I am not sure I know any actual facts about what the TPP will do. We are told it is a wonderful thing for us and its terms are completely top secret, so should we be suspicious?
Indeed the first and maybe most controversial aspect of the TPP is that it is so secret. Congresspersons are allowed to read it only in a locked and guarded sound proof room in the Capitol Building and are forbidden to take notes out of the room. It may provide some comfort that trade negotiations are always surrounded by secrecy… allegedly because the information is very valuable to investors and because trading partners are very goosy about letting their public know what is happening.
The basic facts about the TPP are simple enough. It will remove trade barriers between the majority of nations on the Pacific Rim. The parties to the TPP are the USA and Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Trade barriers are not just tariffs. These include laws and regulations specifically intended to be trade barriers, intellectual property laws (copyrights and patents), labor laws and other matters having to do with commerce.
Because the agreement is so secret (not to mention massive, Congresspersons are said to have access to thousands of pages including the current draft and annotated position statements of trading partners) most of what we think we know about the TPP comes from leaks and more significantly, what is reported about what has been leaked. We also have a Congressional Research Service (CRS) Report that provides a basic analysis. Surveying the two, I cannot say that we have a clear picture. For example, the leaks focus on a section intended to protect imports from fake trade barriers, such as Japan’s claims years ago that American electronics (Motorola pagers) were inferior to Japanese products. Current trade agreements allow corporations to sue to remove such artificial barriers, but this provision has been abused and misunderstood. Recently, tobacco companies sued Brazil under this provision because of local rules that prohibited the use of company logos on cigarettes in order to discourage cigarette sales. The reporting on this in many cases has been about the ability of corporations to use this provision to circumvent local laws. The CRS report points out that the US sees this example as an abuse of the rules and is looking for language that will clarify this.
Also reported widely is the complaint that the TPP does not demand stringent protections for labor and the environment, and has no mechanisms for enforcing the limited standards that are included. If the CRS description of the standards and enforcement mechanisms are correct, this criticism is accurate, and indicative of the abuse of power our government so frequently allows its corporate masters.
While rich and powerful corporations and investors have a seat at the negotiating table and participate fully in the process of drafting this top secret treaty, working Americans, labor unions and consumers are not even allowed to read it. Among the certain results of this imbalance are weak labor laws, poor consumer protections and limited environmental expectations.
American labor has lost out in prior trade agreements because it is competing with countries where employees work 16-hour days, seven days a week for three dollars a day. They have no health or safety standards and take no special pains to protect the environment. These conditions are perfect for rich corporations and investors, not so good for the rest of us, and disaster for the lowest end of the US labor market. Economic studies show that NAFTA has been particularly damaging to people on the lowest end of the economic spectrum… low-skilled workers with limited education are now essentially competing with the lowest skilled Mexican labor market.
Congress has approved the President’s authority to fast-track the TPP negotiations but it has one more opportunity to influence the process. I have three suggestions that will ensure that the TPP will work to the benefit of all Americans.
1. The Environment: Participating countries should all be required to adhere to the terms of the Kyoto Protocol (and its subsequent agreements). This provision provides a particular problem for the USA because most of the signers of the TPP are also signers of Kyoto, but the USA is not. While the President supports international environmental agreements, the Congress, which is owned by the oil industry, does not.
2. Labor: The TPP should include minimum health and safety standards, a guaranteed work week of no more than 40 hours, annual leave and a minimum wage based on local “living wage” measurements. These standards should be specific and mandatory for each participating nation. There should be enforcement mechanisms in place… i.e. companies that do not follow the rules should be banned from international trade. Unions organizing should be legal and widely encouraged in every participating country.
3. Corporate Taxes: The ability of corporations to avoid paying taxes by forum shopping should be addressed through trade agreements. Corporations should be required to pay some stated tax in each jurisdiction where they store money, and that tax should be shared in some negotiated proportion with the country of manufacture which bears the cost of supporting infrastructure, the country of origin, which initiated the company’s success and continues to provide legal protections, and all markets where goods are sold.