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Keep public education out of trade agreements

By Larry Kuehn, Director of Research and Technology
British Columbia Teachers’ Federation, Canada

Two trade agreements currently under negotiation could have quite negative effects on public education throughout the Americas.

One of these trade pacts is the Free Trade Area of the Americas—the FTAA. At a “Summit of the Americas” in Santiago, Chile, in 1998 all the countries in the region (except Cuba, which was excluded) agreed to work toward this agreement. These negotiations are ongoing, and will be the focus of the next Summit of the Americas. This will be held in Quebec City in Canada in April 2001.

The second agreement—being negotiated in Geneva at the World Trade Organization—is the General Agreement on Trade in Services (GATS). It is designed to provide rules for trade in services comparable to those in the existing GATT (General Agreement on Trade and Tariffs).

Three key problems are common to entrenching services in these trade agreements. The first is that they treat education as a tradable commodity—not recognizing that education is to a significant degree a social process that should be rooted in particular social and cultural realities.

Second, they are anti-democratic. If there is a disagreement about whether an education policy is a trade issue, a trade tribunal of the WTO will decide on the action to be taken. The rulings of these tribunals can overturn decisions that have been democratically made. These trade tribunals have secret hearings, not open, democratic processes and impose their judgment.

Third, these trade pacts are designed to prohibit a country from changing its policies. Once a government has agreed to include an area like education into one of these agreements, it cannot withdraw that area from being covered by the agreement—even if the people of a country vote overwhelmingly that they do not approve of what is happening.

In Canada, we have more than a decade of experience with free trade agreements with the United States—first one between Canada and the U.S., and then the North American Free Trade Agreement (NAFTA). Now the Canadian government is playing a lead role in encouraging the development of the Free Trade Area of the Americas and Canada will be hosting the next Summit of the Americas in Canada in April of 2001.

While the Canadian government has been promoting and signing these free trade deals, many of us in the social movements in Canada have opposed the agreements. Those in English-speaking Canada who value a cultural and social context that is different from that of the United States see a threat of the loss of our country. The nature of these agreements leads not only toward economic integration, but toward assimilation into a conception of culture that sees it primarily as a product for sale and for export.

I want to focus here not on the many implications of these trade agreements, but particularly on their impact on public services, and, in particular on public education and its future. Each of the succeeding trade and investment agreements has added more limits to a conception of education as primarily a social and cultural factor. Each trade deal has been part of changing the conception of education toward it being a tradable commodity.

Before getting into the details of these particular agreements, let me make a point about trade and investments. When we hear the word “trade,” most of us think about the movement of goods across national borders. When it comes to trade in services, the concept is inevitably different. Services are usually delivered directly from one person to another and cannot generally be easily moved across borders in the way that goods can be.

What, then, constitutes trade in education services? Investment in service providers is one of the ways. Let me give some examples of investments that are considered trade in education. In the first, a U.S.-based transnational corporation wants to make a profit from education in Mexico. It invests capital in a private university in Mexico; the profit made through selling education services in Mexico is then returned to the U.S.-based corporation. As a second example, the for-profit Phoenix University from the U.S. sets up campuses and offers degrees in Canada. The profits from its operations return to the U.S. In both these cases, service is delivered to individuals in a country other than that where the institution is owned and profits from investments go to the country where the corporation has headquarters. This is one type of education as an investment that is considered as trade in services.

Besides direct delivery of education services in another country, there are several other forms considered “trade” in education: one is students who travel from one country to another to attend school and pay tuition; another is delivery of administrative services, offered through education management organizations, which are developing in the United States, based on the model of health management organizations; still another is maintenance of buildings; and then there is curriculum; textbooks; and, of course, delivery of education across borders through distance education using the Internet.

Many of us think of education as socialization, cultural transmission and personal cognitive and social development, as well as general preparation for employment. Education is a subject for national social policy that reflects cultural realities and political desires. We do not think of education as a commodity to trade.

However, others do see education as a commodity and a commercial opportunity—the last huge area of public expenditure in most countries that has until now been only marginally privatized. Privatization and commodification are key to making education tradable and profitable to private interests.

The World Bank has contributed to imposing this conception of education in many countries. It has played a significant supporting role in advancing the process of privatization. For many years, it insisted that countries that were to receive loans for education must charge fees to students—there could be no such thing as free education. The record is clear in every country that has followed the World Bank demands and introduced compulsory fees. The percentage of children who attend schools has gone down, especially among girls. When people have to choose between food and education fees, many do not send their children to school. The record is so clear that even the U.S. House of Representatives passed a bill—although it has been blocked from becoming a law—that would prohibit more funds from the United States for the World Bank unless it removes its condition that fees be charged even for basic, primary education.

One approach being pushed by the World Bank is vouchers. They call it having education being “demand led” rather than “supply led.” In other words, the World Bank is saying that education should not be based on national policies of supplying education for everyone through a common school that reflects social decisions about what education is appropriate for a particular society. Rather, the World Bank wants education determined on a consumer choice model—what they call “demand led.” The government would still provide the financing of education through vouchers, but it could no longer exercise its control through government provision of the service.

What has this to do with trade agreements? You can see that the World Bank pursuit of education vouchers coincides nicely with the concept of trade in education services. Disney, for example, could create schools in every country, either with direct service or over the Internet. With a voucher system, each government would continue to pay for education, but government-run schools—or schools run by a local, private company—would have to compete with Disney schools. Vouchers or their equivalent are key to commodification on a consumer choice model, pushing aside the ability of a country to have its social objectives determine its education policies.

This turning of education into a commodity has brought with it the development of a “World Education Market.” This event was first held in Vancouver, Canada, in May 2000, as a place to bring together the international buyers and the sellers of education service. The organizers intend to hold the World Education Market on an annual basis. They anticipate that it will grow as education is increasingly traded as a part of a global commodity market. And, of course, the World Bank has a presence at the event, promoting the sale of education.

Let’s now talk more about the two treaties on trade in services currently being negotiated. GATS and the FTAA are designed to create rules that open up borders to investment and trade in services—“progressive liberalization of trade,” as described by WTO officials. These agreements are also aimed at ensuring that once those borders are opened, no government can close them again, regardless of what the citizens want and express through elections. These international rules will prohibit governments from giving an advantage to local suppliers. And they require that any opportunities given to a local supplier be given to any corporation from outside the country. As an example, if a government provides to its public institutions a subsidy for each student to provide free education or to keep down the cost of tuition, that same subsidy might have to be provided to a for-profit corporation from outside the country.

At a recent meeting in Vancouver, a WTO official said that the push in the WTO to create an international agreement on services came from the United States trade officials. It is easy to see why when one looks at the trade statistics. The U.S. has a huge trade deficit every year. The value of the goods imported is billions of dollars greater than goods it exports. However, education produces the opposite result: the U.S. “exports” $6 billion and “imports” only $1 billion in education services. Further growth in education exports would help further to reduce the U.S. trade deficit.

To get an idea of the scope of the U.S. domination, one can look at Canada’s education export business: it “exports” about $100 (Can) million a year. If it were to have exports equivalent to the U.S. on a per capita basis, it would have to export seven or eight times as much as it currently does. Yet the dominance of the U.S. in entertainment (especially movies, TV and Internet), along with science and technology (much of it built on military development) is so great that no other country can expect to gain ground on education “exports.” In fact, the domination in media and technology, along with open borders, would likely make the U.S. the winner in trade in education with every other country.

A multi-part strategy is being followed by both the U.S. and Canadian governments to bring all services, as well as professional qualifications, under the trade and investment rules. The GATS is the most inclusive approach. Because it is a part of the World Trade Organization, every one of the 130 countries that belong to the WTO would have to meet the conditions set out in the GATS. Some may temporarily claim some areas of exemption, but the WTO is committed to bringing all trade under its rules in the long term.

However, if the current round of the GATS negotiations does not bring about all their objectives, those pushing for total liberalization of trade in services have some interim strategies. One of those involves the regional trade agreements. When the provisions of the Free Trade Area of the Americas (FTAA) are seen in Quebec City in April 2001, they will likely contain the same objectives for including public services that are being put forward in the GATS negotiations.

Another fall back strategy by governments is in place as well. If the liberalization of trade in services cannot be achieved in the regional FTAA, liberalization can still move ahead on a country-to-country basis. As an example, the Canada-Chile Free Trade Agreement recently negotiated has in Chapter H on “Cross-border Trade in Services” most of the provisions that the U.S. and Canadian governments are pushing for the GATS and the FTAA.

Concerns about the direction being taken by the World Trade Organization on the GATS and on the Free Trade Area of the Americas led the delegates to the IDEA conference in Quito, Ecuador, in October 1999 to adopt a position that said that education should be excluded from trade agreements. This position made good sense then. Based on what we have been able to find out since then, the position makes even more sense now. The more we discover about negotiations on both of these agreements, the clearer it is that opposition to education being covered by trade agreements should be strengthened.

In many countries, and certainly in Canada, the populace is being told not to worry. Trust us, government negotiators say. Public education will be protected in the trade negotiations, they claim. Yet, we know that the agreements they are negotiating can have a substantial negative impact on public education.

When we began to oppose public education being included in trade agreements, we were a tiny number of people concerned about what NAFTA and other trade agreements might mean to public education. It seemed that the forces opposing globalization and corporate power were tiny. They were so few that they could be totally ignored.

Yet, it still seemed like important work to carry out research, to understand in detail how trade agreements were being used to negate many of the democratic victories of the 20th Century and turn over to corporations what should be the social rights of people. Bringing civil society organizations together at conferences to issue challenges to the official story was a way of ensuring that people knew that corporate rule was not the only option—for either education or for our societies as a whole.

We can now look back at the short time since the World Trade Organization was stopped in Seattle and feel some hope. Those demonstrations produced a sense of possibilities—and showed that opponents of the negative effects of globalization are not just a few isolated individuals, but are a part of a global movement. Globalization of capital and of communications has also globalized the struggle for democratic institutions and reforms that serve the needs of people, not just profits. Since Seattle, many demonstrations in many countries have challenged the IMF and the World Bank, as well as the WTO.

The change in political climate is well symbolized from an item in the news recently. The tiny, oil-rich country of Qatar in the Middle East was supposed to host the next meeting of the World Trade Organization. They have cancelled out as hosts. They want to avoid the demands for democracy and equity that are heard in the streets around international meetings these days.

At this time our voices must be part of those calls for democracy, equity and social justice. Trade deals must not be allowed to entrench corporate power. They certainly must not be allowed to prohibit democratic and equitable public education systems.

At a recent meeting in Mexico, educators from the three countries in NAFTA called for teacher unions throughout the Americas—and other organizations that support public education—to have a day of protest on April 20, 2001. That is when the leaders of all the countries in the Americas—except Cuba—will be meeting in Quebec City in Canada to consider the Free Trade Area of the Americas. It is a day to say no to education in trade agreements.

In as many places as we can, we must say it over and over again—keep public education out of trade agreements.

“Keep Public Education Out of Trade Agreements” is the text of a talk by Larry Kuehn at the World Forum for People’s Education, sponsored by the Confederation of Educators of the Americas (CEA). The conference was held in Santiago, Chile, in November 2000.


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