Senate Bill's Endorsement of Global Privatization May Bar All New Public Anything, May Trigger Huge, Irreversible Changes.
GATS is the Real Reason For Much Politician Lying/Behavior
Imagine its ten years from now. The GATS provisions on health care have been triggered. Public plans are barred. Multinationals have been given access to the US national market in exchange for profitable contracts overseas, both insurance and in care for our own sick and disabled. Millions cannot afford care of any kind, and subsidies have been eliminated because the cost is too high. People who are sick are rounded up and shipped overseas. Sick people struggle under mountains of medical debt, like in Massachusetts, and elsewhere, now.
That is all we can hope for in the future, if we trigger GATS. Affordable public healthcare will become impossible. Arguably, new public plans are already, under the WTO/GATS commitments we have already made.
What does GATS do? GATS regulates nations for the promotion of free trade, allowing companies to limit laws and practices that stand in the way of free trade.
Free Trade Agreements like GATS and NAFTA operate under the assumption that the eventual goal of nations is total privatization and free trade and that any barrier to privatization (like any public plan or regulation) is bad for free trade- so they attempt to close off areas one by one- permanently- from any reversion to public management or monopoly service providers. This is why we have committed to, for example privatize public jobs gradually, and once they are privatized, we cannot return to a public management easily. They make it very, very difficult by making it a right corporations enjoy, to sell us that service. They then, in a sense, "own it".
The same principle is also being applied to things like fresh water.
Now that we have endorsed privatization of health care and opening the US market to multinationals in order to make healthcare more affordable, we will start seeing more and more multinationals offering "bare bones" health plans that conform to the new harmonization rules, so they can be sold nationwide. They will have to have disclaimers, for example, "This plan does not cover chronic illness" or "This plan does not cover any of these diseases" etc. but they will be less expensive than the kind of plan that Americans can no longer afford. The restrictions on free trade in the new bill will probably be invalidated, but I think the mandate might stand. Wether it does or doesn't, might not matter so mch because as I said, the transition to privatized healthcare is designed to be irreversible. Public health care and single payer wont be possible because you cannot have single payer AND allow equal access to multinational firms (our commitment) at the same time. The promises we have made to allow access to our markets in exchange for access to profitable unregulated markets overseas clearly takes precedence.
Thats what GATS is all about. Regulating countries and their unpredictabiity to make the world safe for global trade.
Affordable means unprofitable to some. Even monopoly service providers like Medicare that serve some non-elderly may be threatened by the provisions in GATS that prohibit all monopoly service providers except for military and retirement plan members (implied, only the elderly, post work population), exclusively. Obviously, this is the reason public was never really on the agenda. That would be inconsistent with USA's advocacy of unrestrained free trade. By making progress on eliminating monopolies like Medicare, we make progress for the WTO. In return, "we" (US owned multinationals) get to set up profitable, unregulated businesses overseas. Everybody wins, except the US people.
Health Care Reform
US commitments under GATS to liberalize trade in insurance services, including health insurance, may interfere with future federal and state initiatives to improve access to health care services for vast numbers of uninsured and underinsured citizens.
Health care reform could be affected in several ways.
- GATS could undermine future attempts to enact single payer national health care because it effectively prohibits the grant of new monopoly rights.1
- Second, any attempt to expand the existing Medicare program to cover children or new services such as prescription drugs might face a challenge under GATS. Since Medicare is a monopoly provider of health insurance for the aged, it may be subject to the US commitments on financial services under GATS. These include a commitment to endeavor to eliminate or reduce the scope of existing monopoly rights.2 A recent analysis of the Canadian health insurance program indicates that expansion of Canada's Medicare program could be vulnerable to challenge under NAFTA and/or GATS.3 Any such challenge to the Canadian health insurance program could have serious repercussions for the US Medicare program.
- Third, GATS may create barriers to state and federal initiatives to improve access to health care through HMO and health insurance regulation. The insurance industry's position on liberalization of trade in insurance services advocates "pro-competitive" regulatory reform. This means limiting consumer protection regulation to financial solvency and disclosure issues, with no restrictions on pricing and no limits on the types of insurance products allowed on the market.1 From this perspective, consumer protections and initiatives to improve access to health care, such as mandatory coverage requirements or rate controls, would be seen as anti-competitive barriers to trade.2
Source: The General Agreement on Trade in Services (GATS): Implications for regulation of financial services in the United States, (2002) by Patricia Arnold, Associate Professor, School of Business Administration, University of Wisconsin-Milwaukee (arnold@uwm.edu)
How is GATS triggered? We already signed it years ago, and triggering it on health insurance is as simple as granting the expressed wishes of multinationals to be able to sell one policy to Americans throughout the nation. A "national exchange" or "cross state line sales" (see References at link) is what they asked for, in 2003. In exchange for honoring its side of GATS, by allowing multinationals in, and ending US monopolies on healthcare enabling increased profitability even in markets like the aged, US companies will get lucrative foreign contracts, allowing them to enter new, profitable and unregulated emerging markets. This makes up for declining US profitability.
US customers, such as HMOS and state/federal governments may also start offshoring long term healthcare, for example, care of the long term sick or disabled. Telemedicine is also growing, care over a high speed Internet link. Certainly, the care for the chronically ill in Nauru would be less expensive than in Norwalk, Palau less expensive than Pasadena. Food service/hotels/Internet access/international phone calls and Internet access could also be turned into profit. Low wages and the surplus of workers would make this a very profitable business.
Why is it irreversible? GATS is written to be irreversible, once triggered, for obvious reasons. It is meant to enfore a steady increase in privatization, regardless of economic climate or affordability. Its ratchet effect is designed to tighten with each "movement".
If such agreements were reversible, how would US firms ever be willing to invest in foreign lands always worrying that the government would decide that the cost too onerous, the inflexibility crippling. The same applies in reverse. Nations that try to reverse GATS are typically sued in closed WTO tribunals and lose, they soon find that the cost is astronomical, as it is based on potential, rather than actual sales lost to the plaintiff. In the case of the US, thats an awful lot of money that a plaintiff stands to get for virtually nothing. So, stand asured, the triggering of GATS in the Senate bill would be intentional. It would remove the nagging of single payer and public option advocates from the realm of the possible, forever.
Report on potential gotchas in Obama/McCain proposals - such as a national exchange, that potentially open the US insurance market to mutinationals and thereby prevent single payer forever.
Canadian report on similar issues, in depth.
All of the same issues and cautions apply to us.
Global Trade Watch
IMPORTANT LESSONS ON POENTIAL GATS "SCOPE" in HEALTH INSURANCE AND HEALTH CARE SERVICES from the Aruba/Online Gambling Case
The public health implications of world trade negotiations on the general agreement on trade in services and public services (The Lancet)
P. Arnold on GATS Service Negotiations, including Medicare and GATS
Trading Health Services Across Borders
Search on Medicare and GATS (brings up good, relevant data)
By Nicholas Skala re. Aruba online gambling case-
"The WTO Dispute Settlement Body panel ruled against the United States on both its defenses (8, p. 271). The Panel held that, regardless of whether the United States had intended to or not, it had committed gambling services to its schedule under normal rules of treaty interpretation. It further held that the United States had failed to demonstrate that the anti-gambling laws were "necessary" to protect public morals or to prevent deception and fraud, because it had not "exhausted" all opportunities to explore measures that were more amenable to international trade, and that the United States could not defend its laws from GATS rules, because they discriminated against international trade by allowing for the provision of domestic online betting on horse races. After dismissing the U.S. defenses, the Panel ruled that three U.S. federal laws (the Wire Act, the Travel Act, and the Illegal Gambling Business Act) and similar state laws in South Dakota, Louisiana, Massachusetts, and Utah violated the GATS market access rules, and held that they should be "brought into conformity" with the GATS (i.e., substantially modified or repealed). Significantly, the Panel held that because it had already found that the U.S. laws violated the GATS market access provisions, it would not rule on other claims made by Antigua, including alleged violations of GATS national treatment and payments and transfer restriction provisions. A third claim of a U.S. violation of GATS domestic regulation provisions was dismissed only because Antigua had not submitted a sufficient claim. On appeal, the United States argued (somewhat ironically, considering that it was perhaps the most adamant proponent of services liberalization) that the Panel's ruling "unreasonably and absurdly deprives [nations] of a significant component of their right to regulate services by depriving them of the power to prohibit selected activities" (9). These protests notwithstanding, the WTO Appellate Body (the highest "court" of the WTO) upheld the Panel's ruling (albeit on modified reasoning) that the United States had committed gambling services to GATS and that the federal laws violated its GATS commitments, holding that a prohibition on gambling constitutes an impermissible "zero quota" on the number of allowed service providers or operations. It overturned the Panel's finding, however, that the U.S. laws were not "necessary" to protect morals or against fraud, but upheld its conclusion that the U.S. gambling laws were discriminatory and held that, as a result, the "necessity" defense could not be invoked. The Panel's ultimate conclusion that the U.S. law violated the GATS was affirmed (9, p. 123). Negotiations on compensation by the United States are ongoing. Several unsettling conclusions can be drawn from the U.S.-Gambling case. First, domestic statutes and regulations, even criminal ones, can be found to be violations of the GATS in sectors in which specific commitments have been undertaken, and probably also in those in which no commitments have been 370 / Skala À; undertaken (as in the general prohibition on new monopolies). Second, in sectors in which commitments are undertaken, foreign service suppliers must be granted market access even if domestic suppliers are prohibited from doing so, unless the prohibition can be shown to be "necessary" to protect public order or against fraud. Third, the GATS treaty and schedules are written with such ambiguity that trade experts are not even aware of what they have committed to GATS jurisdiction. The U.S.-Gambling case raises concerns that other broadly worded commitments may be subject to undesired interpretations. Finally, the Dispute Settlement and Appellate Bodies have demonstrated that they are willing to give extreme and unanticipated interpretations to the GATS rules. Few would consider a criminal anti-gambling law a "limitation on the total number of service operations," indistinguishable from a trade quota. But the WTO adjudicatory system has demonstrated a willingness to view public protections in exactly this way and to rule against them where they inhibit commerce. What are the potential implications of the relevant WTO rules and juris- prudence for the U.S. health sector"