Let’s say you had a civil dispute with someone over money. Eventually you have to take them to public court and a legal system with a judge rules one way or the other; perhaps you get your money back and some compensation. Or perhaps the case fails, but there is an open explanation why. That’s the way it usually works.
Only this time, instead of coming with your lawyer before a judge and disputing with their legal team, a shadowy organisation, with members tied to your opponent, rules that you are in the wrong and owe substantial compensation with no appeal.
ISDS – Secret Corporate Court
That’s the Investor-State Dispute Settlement, or ISDS: it is a secret commercial mechanism written into many international treaties that allows a corporation to sue a country for what it deems loss of revenue. It’s another example of “socialisation for the rich” where corporations can loot the public purse. It comes in tandem with “Special Economic Zones” or “Charter Cities” (or Ports), where a part of a country is hived off to companies to create their own tax free zone, with their own rules. It appeals to right-wing billionaires like Peter Thiel, founder of Paypal. In a SF dystopian way various groups are trying to set up their own corporate-owned mini-states. This is happening in Honduras, but also here in Britain.
Freeports – Not So Free After All
In December 2022, the first three UK Freeports became operational after receiving government approval. The operational Freeports are Plymouth, Solent and Teesside and each of these Freeports will now receive up to £25 million in seed funding. Two additional freeports are planned in Scotland.
As tax expert Professor Richard Murphy says, “[Freeports] exist to promote the ideas of far-right politicians who hate the idea of regulations and tax, and who want to profit from their removal. Saying this I stress that there is no convincing evidence that freeports create new jobs or prosperity: at best they just move jobs in to freeports from neighbouring areas.
But this relocation of jobs is not ‘free’ as the name freeport might imply. It comes at a considerable cost, which is the undermining of the law and regulation of the spaces around the freeport elsewhere in Scotland, which is exactly what their promoters want. Freeports are part of a tax haven narrative that should have been consigned to history decades ago because of the harm that they cause.”
Essentially they are a corporate state aligned precisely with what companies want, and any notions of welfare, worker rights or protecting the environment are ignored.
In Honduras, Próspera is a US company started by a group of extreme libertarians, backed by billionaire Peter Thiel and former World Bank chief economist Paul Romer. The plan was to establish a private government on the Honduran island of Roatán, allowing them to implement a libertarian free market utopia tax haven (called a ZEDES)— the success of which, they hoped, would undermine normal government everywhere. You can imagine what it would be like being a poor worker in this zone.
The new left-wing government of Honduras is fighting against it, but being sued for billions under the ISDS. They view this as “Corporate Colonialism”, a new form of exploitation. They call the Zedes by their true name: corporate colonialism; a criminal violation of Honduran sovereignty and the social, economic, and environmental rights of its citizens.
Thiel even had an idea to create a “Seasteading city” of artificial islands for rich people outside any state’s jurisdiction, but this seems to have not been feasible. The Thai navy ran off an attempt at creating one off their coast. There are more obstacles than the libertarians might imagine. As economic conditions get worse, there is more incentive to get such projects going.
The Freeports in Britain are yet another wedge to destroy what remains of the welfare state and offload any ethical considerations and costs onto the UK’s government while taking the profits elsewhere. They need to be resisted here, as well as in developing countries like Honduras or Thailand.