The TPP is Terrible. Or Great.

The TPP is Terrible. Or Great.

Alexis ChapmanTuesday,10 November 2015

The full text of the Trans-Pacific Partnership (TPP) was released on Nov. 5. So now is the time to decide how you feel about the massive trade deal that involves 11 countries (not China) and then tell your representative how to vote on it when it comes up in Congress. That’s how this whole representative Democracy extravaganza is supposed to work, so let’s do this!

The first step is figuring out if you support the TPP or not, and you should figure it out. You should care about the TPP because it’s a huge deal. Literally. It’s a trade deal that will impact 40% of the world’s economy. It will have really big, long lasting effects on manufacturing, agriculture, labor, intellectual property, medicine, and the environment. Unfortunately, it’s also huge in the sense that it’s several thousand pages of dense legalese. Also, the chapter summaries were all written by the Office of the United States Trade Representative (USTR), which is actively promoting the agreement. So you’re probably going to need some more concise and less biased info in order to make up your mind. Enter the press (Hello!) to help you get a handle on the pros and cons.

Global U.S. leadership: The idea here is that we want the rest of the world, especially Asia, to be following our lead (not China) on things like ethical labor standards, environmental regulations, and free trade. Frankly, neither the U.S. nor China has what I would call a perfect record in these areas. But ours is better so if Pacific Rim countries have to pick (and apparently they do) then yeah, it’s probably better if they end up more like the U.S. than like China.

Expanded markets for exporting US goods: The USTR and President Obama have been pretty aggressively talking up the 18,000 tax cuts on Made In America Exports that are part of the TPP. How this works is that participating countries will stop charging tariffs on incoming U.S. goods so it will be cheaper and easier to sell things like American cars and cheese in those countries. The link above lists what industries will benefit and it’s a long list with the potential for billions of dollars in savings for U.S. companies.

Better labor regulations in signatory countries: Fair labor standards are one of those values that the U.S. wants to take a leadership role on, and in this area I think the TPP does deliver. It includes obligations for participating countries to protect the freedom to form unions, eliminate child labor and forced labor, protect against employment discrimination, require laws on acceptable conditions of work related to minimum wages, hours, and occupational safety, and a number of other labor provisions. These are obviously good things if you care at all about human rights. Several TPP countries currently have relatively weak labor regulations so this is something pretty important to consider when weighing the different sides.

Almost Pro
Environmental standards: The TPP does have more rigorous environmental standards than any previous trade agreement, but it’s also not nearly as good as it could be and it’s missing some stuff. It obligates member countries to enforces CITES, promote sustainable fisheries, protect the ozone, enforce their existing environmental laws and more. Unfortunately, it sets up enforcement for these provisions through “trade tribunals,” which you’ll find in the cons section below. It might also lead to more fracking. And it doesn’t mention climate change. Anywhere. At all. Failing to even acknowledge climate change, and the way global trade and industry has contributed to it, seems like a kind of monumental oversight in a trade agreement that is trying to improve global environmental standards.

Really Large Con with Some Pro Maybe
Intellectual property (IP) and patents: The intent of this part of the agreement is the pro sounding “Promotion of Innovation and Creativity.” For industries that rely on strong copyright protections, and which have lost money due to currently weak protections in TPP countries, this will be a big plus. On the other hand, Doctors Without Borders and other groups have pointed out that by giving pharmaceutical companies longer monopolies over brand name drugs, the IP provisions of the TPP would “restrict access to generic medicines making life saving treatments unaffordable to millions.” Protecting people’s ideas from theft is important, but having people not die because medicine is too expensive is also important. It seems that there should have been a way to create an agreement that prioritized both and maybe if the TPP falls through this is one of the things they can fix in the next attempt. The IP rules are also opposed by internet freedom groups that contend that the TPP is too strict and would be detrimental to web freedom.

Probably Con
Loss of U.S. jobs: This is the big one that everyone is arguing about. Opponents (a lot of Democrats) say that removing tariffs on imported goods will flood the U.S. market with cheap imports, U.S. manufacturers won’t be able to compete and jobs will be lost. Supporters (President Obama and a bunch of Republicans, I know, weird right?) claim that we already receive a lot of non-tariff or low tariff imports from TPP countries, so the above scenario is not a concern, and that the important part is that we’ll be able to export a lot more to those countries (18,000 tax cuts!).

It remains to be seen whether the price of imported goods minus the costs of tariffs but plus the costs of better labor practices will equal cheaper goods for U.S. consumers. If things do get cheaper then yay for cheaper stuff, but boo for putting U.S. manufacturers out of business. And vice versa. The boring truth here is that it will probably be both; some industries will be affected positively, some will be affected negatively.

Tribunals: The Dispute Settlement provisions of the TPP come into play if a country fails to implement some part of the agreement. Like the rest of the agreement this section is long and complicated, but one part in particular has been rightly coming under scrutiny. Basically if one country, or even an individual company, believes that a TPP country has violated the agreement, they can have the dispute legally settled by a settlement panel, or tribunal, rather than by the country’s courts. This brings up all kinds of issues about national sovereignty (if a country’s laws are trumped by the trade agreement that’s a problem), the potential for corruption and/or cronyism on the panels, and the power this gives corporations to demand tax dollars as compensation for real or perceived breaches of the TPP.

So those are a few of the biggest pros and cons. There is of course a lot more to it, I mentioned it’s like 2,000 pages right? There are sections on agriculture, and VISAs, and small businesses. There is also some really important stuff not in it. Tons of goods for sale in the U.S. are currently manufactured in Bangladesh and Indonesia, and people in both countries could definitely benefit from improved labor regulations, but currently neither is part of the TPP. Indonesia may actually join soon, but of course that will only mean something if the governing bodies in the U.S., and the other 10 countries involved, decide to pass it. And as citizens of the country that’s supposed to be leading this whole thing it would be a good idea for us to learn as much as we can about it and then let our representatives know how we want them to vote.

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Image Credit: U.S. Department of Agriculture on Flickr

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