Trans-Pacific Partnership

Lately my email has been flowing with information about the Trans-Pacific Partnership.  If you haven’t heard of it, don’t know much about it, or are scratching your head as to what it could be; you’re not alone.  One of the confusing issues is all the discussion on “fast track” authority, and how it gets attached to the Trans-Pacific Partnership.

When President Nixon was in office he got Congress to grant him the unilateral authority to negotiate and sign trade deals.  Once he made the agreement the deal went to Congress who had a shortened time frame to give the legislation a yes or no vote.  Congress could not amend or attach anything to the trade deal, nor could they filibuster.  They had shortened debate time on the floor.  The entire process takes no more than ninety days.  That authority expired and President Obama has requested for it to be reinstated.

How does that relate to the Trans-Pacific Partnership? According to President Obama’s administration it is a requirement for getting the Trans Pacific Partnership completed.  The Senate Finance Committee just passed the Face Track Authority through.  Once the President gets the Fast Track authority back in place he could finally sign the agreement and then send it to Congress.  They will then have very little time to read, much less debate, before voting on the agreement.  The entire process would take exactly ninety days.  It would also make it impossible for the American public to hold their members of Congress accountable for the Trans-Pacific Partnership or any number of trade deals over the next four years.

So what is the Trans-Pacific Partnership agreement?  A search online yielded little result as to the full text of the agreement; that is not surprising since it is a classified document.  And I, like the vast majority of American’s do not have top secret classified clearance.  Even members of Congress, who have congressional authority to view such documents, were denied seeing the document for years.  In 2012 Senator Ron Wyden (D-OR) introduced Senate bill 3225 which would have required the Office of the US Trade Representative to disclose its Trans Pacific Partnership documents to all members of congress.  However where members of Congress were being kept in the dark corporations weren’t.  According to Ron Wyden (D-OR), “The majority of Congress is being kept in the dark as to the substance of the TPP negotiations, while representatives of U.S. corporations—like Halliburton, Chevron, PHRMA, Comcast, and the Motion Picture Association of America—are being consulted and made privy to details of the agreement. […] More than two months after receiving the proper security credentials, my staff is still barred from viewing the details of the proposals that USTR is advancing. We hear that the process by which TPP is being negotiated has been a model of transparency. I disagree with that statement.”    Big business accounts for some 500 of the cleared advisers on the advisory panels, 100 of the advisers come from labor, environmental and other groups.

In 2013 members of Congress were allowed to see parts.  The parts they got to see were based on the committees that they were assigned to.   Representative Alan Grayson (D-Fla.) managed to be allowed to read a copy of the entire draft document.  In an interview with the HuffPost he said that the “Obama Administration has barred any Congressional staffers from reviewing the full negotiation text and prohibited members of Congress from discussing the specific terms of the text with trade experts and reports.”

So why keep it all secret, including from the American people?  The Administration claims that its a matter of national security, and all other countries involved would lose confidence in the U.S. if they released it to the public.  In 2013 Ron Kirk President Obamas top trade official at the time suggested in an interview that the reason the text should not be made public is that it would raise such opposition that it could make the deal impossible to sign.  According to an April 22, 2015 blog post by Elizabeth Warren when she asked why the agreement is top secret she was told, “We can’t make this deal public because if the American people saw what was in it, they would be opposed to it.”

So what is in the Trans Pacific Partnership?  The information online about what is contained in the agreement was leaked.  Other information comes from the White House article “The Trans-Pacific Partnership: What you need to know about the most progressive trade agreement in history.”  Which is several bullet point slides and one small business owners’ letter that nicely summarizes the slides.  There is also a video that discusses how “95% of all consumers are outside of America”, and later says, “so we need to be able to expand trade with the fastest growing region.”

What I was able to locate about the Trans-Pacific Partnership is this:

  • for the past six-years this deal has been put together and lobbied by corporations, banks, wall-street, republicans, and the administration.
  • It involves 12 countries and accounts for 40% of the world economy.
  • This deal has also been heavily lobbied to members of Congress,
  • Only 5 of the 29 proposed chapters actually pertain to trade matters with other countries.
  • There is a ban on buy American and buy local.
  • Not one word of the agreement can be changed unless all 12 countries agree. It will effectively limit what Congress, states, counties and local cities can make as policy or laws on any nontrade issue contained in the agreement.
  • Existing and future American laws would need to be altered to comply with the term, or trade sanctions could be imposed against exports.
  • There is no expiration date
  • Many chapters with binding rules cover:
    • Monopoly patent protection
    • Make the introduction of generic drugs more difficult and raise the price of medications.
    • Rules on financial regulations
    • Environmental provisions
    • Copyright rules which revise failed provisions of the Stop Online Piracy Act, including Internet Service Providers would be required to police websites hosted on their servers.
    • Restricts domestic rules regarding food safety and inspections
    • Major corporations lobbied and had access to the bill, and have loaded it with provisions that provide them with advantages and remove any regulations that might cost them money.
    • It would nullify US regulations and laws in favor of laws from more lightly regulated countries.
    • It would reduce internet freedoms
    • It would reduce derivatives regulations
    • Expands cases that can be sent to International Tribunals that were set up under NAFTA. Currently International Tribunals are to protect a corporation on foreign soil from having the local government take their profits, seize their goods, etc.  Under Chapter 11 there is also a “minimum standard of guaranteed treatment” for any investor who goes to another country.  It guarantees compensation for regulatory changes and costs.  The Trans-Pacific Partnership would allow a corporation to take the issue to a tribunal for any reason that results in a loss of profits to the international shareholders of that corporation.  There is no outside appeal.
      • In a trade dispute the issue would go before three private attorneys who are appointed judges. The judges can be lawyers for large corporate interests.  Only investors can bring suits to a tribunal, and would be able to go straight to a tribunal for any issue they have.  The tribunal can then levy fines on local sovereign governments if their local laws and regulations conflict with the Trans-Pacific Partnership.  It would allow a corporation to punish a country for passing or having specific laws like environmental, worker safety, or even wage laws.  One notorious case is the Eli Lilly lawsuit against Canada for $500 million in future potential profits they would not get due to Canada’s patent laws.  Or where Citadel Exploration sued San Benito County in California for $1.2 billion in potential future profits lost due to a fracking ban.  With Trans Pacific Partnership in place they could take the case straight to the tribunal and skip the court system.  In essence tribunals exist to protect corporate interests.  Former top congressional trade staffer Gordon Laffer described the result as “a kind of Potemkin democracy, in which citizens are free to choose their flags and holidays but cannot afford to enact any laws that might reduce international investors’ profits.”  Over the past 20 years $400 million dollars has been paid out in the investor lawsuits.

There are several videos on the subject, below are just five:

  • Here is another video that goes farther in depth:
  • Here is a 2013 interview with Ron Paul about Fast Track and the Trade Agreement
  • This is a 46 minute video, done by Lori Wallach of the Public Citizen’s Global Trade Watch that goes into depth about the agreement from 2013:

The deal has been labeled as “NAFTA on Steroids.” Back in 1986 President Bill Clinton said about NAFTA, “NAFTA means jobs.  American jobs, and good-paying American Jobs.  If I didn’t believe that, I wouldn’t support this agreement.”  He also said that NAFTA would result in “an export boom to Mexico.”  However that isn’t exactly what happened.  Public Citizen’s Global Trade Watch released a study on what NAFTA has done.  In an interview on Bill Moyers their Director Lori Wallach said, “The flow of goods has increased.  Unfortunately, that flow has been a huge surge of imports into the United States, from Mexico, and, interestingly, from Canada, so that we’ve seen the displacement of one million jobs on net because of the huge increase—a 450 percent increase—in our trade deficit in the 20 years since NAFTA went into effect.  The year before NAFTA, the United States has a small trade deficit with Canada—about $20 billion dollars—and a slight surplus of $2 billion dollars with Mexico.  Now, 20 years later, we have almost a $200 billion dollar trade deficit with those countries.  So the surplus with Mexico turned into a huge, huge deficit, as all those companies relocated there to produce goods with lower wages.”

President Obama has said, “That’s not the trade agreement I’m passing.  You need to tell me what’s wrong with this trade agreement, not one that was passed 25 years ago.”  Mr. President we would love to be able to tell you what is right and wrong with the agreement, only we can’t.  Why?  Because it is being kept secret from the American people, and we only have your word to take for it being such a great deal.  The other problem is that the White House website even compares this agreement to NAFTA, “through the Trans-Pacific Partnership we are renegotiating NAFTA.”    President Obama has also said that his “Democratic opponents have their facts wrong.  I would not be doing this trade deal if I did not think it was good for the middle class.”  He also said that Elizabeth Warren is “wrong” on the issue.  He further claims that the trade proposal “has been carefully negotiated and will undergo public scrutiny for months before final votes take place.”  By months you really mean only ninety days?  Fast Track Authority only allows for a total of ninety days from introduction into Congress until the final full vote.

Democratic Senator Bob Casey stated this on his website, “Trade Promotion Authority legislation will pave the way for another NAFTA-style deal that costs jobs and hurts Pennsylvania’s economy. Over and over again we’ve been told that trade deals will create jobs and better protect workers and the environment. Those promises have never come to fruition.  Now some in the Senate are ready to dive into another mistaken trade deal. When it comes to debating economic policies we ought to consider whether they will grow middle class wages, create new jobs and bolster our manufacturing sector. Trade Promotion Authority legislation does none of these things.”

Senator Bob Casey is right.  Before NAFTA was passed US producers made claims about the jobs that would be created in the US.  Only it has had the opposite effect.  Corporations found that they could easily move their facilities to another country where they didn’t have to pay workers as much.  They didn’t have the same regulations for worker safety, environmental regulations as they did in the United States.  They then could easily ship the goods back to America.  Most of the time people claim that these were all low skilled jobs.  It started that way, and then expanded.  Director Lori Wallach in her Bill Moyers interview explains that they, “went and looked at the federal governments Trade Adjustment Assistance database and we found that company after company—big US manufacturers like Chrysler, GE, Caterpillar—that promised to create specific number of US jobs instead were off shoring thousands and thousands of US jobs to Mexico, and then they were bringing the product back into the country and selling it.  It was still their US brand name, but made with much lower wages in Mexico.”  She goes on a bit later to discuss how, “in the beginning it was a huge wipeout of the auto sector, textiles and apparel, and appliances.  But now it’s computers, its clean manufacturing of computer chips, high-end electronics, aircraft—these are high-end, high-tech, well-trained, well-paid jobs.  The so-called jobs of the future are all being off shored.”

It seems that the administration has spent a lot of time lobbying on this one issue, time they could have spent lobbying for the American Jobs Act, to raise the minimum wage, meaningful reform to student loans, meaningful reform to housing mortgage loans, to lift the cap off social security, and to expand Medicare and Medicaid.  As Democratic Senator Sherrod Brown said in a recent interview, “I think if you could get my colleagues to be honest, on the Democratic side, with you — and I think you can mostly — they will say they’ve been talked to, approached, lobbied and maybe cajoled by more cabinet members on this issue than any issue since Barack Obama’s been president, that’s just sad.”  He went on to add, “I wish they put the same effort into minimum wage. I wish they put the same effort into Medicare at 55. I wish they put the same effort into some consumer strengthening on Dodd-Frank.”

All of this is under the umbrella of reducing tariffs, which have fallen by two-thirds since 1960, and reducing American import restraints which cost less than .01% of GDP.  So this isn’t about trade it is about enforcing patents, copyrights, and protecting the bottom line of corporations and their share holders.  If history is any indication the last people that this trade deal will help is middle to lower income Americans.

 

Links:

Fast Track (Trade) (http://en.wikipedia.org/wiki/Fast_track_%28trade%29)

Trans Pacific Partnership (http://en.wikipedia.org/wiki/Trans-Pacific_Partnership)

Fast Track (Trade) (http://en.wikipedia.org/wiki/Fast_track_%28trade%29)

S.3225 (https://www.congress.gov/bill/112th-congress/senate-bill/3225)

Senator Wyden Comments On 3225 (http://www.gpo.gov/fdsys/pkg/CREC-2012-05-23/pdf/CREC-2012-05-23-pt1-PgS3517.pdf)

Alan Grayson On Trans-Pacific Partnership: Obama Secrecy Hides ‘Assault On Democratic Government’ (http://www.huffingtonpost.com/2013/06/18/alan-grayson-trans-pacific-partnership_n_3456167.html)

Ask Lori Live: Trade Expert on the Trans-Pacific Partnership. (https://www.youtube.com/watch?v=EuKSGvUXsk8 at approximately 6 minutes)

You Cant Read This (http://elizabethwarren.com/blog/you-cant-read-this)

Trade (https://www.whitehouse.gov/issues/economy/trade)

NAFTA Chapter 11 (http://sice.oas.org/trade/nafta/chap-111.asp)

Obamas Free Trade Deal Lets Corporations Impose Their Will (http://thinkprogress.org/economy/2015/04/16/3647824/whos-down-with-tpp/)

Oil Company to fle $1.2 billion lawsuit against county with 57K people for banning fracking (http://www.dailykos.com/story/2014/11/24/1347097/-Oil-company-to-file-1-2-billion-lawsuit-against-county-with-57k-people-for-banning-fracking)

Obamas Free Trade Deal Lets Corporations Impose Their Will (http://thinkprogress.org/economy/2015/04/16/3647824/whos-down-with-tpp/)

Citizens.org Nafta Report: NAFTA’s 20 Year Legacy and the Fate of the Trans-Pacific Partnership  (http://www.citizen.org/documents/NAFTA-at-20.pdf)

Trade Expert: Why TPP –NAFTA on Steroids”–Must be stopped (http://billmoyers.com/2014/01/09/fool-me-once-20-years-of-nafta-show-why-the-trans-pacific-partnership-must-be-stopped/)

Fast Track (Trade) (http://en.wikipedia.org/wiki/Fast_track_%28trade%29)

Casey Statement on Trade Promotion Authority Agreement (http://www.casey.senate.gov/newsroom/releases/casey-statement-on-trade-promotion-authority-agreement)

Value of US Imports (http://dataweb.usitc.gov/scripts/AVE.PDF)

The Economic Effects of Significant U.S. Import Restraints (http://www.usitc.gov/publications/332/pub4440.pdf)

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7 thoughts on “Trans-Pacific Partnership

  1. Roseylinn, I must confess, I generally like trade agreements, but that should not be viewed as a blanket statement that all features are well grounded. There is a good book written by David Schmick called “The World is Curved” that speaks of the similarities between Bill Clinton and Ronald Reagan on promoting trade. More jobs were created under Clinton’s watch than even under FDR, the second most prolific job creator. Reagan is the best Republican job creator, but trails these two. That does not mean we should sign everything, so some oversight is needed. Fast Tracking gives me some pause. By the way, the Dems should tie this to opening up Cuba which will help trade. BTG

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    1. I’m generally not against trade agreements. I tend to believe that trade deals that set up a basic understanding of “we’d like to sell you our stuff and buy your stuff with some generally agreed upon rules” are fine. There needs to be rules to prevent seizing of assets, employees and representatives being allowed to conduct business without fear of being arrested on the dock, etc. And a system set up for an international court where an impartial judge hears disputes.

      Oversight is needed and so is transparency. Something that this trade deal, and the next ones in line after it, are sorely lacking. When an administration fights as hard as this one to keep it secret from members of Congress and the American people, yet allows 600 corporations access, it raises a very large red flag.

      I tend to attribute all the jobs lost under or because of specific trade deal to job losses of the President who signed that specific deal. So in regards to the jobs lost under NAFTA all of those are jobs lost are because of Clinton.

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      1. Agree with your points. On the flip side, more jobs were created under Clinton than any other President even under FDR’s watch. FDR had a greater percentage increase, though. With that said, we must be mindful of what is in these agreements and not give away the store. While we want free trade, some central governments will prop up trade to gain market share as China has tended to do. So, we are often dealing with a stacked deck.

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