THE TRANS-PACIFIC PARTNERSHIP: CORPORATE POWER GRAB

The full text of the Trans-Pacific Partnership (TPP) – a trade treaty and much more – was recently released. It was negotiated over 8 years in secret from the public and even Congress, although corporate executives were routinely involved. The treaty includes 12 countries: the US, Japan, Canada, Mexico, Australia, New Zealand, Peru, Chile, Singapore, Brunei, Malaysia, and Vietnam. Although the countries in the TPP represent over 40% of the global economy, the impact on trade per se – trade volume, tariffs, and quotas – will be small because the US already has a trade treaties with most of these countries, including all of the larger ones. [1]

Now that the full text has been released, at least 60 days have to pass before Congress can act on it. The Obama administration asked for and Congress agreed to consider this treaty under Fast Track rules. These rules require Congress to vote yes or no on the treaty with no amendments and in a limited time window. However, in the negotiations over approval of Fast Track rules, due to strong push back against them and against the treaty itself, the Obama administration agreed to release the full text of the treaty to Congress and the public for at least 60 days before a Congressional vote.

President Obama says that the TPP includes the strongest provisions of any trade treaty for protecting workers and the environment. [2] However, this is not saying much as past trade treaties have done almost nothing to protect workers and the environment. In addition, the TPP provisions for enforcing the labor and environmental provisions are quite weak. [3]

On the other hand, there are strong protections and enforcement mechanisms for corporate and investor interests. The “set of regulations governing investor rights, intellectual property, and … key service sectors, including financial services, telecommunications, e-commerce, and pharmaceuticals … enshrine the power of corporate capital above all … including labor and even governments.” [4]

Corporations and investors are allowed to sue governments if they feel their ability to make future profits is harmed by a country’s laws, rules, or regulations. They can take these claims to private Investor-State Dispute Settlement (ISDS) tribunals that make final, binding decisions and that bypass a country’s own courts and legal system. There is significant experience based on similar provisions in previous treaties that the ISDS process can undermine countries’ environmental and public health laws, as well as require governments to pay hundreds of millions of dollars in compensation to multi-national corporations. [5]

Senator Elizabeth Warren has criticized the TPP for giving multinational corporations too much power, in particular by allowing them to settle disputes through the ISDS tribunals and by expanding the ability of the large Wall St. financial corporations to challenge country’s financial rules and regulations. She has also stated that the TPP doesn’t go far enough in enforcing labor, public health, and environmental standards. [6]

Some conservatives are joining Senator Warren and others in expressing concern about the ISDS tribunals because they undermine US sovereignty by giving foreign corporations the right to challenge US laws and regulations. In addition to laws on safety, public health, and environmental standards, any US government law or regulation giving preference to the use of US companies in fulfilling government contracts would be subject to challenge by a foreign corporation under the TPP.

I’ll share more concerns about the TPP in subsequent posts.

My previous posts on the TPP and related matters include:

STOP “TRADE” TREATIES THAT FAVOR BIG MULTINATIONAL CORPORATIONS, 3/9/15, https://lippittpolicyandpolitics.org/2015/03/09/stop-trade-treaties-that-favor-big-multinational-corporations/

HISTORY AND LEAKS MAKE CASE AGAINST “TRADE” TREATIES, 1/20/14, https://lippittpolicyandpolitics.org/2014/01/20/history-and-leaks-make-case-against-trade-treaties/

STOP FAST TRACK FOR CORPORATE POWER GRAB, 1/13/14, https://lippittpolicyandpolitics.org/2014/01/13/stop-fast-track-for-corporate-power-grab/

TRADE TREATIES NEED OPEN DEBATE, NOT FAST TRACK, 1/8/14, https://lippittpolicyandpolitics.org/2014/01/08/trade-treaties-need-open-debate-not-fast-track/

“TRADE” AGREEMENTS & CORPORATE POWER, 9/13/13, https://lippittpolicyandpolitics.org/2013/09/13/trade-agreements-corporate-power/

“TRADE” AGREEMENT SUPERSIZES CORPORATE POWER, 9/10/13, https://lippittpolicyandpolitics.org/2013/09/10/trade-agreement-supersizes-corporate-power/

CORPORATE RIGHTS IN TRADE TREATIES, 7/22/12, https://lippittpolicyandpolitics.org/2012/07/22/corporate-rights-in-trade-treaties/

TRADE AGREEMENTS PAST AND PRESENT, 7/17/12, https://lippittpolicyandpolitics.org/2012/07/17/trade-agreements-past-and-present/

[1]       For more details and background on the TPP and related issues see previous posts that are listed at the end of this post.

[2]       Nakamura, D., 11/6 /15, “Release of text of Pacific trade pact does not quiet critics,” The Boston Globe from The Washington Post

[3]       Sachs, J.D., 11/10/15, “TPP is too flawed for a simple ‘yes’ vote,” The Boston Globe

[4]       Sachs, J.D., 11/1015, see above

[5]       Sachs, J.D., 11/1015, see above

[6]       Jan, T., 11/6/15, “Warren steps up criticism of the deal,” The Boston Globe