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Forum Post: Fast Track Opponents Predict More Lost Jobs, Higher Trade Deficit; Big Business Sees Unlimited Trade

Posted 11 months ago on Jan. 18, 2014, 3:27 p.m. EST by LeoYo (5909)
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Fast Track Opponents Predict More Lost Jobs, Higher Trade Deficit; Big Business Sees Unlimited Trade

Saturday, 18 January 2014 09:40 By Anne Meador, DC Media Group | Report

http://truth-out.org/news/item/21301-fast-track-opponents-predict-more-lost-jobs-higher-trade-deficit-big-business-sees-unlimited-trade

The Senate Finance Committee held a hearing on January 16 on a bill that would renew Trade Promotion Authority (TPA) for the President, allowing trade treaties to be “fast tracked” through Congress. The measure was introduced by Finance Committee Chair Max Baucus (D-MT) last week, just as far-reaching “free trade” agreements with Asian and European countries are nearing completion.

President Obama is pursuing two controversial trade agreements, the Trans Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), and it is widely agreed that he needs fast track authority to move forward. Sen. Orrin Hatch (R-UT) however took several opportunities to protest the absence of the U.S. Trade Representative, lambasting the President for “leading from behind” when it came to TPA.

Supporters of the TPA bill outnumbered detractors at the hearing. Of the four witnesses testifying, only one, Larry Cohen of the Communication Workers of America, spoke out against it. A few committee members in attendance, including Senators Sherrod Brown (D-OH) and Bob Casey (D-PA), were opposed.

The two sides had radically different interpretations of the results of past free trade agreements and predicted outcomes if Congress handed TPA to the President now. Summing up their gap in perspectives, Sen. Hatch peevishly said to Larry Cohen, “You and I are living in an alternative universe.”

“Why can’t unions see that TPA is needed?” Hatch asked Cohen.

From Cohen’s standpoint however, the issue lay more with the TPA bill proposed by Baucus, not with TPA itself. “We need Trade Promotion Authority to create a sense of balance and fairness from the framework of the American people, not just of the large multinational corporations,” said Cohen.

Margaret Flowers of the FlushTheTPP campaign, one of the protestors who held signs saying “TPP: How Low Can Wages Go?” during the hearing, criticized the fast track bill for putting limits on floor debate, barring Congress from making amendments, and requiring “a straight up-and-down vote.”

It would also, she said, be a continuation of the secrecy surrounding negotiations of the Trans Pacific Partnership. The only text released to the public so far has been leaked. She doesn’t think fast track passage through Congress would improve transparency in any way.

“[Even] Congress has limited access to the text, while 600 corporate advisers have ready access,” she said. “It will be pushed through without any review or transparency, and that’s going to set the global template for trade.” Hatch promised transparency during the legislative process.

Objections to the TPP and TTIP rest largely on the powers they give corporations to override domestic laws in violation of state sovereignty. Sen. Brown asked about the ability of corporations to sue foreign governments. “Do we want that power?” he asked.

Cote deferred. “That’s a level of legal complexity that’s beyond me,” he said. Elena Stegemann, a small business owner who also represented the U.S. Chamber of Commerce, stated that she had “no experience in these matters.” But Cohen sharply condemned it. “We cannot have democracy if corporations have super rights to enforce their control,” he said.

TPA would expedite the removal of barriers to trade, supporters argued. Baucus, in his opening remarks, stressed the need “to level the playing field.” Stegemann echoed him by saying, “The international playing field is unfairly tilted against American workers.”

They and David Cote, Chairman and CEO of Honeywell, say that TPA will help pass free trade agreements that will allow the export of more American goods and employ more American workers. They pointed to NAFTA, which was put into effect twenty years ago.

According to Cohen, however, NAFTA exported American jobs, not goods. “It’s common knowledge that since NAFTA, trade deficits have gone up five-fold,” he said. “The question is, where does production occur? A multinational doesn’t really care, or can’t.”

While Honeywell has a global workforce of 132,000, only 58,000 of them are located in the U.S.

By the end of the hearing, Hatch became exasperated with Cohen. “I feel really deeply about this,” he said. ”Your argument is that trade costs jobs.”

But Cohen was not buying the alternate universe theory. “We want world trade. We must have world trade,” he said. “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, sustainable production that we can be proud of?”

Video of protestors, including Margaret Flowers, speaking out against Fast Track and the Trans Pacific Partnership (TPP) after the conclusion of the hearing:

http://www.youtube.com/watch?feature=player_embedded&v=_em0-IwojJI

This piece was reprinted by Truthout with permission or license.

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[-] 5 points by LeoYo (5909) 7 months ago

Trans-Pacific Partnership: Another Trade Liberalization Scam

Sunday, 18 May 2014 00:00
By John Weeks, Truthout | Op-Ed

http://truth-out.org/opinion/item/23740-trans-pacific-partnership-another-trade-liberalization-scam

The TPP represents not "freer" trade, but re-regulation of trade to entrench corporate profit making. Economist John Weeks skewers the free trade dogma that is the ideological justification and corporate sales pitch for neoliberal globalization.

The gathering pressure for Congress to "fast track" the Trans-Pacific Partnership (TPP) demonstrates yet again that trade liberalization is one of the few aspects of economic policy about which there is agreement across the mainstream of the political spectrum, in both the United States and Europe. Almost all conservative commentators endorse it with gusto, for centrists it is an article of faith, and even many progressives accept it implicitly by their criticism of industrial country protection.

The neoliberal ideologues sell it by bestowing the label "free trade," which is allegedly reached by repeated measures of "trade liberalization." No matter that the TPP has little to do with trade and everything to do with setting loose capital on a global scale. Well tested and demonstrably disastrous in the North American Free Trade Association, this liberating of capital includes 1) global extension of corporate patents under the moniker "intellectual property rights," 2) shifting enforcement of those patents from national governments and courts to ad hoc international tribunals, and 3) prohibiting as "protectionist" measures protecting labor rights and the environment.

This is not "freer" trade, but re-regulation of trade to entrench corporate profit making. However, if you call it freer trade, you can sell it to the public. In order to discredit this corporate sales pitch, I have to drive a stake through the heart of the Free Trade dogma that is the ideological justification for neoliberal globalization.

The greatest economist of the 20th century, J M Keynes, explicitly recanted his support for free trade. In a rarely quoted (suppressed?) passage in The General Theory, he wrote:

So lately as 1923, as a faithful pupil of the classical school who did not at that time doubt what he had been taught and entertained on this matter no reserves at all, I wrote: "If there is one thing that Protection can not do, it is to cure Unemployment. . . . So absolutely overwhelming and complete has been the domination of the classical [free trade] school. (The General Theory of Employment, Interest and Money, 1936, Ch 23, Section 1).

The disgust of Keynes over free-trade ideology did nothing to weaken the commitment of economists to this pernicious propaganda. The putative advantages of liberalizing trade are as well-known as they are bogus. It will increase welfare though a better allocation of production and consumption in every country (specialize in what you do best). It will increase domestic competition and lower prices for consumers. And it will stimulate exports and employment as the mirror of the cheaper imports. Better use of resources, cheaper goods and more employment. What's to be against?

The simple answer is, as I show in my new book, Economics of the 1% : Everything. Jagdish Bhagwati, today's leading advocate of "free trade" and winner of the Nobel Prize in economics, demonstrated 50 years ago that the assumptions required to conclude that free trade improves human welfare are absurdly restrictive and - he should have written - an insult to the intelligence. They include 1) continuous full employment of all resources in all countries; 2) all countries can produce all traded commodities; 3) the consumption patterns of people of all countries are the same; and 4) in every country, the same technology is used to produce each commodity. (The true believer in free trade might wish to read the Jagdish Bhagwati 1964 article, "The Pure Theory of International Trade," Economic Journal, 74, 1-78).

Accept these absurdities and the most that can be demonstrated is that some trade is better than no trade (autarky in the economics lingo). It cannot be demonstrated that more liberalization is an improvement on less. This inability to generalize about the consequence of reducing protection measures goes by the oxymoronic name "Principle of the Second Best." The point is simple: Some policy measures may exist to protect the population against fraud, deception and market power of global corporations. Removing one of these while leaving others in place may facilitate those maladies.

Second - and contrary to oft-repeated assertions - in practice, protection (tariffs and quotas) rarely reduces competition from foreign suppliers. If effective, tariffs and non-tariff measures increase the prices at which imports sell. This does not prevent competition from being intense in the protected domestic market. As part of an industrial policy, trade protection can be designed to foster competition, as in South Korea over the last four decades. And, of course, it is quite common in small countries for the allegedly competing imports to be marketed by the domestic producers of the same product (who have production facilities abroad). When this is the case, removing protection increases the profits of the monopoly importers.

Third, there is no theoretical basis for the argument that freer trade stimulates domestic production and employment. It is quite impossible to produce such a theoretical conclusion, because as I wrote above, trade models assume full employment. Adam Smith made the argument that trade provided a demand outlet for a country's surplus production ("vent for surplus") and thus could increase domestic employment. Subsequent economists rejected this sensible idea as naïve and simplistic.

As well they would. If domestic demand were insufficient for full employment, increased public expenditure or private domestic investment would resolve the problem as well as export demand would. The exception would be if a country requires a demand stimulus when it simultaneously suffers from an unsustainable import level. However, by letting in more imports, trade liberalization makes that problem worse, not better, as many African countries discovered in the 1990s under World Bank "adjustment" programs.

Always lurking in the free-trade wings is the argument that developing countries benefit from the elimination of industrial country protection, especially on agricultural products. Perhaps the most surprising thing about this argument is that anyone other than a true believer in free trade would take it seriously.

Most agricultural products protected by rich countries are not grown in the poor countries. The benefiting countries could be middle income (e.g., Argentina), where the agricultural population (and, therefore, number of beneficiaries) is small. Second, for those few products that are produced by low-income countries (cotton in Mauritania is invariably cited), the most likely beneficiary of a production decline in the United States and the European Union would be China, not a poor country in sub-Saharan Africa.

In addition, domestic processing and consumption of these products while diversifying exports might be a considerably better outcome than mutual trade liberalization. Better that Mauritania gins its cotton to make thread to clothe its population, than export it and import the clothes from China, the United States and Europe. Trade liberalization in exchange for access to foreign markets has been the death blow to industrialization strategies in many, if not most, poor countries.

As for trade in manufactures, the chart below shows the overwhelming beneficiary of increased access to developed country markets will be Chinese capital and global capital with production facilities in China. From about 5 percent of global manufacturing exports in 1999, Chinese companies in 2012 accounted for just over 20 percent. A recent report by the Economic Commission for Latin America and the Caribbean demonstrates Chinese high-jacking of Mexico's trade in manufactures with the United States.

http://www.themanufacturinginstitute.org/Research/Facts-About-Manufacturing/Foreign-Trade-and-Investment/Share-of-Exports/Share-of-Exports.aspx

I recently spent time in Bangkok and Hanoi working with the United Nations Economic and Social Commission for Asia and the Pacific. While hesitant to criticize the TPP because of US influence in the United Nations, ESCAP professionals showed a singular lack of support for it. The only enthusiasm I encountered for the TPP was in Hanoi, where the government actively pursues a mercantilist trade policy based on factory conditions and environmental degradation as bad or worse than in China. Working conditions in export factories in and around Ho Chi Minh City reinforce the image of globalized production as paying poverty wages in appalling working conditions (see the recent photo-report on Colombia in Truthout by David Bacon).

Consider a world in which all the major countries in 2008 responded to the global financial collapse with strong fiscal stimulus packages accompanied by temporary import and capital controls to prevent economic growth from generating unsustainable trade deficits. As these countries approached full potential by expanding domestic demand with steady exchange rates, even with the import restrictions, world trade would have grown faster than was actually the case. The measured growth of trade was an anemic 3.3 percent in 2008, a disastrous minus 10 percent in 2009, and a barely-breathing one percent during 2010. The recovery to 5 percent in 2011 fell far below the average for 1980-2007, dropped to a pathetic 2 percent in 2012, and about the same in 2013.

There is a lesson here. A world with free trade should come after - not before - global full employment and after strict national regulations on global capital. And a world with the corporation-liberating TPP should not come at all, ever.

Copyright, Truthout.

[-] 2 points by grapes (3544) 11 months ago

Max Baucus was responsible for the U.S. NOT having the single-payer universal medical coverage. He held it up for ransom with earmarks. With the Democratic majority in both houses of Congress and control of the White House, the Democrats could have passed ANYTHING but they instead tried to wring gravy from the "sure-to-pass gravy train" of the healthcare reform bill through earmarks. It died by many Democratic stabbings.

Later on when Californians got shockers from health insurance rate jumps, they exerted pressure on Nancy Pelosi and the White House. This was when the geoduck got involved and finally got us all the mongrel hodgepodge of Patient Protection ACA which was mostly a formerly Republican idea.

Max Baucus warned months earlier of the impending train wreck of the implementation of ACA. Then the train wreck occurred as predicted so to shut him up, the geoduck gave him the cushy job of ambassadorship to China. It allows him to do his nefarious job with TPP and avoid the Democrats being implicated in that affair. Max Baucus was very "bipartisan" because he carries water for the Republicans serving the plutocracy. Beware of the TPP because it may very well be indirectly passed by the Congress abdicating its power to the geoduck. It smells the same way as how the federal reserve created trillions of dollars out of thin air circuitously.

[-] 2 points by LeoYo (5909) 11 months ago

WikiLeaks on the Trans-Pacific Partnership Environment Chapter: "Toothless Public Relations Exercise"

Wednesday, 22 January 2014 09:37 By Yves Smith, Naked Capitalism | News Analysis

http://truth-out.org/news/item/21372-wikileaks-on-the-trans-pacific-partnership-environment-chapter-toothless-public-relations-exercise

WikiLeaks has thrown yet another wrench in the negotiations over the sellout-to-multinationals-masquerading-as-trade-deal otherwise called the Trans-Pacific Partnership. Wednesday, on the eve of an expected-to-be-contentious Senate Finance Committee hearing on the Administration’s request for “fast track” authority for the TPP, WikiLeaks released another important draft chapter from the pact, this on environmental regulations. It’s relatively current, as of the last day of the Salt Lake City session in November, putting it only one negotiating round the behind the actual draft. And this, like the intellectual property chapter that WikiLeaks published last year, is one that shows the parties to the deal at loggerheads.

WikiLeaks also published an analysis by Professor Jane Kelsey of New Zealand. Given how difficult it is to parse the text (particularly since one also needs to understand how its provisions relate to other international agreements to appreciate the significance), her report provides a good, technical overview.

The main points of her analysis of the chapter proper are that despite aspirational language, the draft chapter has few definitions of key terms and has no mechanism for providing penalties. The one stab at defining terms is “environmental laws” and that is narrow, including only environmental protection and human health and safety. It excludes prudent resource management practices and also appears to impinge on the UN Declaration on the Rights of Indigenous Peoples, which all parties to the pact save the US have signed. Among other things, it protects the rights of indigenous people over traditional knowledge, specifically:

…genetic resources, seeds, medicines, knowledge of the properties of fauna and flora…and … the right to maintain, control, protect and develop their intellectual property over such cultural heritage, traditional knowledge, and traditional cultural expressions.

Seeds? Monsanto is going to cede control over seeds to savages indigenous people? Similarly, Big Pharma has been scouring exotic locations to try to find new molecules and treatments to exploit. It would be a shame if pesky natives stood between them and their profits. You can see why the Administration keeping these notions out of the text.

Professor Kelsey also notes that she is reading this chapter in isolation, she can’t tell how conflicts between chapter will be resolved, but she can see there are plenty, most importantly with the investment chapter:

The most egregious threat to the environment is the investment chapter, in particular the prior consent by all countries except Australia to investor-state dispute settlement (ISDS). The vast majority of investment arbitrations under similar agreements involve natural resources, especially mining, and have resulted in billions of dollars of damages against governments for measures designed to protect the environment from harm caused by foreign corporations. The US is also demanding that contracts between investors and states that involve natural resources also have access to ISDS.

Now it isn’t hard to surmise what is going on here. You have an environment chapter with no effective enforcement mechanisms. You have an investment chapter that allows foreign investors to sue governments over lost prospective prospective profits in secret arbitration panels and win large judgments. Gee, what do you think matters, the headfake environment chapter or the chapters that allow investors to sue because protecting the environment or citizens’ health costs them money or to patent even more biological products and extract rents?

And this concern isn’t theoretical. Public Citizen has done extensive data collection on and analysis of past trade deals, as well as what could be discerned about the TPP and its sister, the TransAtlantic Trade and Investment Partnership. The TPP and TTIP have stronger foreign investor protections than existing trade pacts, which heretofore (post NAFTA) have broadly similar provisions. The results can hardly be characterized as pro-health, pro-environment, or pro-regulation. I’m reproducing this section from a November post because it’s hard to believe how bad these agreements are unless you see the details:

Even though no one has seen the exact language of the text, since it is being kept under wraps, both deals are believed to strengthen and extend investor rights, which means give them easier access to the courts. Consider this description from a July presentation by Public Citizen:

What is different with TAFTA [pending Trans Atlantic Free Trade Agreement] (and TPP) is the extent of “behind the border” agenda

• Typical boilerplate: “Each Member shall ensure the conformity of its laws, regulations and administrative procedures with its obligations as provided in the annexed Agreements.” …

• These rules are enforced by binding dispute resolution via foreign tribunals with ruling enforced by trade indefinite sanctions; No due process; No outside appeal. Countries must gut laws ruled against. Trade sanctions imposed…U.S. taxpayers must compensate foreign corporations.

• Permanence – no changes w/o consensus of all signatory countries. So, no room for progress, responses to emerging problems

• Starkly different from past of international trade between countries. This is diplomatic legislating of behind the border policies – but with trade negotiators not legislators or those who will live with results making the decisions.

• 3 private sector attorneys, unaccountable to any electorate, many of whom rotate between being “judges” & bringing cases for corps. against govts…Creates inherent conflicts of interest….

• Tribunals operate behind closed doors – lack basic due process

• Absolute tribunal discretion to set damages, compound interest, allocate costs

• No limit to amount of money tribunals can order govts to pay corps/investors • Compound interest starting date if violation new norm ( compound interest ordered by tribunal doubles Occidental v. Ecuador $1.7B award to $3B plus

• Rulings not bound by precedent. No outside appeal. Annulment for limited errors.

And that’s alarming in light of some of the cases already brought before these panels in existing trade agreements like NAFTA. For instance:

Eli Lilly is suing the Canadian government for not having the same extremely pro-drug-company patent rules. It is seeking $500 million in damages for two drugs that Canada approve to be sold as generics. If Eli Lilly prevails, other drug companies are sure to follow suit.

Vattenfal, a Swedish company, is a serial trade pact litigant against Germany. In 2011, Der Spiegel reported on how it was suing for expected €1 billion plus losses due to Germany’s program to phase out nuclear power:

According to Handelsblatt, Vattenfall has an advantage in seeking compensation because the company has its headquarters abroad. As a Swedish company, Vattenfall can invoke investment rules under the Energy Charter Treaty (ECT), which protect foreign investors in signatory nations from interference in property rights. That includes, according to the treaty’s text, a “fair and equitable treatment” of investors.

The Swedish company has already filed suit once against the German government at the ICSID. In 2009, Vattenfall sued the federal government over stricter environmental regulations on its coal-fired power plant in Hamburg-Moorburg, seeking €1.4 billion plus interest in damages. The parties settled out of court in August 2010.

Phillip Morris threatened suit against Australia for its plain cigarette packing rules and is suing Uraguay for anti-smoking regulations

[-] 3 points by LeoYo (5909) 11 months ago

Now consider what this means. These companies are not suing for actual expenses or loss of assets; they are suing for loss of potential future profits. They are basically acting as if their profit in a particular market was guaranteed absent government action. And no one else enjoys these rights. Consider highly paid workers in nuclear plants. Will they get payments commensurate with the premium they’ve lost over the balance of their working lives from the phaseout of nuclear power? Will cigarette vendors in Australia get compensated for the decline in their sales? Commerce involves risk, which means exposure to loss, yet foreign investors want, and seem able to get, “heads I win, tails you lose” deals via these trade agreements.

And it’s even worse than you imagine once you understand how these panels work. Recall how Public Citizen mentioned the role of the panelists who go between working for the companies and serving on the panels? A small and tight-knit group has disproportionate influence (click to enlarge):

Consider the implications of the fact that the 15, and the larger community of panel “regulars,” work both sides of the street. They draw cases that go before the trade panel, as well as hear them. Thus it’s in their interest to issue aggressive rulings in order to facilitate more cases being filed.

Back to the present post. Now contrast this discussion with the pro-Obama propagandizing in the New York Times article on the WikiLeaks disclosure. Astonishingly, it ignores the substantive irrelevance of the environment chapter and instead pretends that the Administration really, truly wanted to hang tough on environmental issues, but is being beaten up by those meanie foreigners and has been forced to give a lot of ground to get that oh-so-valuable “trade” deal:

The negotiations over the Trans-Pacific Partnership, which would be one of the world’s biggest trade agreements, have exposed deep rifts over environmental policy between the United States and 11 other Pacific Rim nations. As it stands now, the documents, viewed by The New York Times, show that the disputes could undo key global environmental protections….

The documents consist of the environmental chapter as well as a “Report from the Chairs,” which offers an unusual behind-the-scenes look into the divisive trade negotiations, until now shrouded in secrecy. The report indicates that the United States has been pushing for tough environmental provisions, particularly legally binding language that would provide for sanctions against participating countries for environmental violations. The United States is also insisting that the nations follow existing global environmental treaties.

“Existing global environmental treaties”? Huh? The US wouldn’t sign the Kyoto accords. And it’s simply untrue that the US is proposing language up to the standards of other international environmental agreements. Consider this section from Kelsey’s report:

New Zealand is part of the WTO group ‘Friends of the Fish’. The proposals in Article SS16.6 to restrict fisheries subsidies that contribute to overcapacity and overfishing fall far short of the positions they have been promoting. These are detailed in the US environment groups’ memo…

In Article SS15 the parties merely agree to discuss ways to deal with climate change with possible links to the APEC process. The US and Australia oppose even that provision.

To put this another way, to the extent that the US has gotten tougher environmental protections, which the Times depicts as “strong language” (as in legally binding), it is only in bilateral deals. But my understanding is the foreign investor protections are in all post-NAFTA trade pacts. Thus the environmental provisions (to the extent that they actually are well-defined enough to be enforceable) would still conflict with the foreign investor protections.

It would appear that in practice, the foreign investor provisions would vitiate any environmental provisions. In other words, to the extent the green lobby thought they were getting anywhere, they were kidding themselves (and that before you get to the question of whether the US was serious about enforcement, or would at most file the occasional token action to go through the motions). Nevertheless, it is true that this draft chapter retreats from what little progress has been made. As Kevin Gosztola recaps in Firedoglake:

Michael Brune, executive director for the Sierra Club, one of the largest and most influential environmental organizations in the US, reacted, “If the environment chapter is finalized as written in this leaked document, President Obama’s environmental trade record would be worse than George W. Bush’s. This draft chapter falls flat on every single one of our issues – oceans, fish, wildlife, and forest protections – and in fact, rolls back on the progress made in past free trade pacts.”

According to a Sierra Club analysis, it would not prohibit shark finning, even though the US is required by law to seek bans against this practice from countries. It relies on trade sanctions instead of fines if a country violates its obligations, which is a step backward. There also is no requirement in the drafted chapter to require countries stop illegal trade that may threaten communities or ecosystems.

So when is the New York Times editorial board going to eat some crow? They endorsed these negotiations, taking at face value the Administration’s party line:

The Obama administration said it wants a “next-generation” agreement that, in addition to lowering tariffs, lowers investment restrictions, improves labor rights, encourages environmental protection and reduces government favoritism of state-owned businesses. That is an ambitious agenda considering that more than 150 countries are struggling to complete a much simpler deal at the World Trade Organization…The hope among some American officials is that by completing deals with Europe and Pacific nations, Washington will set an example for the rest of the world to follow.

Sadly, even as the evidence against this deal mounts, I wouldn’t bet on an retreat by the Times’ editorial board, nor by Paul Krugman, who has gone silent after saying he’d do “some homework” on TPP. But for once, Congress appears to be out ahead of the lapdog media. Even before the latest release, fast track authority was in trouble in the House, with Boehner saying he didn’t have the votes.

But this is no time for complacency. Please use this new information as the basis for calls to your Senators against this sellout to multinationals.

This piece was reprinted by Truthout with permission or license.

[-] 2 points by LeoYo (5909) 11 months ago

"Like Gravity" Fast-Track Trade Sinks Jobs and Wages

Wednesday, 22 January 2014 09:09 By Mary Bottari, PR Watch | Report

http://truth-out.org/news/item/21371-like-gravity-fast-track-trade-sinks-jobs-and-wages

Rep. Dave Camp (R- MI) and Sen. Max Baucus (D-MT) have introduced “Fast Track” legislation in Congress. It’s been 15 years since a U.S. president sought Fast Track authority, which strips Congress of its Constitutional authority to have a meaningful role in U.S. trade policy. If the Fast Track bill passes, the Trans-Pacific Partnership (TPP), a trade deal involving 11 Pacific Rim countries could be completed and signed before it is sent to Congress for a vote. Then the far-reaching trade deal will be railroaded through with no amendments and only 20 hours of debate.

The original Fast Track was cooked up by Nixon, served up again by Clinton to pass the NAFTA and WTO agreements, and stirred up again in 2000 to jam China free trade through Congress. That all worked out well, didn’t it? The United States lost 5.7 million manufacturing jobs in the NAFTA/WTO era, and our trade deficit with China is now one of the largest in history.

Today, President Obama is seeking Fast Track to get the TPP and the 27-nation Transatlantic Trade and Investment Partnership (TTIP) through Congress. His road is a rocky one. His trade team could not convince a single Democrat to author the bill in the House, and with hundreds of groups across the political spectrum -- from progressive environmental and consumer groups to the conservative Farm Bureau and Tea Party patriots -- lined up against it, it’s possible Fast Track can be defeated.

“When Will We Start to Measure the Results?”

The long, controversial history of fast tracked trade agreements hardly came up in the first Senate hearing on the Baucus-Camp bill on January 16.

Chairman Baucus, the only Democrat to author the legislation in either house, rambled on about the fact that 95 percent of the world’s consumers live outside the United States. According to Baucus, we need more trade deals to reach those consumers. But he forgot to mention that the United State is already part of the WTO trade pacts on goods and services encompassing some 159 member countries, so our products already have privileged access around the globe.

This line of argument was also supported by the ever-present Honeywell CEO David Cote, last seen pushing Social Security and Medicare cuts on behalf of the Business Roundtable and the “Fix the Debt” gang. Cote dubbed Fast Track “a key enabler for trade agreements,” invoking the wrong kind of chuckle.

Larry Cohen, President of the Communication Workers of America, injected a refreshing dose of reality to the proceedings. Cutting through blather about “leveling the playing field,” Cohen looked Baucus in the eye and demanded answers to a few pointed questions.

After 20 years of NAFTA, Cohen demanded, when are we going to start to actually measure the results? “No other nation has trade deficits like ours,” said Cohen. Since 1993, the year before NAFTA, our trade deficit in goods was $132 billion or 1.9 percent of GDP. By 2012, our trade deficit ballooned to $741 billion or 4.6 percent of GDP, Cohen detailed in his written testimony.

When, asked Cohen, will we start to document the net effect of these trade deals on employment? “What has happened to our jobs, our communities, the North Philadelphia that I grew up in? The Cleveland that I can picture now? The devastation throughout those communiites, no replacement for those jobs,” said Cohen. The Economic Policy Institute estimates that between 1998 and 2012, the United States lost one third of its manufacturing base largely due to growing U.S. trade deficits.

When, asked Cohen, will we document the effect of trade on pay and standards of living? "I can tell you story after story where CEOs say to me -- it’s gravity, we have to move the jobs or you have to cut the pay,” says Cohen. When U.S. workers are put in competition with workers like those in Vietnam making 28 cents an hour, U.S. wages have no where to go but down. Cohen pointed out that average weekly take home pay for an American worker today is $637 compared to $731 40 years ago.

The Senators shifted uncomfortably in their seats, but had no answers for the CWA chief, who pushed to bring thousands of call center jobs back to the United States. Telecom firms, however, demanded that the salaries “be competitive” with those of overseas workers.

Congress Is Targeting the Wrong Deficit

Just days before, Senate Republicans shot down unemployment benefits for 1.3 million Americans, because, to the Republican caucus, nothing matters more than the United States federal account deficit.

But many economists say Washington has the calculus backwards -- they are targeting the wrong deficit. As Dean Baker and Jared Bernstein explain in the New York Times, Washington’s obsession with lowering the budget deficit by slashing spending and supports for the economy will only lead to slower growth, whereas “reducing the trade deficit would have the opposite effect. Not only that, but by increasing growth and getting more people back to work in higher-than-average value-added jobs, a lower trade deficit would itself help to reduce the budget deficit." EPI projects that reducing the trade deficit could generate a "manufacturing-based recovery" for the United States.

The two trade agreements in the works right now, the TPP and the TTIP, will only add to our job-killing trade deficit.

Corporate Courts Facilitate Attacks on Consumer, Health, and Environmental Protections

Senator Sherrod Brown (D-OH) turned the conversation at the Fast Track hearing in a completely new direction by asking David Cote if he thought trade agreements should be used to attack consumer and environmental laws democratically enacted around the globe. Brown referenced the so-called “investor-state” provisions that have been included in U.S. trade agreements that allow corporations to directly sue governments for cash damages outside of domestic court systems and in friendly trade tribunals if they believe consumer, health, or environmental regulations harm their products.

Brown pointed to a new case in Australia, where U.S. firm Phillip Morris is suing Australia over a new plain packaging rule for cigarettes designed to reduce cigarette smoking among teens and other new users. Phillip Morris battled the rule in Australian courts and lost, so is taking it to a corporate-friendly trade tribunal. The rulings of these tribunals are binding, and there is no appeal.

Cote, who is no doubt perfectly aware of the perverse system and its history of successful attacks on a range of public interest laws (detailed by Public Citizen here), used the “I am not a lawyer” dodge.

The list of these investor attacks is growing. U.S. pharmaceutical firm Eli Lilly is attacking Canada’s system for approving generic drugs under NAFTA, and a U.S. fracking firm is attacking Quebec’s moratorium on fracking as a “trade barrier.”

Wikileaks Takes on Trade

The range of public interest policies implicated in the trade agreements is enormous. TPP “includes chapters on patents, copyright, financial regulation, energy policy, procurement, food safety and more -- it would constrain the policies on these matters that Congress and state legislatures could maintain or establish,” says Public Citizen.

As if that wasn’t enough, the TPP’s draft environment chapter, published by Wikileaks last week, would undermine protections for oceans, forests, and wildlife. “If the environment chapter is finalized as written in this leaked document, President Obama’s environmental trade record would be worse that George W. Bush’s,” said Michael Brune, executive director of the Sierra Club.

This is Wikileaks’ first foray into trade, but it makes consummate sense. Not only are the agreements being negotiated behind closed doors with classified input from 600 U.S. corporate advisors, but the issues on the table include internet freedom and access to medicines around the globe.

The draft intellectual property chapter obtained by Wikileaks “would trample over individual rights and free expression, as well as ride roughshod over the intellectual and creative commons,” says Julian Assange. “If you read, write, publish, think, listen, dance, sing or invent; if you farm or consume food; if you’re ill now or might one day be ill, the TPP has you in its crosshairs,” he told Politico. The U.S. government's pro-PhRMA position “will severely restrict access to affordable medicines for millions of people,” says Doctors Without Borders.

Another World Is Possible

The last time the United States used Fast Track to pass a trade agreement, it was with South Korea. Senator Baucus and crew trotted out all the same talking points about how our exports would boom. But it was our trade deficit that boomed, increasing by $5.5 billion or 46 percent since 2012.

With the U.S. recovery staggering and with the wide range of issues caught up in the trade negotiation, it is no wonder that a coalition of those opposing free trade agreements is growing more diverse and powerful every day.

Fast Track will not pass without a sustained effort by the President himself. Yet, when his top trade representative did not bother to show up at the Senate hearing last week, Obama left everyone wondering if he had the appetite for the fight or if another world was possible.

This piece was reprinted by Truthout with permission or license.

[-] 2 points by LeoYo (5909) 11 months ago

People Pressure Is Making Fast-Tracking the TPP Politically Toxic

Tuesday, 21 January 2014 10:36 By Kevin Zeese and Margaret Flowers, Popular Resistance | Report

http://truth-out.org/news/item/21354-people-pressure-is-making-fast-tracking-the-tpp-politically-toxic

The White House is calling January “TPA (Trade Promotion Authority) Month” and has made it their task to pass Fast Track. President Obama needs Fast Track to pass the Trans-Pacific Partnership (TPP). When Congress returned this month, a bill was quickly introduced after delays of more than a year.

The lies begin with title of the bill: “The Bipartisan Congressional Trade Priorities Act of 2014.” Bi-partisan? In the House there was only one sponsor, Republican David Camp (MI). The Republicans demanded the Democrats add a sponsor before it was introduced, but due to public pressure, they could not find one.

The only Democrat on the bill in the Senate is Max Baucus (MT) — the senator who gave us the Bush tax cuts for the wealthy and who is leaving the senate to become Ambassador to China. So, the bill is only bi-partisan until he heads off to his new job.

Baucus likes to informally call the bill “The Job Creating Bipartisan Trade Priorities Act,” but that just adds another lie since trade agreements consistently lose jobs, expand the wealth divide and increase trade deficits.

TPP Loses Momentum

After four years of secret negotiations with more than 600 corporate advisers, the once seemingly invincible largest trade bill in history, covering 40% of the world’s economy, looks very much like it can be defeated.

Why is the TPP looking like it can be stopped? One reason is its secrecy.

Leaks are sinking the TPP like the Titanic on its way to the bottom of the ocean. Ron Kirk, the former US Trade Rep said they were keeping it secret because the more people knew, the less they would like the TPP and it would become so unpopular it could never become law.

Each leak has proven him right.

This week, Wikileaks released the Environmental Chapter. The bottom line – there is no enforcement to protect the environment. The TPP is worse than President George W. Bush’s trade deals. Environmental groups are saying the TPP is unacceptable.

http://www.youtube.com/watch?feature=player_embedded&v=r0oUAdGmq4k

More at The Real News

Similarly, the leak of the Intellectual Property Chapter revealed that it created a path to patent everything imaginable, including plants and animals, to turn everything into a commodity for profit.

The refrain is always the same: profits come first. The necessities of the people and protection of the planet come last.

Backlash in Congress to Fast Track

Baucus announced last March that he would deliver Fast Track by June. Pressure delayed it so that now the bill is being introduced in the beginning of an election year. Election years are a terrible time to pass anything controversial.

The TPP is becoming politically toxic. Over the last year there has been a steady stream of emails and phone calls to Congress. Members have faced constituent meetings and protests where TPP is being raised. Some examples of protests: Los Angeles, Seattle, Washington, DC, Salt Lake City, Minneapolis, US Trade Rep Office, Vancouver, Leesburg, New York City, . . . we could go on. Americans have sent a clear message to Congress members that they better not be associated with the TPP in an election year.

When Fast Track was introduced there was a backlash, according to public reports, of angry Democrats. Rep. Earl Blumenauer (D-OR) told Huffington Post: “I’m a little disappointed that something’s dropped that was never discussed with Democrats in the House. As I understand it, it wasn’t actually discussed with Democrats in the Senate.”

Five members of the Senate Finance Committee told US Trade Representative Mike Froman they will not support the Baucus Fast Track bill because Congress needs to be involved throughout the process not just in an up or down vote after it is completed.

During a hearing on Fast Track on Thursday protesters were there expressing their displeasure.

http://www.youtube.com/watch?v=_em0-IwojJI&feature=player_embedded

Baucus says he will not be holding a mark-up of the bill because of the divisions on the Finance Committee. Sen Ron Wyden (D-OR) who will be taking Baucus’ place told Politico there was “broad frustration” with the lack of transparency. And. Majority Leader Reid said that he may not even bring the bill to the Senate Floor if it passes out of committee.

As bad as the senate sounds for the administration, the House is even worse. Opposition has been building in recent months with Democrats and Republicans writing President Obama opposing Fast Track.

They could not find a Democratic co-sponsor and now Politico reports, that Speaker Boehner says he will not bring the bill to the floor for a vote unless 50 Democrats support it.

State of the Union: Last Stand for Fast Track of TPP?

The president’s TPA month is off to a bad start, so he has to make a big pitch in his upcoming State of the Union on January 28. If he doesn’t, it is a sign he has given up and is distancing himself from defeat. He’s not only going to have to persuade almost every Republican to support him (that would be a first for his presidency), he’s going to have to convince every Democrat who has not taken a position, and change the minds of many who have already publicly said they oppose Fast Track.

The problem is Members of Congress know that if they get on the wrong side of corporate trade agreements, it will hurt them politically. The public is angry about this job-killing trade deal, even Minority Leader Pelosi has had her events interrupted by TPP protesters. The social movement against corporate trade is coming across loud and clear leading top House Dems to describe it as “dead on arrival” if it does not protect labor and the environment.

The views of many in Congress were summarized in a statement by Democratic Reps. George Miller (CA), Louise Slaughter (NY) and Rosa DeLauro (CT): “Our constituents did not send us to Washington to ship their jobs overseas, and Congress will not be a rubber stamp for another flawed trade deal that will hang the middle class out to dry.”

Members of Congress have seen the research that shows 90% of Americans will see their income go down from the TPP while the wealthiest get wealthier. Why would any Member of Congress want to sign on to something like that – especially in an election year.

Congress should oppose Fast Track because it is an Obama power grab. Under the Baucus-Camp bill the Congress will have 90 days to review the agreement. The House will have 60 days and the Senate will have an additional 30 days. The count begins when the White House decides the negotiations have been completed.

Under the Baucus-Camp Fast Track the president is also able to draft extensive implementing legislation to bring US law into compliance with the agreement. It is up to the president to decide what changes in laws or new laws are needed to comply with the TPP. Congress is not able to mark-up or amend the language of these bills. And, these can be very significant laws. For example, provisions like “Buy American” or “Buy Local” can be repealed as a restraint on trade. In all of these cases under Fast Track the president becomes the Congress and drafts legislation, totally destroying the checks and balances of the three branches of government.

As some anti-TPP activists in Los Angeles showed in a great street theater action in front of the offices of Rep. Xavier Becerra (D-CA), Fast Track makes Congress unnecessary. They brought the “TPP movers” to his office and outsourced him. It is important for activists to know what is in Fast Track because the US Trade Representative has been doing its best to mislead the public.

[-] 2 points by LeoYo (5909) 11 months ago

Time to Finish the Job, Make Fast Track for the TPP Politically Toxic

The movement against the TPP has come a long way in the last year from challenging a trade agreement that no one knew about and looked like it could not be stopped; to a trade agreement widely known about in activist circles and which is becoming too toxic for elected officials to be associated with in an election year.

The reason we have come this far is because the TPP affects so many aspects of every person’s lives – food, the environment, workplaces, the Internet, banking and finance, job availability, health care, energy, the list goes on and on. As people learn about the TPP and what it does they oppose it. While lame ducks like Obama and Baucus who do not have to seek re-election, can ignore angry constituents and follow the demands of big money, those seeking re-election do not have that luxury.

Our task: We need to continue to build opposition and show elected officials they do not want to be associated with these toxic trade agreements. They need to understand that fast-tracking the TPP could end their career.

A lot is already planned. To stay informed “like” the Flush The TPP Facebook page and follow the twitter feed where we will be regularly publishing new sharable memes to continue to build the stop the TPP movement. If more TPP leaks come out, we’ll provide immediate analysis. If there are hearings we will organize protests to make sure the voices of opposition are heard and share that information.

Every Tuesday there is a TPP twitter storm at 9 PM Eastern. Follow the hashtag #TPPMediaMarch to participate. There will be a special TPP storm during the State of the Union on January 28.

Scores of organizations have come together in a movement of movements to create a webpage StopFastTrack.org. We’ve planned ten key days of pressure on Congress from January 22 to January 31. During this period, people will be making phone calls to Congress through the website which will provide simple tools to call Congress. In addition, during this period, people are organizing for the State of the Union on January 28 and an Inter-Continental Day of Action on January 31.

During the State of the Union, people opposed to the TPP plan to stand vigil outside of the Congress beginning at 8:30 so they can be there when the president arrives for the speech that begins at 9 PM. During the speech a special State Of The Union TwitterStorm will be held from 9-10pm EST, follow #TPPMediaMarch to participate.

On January 31 there will be an Inter-Continental Day of Action against the TPP & Corporate Globalization. The theme is ‘No More NAFTA’s as this month is the twenty-year anniversary of NAFTA, which has had devastating consequences for working families, small farmers, indigenous peoples, small business and the environment in all three countries and beyond. The pending Trans-Pacific Partnership (TPP) has been described as “NAFTA on Steroids.”

We have come an incredible distance and the likelihood of stopping the TPP is stronger than it ever has been.The president and transnational corporations will make an aggressive push to pass Fast Track this month. It is our job to stop them and make it impossible to bring Fast Track or the TPP up again. We can accomplish this and when we do it will be a tremendous victory of the people over transnational corporate power!

This article is produced by PopularResistance.org in conjunction with AlterNet. It is based on PopularResistance.org's weekly newsletter reviewing the activities of the resistance movement.

This piece was reprinted by Truthout with permission or license.