Krugman Raises White Flag on Trade, admits his “free-trade” cheerleading was mostly garbage

[Baobab]

14. Clinton trade deal is the real reason US health care is so thoroughly broken-

And one of several currently pending trade deal is trying to globally privatize education... irreversibly - Definitive proof here:

http://www.eua.be/Libraries/publication/EUA_Statement_TTIP.pdf?sfvrsn=2 Read it!

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The following is just an excerpt from a paper at

http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.405.5725

about International Trade Law and U.S. Health Reform


What the GATS Rules Require

Broadly speaking, there are three “tiers” of GATS rules affecting health care.
The first tier of rules, General Obligations and Disciplines, apply equally to all
service sectors of all WTO member countries, regardless of whether those sectors
are committed in a country’s schedule or not. The second tier, Specific Commitments, apply only to those sectors that a country commits to its schedule.

These rules are more far-reaching, and members were given the opportunity to write
any exceptions or limitations to them into their schedules. Finally, under GATS
Part III, Article XVII, WTO member countries are allowed to negotiate a third
“tier” of rules to govern their commitments above and beyond the underlying
Specific Commitments rules that normally apply. Citing this provision, the United
States has inscribed its Financial Commitments schedule with the “supplemental”
rules of the Understanding on Commitments in Financial Services. These rules
apply in addition to the underlying GATS Specific Commitments rules on
Market Access and National Treatment



General Obligations and Disciplines. These rules apply to all service sectors of
all WTO member countries, regardless of whether or not the sectors have been
committed to a nation’s schedule. While these are generally the least controversial
provisions, several may have serious implications for reform or regulation of
the health sector (4).

Most-Favored-Nation Treatment: This provision requires a member to give
service suppliers of any other WTO member no less favorable treatment than it
gives service suppliers of “any other country” (4, Art. II).

Prohibition on New “Monopolies”: This provision requires that if a country
grants new “monopoly rights” regarding the supply of a service covered in its
schedule, the country granting the “monopoly” must enter into negotiations to
provide compensation to any other member adversely affected by it. If an agree-
ment is not reached, the affected member may refer the matter to arbitration, and
the “monopoly” may not go into force until the compensation required by the
arbitration has been made. The term “monopoly rights” is not defined anywhere
in the agreement (4, Art. VIII).

“Disciplines” on Domestic Regulation: In sectors where no commitments
have been undertaken, the GATS states that a special Council for Trade in Services
shall develop “disciplines” that assure that qualification requirements and proce-
dures, technical standards, and licensing requirements for the provision of services
are “not more burdensome than necessary to ensure the quality of the service.”
Regarding sectors in which commitments have been undertaken, however, it
is unclear whether such a “necessity test” is already in force (4, Art. VI).

Specific Commitments. These rules apply only to service sectors that members
have volunteered to submit to the rules by inscribing them in their schedules.
Members were also given an opportunity to reserve specific exceptions to the
rules during the negotiations of their schedules. Rules in this section fall into two
broad categories, Market Access and National Treatment.

Market Access: The rules in this section are aimed at preventing governments
from limiting the number, type, form, or size of foreign service suppliers in their
markets or intervening to affect or regulate the way the firms provide the service.

Examples of prohibited measures include (4, Art. XVI):

Limitations on the number of service suppliers

Limitations on the total quantity of service output

Requiring a specific type of legal entity (e.g., nonprofit)

Limitations on the “total value of service transactions or assets”

National Treatment: This set of rules requires that foreign service suppliers
receive, “in respect of all measures affecting the supply of services,” the same
treatment that a nation gives to its own service suppliers. It is easy to think of
situations in which a country may want to shape policy to favor domestic industry
over foreign operations, but the GATS rules go even farther than these require-
ments.

Under the National Treatment rules, any measure that modifies the conditions of competition in favor of a domestic supplier is a GATS violation. In other words, even if a policy has no intent to discriminate against foreign service
suppliers—indeed, it can be totally unrelated to service provision at all—if it
has the effect of disadvantaging them, it is potentially a violation of the GATS
(4, Art. XVII).

Special Rules for Health Insurance. The United States committed health insurance
to its schedule under the Financial Services section. Two special sets of rules
apply to commitments made under this section. The first is the Annex on Financial
Services, a unique set of constraints that apply to all commitments in financial
services, no matter what nation makes them. The second is an even more expan-
sive Understanding on Commitments in Financial Services, a set of extreme
liberalization rules that are an optional “attachment” to commitments in finan-
cial services that the United States has chosen to take. These rules go so far in
constraining governments that only developed countries have signed on to them.
The Annex on Financial Services: Most financial services are related to banking
and investment, hence the Annex provisions pertain mostly to them. One provision
in particular is significant in assessing the impact of the GATS on health care:

• Subjection of “Public Entities” to GATS Rules: Normal GATS rules make an
exception for government services and procurement (with significant limita-
tions). The Annex specifically states that if a nation allows domestic service
suppliers to compete with “public entities,” those entities are subject to
GATS rules. This will have significant implications for Medicare, as we will
see (4, Annex on Financial Services, §1(b)(iii)).


The Understanding on Commitments in Financial Services: The most far-
reaching document in the GATS, the Understanding binds signatory nations to
an extreme level of financial services liberalization. The commitments undertaken
by signatories to the Understanding include:

• The “Standstill” Provision: The signatories pledge that any exceptions to
the commitments they have made are limited to existing measures. The
implications of this vaguely worded provision are not entirely clear. Some
commentators believe that the signatories bind themselves to never enact a
limitation on their commitments in the future that was not in effect when
the Understanding was inscribed in their schedule. In effect, the level of
privatization at the time of the implementation of the Understanding is
“locked in” (5).

• New Financial Service: Signatories pledge to allow foreign firms to offer
any new financial product in their territory, as long as another WTO member
offers it (5, Art. B(7)).

• Domestic Regulation: Signatories pledge to “endeavor to remove or limit
any significant adverse effects” on foreign investors of any laws that “affect
adversely” the ability of foreign firms “to operate, compete, or enter” the
domestic market (5, Art. B(10)).