By Doug Porter
Sometime this spring Senator Orin Hatch will ask the congress to vote on giving the President “fast track” authority in relation to the Trans Pacific Partnership (TPP). What this means is that the terms of the treaty establishing ground rules for trade, intellectual property and corporate behavior around the Pacific Rim will be subject to a simple yes or no vote.
Opponents of TPP and the companion Transatlantic Trade and Investment Partnership (TTIP) make a big deal out of the fact that the nuts and bolts of these deals are negotiated in secret. As a practical matter I don’t see how a complex agreement between nation-states and corporate entities could be negotiated in public. But we should have a right to know –beyond platitudes– what our government supports in negotiations.
The crux of this matter is that we’re being asked to trust negotiators to create a mechanism along the lines of previous trade deals. Many of the people who negotiated those earlier deals now admit they failed to provide the promised economic benefits to anybody not owning stock in a multinational corporation.
San Diego Congressman Juan Vargas and his ideological opposite Rep. Duncan Hunter have both indicated they’ll vote against “fast track,” technically known as Trade Promotion Authority(TPA). Vargas’ is likely motivated by concerns about free trade deals impact on jobs and wages. Hunter (and a significant number of conservatives) is motivated by a fear that such deals erode the sovereignty of the United States.
Reps. Susan Davis and Scott Peters are publicly uncommitted. MoveOn.org marshaled its members to politely “drop by” their local congressional office last week to urge a “No” vote. The scene at Davis’ office included a heavy police presence, complete with a threat to arrest people for chalking the sidewalk. No injuries to the ink pens used to petition the Congresswoman were reported.
Congressman Darrell Issa, who’s publicized leaked TPP documents of the past, is now apparently on board to vote for fast track.
From the Washington Post:
“This president has earned our distrust, but having said that, I still support TPA,” Rep. Darrell Issa (R-Calif.), one of Obama’s fiercest critics as the former head of the House Oversight and Government Reform Committee, said in an interview. “I still want to have the trade team be able to go forward and make good offers.”
UT-San Diego: Blame the Democrats
So, while there is enough bi-partisan opposition to fast track to delay introduction of legislation until next month, the Daily Fishwrap editorial board says it’s all about Democrats. (And introduces a large amount of “truthiness”along the way.)
Unfortunately, as U.S. Trade Representative Michael Froman laid out last week in an interview with the U-T Editorial Board, many Democrats view international trade as being synonymous with globalization, the phenomenon of jobs and industries leaving America for places with much lower labor costs and fewer worker and environmental protections. Froman said that trade agreements — such as the Trans-Pacific Partnership that the U.S. is now negotiating with 12 Pacific Rim nations — should instead be seen as laying the groundwork for long-term, sustainable, humane prosperity. Froman says the emerging deal includes binding environmental and worker-rights provisions of a sort that President Obama has always said should have been in the 1993 North American Free Trade Agreement.
So Democrats in San Diego and beyond have a choice: Do they continue to see international trade as a boogeyman? Or do they prefer a future in which the U.S. — not China — sets the Pacific Rim trade framework? “Trade integration in Asia is already happening — with or without the United States,” warned Lawrence Summers, a former top economic adviser to Presidents Obama and Clinton.
There is no major economic power more hostile to environmental and worker protections than China. We hope this reality settles in with the Democrats who are on the fence about the Trans-Pacific Partnership.
In sum, according to the gospel of Manchester, opposing fast track means Democratic legislators are against trade and willing to allow the godless Chinese communists to dominate the Pacific Rim. Republicans get a pass on this one.
Let’s take a look at provisions of TPP that have been leaked to see if there are any other reasons why Democrats might be opposed to fast track authority.
The Investor State Dispute Settlement (ISDS)
Trade agreements (think NAFTA) like the ones everybody agrees were flawed typically contain an ISDS, wherein foreign investors can sue nations (but not vice versa) for treaty violations. Since the intellectual property and commerce clauses are meant to protect investors/corporations, egregious legal actions have been initiated in countries around the world.
HBO’s John Oliver dedicated a portion of his weekly satiric news program to the tobacco companies who are suing countries who attempt to control cigarette packaging as part of their anti-smoking campaign.
The New Protectionism
Calling the TPP a “trade deal” is really a triumph of modern-day marketing/propaganda. What they’re really talking about are establishing ground rules for commerce in an era where the nation-state’s prerogatives are increasingly dictated by corporations.
Here’s Conor Lynch, writing at Daily Kos, with the low-down:
Modern free trade deals are not just about getting rid of artificial protective barriers, like tariffs and subsidies. In fact, trade barriers are already rather low between nations involved in massive deals like the Trans-pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP). For example, on average, tariffs between United States and Europe are quite low, at under three percent. The reality is that these trade deals are actually quite protectionist, but not in the usual sense of protecting developing industries. No, these deals include provisions that protect multi-national corporations that are already fully developed.
Now, you may be thinking, why would big corporations need the help? Doesn’t, say, big pharma already make enough in profits? To an outsider, it definitely looks that way. In fact, the pharmaceutical industry is one of the most profitable around, and in 2013 was tied with the banking industry for highest profit margins. But still, when competing in a capitalist society, one must always aim for more. And provisions within the TPP would help make this happen by expanding drug patent rights beyond the original twenty years. This will very likely keep important medicines, sometimes life-saving, overpriced and unaffordable in many nations around the world, especially in developing ones.
The Coalition for Four Pinocchios
The UT-San Diego editorial did fit in nicely with the marketing pitch advocates are using to sell TPP in that it targeted Democrats.
The thinking among TPP supporters must be the best way to attack this problem is to turn it on its head. You know, like “war equals peace.”
So 270 Strategies, the company tasked with the current public relations push, created the Progressive Coalition for American Jobs.
The “Progressive Coalition for American Jobs” sent out a press release earlier this week promising that the TPP will “support hundreds of thousands of new jobs in the United States.” This is the same promise that Clinton used to sell NAFTA, the North American Free Trade Agreement, and we know how that turned out. (Hint: lost jobs, lost wages, lost factories, lost industries, devastated regions of the country, increased trade deficits and a few CEOs and Wall Street types made vastly richer.) (See also, Obama’s Trans-Pacific Partnership Promises Echo Clinton’s On NAFTA.)
The Washington Post’s Fact Checker looked at this “hundreds of thousands of new jobs” claim on January 30, in “The Obama administration’s illusionary job gains from the Trans-Pacific Partnership.” The conclusion:
Our advice remains: be wary whenever a politician claims a policy will yield bountiful jobs. In this case, the correct number is zero (in the long run), not 650,000, according to the very study used to calculate this number. Administration officials earn Four Pinocchios for their fishy math.
Strike one for the Progressive Coalition for American Jobs. Take out the words “for American Jobs.” It’s “the Progressive Coalition for Four Pinocchios.”
The Moyers.com columnist goes on to point out that there are no actual progressives in this coalition, citing op-eds from Reps. Raúl M Grijalva and Keith Ellison of the Congressional Progressive Caucus and Senator Elizabeth Warren.
You have to wonder why they feel the need to manufacture a non-existent coalition if their product is so good.
Take the word “Progressive” out of the name. So now it’s just “the Coalition for Four Pinocchios.”
The US vs. China Argument
Larry Cohen, president of Communications Workers of America (CWA), tackled this claim in a Huffington Post article last month:
If it really is China or us, why don’t we address currency manipulation and prevent Japan and other TPP nations from following China’s example of controlling exchange rates so that our exports can’t compete?
And if it is really China or us, why does the USTR insist on guaranteeing multinational corporations profits when they invest abroad? Vietnam, Malaysia, Singapore and Brunei are certainly not interested in one-way lawsuits by multibillion-dollar corporations if they enact any legislation that threatens those corporate profits! Investor-State Dispute Settlement cases from old free trade agreements like NAFTA and CAFTA have already forced mostly poorer nations to pay tens of millions of dollars in settlements and arbitration awards, and 500 cases are pending now.
In fact, our trade framework is an unholy alliance between the geopolitical concerns of the State Department and the business interests of the US Chamber of Commerce and Business Roundtable. US workers and those who care about the environment, global health care, human rights, consumer safety, balanced trade and manufacturing renewal are left out. We’ve heard nearly identical promises from Presidents Clinton, Bush and Obama regarding previous deals with China, Mexico, Colombia, Honduras, Guatemala and Korea.
Labor Draws the Line
So, as you may have gathered, organized labor isn’t happy about TPP. Despite the promises that the labor and environmental chapters of the TPP were a big improvement for American workers and environmentalists, the sad history of lack of enforcement of even the weaker protections of early trade agreements means just a few nice words are not enough.
Last week AFL-CIO President Richard Trumka promised that organized labor was going “all out” to oppose “fast-track” authority to complete the 12-nation Trans-Pacific Partnership.
From the Washington Post:
“This will trump any debate out there,” Trumka said. “There is such a dramatic impact on the standard of living and a lowering of wages and a loss of jobs — this will have a major impact, and we will not forget this vote for a long time.”.
And organized labor backed its big talk with big action: they cut funding for all congressional campaigns just to make sure the message was heard loud and clear.
From the Wall Street Journal:
Unions have opposed the TPP through demonstrations, letters to lawmakers and political ads, but withholding political contributions is a more forceful way of flexing their muscle. In the 2014 midterm elections, unions—the lifeblood of the Democratic Party—contributed about $65 million from their political-action committee, or PACs, to candidates, nearly all Democrats.
“Every single union in the AFL-CIO has agreed to join together to send Congress a message that if you mess with one of us you mess with all of us,” Harold Schaitberger,president of the International Association of Fire Fighters, said Monday at the union’s legislative conference in Washington. “We need to cut the spigot off.”
For Congresswoman Susan Davis, whose campaign is largely paid for by tech and defense entities, labor’s threat means she’ll be out 15% or so of her potential funding for 2016. For Rep. Scott Peters, union support is negligible compared to his corporate donors. Davis is in a “safe” district. Peters could self-fund if he needed to. So don’t be surprised about how they vote.
These trade deals are complex, but necessary, tools. The world is changing and there’s no putting the trade genie back in the bottle.
What’s at stake here is making sure that the mistakes of the past are not repeated. We can’t afford another million jobs lost due to broken promises made, as happened with the North American Free Trade Agreement. We can’t allow the economy to continue to be structured in a way that promotes increasing inequality.
The Myth of Seattle’s Minimum Wage
The San Diego Small Business Coalition (which is actually a creation of the Chamber of Commerce, funded by large corporate interests) is running promoted Facebook posts linking to a wave of right-wing media stories about how Seattle’s restaurant industry is collapsing in the face of a $15 an hour minimum wage law.
For this story (and others based on it) to be true, you have to be willing to believe Seattle restaurants in one of the most competitive markets in the county are closing now in anticipation of a law that won’t fully affect them for six years.
Los Angeles Times business columnist Michael Hiltzik checked out the facts and discovered just another instance of bending the facts to suit the narrative. In other words, truthiness.
The conservatives gleefully associate this phenomenon with the coming increase in the city’s minimum wage, which kicks in April 1 with a rise to $11 an hour from $9.32. (Employers whose workers earn tips get a break–they can pay $10 if the workers make up at least another dollar from their tips.) The wage hike builds over time; for employers with fewer than 500 workers, which would probably cover every full-service Seattle restaurant, the ultimate increase to $16.49–or $15 for tip earners–doesn’t happen until 2021.
David Watkins of the Lawyers, Guns & Money blog points out that the minimum wage opponents are declaring “We told you so” way too soon. In fact, the article that inspired the gloating doesn’t ascribe any of the closings to the minimum wage increase and, indeed, points to different reasons in every case. As for the idea that Seattle restaurants are “closing in record number” (sic), as the Tea Party News Network proclaims, it’s just not so.
Here’s the rundown. Of the seven restaurants specifically mentioned in Seattle Magazine’s March 4 post, one was reported by its owner to be located in the wrong neighborhood for its particular mix of bar space and atmosphere. Another is being offloaded by an owner who has three other restaurants in the city and is opening two more. (A neighboring restaurant is expanding into its space.) A third turned out to be too big for the clientele at its location. Three aren’t closing at all, but are getting new chefs because theirold boss is moving to Spain to join his partner.
How many owners cited the minimum wage as a factor in their actions? None.
On This Day:1886 – 20 Blacks were killed in the Carrollton Massacre in Mississippi. 1958 – The Vanguard 1 satellite was launched by the U.S. 1968 – Staffers at San Francisco progressive rock station KMPX-FM strike, citing corporate control over what music is played and harassment over hair and clothing styles, among other things. The Rolling Stones, Joan Baez, the Jefferson Airplane, the Grateful Dead and other musicians request that the station not play their music as long as the station is run by strikebreakers.
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