[CTC] TPP and Presidential Politics

[Arthur Stamoulis]

Two articles below...

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826

http://www.nytimes.com/2015/10/01/business/pacific-trade-deal-talks-resume-under-fire-from-us-presidential-hopefuls.html

Pacific Trade Deal Talks Resume, Under Fire From U.S. Presidential Hopefuls

The New York Times

By Jackie Calmes

September 30, 2015

WASHINGTON — Trade ministers for the United States and 11 other Pacific
nations gathered in Atlanta on Wednesday to try to reach agreement on the
largest regional free-trade pact ever. But knotty differences persist, and
antitrade blasts from American presidential candidates have not eased
prospects for any deal.

The talks in a downtown Atlanta hotel are picking up where ministers left
off two months ago after deadlocking at a Maui resort, at odds over trade
inpharmaceutical drugs, autos, sugar and dairy goods, among other matters.
United States negotiators said last week that enough progress had been made
in recent contacts to justify hosting another, perhaps final round.

For President Obama, who cited the potential agreement during his address
this week to the United Nations, success in a negotiating effort as old as
his administration would be a legacy achievement. The proposedTrans-Pacific
Partnership would liberalize trade and open markets among a dozen nations
on both sides of the Pacific, from Canada to Chile and Japan to Australia,
that account for about two-fifths of the world’s economic output.

Failure would be just as big a defeat for Mr. Obama, and upset his
long-troubled foreign policy initiative to reorient American engagement
toward fast-growing Asia and away from the violent morass of the Middle
East and North Africa. Yet if the Atlanta talks yield no agreement by the
weekend, the Americans are unlikely to declare failure.

Time is not the president’s friend, however. Even if agreement is reached
this week, Congress will not debate and vote on it until late winter — in
the heat of the states’ presidential nominating contests — because by law
Mr. Obama cannot sign the deal without giving lawmakers 90 days’ notice.

He will need bipartisan support, given the resistance of many Democrats and
union allies to such trade accords. But presidential candidates in both
parties have already registered strong opposition.

The Republican front-runner, Donald J. Trump, the billionaire who boasts of
his own deal-making prowess, has called the emerging trans-Pacific
agreement “a disaster.” While some Republican rivals also are critical, it
is the rhetoric of Mr. Trump, given his celebrity appeal, that has
Republican leaders more worried that a toxic trade debate could threaten
vulnerable Republicans in 2016. Senator Mitch McConnell of Kentucky, the
majority leader, supports a Pacific accord but nonetheless wants to protect
his narrow Republican majority — and deny Mr. Obama an achievement.

On the Democratic side, where unions, progressive groups and many members
of Congress oppose an agreement, Hillary Rodham Clinton has not taken a
stand, though she repeatedly promoted the Pacific accord as secretary of
state. In June, Mrs. Clinton told an Iowa audience “there should be no
deal” if congressional Democrats’ concerns for workers were not addressed,
and many in the party, including administration officials, expect she
ultimately would oppose a deal, like her rival, Senator Bernie Sanders of
Vermont.

The United States trade representative, Michael B. Froman, said before
heading to Atlanta, “The president has made clear that he will only accept
a T.P.P. agreement that delivers for middle-class families, supports
American jobs and furthers our national security.”

“The substance of the negotiations will drive the timeline for completion,”
Mr. Froman added, “not the other way around.”

Mr. Obama and Vice President Joseph R. Biden Jr., who has not ruled out a
bid for president, showed at the United Nations that they were pressing
hard to get an agreement. The president affirmed his support in private
meetings with several world leaders, according to administration officials.

In his address to the United Nations, Mr. Obama told foreign leaders the
accord would be a model for the world, “an agreement that will open
markets, while protecting the rights of workers and protecting the
environment that enables development to be sustained.” Should a deal come
together, central to the White House campaign to sell the agreement to
Congress would be the argument that setting economic, labor and
environmental standards in the Pacific region would counter China’s
influence, officials said.

Late Tuesday, Mr. Biden brought Mr. Froman to a Manhattan meeting with
Prime Minister Shinzo Abe of Japan, who has made an agreement central to
his own economic platform.

The Obama administration has pressed for the Pacific accord for six years,
picking up the idea from the George W. Bush administration. Many issues
have been all but settled, but nothing is final until everything is decided.

That progress, including tentative agreements on ending tariffs, setting
labor and environmental standards, and opening certain markets, has
sustained the negotiations despite setbacks.

But several issues continue to block a deal.

Dairy market rules divide the United States, Canada, Australia and New
Zealand; this has been especially troublesome for Canada’s team, since the
nation will hold elections this month.

Also divisive are provisions over auto exports, including requirements that
autos have a certain percentage of parts made in countries that are parties
to the agreement. Japan has sought a lower percentage of parts in the
“rules of origin,” with some support from Americans, to allow the export of
autos with Chinese parts, while Mexico and Canada demand stricter rules.

Perhaps most contentious are negotiations related to protections for
pharmaceutical companies’ drugs, especially cutting-edge biologics that are
made from living organisms and considered promising against cancer, among
other ailments.

Several countries, especially Australia, have opposed the United States and
its pharmaceutical industry for insisting that companies’ drug data be
protected for 12 years to create financial incentives to innovate. Critics
say this keeps lower-cost generic drugs and “biosimilars” off the market
for too long.

Here, too, the presidential contest has injected a wild card: Mrs. Clinton
and Mr. Sanders each have accused drug makers of price gouging.

While there is talk of an eight-year compromise, for many opponents that is
too long. Judit Rius Sanjuan, a manager of a campaign by Doctors Without
Borders to hasten access to lower-priced drugs and vaccines, said she met
with American negotiators last week in Washington, “and they gave me zero
indication that they are going to be more flexible on this issue.”

Andrew Spiegel, executive director of the Global Colon Cancer Association,
said drug makers needed the incentives of strong protections for their
intellectual property to encourage their research. He did not offer an
answer to the question dividing negotiators: how many years the drug
makers’ data monopoly should last.

“I leave it to them to pick the magic number,” Mr. Spiegel said.

Last week, 156 members of Congress, mostly Democrats, wrote the
administration to complain that some parties to the talks, like Vietnam,
Singapore and Japan, manipulate their currency values to underprice their
products. While discussions are continuing, the administration is counting
on reaching a currency deal with the Asian nations that would be a side
agreement to any trade pact.

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Morning Plum: Donald Trump is just getting started, Republicans
Washington Post
By Greg Sargent
October 1, 2015
https://www.washingtonpost.com/blogs/plum-line/wp/2015/10/01/morning-plum-donald-trump-is-just-getting-started-republicans/

I’m telling you, folks, if you think Donald Trump’s demagoguery on
immigration has created problems for Republicans, just wait until he
unveils his next act. If we get a Trans Pacific Partnership trade deal,
Trump may well roll out a whole new story about how Republicans and
Democrats alike are conspiring with a shadowy cabal of international elites
to help China and other foreign countries continue destroying the living
standards of American workers.

It turns out Republicans are very worried about this.

The New York Times reports this morning that talks have resumed on the
massive Trans Pacific Partnership trade deal. This is often cast as a
divisive issue in the Democratic presidential primary, which it certainly
could end up being. But as I’ve argued, it could also produce serious
divisions in the GOP presidential primary. Though it has received
surprisingly little attention, Trump has previously attacked the TPP, and
the Times’ Jackie Calmes makes these crucial points:

    Even if agreement is reached this week, Congress will not debate and
vote on it until late winter — in the heat of the states’ presidential
nominating contests — because by law Mr. Obama cannot sign the deal without
giving lawmakers 90 days’ notice.

   …it is the rhetoric of Mr. Trump, given his celebrity appeal, that has
Republican leaders more worried that a toxic trade debate could threaten
vulnerable Republicans in 2016.

The TPP may be debated in Congress precisely when the voting is fully
underway in the GOP presidential primaries. And Republican leaders are
worried that Trump’s rhetoric against “free trade” will create
complications for the party’s Senate incumbents, who would presumably want
to vote to pass the deal. But that’s not all: the TPP could also provide
Trump with a weapon to wield against his GOP rivals. Jeb Bush and Marco
Rubio support it. By contrast, Trump has railed against the TPP by warning
that China will be given back-door access to the deal, further enabling
China’s ongoing ripoff of American workers, and against international “free
trade” deals in general by claiming we are being “defrauded” by other
countries.

And in another signal, Trump gave an interview to John Harwood in which he
claimed we are getting taken to the cleaners by a number of other
countries, particularly China’s currency manipulation and tariffs.
“Countries are taking advantage of us, big league,” Trump said. Thus, his
attacks on the TPP could be seamlessly woven into the broader story that
Trump is already telling, in which immigrants are to blame for the
suffering of American workers. Trump can simply add international
trade-negotiating elites, their enablers among the GOP presidential
candidates and among Republicans and Democrats in Congress  — and a new
version of the Chinese menace, which he has been heartily bashing already —
to the cast of villains. (There will be plenty of legitimate reasons to
criticize the TPP; Trump will likely opt for a lurid and xenophobic tack.)
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If Trump does go this route, it will be interesting to watch, because it
will test the assumption that GOP primary voters (many of whom already
appear to agree with the tale he’s telling about illegal immigrants) agree
with GOP orthodoxy on “free trade.” As Ron Brownstein has explained, Trump
has built a particularly firm foundation among blue collar Republican
voters. And Ed Kilgore has noted that Rust Belt and southern conservatives
tend to be alienated by internationalist free trade talk. Who will these
voters listen to on the Trans Pacific Partnership — Jeb Bush, who is trying
to talk in reasonable tones about the virtues of lowering international
trade barriers, or billionaire Trump, who is warning that foreign elites
are looking to rip off American workers even more than they have done
already?
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