By Margaret Flowers and Kevin Zeese, Truthout | News Analysis
TRUTHOUT: We are in the midst of an epic battle between the people of the world and transnational corporations. Wealthy governments and corporations are merging in a global system in which private corporations have absolute power over your life. This is a battle the people can win and when we do it will show that we can defeat corporate power on issue after issue.
The 1999 battle in Seattle to stop the World Trade Organization (WTO) from granting increased power to transnational corporations and the negative consequences of the North American Free Trade Agreement (NAFTA) created broad public awareness about the ways that ‘free trade’ hurts people and the planet. As a result, in the past few decades, the WTO has effectively been unable to move forward with its neoliberal economic agenda. And the United States was forced to move to smaller country-by-country trade agreements, many of which were stopped by public pressure.
The Obama administration is currently mired in an ambitious project to accomplish both the continuation of the WTO’s agenda and a restructuring of NAFTA in ways that place corporate property rights over protection of people and the environment. Using the friendly term, ‘partnership,’ the administration is negotiating a sweeping free trade agreement, the Trans-Pacific Partnership (TPP), which could potentially involve the entire Pacific Rim as well as a sister agreement with European nations. This is being done largely in secret and in a way that subverts the democratic process.
Former US Trade Representative Ron Kirk, who now has a lucrative job in the private sector advising transnational corporations for the law firm Gibson Dunn, said that if people knew what was in the TPP, there would be no way to get it signed into law. As he told one interviewer, if the text were made public negotiators would be walking away from the negotiations because they would be very unpopular.
The new US Trade Representative, Obama’s classmate Michael Froman who worked at CitiGroup, and the more than 600 corporate advisers involved in writing the TPP, have direct access to the text of the treaty, but members of Congress have only limited access and the public and media are excluded. Recent calls for transparency by members of Congress have been denied, so the extent of what we know comes from leaks.
We do know that the TPP is less about trade and more about entrenching corporate property rights. It will establish a judicial system that gives corporations greater power than sovereign nations and bypasses the democratic process. The TPP will affect the global economy so that corporations control all aspects of our lives from wages, food safety, the price of medications and our rights to clean water and air to Internet freedom and more.
The breadth of this corporate power grab may also be its downfall because it is an opportunity for solidarity. A broad coalition of organizations from the entire North
American continent in solidarity with groups in other Pacific Rim nations are working together to demand transparency and a democratic process for the TPP. These groups are calling for an end to the failed model of free trade and for a new type of trade that honors the rights of people and the planet.
Corporate Property Rights and Profits Come First
Protests in Seattle in 1999 were successful in stopping the WTO meetings being held there. The next set of meetings took place in Doha, Qatar, a place of highly restricted access, in 2001. The Doha Round still has not concluded because the member nations have not been able to come to a consensus, particularly because of the unwillingness of the US to give up agricultural subsidies.
The Trans-Pacific Partnership and it’s sister, the Trans-Atlantic Trade and Investment Partnership (TTIP, known as “TAFTA”), are the Obama administration’s response to the failure of the WTO. These two treaties will aim to not only give multinational corporations all of the deregulation and legal rights they sought through the WTO, but are intended to go even further. With the inclusion of Canada and Mexico, the Obama administration will live up to its promise to renegotiate NAFTA, but not in the way that he alluded to during his 2008 presidential campaign.
In 2008, candidate Obama said on multiple occasions that one of the first things he would do as president would be to ‘fix’ NAFTA so that there was greater protection of worker rights and the environment and so that corporations would not be able to undermine laws that are in the public’s interest. Perhaps his true intentions were mistakenly revealed by a senior economic adviser to the campaign, Austan Goolsbee, who informed the Canadian government that Obama’s rhetoric on NAFTA should be understood as “more about political positioning than a clear articulation of policy plans.”
After his inauguration, Obama dropped any action on trade including negotiation of the TPP which had started under President Bush. Then he announced in late 2009 that the US would participate in trade talks with Pacific Rim countries. Since then, there have been 17 rounds of negotiations, and the 18th is scheduled for this month in Malaysia. Reports from negotiators are that the Obama administration is pushing hardest for an agreement that would strengthen corporations and increase their profits even if it meant the people suffered.
The general tone of the TPP negotiations is typical of the US approach to other nations when it comes to the economy. The US dominates the agenda, with allies when needed, and bullies smaller nations into accepting provisions that will harm their population. Civil society groups are invited to the rounds of talks, but in reality, they do not have influence over what is included. “Stakeholder” briefings, where civil society groups can ask questions of the trade representatives, are a lesson in evasive non-answers. Mostly, the inclusion of civil society is to give the appearance of an open process. How can stakeholders participate when the contents are secret, except for leaked sections?
As an example of harmful policies, through leaked text it is known that the TPP gives pharmaceutical and medical device corporations the ability to ‘evergreen’ their patents and prevents governments from negotiating fair prices. This keeps the price of medications and other necessary health goods high and prevents generics. Similar provisions in other free trade agreements raised the cost of medications by 20 percent or more resulting in a negative impact on public health. These provisions will make life-saving medications unaffordable and increase disease and death, particularly in poorer countries, all so that corporations can make unreasonable profits. They will also undermine top public health systems in Japan and Australia.
Another example is the investor rights provision which will allow ‘foreign’ investors to sue a nation if their laws interfere with trade, allowing corporations to sue in trade tribunals for loss of “expected profits.” This means a corporation will be able to sue a nation if a labor, environmental or consumer protection law decreases the profits the corporation planned on making. The trade tribunal will be staffed by judges who are mainly corporate lawyers on temporary leave from their corporate jobs. Essentially the United States will be giving up its national sovereignty to foreign investors, as will other countries.
Will this legal right be abused? It already is. Kristen Beifus of the Washington Fair Trade Coalition tells us that a corporation, Lone Pine Resources which is incorporated in Delaware, is suing the Canadian government for $250 million. It passed itself off as an American corporation in order to sue, but it is headquartered in Calgary and does all of its business in Canada. Lone Pine Resources is suing because it spent money to set up a fracking operation in Quebec, but then a fracking moratorium was passed.
Richard McIntyre, who serves as the US Trade Representative for the Green Shadow Cabinet, states that agreements such as the TPP are not really about trade at all. They are designed to protect the property rights of foreign investors in a way that works outside of the traditional legal system. Corporations can make claims against governments in a way that bypasses the democratic process. In effect, this will give a corporation the power to force a country, particularly smaller countries, to change its laws. Countries will learn that they cannot pass laws in the public interest without expensive litigation.
Suppose a country has an environmental or labor protection law in place. Under the TPP, a corporation will be able to sue that country for loss of expected profits if the law means it must do things like pay higher wages, comply with work safety provisions clean up toxics in the environment or handle its waste safely. The country will then face a choice of paying millions of dollars or changing its law. Poor countries, such as Vietnam, will not really have a choice because they cannot afford to pay an expensive fine.
McIntyre concludes that the current free trade process is really a debate about property rights and corporations having more rights than people. Although there are labor and environmental standards in free trade agreements, McIntyre calls these a “hollow
victory” because they are very vague and there is no way to enforce them.
We Can Stop the Trans-Pacific Partnership
We can stop the TPP. There is enough experience with corporate trade agreements that we now know they can be stopped. The keys are: letting people know what is in them because their contents are unpopular; and second, getting people active to express their disapproval so the agreement becomes so unpopular no elected official wants to be tied to it.
In the past, when trade agreements were under negotiation, they were discussed in the mass media and the text of the agreements was public. The Office of the US Trade Representative published the text of agreements on their website, even as the treaty was being negotiated.
Now that many people have caught on to the fact that free trade agreements have negative consequences, transparency has ended. The current text of the TPP is only available to the trade representatives and the 600 corporate advisers who are involved in writing it. They have real-time access to the text on their computers. Members of Congress must apply to see the text and when they are granted access, it is at the ‘read and retain’ level only, and they are sworn to secrecy. This means they can view it in a private room but cannot bring staff with them or take notes or photos of the text. And the media has been almost completely silent on the TPP. Stories are just starting to be printed because now that more people know about the TPP, the media loses its credibility if it doesn’t report on it.
There have been requests for more transparency. Civil society groups wrote letters to the trade representatives, people signed petitions and members of Congress have called for more access to the text. However, it was leaked that a Memorandum of Understanding was written into the TPP which “commits the countries not to declassify documents related to the negotiations for ‘Four years from entry into force of the TPP agreement or, if no agreement enters into force, four years from the close of the negotiations.’”
Senator Elizabeth Warren wrote the candidate for US Trade Representative, Michael Froman, asking for public transparency of the text. That request has not been granted. After 8 months of negotiations and tremendous public pressure, Representative Alan Grayson was permitted to view some of the TPP documents. His comment: “The TPP is nicknamed ‘NAFTA on steroids.’ Now that I’ve read it, I can see why. I can’t tell you what’s in the agreement, because the U.S. Trade Representative calls it classified. But I can tell you two things about it. 1) There is no national security purpose in keeping this text secret. 2) This agreement hands the sovereignty of our country over to corporate interests. 3) What they can’t afford to tell the American public is that [the rest of this sentence is classified].”
Why so secret? Public awareness and pressure have prevented the completion of at least 14 trade agreements over the past decades. The keys to stopping these agreements have been public awareness and protest. As Beifus says, “We haven’t passed a trade agreement in Congress because when people get in the streets, it becomes politically unsavory.”
Beifus is an organizer of a cross-border coalition of advocacy groups from Canada, the US and Mexico who are working together to create that politically unsavory environment for the TPP. They co-wrote a tri-national statement of unity and are calling for public access to the text and a democratic process in Washington. The cross-border group also works with advocates in other Pacific Rim countries in order to build solidarity.
The TPP offers a real opportunity for solidarity not just between countries that will be affected, but also between groups that are working for a broad variety of issues: food safety, health care, internet freedom, worker rights, the environment and more. Coalitions of groups that support fair trade rather than free trade exist in the US and are expanding.
We are involved in a campaign, organized through PopularResistance.org in cooperation with groups that have been focused on trade for years, called FlushtheTPP.org. The goals of FlushtheTPP.org are to help people see that our concerns are united by the TPP and that we can stop the TPP by working together. FlushtheTPP.org is an action-oriented website that provides the tool people need to organize actions locally. (Sign up on FlushtheTPP.org to get involved.)
Actions are designed with two initial goals: To bring greater awareness to the public about the TPP and to prevent Congress from granting the White House “Fast Track” (a.k.a. Trade Promotion Authority). In July, we kicked off #TPPTuesdays for solidarity visibility actions – holding signs or other creative ways to get attention and passing out literature about the TPP. In August and through the autumn, people will be encouraged to focus on members of Congress and Fast Track.
Fast Track was first passed under President Nixon in the 1970’s. It gives the president the ability to negotiate and sign trade agreements, and Congress can then vote on the treaty after it has been signed. This subverts the Constitution as under the Commerce Clause, Congress has the power “To regulate Commerce with foreign Nations.” Fast Track prevents the democratic process which includes the checks and balances of public hearings, expert testimony and amendments. Retiring Senator Baucus, who consistently represents big business interests, has made it his personal mission to deliver Fast Track to President Obama.
Negotiations of the TPP were expected to wind down this fall; however, because of conflicts between the countries involved and with Japan planning to join the talks at the July round in Malaysia, the process may extend into the spring. This gives us more time to educate, organize and mobilize people, but there is still a sense of urgency. If Congress grants the White House Fast Track, then the deal will be much harder to stop.
It will be interesting to see what happens when Japan signs on. The new Prime Minister, Shinzo Abe, ran on a platform opposing the TPP, but quickly shifted gears after his election. He announced his decision to join the talks in March, despite widespread opposition. Thousands of people now show up to protest the TPP in Japan. Abe claims that he will negotiate in Japan’s interests, but that will conflict with provisions that have already been negotiated.
One of the keys to successfully stopping corporate trade agreements is for people to broaden the fissures between countries by highlighting why the agreement will be bad for their country. Protesters outside of negotiations, in the media and on the web highlighting how sections of these agreements will hurt their people make overcoming fissures between countries difficult.
Ushering in a New Era of Fair Trade
If the TPP, and its sister TTIP, are prevented from going forward as intended, this could bring in a new era of fair trade that respects the rights of people and the planet. Free trade agreements have been proven to be flawed models for trade because in addition to accelerating the downward trends in worker rights and environmental protection, they also increase the US’ trade deficit.
The 2012 trade data reveal that for countries with which the US has a trade agreement, the trade deficit increased by 440 percent. At the same time, the trade deficit decreased slightly for countries with which the US does not have a trade agreement. And the US already has trade agreements that cover 90 percent of the GDP of the countries involved in the TPP.
These numbers alone should tell us that the TPP is not really about trade. It is actually a back door for corporations to get laws passed that are in their favor and that could not pass Congress under a democratic process. McIntyre refers to ‘Free Trade” as ‘De-regulated International Commerce.’ Most of the trade in these trade agreements is happening through global corporate supply chains that go wherever the resources and labor are the cheapest.
Not only does de-regulated trade harm the environment by allowing corporations to settle where environmental laws are the most lax and making new laws difficult to pass, but it leads to hundreds of thousands of jobs leaving the US. The TPP is often referred to as ‘NAFTA on steroids.’ It is estimated that close to 700,000 jobs were lost from the US due to NAFTA alone. The TPP will make it easier for transnational corporations to re-locate where labor is the cheapest, which drives down wages and working conditions for everyone. Free trade agreements escalate wealth inequality worldwide.
One group of workers at a paper mill in the Northwest whose jobs were sent overseas visited the new paper mill and found that not only had they lost their jobs, but all of their hard-won concessions for worker rights and environmental safety were also lost in the transfer.
This is why there is an opportunity for global solidarity to stop this flawed model of trade. Important questions that must be answered going forward are why corporations are given rights that people don’t have and why corporations are not held liable for the harmful effects of mines and factories in their global supply chains. It is time to put a pause on trade agreements that further the free trade model until these and other issues are sorted out.
Fair trade coalitions are calling for sensible trade processes that are grounded in transparency and democracy. This means that all groups affected by the agreement must be involved in the negotiations in a fair and equitable way. And fair trade means that the rights of people and the planet come first, before corporate profits with people empowered to enforce those requirements.
One step in this direction is a bill introduced by Senator Sherrod Brown called “The 21st Century Trade and Market Access Act.” This act contains binding requirements for trade deals to protect food safety, the environment and workers as well as mechanisms to enforce these requirements. Nobel economist Joseph Stiglitz recently wrote that trade deals should follow three principles:
1. They should be symmetrical so that requirements are applied to all parties involved.
2. National interests should have higher priority than commercial interests.
3. The negotiations should be transparent.
Stiglitz warns us though that “the US is committed to a lack of transparency.”
Other steps are being taken at the local level to encourage fair trade. These include raising community awareness about the importance of fair trade, increasing local access to fair trade items and passing resolutions to affect government procurement policies.
All of these steps are important. We believe that a high priority step right now is to join together in solidarity to stop the TPP, and after we win that, to stop the TTIP. Negotiations of the TTIP are just beginning this month with the first round in Washington, DC. The TTIP is already in a precarious position because of the revelation that the US has been spying on the EU.
Visit FlushtheTPP.org. Take the pledge. Start planning events in your community to expose the TPP. Important dates to keep in mind are the 18th round of negotiations starting on July 15 (a great time to hold solidarity actions) and the 19th round of negotiations which is expected this September somewhere in North America. We will work to mobilize a large presence at that round. Sign up to receive FlushtheTPP.org email action updates and pledge to join the campaign.
This is a campaign that we can win that will place us firmly on the path to a fair trade future; and a victory on which we can build the global revolt against corporate power. Join this historic turning point in the effort to end the rule of money and transfer power to the people.
You can hear the interview with Richard McIntyre and Kristen Beifus on “Taking Corporate Power Out of Our Trade Agreements” on Clearing the FOG.
