Tag Archives: joininghands

Joining Hands Network Model: Example La Oroya

I realize I may not have really ever explained what Joining Hands is or does. If you’re a regular reader, you might be aware that it’s a development-oriented NGO. If you’re an occasional reader, you might know I work there. If this is your first time, you might be looking for the inevitable explain that follows this cliché introduction. Please, continue.

The Presbyterian Hunger Program founded the Joining Hands Network after realizing that localized development projects fell short of ending poverty. Sure these projects helped pull folks out of poverty and empower them, but it did little to address the structural issues like climate change, corruption or corporate privilege that foster poverty. That’s where Joining Hands steps in.

Joining Hands unites local, national and international efforts to resolve the same issue. In doing so, it answers the question: What can I even do from my home besides give money? Joining Hands offices work with partner organizations around the world to identify the root structural issues at the international level, which drive issues at the national level and create the problems manifested at the local level around the world.

Joining Hands model applied

I’ve been fortunate enough to hear Jed Koball, mission co-worker in Peru and one of my many bosses, outline Joining Hands’ model as it applies to Peru, specifically around mining. We start with La Oroya, which I have mentioned in writings before. In the 1920s, a mine and lead smelter opened in La Oroya and continued operating under up until a decade ago. Throughout the time period, poor regulation led to high levels of contamination.

In 1997, the Peruvian Government sold the smelter to Doe Run Peru, a subsidiary of the U.S.-based Renco Group, owned by the meanest of the famous Iras, Ira Rennert. That sale involved contractual obligations for Doe Run clean up the factory and the Peruvian state to clean up the local soil. Neither followed through.

At the local level, Joining Hands stepped in to raise awareness in La Oroya with the member organizations, FILOMENAS and CAMBIALO. FILOMENAS taught folks about environmental and public health issues and encouraged them to protest for better mining regulations. CAMBIALO provided programs to empower children affected by mining to tell their story and work for change in the future.

In 2005, Joining Hands arranged for a study by the University of Saint Louis revealed that Oroyeños, including children born recently, had 11 heavy metals in their blood including lead, arsenic and copper. This study marked a turning point in advocacy for La Oroya at the national level. Eventually, Doe Run closed down and the smelter stopped operating.

In an effort to get reparations in place for La Oroya, the director of Joining Hands, Conrado wrote an ordinance allowing for full medical coverage for those affected by mining activity. Though unanimously passed three years ago, the network and other partners are still pushing for implementation for those continuing to be affected by 90 years of contaminant buildup.

The issue does not stop at the national level though. Doe Run soon filed for bankruptcy. Rennert sued the Peruvian government, blaming the financial problems on unfairly high expenses to meet their contractual obligation to clean up the operation in La Oroya. The suit was possible via the Peru-United States Trade Promotion Agreement, which includes an investor-state arbitration clause. Investor-state arbitration allows companies to sue sovereign governments for taking actions that restrict their investor rights and prevent free trade.

In theory, this protects companies from countries that unfairly seize assets or raise taxes to oust them or get them to abandon their property. That would be unjust though most large corporations could handle the setback.

Unfortunately, like many seemingly sound theories, arbitration courts have worked against their purpose. Companies use this process to challenge environmental and public health laws. This is a practice that economists call “rent seeking,” the spending of money to allocate yourself more wealth than the market equilibrium. Imagine renting out the invisible hand to slap governments around a bit.

There are many such cases, which largely involve mining companies resisting environmental regulations. Canada-based mining company Pacific Rim (now owned by OceanaGold) is suing El Salvador for placing a moratorium on mining activity following a water crisis in 2008 due to mining contamination after granting Pacific Rim exploratory permits. British-based Philip Morris International Inc. and British American Tobacco sued the United Kingdom for for plain packaging of cigarettes as part of a public health movement.

Corporate lawyers handle the arbitration cases and losing countries are forced to payback large sums for lost profits. Worse than the economic setback is the nullification of relevant laws and an overall reduction in sovereignty for the state. If Peru loses to Doe Run it will call into question Peru’s right to enforce environmental regulations put in place as part of mining contracts.

In fact, that is holding up the sale of the lead smelter to a Chinese mining company. The negotiations are stuck on environmental regulations and awaiting the outcome of the Doe Run suit.

Joining Hands has identified investor-state arbitration suits as a vital issue for international advocacy by supporters from around the world. Right now, Peru is involved in negotiations for a 12-country multilateral trade agreement, the Trans Pacific Partnership (TPP), which encompasses 40 percent of the global economy. It will supersede all prior trade agreements and provides a clean slate for removing certain unjust trade provisions.

The TPP has been negotiated behind closed doors by heads of state and corporate executives. Leaked text indicates a similar investor-state arbitration clause to those that allowed Doe Run to sue Peru over its bankruptcy.

The TPP, as a U.S.-directed initiative, must first be passed by the U.S. before it can proceed for ratification by other countries. Our constitution allows us the Senate and House of Representatives to approve the “fast track” of treaties, wherein the President negotiates a treaty and then the legislative chambers vote for or against the entire document.

While more efficient, that puts legislators in a bind. Free trade is one of the more economically sound strategies out there and partnerships help facilitate cooperation and smooth out the kinks in trade. Specifically, the TPP could reduce customs expenses for Bridge of Hope. Of course, that is also a vote in favor of the questionable clauses rumored to be part of the agreement regarding state sovereignty, labor conditions, the environment, agricultural, and several other issues.

Unfortunately, the Senate has already approved “fast track,” but the House vote could occur as early as this week. If the House votes against the “fast track,” they can amend the agreement to remove clauses that are not the will of the people before passing it.

That will be a messier process. Once the Congress manages to get the wording fixed it will be sent to other countries for debate and they may also seek to refine wording.

I do not apologize for the lack of expediency though. We are not suffering so greatly in the United States that we will be unable to continue on without a new free trade agreement to bring down prices. Likewise, it will take time for developing countries to receive the benefits of the TPP, much of which would be overshadowed by potential challenges to sovereignty.

Personally, I’d rather get it right.

Joining Hands suggest that you in the U.S. write your congresspersons to vote “No” on the “fast track.” If that is accomplished, you can then step up to urge the removal of the international arbitration clause to remove a structural injustice that leads to La Oroya.

Please write a letter to your representative telling them to vote “No” on the Fast Track. Citizens Trade’s campaign offers an adaptable form letter. The effects of reshaping the TPP will ripple throughout the world and into the forgotten spaces like La Oroya.