[CTC] TPP Critics Pitch New Template For Trade Deals, Blast Past Agreements

[Arthur Stamoulis]

INSIDE US TRADE
 
TPP Critics Pitch New Template For Trade Deals, Blast Past Agreements

October 04, 2016 
Two of the most outspoken critics of the Trans-Pacific Partnership and other recent trade agreements on Tuesday presented a new framework for the negotiation of trade deals, as well as their content, with a focus on transparency in negotiations and worker and consumer interests.

The platform was pitched by Rep. Rosa DeLauro (D-CT) and Lori Wallach, director of Public Citizen's Global Trade Watch, on Oct. 4 at Yale Law School's American Constitution Society conference on “Transforming the Global Economic Order: Understanding Critical Perspectives on the TPP."

The new vision outlined by the two TPP opponents is largely based on a booklet, “The New Rules of the Road: A Progressive Approach to Globalization,” coauthored by Wallach and Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities and former chief economist and economic adviser to Vice President Joe Biden. The booklet was released in September.

Both Wallach and DeLauro argued that agreements to expand trade do not necessarily have to contain provisions that, in their view, undo worker protections, run counter to consumer interests and benefit multinational corporations at the expense of the middle class.

The sense that trade agreements tilt the playing field toward business interests to the detriment of workers has greatly contributed to the skepticism and even hostility toward trade that is featured so prominently in this election cycle's discourse, DeLauro said.

Wallach and DeLauro stressed that TPP is not just the latest iteration of that sort of trade deal in an evolving continuum, but is more so a platform agreement that will lock in dangerous rules for the foreseeable future. TPP, Wallach said, is set up to be a so-called docking agreement, meaning the U.S. will seek to have other countries join TPP rather than negotiate new deals from scratch -- making the fight over TPP's ratification in the U.S. even more consequential for the global trade framework.

In that vein, Wallach and DeLauro expressed confidence that the 160 House Democrats who voted against granting President Obama fast-track authority in 2015 are solidly against TPP, although that number has been disputed as of late by some TPP proponents. Those supporters claim the administration can round up more than the 28 House Democrats who voted for TPA if TPP comes up in the lame-duck session, although it is not clear if enough Democrats will jump on board <https://insidetrade.com/node/156010> to result in TPP's passing.

Overall, Wallach and DeLauro noted that trade agreements have moved past negotiations on how to reduce tariffs into areas of discussion that are not necessarily negative, but often result in deals negotiated in a way that solidifies corporate influence and furthers economic inequalities.

DeLauro, for example, said the inclusion of labor and environmental provisions in trade agreements is a positive development, but the track record for enforcement as well as the strength of the provisions negotiated shows that commercial interests consistently trump labor and environmental objectives and obligations.

To bolster her argument, DeLauro said no U.S. administration has self-initiated labor action against a trading partner, and complaints filed by labor unions and NGOs under FTAs have either been rejected or have seen little substantive progress.

Along those lines, DeLauro argued that the U.S. should not strive for regulatory harmonization across different potential free trade partners if that endeavor results in the lowering of existing U.S. standards for the sake of trade liberalization. Such a situation arose out of the the TPP negotiations, she said.

Nor should investor-state dispute settlement provisions -- which have attracted the attention of TPP critics <https://insidetrade.com/node/155753> -- be included in FTAs, Wallach and DeLauro said, repeating the oft-used critiques of those provisions while noting that investors always have the opportunity to work out a contract with the target country for their investments if they want to reduce state-based risks to those investments.

Trade agreements should also include disciplines on currency manipulation, Wallach said. Absent that, potential benefits to the U.S. manufacturing base can quickly vanish, or even be flipped, due to the appreciation of a trading partner's currency relative to the U.S. dollar. That would make American-made goods more expensive in foreign currency and imports from abroad cheaper, she said. Wallach also noted that even though China is often pointed to as the main culprit for currency manipulation, Japan and Vietnam, both TPP partners, have engaged in the practice.

“The fact that our current crop of trade negotiators tells us that the inclusion of actionable rules against currency manipulation is impossible should be taken not at face value, but as a clear sign that the present negotiating system is broken,” Wallach and Bernstein write. “If the current 'highway crew' is unable to build a road that facilitates this critical change, we need a new crew.”

Wallach and DeLauro, as well as Bernstein in writing, also blasted rules in trade agreements in general, and TPP in particular, that they claim lower food safety standards, constrain government procurement and limit the use of financial regulation.

Turning to process, Wallach and DeLauro lamented restrictions on viewing the TPP text as it was being negotiated, the lack of responsiveness from USTR to input from Congress and civil society, and provisions in fast-track authority that allow Congress to vote only on the deal once it's signed, at which point changes cannot be made.

“The secretive negotiating process that has prevailed over the years has facilitated corporate capture and the hijacking of 'trade' agreements to implement non-trade policies that face broad opposition,” Bernstein and Wallach argue in their platform.

Wallach and DeLauro charged that recommendations forwarded by trade advisory committee tasked with providing input on TPP labor provisions was not taken into consideration even though the committee has a direct line to USTR.

Bernstein and Wallach write that “the vast majority -- 85 percent according to the Washington Post -- of those who gave input to our trade negotiations on the TPP were from 'corporate interests and their trade associations.' The U.S. Trade Representative (USTR) response to this imbalance has been to add new committees, for instance on the environment, which are comprised of industry and public interest advocates.”

“Predictably, these committees simply deadlock on recommendations while the committees focused on specific industries or issues remain corporate-dominated,” they add. “Meanwhile, the detailed, worker-oriented input of the one non-corporate dominated committee, the Labor Advisory Committee, has been systematically dismissed.”

Eliminating secrecy surrounding texts and allowing them to be viewed by the public would remove the need for the advisory committees altogether, Wallach and Bernstein argue, allowing for a more democratic process of negotiating and better overall trade agreements. -- Jack Caporal (jcaporal at iwpnews.com <mailto:jcaporal at iwpnews.com>)

 
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