On most issues, Washington often feels hopelessly gridlocked, but believe it or not, politicians from opposite ends of the political spectrum have found some rare common ground: opposition to President Obama’s Trans-Pacific Partnership trade deal.
On Feb. 4th, representatives of the 12 nations party to the treaty, including the U.S. and Canada, signed the agreement in New Zealand, opening the door for countries to begin ratifying the deal in their respective legislative bodies.
Reached last October after seven years of secret negotiations, the trade pact has been billed by the White House as a game-changer that “has the strongest protections for workers of any trade agreement in history.”
But that’s only half of the story.
The TPP, as it’s known, is a broad-based trade and investment agreement among the United States, Canada, Japan and nine other Pacific Rim countries. And, like other trade deals before it, it aims to reduce tariffs on imports and exports and promises reforms in labor laws, environmental standards, human rights and intellectual property protection—all things designed to keep U.S. companies competitive.
|The U.S. carries a net trade deficit of more than $154 billion to the 11 other countries party to the TPP. This chart shows total trade between the countries, $1.6 trillion, as well as trade balance with the U.S. If TPP is passed, these deficits could grow even larger while U.S. jobs move overseas. (Source: Congressional Research Service)
But leading presidential candidates, members of Congress from both parties, labor leaders, environmentalists and even some corporate interests aren’t buying it, especially after the agreement’s full 6,000-page text was made public last November.
“The final text of the agreement,” AFL-CIO President Richard Trumka wrote in an op-ed for The Hill newspaper in February, “is even worse than we imagined, with loopholes in labor enforcement and rewards for outsourcing.”
“The TPP is a giveaway to big corporations, special interests and all those who want economic rules that benefit the wealthy few,” he wrote, adding that the labor movement tried dozens of times during negotiations to convince the White House to make changes but that labor leaders were ignored at every step.
Liberal standard-bearer Sen. Elizabeth Warren, who has been critical of the secretive process from the beginning, detailed the ways that the TPP favors corporate interests over working people in a speech late last year at the National Press Club.
“As the negotiations took place,” Warren said, “there were cleared advisors … here in the United States who whispered in the ears of the actual trade negotiators, met with them, talked with them, helped them shape the trade deal. And 85 percent of them were either corporate CEOs or lobbyists. That builds a tilt into the entire process. And now we’ve seen the product, and the tilt is right there.”
The main problem with the TPP, Warren explained, is that for all its great promises about labor rights and human rights and environmental protections around the world, the deal contains the same old enforcement mechanisms that have failed over and over on past trade deals and have paved the way for shipping American jobs overseas. “Promises without enforcement aren’t worth the paper they’re printed on,” she warned.
Another major problem with the deal, according to the IBEW’s Manufacturing Department Director Randy Middleton, has to do with the TPP’s rules of origin.
“Under this agreement, a car can be made 45 percent in China, which is subject to none of these supposedly ‘rock-solid’ labor standards, and then get shipped off to any other TPP-signatory country, finished up, and still make it into the U.S. 100-percent duty free,” Middleton said. “Tell me how that’s good for Americans, or even the least bit fair to the workers who are going to be hit hardest by this thing.”
A recent study by the Global Development and Environment Institute at Tufts University warned that economic projections touted by the White House are essentially bogus, “based on unrealistic assumptions,” the report showed.
The reality, according to the study, is that TPP would lead to losses in employment and increases in inequality in developed countries, with no country more affected than the U.S. In total, the study expects that U.S. gross domestic product would shrink by more than half a percent over 10 years of TPP and 448,000 jobs would be lost.
Even more, the share of GDP that goes to labor would decrease by 1.31 percent, meaning an even larger share of a smaller economy would go directly to corporations and their CEOs.
“What we’re seeing with TPP is really no different than any of the bad trade deals that came before it,” said IBEW International President Lonnie R. Stephenson. “Corporations are going to make a lot of money off this, just like they did with NAFTA, CAFTA or the Korean trade deal, and working people are going to be left holding the bag.”
Since the North American Free Trade Agreement was passed in 1993, the U.S. has lost more than one in four manufacturing jobs, putting more than 5 million people out of work. More than 57,000 U.S. manufacturing facilities have closed since then, and the U.S. trade balance with Mexico and Canada has skyrocketed from a $5 billion surplus in 1993 to a $177 billion deficit today.
With vocal opposition from leading presidential candidates on both sides – including Hillary Clinton and Bernie Sanders – TPP’s prospects in Congress are dwindling.
Just hours before U.S. Trade Representative Michael Froman inked the deal in Auckland, congressional leaders, joined by Trumka and members of the progressive community, participated in a press conference on Capitol Hill vowing to stop the trade agreement in its tracks and backing it up with more than a million signed petitions opposing TPP.
“I see an agreement written by corporations for corporations,” Rep. Rosa DeLauro of Connecticut said. “We need to defeat this agreement because it stacks the deck against working people.”
Rep. Tulsi Gabbard of Hawaii, who has been a stalwart ally to labor throughout the TPP process, added, “We know how this [TPP] story will end. … The American people deserve transparent trade that will not take us down a path that leads to more suffering.”
Rep. Debbie Dingell, whose Michigan district includes a number of Detroit automakers, said she is concerned that the TPP does nothing to stop big-time currency manipulators like China and Japan, who artificially deflate the currencies to boost exports.
With unchecked currency manipulation, she said, “a Japanese car has an $8,000 advantage over a Ford vehicle built here in America.” The TPP, without provisions to stop such manipulation, Dingell said, is “poison to manufacturers.”
Trumka called the deal “toxic,” and issued a stern warning to lawmakers who cave to corporate pressure on the TPP. “To all those on the ballot in 2016, we have a simple message: either you’re with us or you’re against us.”
As it stands, the TPP is unlikely to reach a vote before the November elections. Congressional leadership understands how unpopular the deal is with ordinary Americans, and experts think Senate Majority Leader Mitch McConnell and Speaker Paul Ryan want to protect their members by delaying action until after the elections.
Even with the delay, the deal faces opposition by large numbers of Democrats and more than a handful of Republicans, including former U.S. trade representative Ohio Sen. Rob Portman. Faced with a competitive challenge from former Gov. Ted Strickland, Portman came out against the TPP on the day it was signed. “I can’t support the TPP … because it doesn’t provide that level playing field,” he said.
Still, the White House considers TPP a top priority, and Obama is continuing to urge Congress not to wait until after the elections.
“If waiting is indeed their plan,” Stephenson said, “they think we’ll forget about it before 2018 rolls around. I can promise these lawmakers that we in the labor movement have long memories. If they vote to inflate corporate profits over protecting American jobs, we won’t forget about it.”
Home page photo used under a Creative Commons license from Flickr user ILOPictures.