British firm may have created a successful lock in of US healthcare policy, read story to understand how scary this kind of corporate lock-in is.

It was a mystifying story. In 2014, a Midwestern TV station - in response to a viewer tip, reported on a mysterious warehouse of contractors of a controversial British firm who were allegedly "being paid to do nothing". Even though its existing workforce were literally going crazy from not having enough work to do, the company hired more people. Here we are also going to discuss the concept of "moral hazard" and governments, a discussion that has nothing to do with any particular company.

The locking in of multinational corporations can be seen as a stealth attack on a future Medicare For All managed by professional civil servants.

Corporations - speaking generally, and the corporate structures generally are amoral and not appropriate in the healthcare setting, as we are seeing with the warehouses where illegal aliens are being kept and the arguments which are being made about the medico-legal standard of care applicable for children being kept in it.

In 2014 a midwestern TV channel did a series on a UK contractor "paying workers to do nothing" a clue that the workers and work may legally establish a binding entitlement under GATS. Because they are a foreign firm, that turns the entire service sector into international trade, under the jurisdiction of the WTO.

My theory, currently totally speculative, is that the presence of these workers may have some lock in effect on corporate management of partially subsidized healthcare in the US, by making it an international entitlement, and set the scenes for a possible tit-for-tat.

 See also: the proposed, negative list "plurilateral" FTA, TISA.


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"we want to hire more people even though we have no work for the people we have"

So went the series of investigations conducted by KMOV.


The story may have global implications because of its tie ins to a trade agreement that few of us have ever heard of. Its called the General Agreement on Trade in Services, or GATS. It was intended to be similar to NAFTA, but "for the non-manufacturing "services" jobs" And worldwide. 

As I have been doing research as deeply as I can to build this site, on certain critical areas, what I am realizing is, the body of GATS law is still uncompleted, and ambiguous. GATS jurisprudence is so incomplete, that "interested parties" may be hoping to set up test cases they can control, to establish the legal precedents they want. We have to understand here that multinationals see themselves as the future, and that future is one that revolves around money, not people. 

New legal precedents established in WTO law under GATS will then last "forever" as people have no standing in the WTO so WTO decisions don't have any means of people challenging them. .

(FTAs have no expiration dates, typically)

And in the case of WTO law, generally will be binding on the entire WTO membership, currently more than 160 countries. All the major economic players in the world.

These "agreements", like the GATS that few voters would agree with, present big problems for health care, using international trade as a pretext to prevent democracy from controlling policy.

For example, GATS might prohibit changes that occurred in health insurance after some specific date, say February 26, 1998, requiring a country's regulation to use a date as a ceiling for permitted regulation. This is to make sure that foreign investors could depend on a profitable market for their profits, one where profits were not depressed by government competitors offering products below cost plus healthy profits. Limits such oas requirements that some percentage of money taken in be spent on patients care likely violate gATS. So do prohibitions on certain kinds of entities (like for profit) or numerical limits on the number of providers of the service and kinds of services offered. (prohibiting healthcare thats attenuated in order to be cheaper, say, or prohibiting requirements that companies not practice medical underwriting. New regulations added after Feb 26, 1998 might also be prohibited as violations of standstill) 

Changes that made health insurance affordable for people with pre-existing conditions might be deemed more burdensome than some other alternative, like allowing people to use their MSA - (pretax money) to buy healthcare internationally.

GATS includes almost "everything you cannot drop on your foot".

What is "Moral Hazard" and why does it matter?

To understand Moral Hazard, lets look at an example of the concept in use, the so called "baby-farming" of the past where desperate poor women in countries like the UK and Australia paid "nurses" a flat fee to take their non-marital children off their hands. Transfering the legal (although not the moral) responsibility of care to somebody else.

The babies subsequently often fared badly. The practice was eventually outlawed.

Increasingly pressed governments may want to shed themselves of moral hazards in the difficult, job-sparse years ahead. Neoliberal governments especially, may see legal responsibility for the health (retirement, housing, educational) outcomes of the poor, (expected to swell as automation reduces the number of jobs needing human labor - when they don't have the money to afford them on their own), Governments see these responsibilities as a form of "moral hazard". 

Although they are unlikely to admit this.

Quite the opposite, to get elected, politicians see themselves as forced to make promises that might be at best difficult and now thanks to GATS more and more of them are officially off the table. Young people in particular are unlikely to be willing to accept the situation as is, but are over optimistic - less likely to be realistic about the willingness of current incumbents to fix the situation or the degree to which the system is captured, not just in the US, all around the world. 

As GATS is a legally binding international agreement which has become part of international law, and proposals by politicians for Medicare for All, although likely to work IF they were implemented, which is unlikely due to the lack of knowledge of the general public of the problems making healthcare measures subject to GATS minimal by necessity. 

Measures that seem acceptable to people, generally are excluded by GATS for many newly created "trade berrier" arguments, which are inflexible and rigid.

Tierless systems are clearly unwelcome within GATS (they would come under its jurisdiction if a country allowed for profit health insurance to be sold alongside a public system, like in the UK, with its dual system that predates the WTO. For that reason, the NHS was likely protected until somebody changed something.) But improvements are prohibited, for example, in the US, *within the GATS* because they would be framed as trade distorting. (The only way out is the GATS Article XXI procedure)

This body of WTO lawseems to me to be becoming more and more restrictive over time, because of a desire to limit the spread of new instances of certain kinds of measures (i.e. public healthcare) to the poorest countries only, and also only for limited times.. (thats required by the "progressive liberalization" ratchet).

Public healthcare systems are not allowed to be good enough to pose "unfair competition" to commercial markets for customers, in essence. Or so it seems to me. But, this area of WTO law is still incomplete.

GATS should be seen as the default, currently binding outcome, and the new proposals as unlikely to come true without far more in the way of changes than simply a few primary elections.

Under capitalism, everything is based on money. Corporations want the business represented by providing services to governments, expected to become more and more of the economy. Public services are too efficient, in their eyes, as they put most of the taxpayers money back into the service. So FTAS like GATS represent them as trade barriers, a sort of theft of opportunity, for example from poorer countries who might offer healthcare that even the poorest in a developed country could afford without needing much of a subsidy.  (This is the kind of market-based solution GATS is designed to promote)

What is a "measure"? (the GATS regulates all measures by governments that affect trade in services)

What is a "measure"?

Source: UNCTAD course on GATS dispute settlement.

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