ago. The government is proud of the country’s high public order and low crime rate in its capital city and attributes it to the success of its draconian punishments for even minor disruptions of public order.

No opposition parties are legal but the government is faced with sporadic acts of violence, led by the Fabrikistan Islamic Jihad (FIJ). This group condemns the government as corrupt and as puppets of international bankers, and calls for its replacement by a government committed to Islamic law and upholding the values of the Koran. The FIJ is an outlawed-group that has been carrying on a sporadic guerrilla war and political campaign against the government of Fabrikistan, labeling it an "infidel regime" and an enemy of Islam. It has engaged in a series of bombings aimed at destabilizing the government. It is particularly outraged by the extension of what it regards as a corrupt and corrupting culture that strikes at every aspect of a proper life and promotes a heathen ideal of women and their role. It is run by religious leaders who regularly denounce the government in their mosques and are in regular contact with members of its paramilitary wing.

The government has used a substantial amount of its revenue to purchase arms from the United States to suppress this movement. It has little revenue to support programs to alleviate malnutrition, inadequate shelter, and disease. It does, however, provide subsidies to keep the purchase of rice and one or two other basic foods affordable. A group of Islamic moderates, calling themselves the Islamic Labor Forum (ILF) has recently formed to promote Islamic values in the lives of Fabrikistan workers and peasants while at the same time helping them to improve the conditions of their daily lives — particularly around issues of malnutrition, inadequate shelter, and disease.

Fabrikistan has attracted large amounts of foreign investment. Chic Duds International (CDI) manufactures over 70% of its athletic shoes and youth apparel in Fabrikistan factories. Corporate headquarters are in New York and its stock is traded on the New York Stock Exchange. In the past few years, CDI has added subsidiaries involved in media and entertainment. It owns WUSA, a major news network, emphasizing international coverage, especially focusing on the financial world. It also owns a series of heavily advertised theme parks. CDI prides itself on being a good global citizen.

The president of Fabrikistan has recently died of natural causes and a leadership council has been formed from members of the previous government, with individuals serving as acting president on a rotating basis. The new government, while emphasizing continuity and stability to reassure international investors is also considering various new directions.

Current Situation

CDI is proposing to build a "destination resort and theme park" on a large tract of land it owns adjacent to the Capitol. The theme park will be the world’s largest and is intended to promote eco-tourism. It will be called: The Green World of the Future. The theme park will emphasize the promise and demonstrate the cutting edge of a range of new technologies that "tread lightly on the land" in the company’s language. They will emphasize the use of renewable resources that produce fewer toxic side effects than conventional technologies. The park is expected to be a major tourist attraction and the complex will include hotels and other facilities. The featured attractions will include:

  • A nature preserve in which various species of wild animals roam, while a monorail winds its way through the preserve for tourists to observe the animals. The monorail will feature a world class restaurant as well as a snack bar and other facilities for less upscale tourists.
  • Lola and Friends, a tribute to CDI’s widely-popular "Lola" doll with her friends and accessories. The Lola doll, popular with teen and pre-teen collectors in the U.S. and many other countries, is an anatomically-correct doll based on a popular teenage singer and dancer, known for her bare midriff and sex appeal. When you push her belly-button, her eyes light up, her hips swing from side to side, and she says a series of phrases such as "Let’s party," and "You go girl." Blond and blue-eyed Lola has friends of all colors and nationalities, including a Fabrikistani girl friend. Accessories for the doll and her friends represent typical dress codes of many countries and include a burkha and traditional Fabrikistani dress — flowing pants covered by a tunic, slit to the thigh. The theme park will feature a new "green" version, identical to conventional Lola, except that green Lola says, "Don’t litter," "Recycle waste," and "Respect the environment," in several different languages.

The nearby hotel area will include a world class spa, an up-scale shopping mall, and a casino which will also emphasize the eco-tourism theme. The casino, for example, will include games such as "Save the Rain Forest," in which payoffs are based on the number of trees saved and one percent of every pot will be put aside for donations to environmental organizations.

The mall will also include CDI’s new line of high-fashion clothes—"Sheikh Duds™"—inspired by traditional Fabrikistan dress. Three internationally known, "brand-name" designers—one from Italy, one from France, and one from the United States—have collaborated in creating the footwear and outfits. Simulated leather and simulated furs are used but no real animals will ever be harmed in the production of the Sheikh Duds line since, as the company slogan puts it, "Animals have feelings too."

CDI has emphasized its commitment to hiring Fabrikistan nationals whenever possible. The complex, the company claims, will produce many new, relatively high- paying jobs as well as attracting many tourist dollars. The company also is including in their plan a large training center where potential employees will be taught a variety of managerial and technical skills and where others may come for training as well.

An independent study by economists hired by the Women’s Global Alliance concluded that only about 20 percent of the revenue generated by The Green World of the Future will remain in the country. This is especially likely to be true if most of the tourists book package deals for their flights, hotels, and theme park stay through travel agencies in their country of origin. The study team also emphasized that a very likely unintended consequence of the project would be the attraction of illegal drug and prostitution industries, the latter trafficking in girls and boys who have been kidnapped from neighboring countries.

The proposed theme park is in an area of the country that lies between the Capitol and a mountainous province where the Fabrikistan Islamic Jihad has a very strong following. CDI proposes to contract with the Government of Fabrikistan to provide security during construction and after completion. The government of Fabrikistan has asked for U.S. military aid to cope with the threat of "terrorist attacks on this endeavor and elsewhere by the FIJ" and has proposed a joint "intelligence-sharing committee" to deal with the terrorist threat.

The government of Fabrikistan has also applied to the World Bank for a major loan under the Bank’s micro-credit program. The loan would enable the government to support the development of small businesses by Fabrikistan citizens, especially women, providing capital to community banks. The proposal includes funds to sub-contract with CDI to provide training. If the training institute is created, CDI has promised in its proposal, to offer training to loan recipients at a modest cost, teaching them the managerial skills they need to remain solvent and providing other forms of ongoing managerial support.

Making a Better World

A large private foundation, unhappy with how the present set of international financial institutions operate, has issued a challenge. It will finance a conference to agree on a specific plan for changing or replacing the World Bank, the IMF, and the WTO with alternatives.

The government of Plantanoguay has organized a group of countries from the Global South to respond to this challenge. Brazil has offered to host the meeting in Porto Alegre, the site of the first World Social Forum. The organizers have agreed on the following ground rules for invitees:

  • Only those delegations that support either the GLOBALIZATION WITH A HUMAN FACE or GLOBALIZATION FROM BELOW frames will be included as participants who must approve the terms of the plan.
  • Participants will include both governments and movements from the Global South and transnational non-governmental organizations.
  • Representatives from the Global North and from the A-Team and WTO will be invited to attend as observers and to raise questions but will not have a vote on the final content of the plan.

In preparation for the conference, six committees have been set up to consider various proposals. The committees will decide which proposals to bring to the participants in the Porto Alegre meeting for a vote.

Some of the proposals were drawn up by those who support the GLOBALIZATION WITH A HUMAN FACE frame and others by those who support the GLOBALIZATION FROM BELOW frame. Teams with one or the other of these frames are not obliged to support all those proposals by those who share their frame but must decide which among them are the most important to pursue. And they may wish to support those proposals made by advocates of the alternative frame, either because they agree with the wisdom of these proposals or on more pragmatic grounds of finding a total set of proposals that will win the allegiance of supporters of both of these frames.

While the observer teams from the Global North do not vote on these proposals, they will be making recommendations to the organizations that they represent. The probability that the proposals adopted by the conference will actually be implemented depends both on the success of the conference in achieving a consensus among the voting members and in neutralizing opposition (or even gaining support) among the observer teams.