Free Trade Deal in Action: Milwaukee Firm Seeks $100 Million From El Salvador Govt.

Under the ​“dispute resolution” provisions of free trade agreements, a corporation can contend that a regulation constitutes a barrier to trade, and then can sue a nation for lost profits.

The issue is decided not in an open international court, but by a secret international ​“dispute resolution panel” composed of unnamed government officials and corporate officials. While their deliberations are conducted in secret and their documents are permanently sealed, their decision is final, as Thom Hartmann explains in his valuable book, Unequal Protection: the Rise of Corporate Dominance and the Theft of Human Rights. 

This provision in CAFTA allows the Commerce Group to challenge the decision by the government of El Salvador to shut down the company’s mine because of severe pollution, which has resulted in a high rate of cancer and kidney disease, according to local residents and government officials. Operation of the mine stopped in 2001, but the Commerce Group gained a permit in 2004 to study the possibility of re-opening the mine, only to have it revoked by the government in 2007.

CYANIDE AND SULPHUR

The Commerce Group’s mine along the San Sebastian River has continued to produce cyanide and sulphur although closed for a decade, Salvadoran attorney Kenia Margarita Ortez Alvarezt told In These Times through an interpreter.

​“Nobody drinks the water, but the horses and cows drink from the river, so it inevitably winds up in our bodies,” she explained. ​“In the summer, it is dusty and the people wind up breathing in the contaminated soil, and they suffer as a result.

​“The wells are also contaminated, so we’re trying to build a cistern to provide fresh water,” she said.

Ortez Alvarez had traveled to Milwaukee to meet with Commerce Group officials that morning and present a letter from community residents with three requests. ​“First, the community wants to get the title to the mine so that mining is permanently ended,” she said. Second, the community wants the Commerce Group to assist in assessing the actual level of danger posed by ongoing leaching of contaminants from the mine.

Finally, the community seeks the help of the corporation in reclaiming the river and surrounding land. But company official Jeffrey Machulak dismissed the community’s contentions and request for help. He claimed that they hadn’t worked the mine for years, and that pollution must be coming from another source.

Machulak also vowed to press ahead with legal challenges, including the CAFTA dispute resolution process.

A WARNING TO CHIPPEWA TRIBE

But for Ortez Alvarez, the long trip to Wisconsin was still worthwhile. She got a chance to meet with a local chapter of Engineers Without Borders, which is eager to assist her community in stopping contaminants and finding fresh water.

Further, Ortez Alvarez was about to embark on a trip to the Bad River reservation of the Chippewa Indian tribe, who are alarmed by plans for a massive iron ore mine that is being fervently promoted by the Gogebic Taconite Mining Company and Governor Scott Walker as a major job-producing project. The Chippewa are concerned that the giant $1.5 billion mine may harm the Bad River, while Republican legislators are trying to rush through the review process needed for such an enormous project within 300 days, as opposed to the two to four years normally required.

Ortez Alvarez’s frank account of her dealings with the Commerce Group was not likely to have generated much support among the Bad River Chippewa for a new mine near their long-treasured river.