Trans Pacific Partnership is bad for USA
Critics claim deal promotes liberal shopping list of non-trade items
GLOBAL TRADE — Hillary Clinton once called the Trans Pacific Partnership the “gold standard” of trade agreements, but that was before she ran for president and later opposed it.
Donald Trump on the other hand has said that this agreement, along with NAFTA, is very bad trade policy. He has opposed TPP from the beginning of his candidacy. He has stated that he would renegotiate NAFTA if elected president because he believes that these agreements are one-sided in terms of what countries will benefit.
Therefore, we decided to take a look at TPP – hopefully to provide our readers with an understanding of what this agreement is all about and the benefits to the United States, if any.
To start with, the TPP is an agreement among 12 countries: United States, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile, and Peru. The pact aims to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth. Member countries are also hoping to foster a closer relationship on economic policies and regulation and to form a single market similar to that of the European Union.
At this point, that would appear to be a questionable goals, with Britain having recently voted to exit the EU — indicating that these trade agreements among various nation-states always undermine autonomy of participating countries.
Most goods and services are involved, but not all tariffs, which are taxes on imports, are expected to be removed.
In all, some 18,000 tariffs are affected. For example, the signatories have said they will either eliminate or reduce tariffs and other restrictive policies from agricultural products and industrial goods. That should be an important issue for North Carolina in terms of agricultural exports. Tariffs on goods manufactured in the United States and almost all U.S. farm products will end almost immediately once the deal is ratified.
Tariffs on textiles and clothing will also end, but while most tariffs will be removed immediately, levies on some sensitive products will be eliminated over a longer time frame as agreed by the signatories.
With services between countries, officials have agreed that free trade would be quite a good thing, and in some areas, they are going to liberalize trade.
The TPP began with a trade agreement between just four nations: Brunei, Chile, New Zealand and Singapore, which began in 2006. That deal removed tariffs on most goods traded between the countries, promised to cut more and also to cooperate on wider issues such as employment practices, intellectual property and competition policies.
The 12 countries proposed for TPP have a collective population of approximately 800 million people — almost double that of the European Union’s single market. The 12 are already responsible for 40 percent of world trade. The deal is a remarkable achievement given the very different approaches and standards within the member countries, including environmental protection, workers’ rights and regulatory coherence — not to mention the special protections that some countries have for certain industries.
The critics argue that it has been a not-so-secret gambit to keep China at bay, which is not one of the signatories. Others claim it paves the way for companies to sue governments that change policy on health and education in favor of state-provided services. The agreement will also intensify competition between nations’ labor forces. But the biggest criticism has been of what the campaigners allege were secretive negotiations, in which governments were said to be seeking to bring in sweeping changes without voters knowledge. On the other hand, defenders say the reason the negotiations were not made public was because there was no formal agreement.
The text of the agreement will have to be signed and then ratified by all 12 signatories. Details of how the deal will be implemented will be argued out in the legislature of the various nations. In the U.S., it comes before Congress in the midst of a presidential election year, which is likely to turn it into a major political football.
However, Congress has granted President Obama “fast-track” authority over the deal, which only allows lawmakers to either reject or ratify the finished product.
To take effect, the deal has to be ratified by February 2018 by at least six countries that account for 85 percent of the groups’ economic output. This means that Japan and the United States will need to be on board in order to ratify the agreement.
So far, everything seems to point toward a favorable agreement, especially where the agricultural interests of North Carolina are directly affected. But, as legendary radio personality Paul Harvey would say: We need to hear the rest of the story.
This agreement goes way beyond ordinary trade among nations. If that were the case, we would have very little opposition. But when other issues having little or nothing to do with trade are introduced, that is when the disputes begin.
According to the Office of the United States Trade Representative, the TPP includes the most robust enforceable environment commitments of any trade agreement in history. They point out that the agreement requires signatories to fulfill their obligations under the Convention on International Trade in Endangered Species of Wild Pharma and Flora to protect and conserve iconic species.
Further, this is the first trade agreement to prohibit harmful fisheries subsidies such as those that contribute to over-fishing. The signatories are required to combat illegal fishing, promote sustainable fisheries management practices and protect wetlands and important natural areas, combat wildlife trafficking, illegal logging, and illegal fishing and protect the marine environment from ship pollution, by implementing their obligations under the International agreement to prevent Marine Pollution known as MARPOL.
In 2013, when the agreement was still being negotiated, the Sierra Club argued that the TPP could directly threaten our climate and our environment and that new rights would be given to corporations, and new constraints on the fossil fuel industry all of which will have a huge impact on our climate, water, and land.
Also, according to the United States Trade Representative, the agreement prohibits exploitative child labor and forced labor; ensures the right to collective bargaining; and prohibits employment discrimination. They further assert that research by the International Labor Organization and the World Trade Organization finds that combining expanded trade opportunities with strong protections for workers can help workers move from informal-sector jobs into formal work in a wage-paying, regulated export industry, which offers a minimum wage, benefits and safety programs.
The agreement goes on to protect intellectual property, pharmaceuticals, investor-state arbitration and so forth. What all of these things have to do with trade policy is a mystery? Clearly, this trade agreement appears to be a back door effort to promote some of the liberal political ideology that has been argued over and over in the United States. It is no wonder that President Obama is supporting the Trans Pacific Partnership. What is a surprise is that our Congress has given him Fast Track authority.
Speaker of the House, Paul Ryan, has been supportive of the TPP, which is a complete amazement. It is easy to understand that most members of Congress may not have read the full agreement. But what is interesting is that several Democrats in Congress have voiced skepticism over the benefits, among them Elizabeth Warren and former presidential candidate, Bernie Sanders.
Even Professor Robert Reich, a high-profile member of President Clinton’s Cabinet contends that TPP is a Trojan horse in the global race to the bottom.
Economics professor Paul Krugman, who often espouses the liberal viewpoint, has said that there is no compelling case for this deal, either from a global or national point of view.
Dartmouth economics professor Emily J Blanchard argues that while the agreement has been roundly criticized on the political left, progressives should actually be supportive of the agreement because of its promise of a new progressive rulebook.
Her statements should sound an alarm among all conservatives who think that this agreement is about free trade. It may be about free trade in some instances, but it is 5600 pages long and is so complex that nobody reads it.
So far, Congress has failed to ratify the agreement despite the persistence of the President and the Speaker of the House. All people reading this article should take it upon themselves to write to their elected Representatives and Senators in Washington and let them have the benefit of your views on this subject, not only for now but for the future.
This matter has great influence on the Presidential Election and will say a great deal about what kind of country we are going to have if it is ultimately approved.
Despite Hillary Clinton’s back-pedaling on the issue, one of her closest advisors, Terry McAuliffe, was caught in a moment of truth during a recent interview. McAuliffe candidly said that Clinton, if elected President, would likely seek passage of TPP.