The Trans-Pacific Partnership: Obama’s Globalization Agreement (Part 1)

Rebecca Smith is the author of “Union Hypocrisy” and is a new, regular contributor for The Brenner Brief. Her work will be published each Tuesday.

It is hard to know exactly what is in the TPP (Trans-Pacific Partnership).  You certainly have not heard about it on any of the major news networks.  Why has the news industry on both the left and right ignored TPP?   

On the fundamental question of these trade agreements, the parties agree. President Barack Obama has pledged to double U.S. exports as a core policy goal, and the Democratic platform lists the TPP as a “historic high-standard agreement” that will help accomplish this. The GOP platform pledged, “a Republican President will complete negotiations for a Trans-Pacific Partnership to open rapidly developing Asian markets to U.S. products.” Both party leaders argue that exports are one key to creating high-quality American jobs.  
Now, Americans are faced with the leadership of both political parties who are largely supportive of more NAFTA-style trade agreements. Yet, this isn’t new since NAFTA was passed with Republican support under a Democratic president. It does add evidence to the idea that the 2012 election is a carefully cultivated political debate in which core economic issues have been carved out.
Nevertheless, perhaps we should take a closer look at something that is so wonderful for our trade yet it cannot be read by the public or congress.  As Nancy Pelosi said a about a similarly wonderful bill, “we have to pass it so we can see what is in it.”
There are two major concerns about agreements like this. First, they continue a transition from a democratic system toward one in which the rights of foreign corporations can trump laws passed by legislative bodies. Every time you have a new trade agreement, you expand the number of companies who can challenge American laws.
The second concern is that the TPP could become a conduit for the U.S. to become more dependent on China.  American tensions with China cause genuine friction. This is not far-fetched, as America is positioning military assets in the region.
While negotiations started in 2007, most negotiating documents and draft chapters are classified. Stakeholders — including 600 corporations but also several labor unions, including the AFL-CIO — can see the draft text, but the public and Congress cannot.   
On Nov. 14, 2012 in Mexico City, Mexico, the PRD group of the Mexican Senate, along with the Mexican labor federation UNT and the campesino federation CONORP, hosted a one-day summit looking at the social and economic impacts of the Trans-Pacific Partnership Free Trade Agreement. The summit was held at the same time as delegations from the 11 TPP countries (Australia, Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States) were meeting elsewhere in Mexico to negotiate the agreement. Speakers at the summit included Sen. Isidro Pedraza Chávez (PRD, Mexico), Melinda St. Louis of Public Citizen (U.S.), Max Correa, Secretary-General of CONORP (Mexico), Rick Arnold of Common Frontiers (Canada) and Celeste Drake, trade policy specialist for the AFL-CIO.
Nevertheless, thanks to a few congressional representatives, one being Darryl Issa (R-CA), a few draft chapters have been leaked. One of the more controversial aspects that have been exposed include banning “buy American” preferences in our procurement procedures.  Another concerning aspect are the infamous “investor-state dispute settlement” (ISDS) provisions, which allow a single foreign company to sue an entire country in a private arbitration court to challenge laws or regulations it does not like.  The agreement strengthens investor provisions, allowing a whole set of new disputes to be removed from the U.S. courts and remanded to international tribunals run by corporate trade attorneys.  There are also concerns that the TPP would undermine access to HIV drugs and other essential medicines in countries that sign the agreement. A spokesperson for Doctors Without Borders even claimed, “Bush was better than Obama on this.” The ACLU claims that the copyright provisions in the TPP are “the biggest threat to free speech you’ve never heard of.”
Some of the other damaging clauses of TPP include natural resource concessions from the federal government, contracts to run utilities (public-private partnerships), and procurement contracts relating to infrastructure construction. In order words, if a government entity wanted to prioritize awarding a government contract to a local firm, the TPP would allow foreign firms to challenge this as a TPP violation. And, the challenge wouldn’t be in an American court, it would be held in an international tribunal.
In another concerning development, the “Outlines of the Trans-Pacific Partnership Agreement” indicates that the Trans-Pacific FTA is likely to include much of the same investment text as the North American Free Trade Agreement (NAFTA).  This includes the provisions that give foreign investors the extraordinary right to bypass U.S. courts and sue the U.S. government in an international arbitration panel if the investor feels it hasn’t been treated “fairly,” or if a federal, state, or local law interferes with its expected profits. 
These same rules give U.S. firms an incentive to invest overseas (taking U.S. jobs with them), so they can bypass the judicial process in foreign countries and sue our trading partners (often developing countries) before international arbitration panels. 
This agreement is a core part of the “Asia pivot” that has occupied the activities of think tanks and policymakers in Washington but remained hidden by the drama of the election. More than any other policy, the trends the TPP represents could restructure American foreign relations, and potentially the economy itself.
The TPP represents the first time the Obama administration has pursued an international commercial agreement from scratch. It would be the largest one since the 1995 World Trade Organization. It would link Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, Mexico and Canada into a “free trade” zone similar to that of NAFTA.  The subject matter being negotiated extends far beyond traditional trade matters. TPP’s 29 chapters would set binding rules on everything from service-sector regulation, investment, patents and copyrights, government procurement, financial regulation, and labor and environmental standards, as well as trade in industrial goods and agriculture.
The TPP is being negotiated by the Office of the United States Trade Representative (USTR). As with other such agreements, Congress must vote to approve it, most likely under a “Fast Track” provision that prohibits any amendments and limits debate. Trade, though constitutionally a congressional prerogative, is now firmly in the hands of the executive branch. And “trade” negotiations have become a venue for rewriting domestic non-trade policy traditionally determined by Congress and state legislatures.
The current USTR is a former Dallas mayor and former corporate lobbyist named Ron Kirk. Also involved is Michael Froman, a deputy assistant to the president and deputy national security advisor for international affairs. Froman headed the Obama transition team in 2008, and apparently led the hiring of Tim Geithner for Treasury Secretary. …
Read Part 2 of The Trans-Pacific Partnership: Obama’s Globalization Agreement Wednesday on
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