TPP Will Undermine Democracy
On critical issues, the massive Trans-Pacific Partnership (TPP) being negotiated in secret by the Obama administration will undermine democracy in the
The only way this treaty—which will be very unpopular with the American people once they are aware of it—can be approved is if the Obama administration avoids a democratic process by using an authority known as “Fast Track” that limits the constitutional checks and balances of Congress.
If the TPP is approved, the sovereignty of the
Circumventing Checks and Balances
President Nixon first developed the idea of Fast Track in 1973 as a way to secure congressional approval on trade agreements and it has been key to passing many unpopular agreements such as the World Trade Organization (WTO) and NAFTA since then. As people have caught on to the off-shoring of jobs and other detrimental consequences of these agreements, civil society now understands how important it is to not allow a president to circumvent the democratic role of Congress. Fast Track expired in 2007, so President Obama must have it re-instated in order to pass the TPP. (His Administration hopes to have Fast Track approved by this summer.)
Under Fast Track, the president is allowed to negotiate and sign trade agreements with whatever countries the executive branch has selected—all before Congress votes on the agreement. Fast Track means that the congressional committee processes are circumvented and the executive branch is empowered to write
Indeed, Fast Track turns the U.S. Constitution on its head. Under Article I Section 8, Congress has the exclusive authority “to regulate commerce with foreign nations” and to “lay and collect taxes [and] duties.” Under the Constitution, the president is empowered to negotiate treaties, but Congress must vote to approve them. Thus, Fast Track takes constitutional power from Congress and prevents the checks and balances needed to prevent an imperial presidency.
For most of the history of the
Fast Track is very unpopular, so now President Obama and others do not use the term. Instead they call it by the euphemism “Trade Promotion Authority.” But, changing the name does not change what it is—a method of ceding the constitutional power of Congress.
Congress needs to consider what agreements like the TPP will do to jobs, trade balances, and the environment. Since Nixon, Fast Track has been used to change U.S. law by establishing “rules related to domestic environmental, health, safety, and essential-service regulations, including deregulation of financial services; establishment of immigration policies; creation of limits on local development, and land-use policy; extension of domestic patent terms; establishment of new rights and greater protections for foreign investors operating within the United States that extend beyond U.S. law; and even limitation of how domestic procurement dollars may be spent.”
The TPP Prevents Progressive Policy
The TPP is much broader than the usual trade agreement and will impact many aspects of society, from the Internet to health care to regulation of risky bank speculation. For this reason alone, it is especially important to have a transparent, public debate about the agreement. The TPP contains 26 chapters, but only 5 of them concern traditional trade issues. The TPP has been negotiated in secret except for over 600 corporate representatives who have been advising the U.S. Trade Representative on its language. In
Though the TPP negotiations are being conducted in secrecy, portions of the text have been leaked. Here is what is known about some of the key issues that the TPP will affect:
Undermine Environmental Laws and Regulations: Similarly, governments who are seeking to encourage localization and green manufacturing through procurement preferences will be stopped. A recent example involved
Undermine Internet Freedom: The Electronic Freedom Foundation (EFF) argues that the intellectual property chapter would have extensive negative ramifications for users’ freedom of speech, right to privacy and due process, and hinder peoples’ abilities to innovate. Its provision on copyrights will adversely affect the creator’s ability to create content, the ability of technology companies to make innovative products, and the ability of users to use content in new ways. EFF summarizes the attack on Internet freedom by the TPP, writing: “In short, countries would have to abandon any efforts to learn from the mistakes of the U.S. and its experience with the DMCA over the last 12 years, and adopt many of the most controversial aspects of U.S. copyright law in their entirety. At the same time, the U.S. IP chapter does not export the limitations and exceptions in the
Destroy Food and Agriculture: Agriculture trade rules have both undermined
Prevent Health, Safety, Environment, Consumer and Labor Laws: According to leaked documents, the TPP contains provisions with special rights for corporations. The provisions protect investors by providing them with compensation for loss of “expected future profits” from health, labor, environmental, and other laws. The negative effect is that nations will not pass laws that threaten corporate profits in order to avoid lawsuits and heavy fines. Court cases in which corporations are suing governments over laws and regulations that cause loss of expected profit will be tried before a trade tribunal of three judges. These judges can include corporate lawyers on temporary leave from their corporate job while they serve as judges. Global Trade Watch reports, that under previous trade agreements “Over $3 billion has been paid to foreign investors under US trade and investment pacts, while over $14 billion in claims are pending under such deals, primarily targeting environmental, energy, and public health policies.” The right to sue governments will create a hurdle for governments considering actions to protect workers, consumers, health and the environment.
Privatize Healthcare and Make it Unaffordable: Leaked documents show that the U.S. Trade Representative is pressuring TPP member countries to expand pharmaceutical monopoly protections which essentially trade away access to medicines. In a recent letter, Doctors Without Borders wrote that the TPP will be “the most harmful trade deal ever for access to medicines in developing countries.” The TPP does this damage by inflating pharmaceutical prices through lengthy patent protections, as Doctors Without Borders writes: “One proposed TPP provision would require governments to grant new 20-year patents for modifications of existing medicines, such as a new forms, uses or methods, even without improvement of therapeutic efficacy for patients. Another provision would make it more expensive and cumbersome to challenge undeserved or invalid patents; and yet another would add additional years to a patent term to compensate for administrative processes. Taken together, these and other provisions will add up to more years of high-priced medicines at the expense of people needing treatment waiting longer for access to affordable generics.”
There is also concern that the TPP will force public health systems to open up their medication programs to pharmaceutical corporations giving them greater access and greater control over the price of medications, effectively destroying the ability of the public health system to negotiate for a low price. The same may occur with public health systems in the U.S. such as Medicare, Medicaid, Tricare, and the Veterans Health Administration making medications more expensive and potentially out of reach for their patient populations.
In addition, countries that provide health care through a national public health program, rather than a market-based system dominated by for-profit insurance, are threatened by provisions that oppose state-owned enterprises. Corporations view state provision of services as unfair competition and therefore a violation of free trade. This will make it more difficult for the
Prevent Public Banks and Banking Regulation: These same provisions about state-owned enterprises will affect public banking, too.
And trade agreements protect big finance by (1) preventing regulation of the finance industry by locking in a model of extreme financial service deregulation; and (2) allowing capital to move in and out of countries without restrictions. This prevents countries from controlling the flow of capital which has many negative consequences. Over 100 economists wrote trade representatives urging them to ensure that the TPP, unlike other trade agreements, will allow governments to control and regulate capital without the threat of investor lawsuits, writing: “Authoritative research published by the National Bureau of Economic Research, the International Monetary Fund, and other institutions has found that limits on short-term capital flows can stem the development of dangerous asset bubbles and currency appreciations, grant nations more autonomy in monetary policy- making, and protect nations from the dangers of abrupt capital flight.”
Thus, the TPP and other corporate trade agreements will undermine the ability of governments to regulate health, safety, labor, environment and finance. The 600 corporate advisers to the TPP see this as an opportunity to do an end-run around laws and policies. This is why the TPP is being called a global corporate coup that makes corporations more powerful than governments.
Corporate Trade Agreements
The evidence is stark that so-called “free” trade agreements, really corporate trade agreements, are bad for the
And, this means a tremendous loss of jobs. Using the Obama administration’s net exports-to-jobs ratio, the FTA trade deficit surge means the loss of nearly one million American jobs.
We should have learned this lesson from NAFTA because what we are seeing with corporate trade agreements since NAFTA is more of the same. Under NAFTA, the
But, instead of learning from NAFTA, President Obama pushed a trade agreement with
Exports are not as robust as advocates of trade agreements would like to believe. Between 2002 and 2012,
Advocates for corporate trade agreements manipulate statistics in order to make a false claim of economic benefit from the agreements. They create obvious falsehoods by not counting many major trade agreements put in place before 2003. This would exclude big agreements like NAFTA, count “re-exports”—goods made elsewhere that are shipped through the United States en route to a final destination, omit imports in their calculations so people do not see the trade imbalance, and not correct for inflation in order to exaggerate exports.
Sadly, rather than being honest about the failure of corporate trade, the Obama administration works overtime to mislead the public. The recently released 2012 annual trade report leaves out critical details from the very beginning. Eyes on Trade analyzes the Obama report: “Take the first sentence: ‘Trade is helping to drive the success of President Obama’s strategy to grow the
Time for a Democratic Revolt
A unique feature of the TPP is that it contains a “docking agreement.” This means that other countries can sign onto the agreement after it has been negotiated as long as they are willing to accept the previously-negotiated terms. The
The TPP has gone through 16 rounds of negotiations in almost total secrecy. Some portions of the text have been leaked, but most remain secret. Throughout the process more than 600 corporate advisers have been working with the U.S. Trade Representative in shaping the proposals and specific language of the text. Civil society has only been marginally involved, not provided drafts and ushered into stakeholder meetings where they can ask questions but only receive vague answers.
Despite this effort at secrecy, civil society groups have been getting organized to oppose the TPP, stop Fast Track and prevent the global corporate coup. More than 400 organizations, including our own organization, It’s Our Economy, representing a diverse range of issues including labor, environment, public health, Internet freedom, banking regulation, human rights, faith, Native American, and much more, have signed on to a letter to Congress emphasizing how the TPP negotiations have been “inconsistent with democratic principles,” opposing Fast Track and outlining expectations of how key issues should be addressed in 21st century trade agreements.
Citizens Trade Campaign summarizes writing: “The letter includes eight broad categories that the TPP, a Trans-Atlantic Free Trade Agreement and any other U.S. trade pact must address in order to improve quality of life for Americans and people throughout the world: (1) prioritization of human and labor rights; (2) respect for local development goals and the procurement policies that deliver on them; (3) no elevation of corporations to equal terms with governments; (4) protection of food sovereignty; (5) maintaining access to affordable medication; (6) safeguards against currency manipulation; (7) space for robust financial regulations and public services; and (8) improved consumer and environmental standards.”
On February 27, the AFL-CIO released an executive council statement questioning the TPP saying, “The United States cannot afford another trade agreement that hollows out our industrial base and adds to our substantial trade deficit.” The executive council of the AFL-CIO went on to say, “We do not need another trade deal that simply boosts corporate profits by encouraging offshoring good jobs while undermining wages, benefits and worker rights. We must do better.” Americans have clearly learned the lessons of previous trade agreements—they only work for the transnational corporations and oligarchs around the world, they undermine workers, and spur lower wages and environmental destruction.
Arthur Stamoulis of Citizens Trade Campaign summarizes the antidemocratic actions of the Obama administration with regard to the TPP saying, “This is a rollback in transparency, and an extremely undemocratic way to craft policy that is likely to influence jobs, health care costs, financial regulations, consumer safety, the environment and more for decades to come. The only way to prevent the public from being saddled with a bad agreement is for Congress to exert its authority.”
The TPP is the battleground for defining democracy in the 21st century and setting up the rules for international commerce in the era of transnational corporate power. No matter what issues you are concerned about, if the TPP becomes law, it will undermine national sovereignty and hopes for progressive policies that put the people’s needs before corporate profits. The time is now to get active, work to oppose the anti-democratic Fast Track approach in Congress and say ”no” to the democracy-undermining Trans-Pacific Partnership. This is a trade agreement that will be opposed by most Americans and a battle on which the people can prevail, but only if they know it exists.
Kevin Zeese and Margaret Flowers co-host “Clearing the FOG” on We Act Radio, 1480 AM Washington, DC and on Economic Democracy Media, co-direct It’s Our Economy and are organizers of the Occupation of Washington, DC. This article was first published on Truthout. Photo 1: Trade Ministers from top nine TPP economies meet in Vladisvostok, Russia. Photo 2: Obama at an East Asia Forum.