Industry: The Achilles Heel of the Trans-Pacific Partnership

Industry: The Achilles Heel of
the Trans-Pacific Partnership
Polly Hughes 5.15.14

The Trans-Pacific Partnership (TPP) and other outrageously restrictive trade agreements are being negotiated secretly. The TPP has been dubbed “NAFTA on steroids.”

The Trade Promotion Authority (TPA), better known as fast-track authority, has been proposed to allow President Obama to sign trade agreements, and then take them to Congress. However, Congress’ power is limited. Limited on time allowed for debate, no amendments, and no filibustering. Congress can only take an up or down vote. That’s it.

Congress last approved fast-track authority in 2002 for President George W. Bush and it expired in 2007. Now, the Obama administration is negotiating three trade accords — the 1) Trans-Pacific Partnership (TPP) with 11 other nations, the 2) Transatlantic Trade and Investment Partnership (TTIP) with 28 European countries and 3) a global services pact with about 50 nations. The White House has been urging Congress to get Fast Track approved quickly but, so far, TPA has not been approved as it has a lot of public and legislative opposition.

The Deal Made Behind Our Back

TPP is a proposed agreement between the U.S. and 11 nations that do business throughout the Pacific Rim. Those 11 nations are: Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam, and Japan.

For about five years, the TPP has been in negotiations behind closed doors and some 600 corporate “trade advisors,” industry leaders, corporations have online access to the working text. However, congress does not have this access.

A committee of congressmen, that included Rep. Alan Grayson, was allowed to read the proposed agreement and those allowed to see it could not take notes or make copies. [1]

[source]

President Obama has been negotiating in secrecy and pushing for fast track to be renewed. The president would sign the agreement and take it to Congress. But Congress would have limited debate time and could only vote up or down with NO amendments and no filibustering allowed.

Historically, free-trade agreements have been negotiated in secret within The Andrew W. Mellon Auditorium in Washington, DC. It's only fitting that such job-destroying agreements be negotiated and signed in a building named after a man who famously said: "liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate...People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people..." Photo by NCinDC

Tenets of the TPP (via Wiki Leaks)

Relinquish our rights to regulate within our own borders (corporations would rule on this matter).

Decisions would be made, not by each country, but by a global business tribunal.

Create special protections and remove global barriers for “too big to fail” banks and Wall Street, but not offer protections to smaller, community banks.

Give preferred “investor state” status to foreign companies that operate within our borders—ultimately, this would encourage U.S. companies to offshore jobs.

Would lower wages for US workers.

Would exempt foreign companies from environmental regulations.

Would affect consumer protections for food safety.

Would destroy collective bargaining and threaten already established worker protections.

Would bring “Buy American” programs to a halt by allowing:

1. Foreign companies to underbid U.S. companies on government contracts paid for with our tax dollars.

2. Foreign investors to file lawsuits in a global business court to challenge “buy local” programs claiming “buy local” as unfair and would allow foreign investors to ask for compensation for anticipated lost profits.

Would threaten to extend restrictive intellectual property laws and impose sanctions with respect to pharmaceutical patents, which would then raise the cost of prescription medicines.

Internet restrictions. ISPs could become censors and block content sharing between individuals.

Would remove restrictions on U.S. standards for GMOs, making it impossible for Americans to know what we are eating; will threaten Europe’s ban on GMOs (genetically modified organism).

Would encourage fracking and drilling; threaten environmental protections; effectively strip the Environmental Protection Agency of its power to control damage caused by fracking.

Would drive up energy prices. The Department of Energy would lose regulatory authority over fuel imports and exports; oil and natural gas could be sold on the open market to the highest bidders. [2]


None of the nation’s 200,000-plus fast-food restaurants are unionized. In NYC fast-food workers hoped to gain footing for a $15 minimum wage and the right to form a union. In July, more than 2,000 workers did the same in major cities across the country. Photo by Annette Bernhardt

Fast Track: An Un-Democratic Hell

Since the first week of January, legislation to pass Fast Track was introduced by Sen. Max Baucus, Democrat of Montana, who was Chair of the Senate Finance Committee and has since become Ambassador to China; Sen. Orrin G. Hatch Utah, the committee’s senior Republican; and Rep. Dave Camp, Republican Michigan, who is Chair of the House Ways and Means Committee.

Then, Rep. Sander M. Levin of Michigan, the senior Democrat on the Ways and Means Committee, said he would introduce a rival measure giving Congress more say over the final terms of any agreements, given the pitfalls of globalization for American workers. Separately, 151 Democrats have signed a letter signaling opposition, and some Republicans have also spoken against fast-track authority.

On January 16 a second letter, signed by 12 senators, was sent to Harry Reid. The basic points of that letter were:

1. TPP and TTIP would remove power from Washington and transfer it to corporate tribunals.

2. These national corporations would become the most powerful legal entities in the world and would be making all economic decisions.

3. Previous trade bills have been detrimental to workers and national competitiveness.

4. Past trade deals have harmed American companies, specifically the manufacturing sector.

Quoted from the letter:

We believe any package should include provisions to address currency manipulation, stronger mechanisms to address unfair labor practices, the ability of communities to preserve their values, strong trade enforcement policies and should provide innovative solutions to finance improvements to our crumbling infrastructure.

The senators came up with some fine rhetoric, but you can discern from this quote that its lukewarm generalization does not really oppose the free trade treaties (past or future). NAFTA has given us 20 years of low wages for American workers and outsourcing of manufacturing jobs. The middle class has suffered enough. This letter was signed by Democrat Senators Al Franken, Tammy Baldwin, Elizabeth Warren, Chris Murphy, Tom Harkin, Carl Levin, Jeff Merkley, Jack Reid, Richard Blumenthal, Ed Markey, Sheldon Whitehouse and Independent Bernie Sanders.[3]

In January, a hearing about the TPA (fast track) was held by the Senate Finance Committee along with several CEOs. One of the most outspoken was President Larry Cohen of Communications Workers of America. There were more supporters than detractors at the hearing. Four witnesses testified, and only Larry Cohen, President of the Communication Workers of America, spoke out against it. Committee members and Senators Sherrod Brown (D-OH) and Bob Casey (D-PA), were opposed. During the hearing Sen. Hatch commented to Larry Cohen:

You and I are living in an alternative universe. And Why can’t unions see that TPA is needed?

And, yet, Hatch promised transparency during the legislative process! Senators Cote, Stegemann, and Hatch all said that TPA will help pass free trade agreements that will allow the export of more American goods and employ more American workers and they pointed to NAFTA, which was put into effect twenty years ago. Larry Cohen countered with:

It’s common knowledge that since NAFTA, trade deficits have gone up five-fold. The question is, where does production occur? A multinational doesn’t really care, or can’t. We want world trade. We must have world trade. We have a global economy in the same way we have a global climate. The idea is, how do we promote the kind of sustainable trade and production that we can be proud of? [4]

15% Protective Tariff Will Stop TPP

The answer to Mr. Cohen’s question is the reintroduction of a protective tariff. A 15% tariff on imported goods to level the playing field. No more cheap labor, no more child labor, and no more outsourcing of American jobs to countries that have labor standards which fall far below humane levels.

Steel mills once flourished in America in throughout the 19th and 20th century. By 1920, the US Steel Mill in Gary, Indiana had roughly 16,000 workers. It was one of the largest steel mills in the country. As a result of free-trade policies and de-regulation, by the middle of the 1980s, steel mills were either merging or closing and approximately 40,000 steel mill jobs were lost by the mid-1980s. The steel mills provided high-wage salaries, benefits, and stability for many American families.[5]

Gary, Indiana, 2008. Abandoned Union Station (built in 1910) was once the main hub for immigrants who moved to Northwest Indiana to work at the once-thriving steel mills. Photo by Eric Allix Rogers

If these policies of de-industrialization through free-trade deals like the TPP continue, wages will only continue to fall, and jobs will only continue to be shipped overseas. However, if Americans forced industries to keep their jobs here in the US, under the protection of our fairly robust labor laws (although they could certainly be better), unemployment would immediately decrease.

Clothing factory in Dongguan, China. Each worker earns the equivalent of 2 US dollars per day (a good wage by Chinese standards), including payment for mandatory overtime. Dongguan exports over $65 billion of goods annually. Photo by Edwin Lee

College students could put themselves through school by working part-time in electronics manufacturing plants, as opposed to pushing a mop around or delivering pizzas at 1 am. Similarly, the poor would have somewhere other than McDonalds to aspire to.

Seagate: an American Corporation and major producer of computer hard drives. Its principal executive office are in Cupertino, CA. Its principle source of labor is located in China. Photo by Robert Scoble

The wisdom of Abraham Lincoln remains just as true today as it did over a century ago:

If we made our own steel, we’d keep the rails, the jobs, and the money.

A protective tariff keeps low-wage, low-quality goods from flooding onto our shores, and consequently, filling up the shelves of giant, union-busting, low-wage monsters like Walmart. Protective Tariffs allow for actual job creation and wealth to be created (as opposed to fighting over scraps) via high-technology goods and services which drive wages up, not down.

Take Action Today to Stop the TPP

Please call, write, and email your legislators today and tell them:

Do not pass TPA (fast track)

Stop secret negotiations of trade agreements

Impose a 15% protective tariff on imported goods


Recommended Reading

Protective Tariffs (Highly Recommended)

Alexander Hamilton on Tariffs

Hamilton's Report on Manufactures

TPP Resolution

Opposition to Fast Track


Notes

1] Carter, Zach. Alan Grayson On Trans-Pacific Partnership. The Huffington Post. TheHuffingtonPost.com, 18 June 2013. Web. 26 March 2014.

2] Secret Trans-Pacific Partnership Agreement (TPP) - IP Chapter. Wikileaks.org. Web. 26 March 2014.

3] Wright, D. S. Senators Write Letter To Harry Reid Opposing Fast Track Authority For TPP. Firedoglake News Desk. Firedoglake.com, 16 January 2014. Web. 26 March 2014.

4] CWA President Larry Cohen: Senate Finance Committee Hearing on Trade. YouTube, 16 January 2014. Web. 26 March 2014.

5] Nelson, Ted. Why Is Gary Indiana So Dangerous? EHow. Demand Media, 14 July 2011. Web. 26 March 2014.


For more from Polly Hughes visit: Education Source


Cover photo by Zixi Wu