A new round of negotiations is underway in Atlanta this week between the United States and 11 Pacific Rim countries. They are trying to finalize the Trans-Pacific Partnership (TPP).
Some groups are asking people to come to Atlanta to protest. There are also calls for presidential candidate Hillary Clinton to make her views known on TPP.
A major reason for the push to get TPP completed now is the upcoming presidential election. The negotiators want Congress to vote before TPP becomes an issue in the campaign, which would mean the public will begin learning of the pact’s provisions and hearing arguments against them.
Negotiators are pushing TPP because it helps get government out of the way of big corporations. A provision in TPP called investor-state dispute settlement (ISDS) lets corporations bring cases against governments in corporate-arbitrated courts that are outside of national legal system, if those government pass laws or regulations that interfere with corporate profits. For example, tobacco corporations will be able to sue governments for engaging in efforts to help citizens stop – or prevent children from – smoking. (See “Tobacco ‘Smoking Gun’ Shows Real TPP Agenda” and “Tobacco “Carve-Out” Dispute Tells Us What We Need To Know About TPP.”)
TPP will also help defund governments by reducing revenue from tariffs. The U.S. Trade Representative (USTR) Michael Froman recently boasted in Politico that TPP will lower government revenues, saying, “TPP will deliver billions of dollars of tax cuts every year going forward” in the form of cuts in tariffs that U.S. manufacturers and farmers face in the TPP countries.
While the agreement – the largest “trade” agreement in history – supposedly is a broad agreement defining the rules of doing business in the 21st century, the negotiations are actually about horse-trading immediate concerns and deals and markets between different corporations. Following is a summary of a few of the remaining issues in the way of completing the agreement: currency manipulation, autos and auto parts, and Donald Trump.
Some countries manipulate their currencies, which makes goods made there cost less in world markets. Meanwhile the U.S. currency is “strong,” which means American manufacturers lose business and are forced to shed workers. Many in Congress want TPP to contain clauses regulating this manipulation.
Last week 158 members of Congress sent a letter to the White House, which, according to the Detroit Free Press, urged “that strong, enforceable provisions against currency manipulation be made part of a Pacific Rim trade deal.”
From the Free Press report,
Legislators from industrial states, including Michigan, have argued that strong, enforceable currency standards must be part of any trade deal with Pacific Rim nations to ensure the U.S. is not put at a disadvantage to countries which may manipulate their currency to help their own industries.
“In just the last month, three of our trading partners — China, Korea, and Vietnam — have each taken steps that have caused their currencies to weaken, disadvantaging American businesses,” the letter said. “These steps have raised significant concerns and highlighted the importance of enacting strong, enforceable protections.”
“U.S. workers and businesses are the best in the world, and it is critical to our country’s economic future that they are able to compete in a fair global marketplace,” the letter continued. “For that reason, it is critical the TPP include strong, enforceable protections against currency manipulation.”
Autos And Auto Parts
Canada and Mexico are opposing a Japanese proposal to lower the requirement for how much of a car and auto parts have to be made in TPP countries to avoid tariffs. U.S. auto companies and parts manufactures, of course, side with Canada and Mexico, but Japan wants to be able to have cars and parts made in China, yet still avoid tariffs.
Unbelievably, our own country’s trade negotiators – desperately wanting this deal to conclude this week – appear to be siding with Japan and China against American, Canadian and Mexican manufacturers. For details, see: “Under Pressure To Finish TPP, Are They Giving Away More Jobs?” and “TPP Terms Are Even Worse For U.S. Than NAFTA?”
Part of Donald Trump’s popularity comes from his opposition to the way that previous trade agreements like NAFTA have hurt American workers and industries. For example, Trump has stated that he will end that NAFTA trade agreement that cost so many jobs and moved so many factories out of the U.S. The Hill reports, in “Trump threatens to ‘break’ trade pact with Mexico, Canada“:
Donald Trump is calling the North American Free Trade Agreement (NAFTA) a “disaster” and vowing to renegotiate or break the deal if elected president.
“It’s a disaster,” Trump told CBS’s Scott Pelley in an interview airing Sunday on “60 Minutes.” “We will either renegotiate it or we will break it because you know every agreement has an end.
“Every agreement has to be fair. Every agreement has a defraud claim. We’re being defrauded by all these countries,” Trump continued.
Pressed on whether he supports free trade, Trump responded, “We need fair trade, not free trade. We need fair trade it’s got to be fair.”
Trump has blasted trade policies, accusing leaders of allowing China and Mexico to steal U.S. jobs and hurt American workers.