Is the TransPacific Partnership Being Brought Back From the Dead?

With a new Republican Congress, and Obama himself a Republican who occasionally wears Democratic clothing, the Administration is making noise that the TransPacific Partnership and its ugly sister, the Transatlantic Trade and Investment Partnership, are moving forward in a serious way.

But the Administration tried that sort of messaging last year to keep up a sense of inevitability about these regulation-gutting, mislabeleed trade deals, when reality was very different. Democrats, joined by a not-trivial block of Republicans, revolted due to the unheard levels of secrecy being maintained around the deal (for instance, the Administration refused to provide current versions of draft language) as well as, for many of them, what they had inferred about the content.

Needless to say, the Republican majorities may well change that dynamic. But what about the considerable opposition for the TransPacific Partnership’s hoped-for foreign signatories, particularly Japan? You’d think the negotiations were full steam ahead based on a Japan Times article last week, Japan, U.S. target reaching broad TPP agreement at March meet. Key sections:

Japan and the United States have agreed that 12 countries discussing a Trans-Pacific Partnership free trade deal should hold a ministerial meeting in the first half of March to reach a broad agreement, informed sources said on Friday…

Japanese and U.S. officials signaled that the two sides narrowed gaps over auto trade, during the latest Tokyo session. Deputy chief TPP negotiator Hiroshi Oe said he strongly feels that the United States is serious about concluding talks successfully.

But Japan and the United States remain apart over farm trade. Elsewhere in the broader TPP talks, the United States and emerging market economies such as Malaysia are in dispute over intellectual property protection.

Yves here. If you read the text closely, there is less here than meets the eye. The two sides have agreed to talk again. And Oe’s remark is wonderfully ambiguous. It’s only about US eagerness, not about where the Japanese are.

We decided to check in with NC’s man in Tokyo, Clive. His report:

There’s been some on-and-off speculation in the Japanese press about what U.S. lawmakers in the post-midterms Congress could or couldn’t do, might or mightn’t do, how it does change the prospects for TransPacific Partnership, how it leaves things much as they were… and so on. As you’d expect with speculation on that subject, you never get any definitive conclusions. But once in a while you get pieces like the Japan Times’ one rehashing the “U.S. really wants to conclude a deal very soon” line – but without saying why the long-standing areas of disagreement might magically be resolved.

And for each vaguely encouraging article which is in the JP media, you get several ones like this from last Friday’s Mainichi newspaper which is representative of a now increasingly downbeat set of reports appearing. The headline reads “TPP: For an Agreement, the US is ‘Really Serious’… Furthermore Japan Shares a Sense of Impending Crisis” which sets the negative tone for what is drawn out in the remainder. The feature goes on to explain that the well understood areas of disagreement between the U.S. and Japan in the TPP negotiations such as agriculture remain unresolved and quotes Japanese negotiators again trotting out the familiar phrases saying that “more serious problems remain, there is still considerable [negotiating] work to do”.

Once you go outside of Japan’s MSM (where verifiable facts get, um, a bit thinner on the ground – but of course that can often be where the real stories can be found!) the TPP negotiations are being reported as being in an even more dire impasse. The Iza news blog – amongst many others – had this from late December last year which is credited to the Sankei newspaper (a reasonably respectable outlet) which then dropped the story and is no longer listed in its online archive, but it was still carried extensively in the news aggregator sites. The article says that Japan’s chief negotiator Amari reportedly shouted at USTR Froman “Japan isn’t a vassal state of the U.S.!” (which I’d also translate as “Japan isn’t a U.S. colony”) with the December TPP negotiation meeting turning into a right old slanging match – real handbags at dawn stuff. Some very unkind things were apparently said about Froman and his “negotiating” “skills”.

I’d say that the Japan Times story is more an attempt by official channels (either in the U.S. or Japan – or perhaps both) at damage limitation to counter the increasingly dire stories leaking out about the level that the TransPacific Partnership negotiations have sunk to than anything to be taken too seriously.

Even though the degree to which Froman has overplayed his hand is turning out to be a huge benefit to US citizens, relying on his continued ineptitude is still taking a risk. When you have time, please call or write your Representative and Senators and tell them how you and people you know are clued into how terrible the TransPacific Partnership is. Remind them it will be used to weaken banking regulations and you don’t want them to be approving pro-bailout policies by supporting the TTP and the TTIP.

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  1. Clive

    While you can safely ignore the “we’re really very close to a TransPacific Partnership, honest” nonsense, the Mainichi newspaper’s article Yves links to above does give a clue about what Washington is thinking (yes, “Washington” and “thinking” in the same sentence, I know, I know, that’s much too flattering a term for what goes on there… but there is a certain ruthless drive present which can on occasions overcome the basic incompetence of the place). From their article, I’ll translate the relevant paragraph:

    “As for the two governments [Japan and the U.S.] rushing the [TPP] negotiations [now], this is because as the U.S. presidential election approaches next year, negotiations will become increasingly difficult. Both the U.S. and the Japanese governments are aiming to have an overall TPP agreement by this spring, with a meeting of the chief negotiators of the 12 countries participating in the TPP planned to be held in New York at the end of January followed by a [full] ministerial-level conference in March.”

    (emphasis mine).

    So, sports fans, Obama and the turncoat Democrats are very very aware that time is running out for Obama’s “legacy” (please someone, pass me the sick bag) and the first half of 2015 is just about the last gasp for any sort of TransPacific Partnership rabbit to be pulled out of the hat.

    Desperate people do desperate things. Therefore, please — please — do as Yves suggests and contact your representative, telling them “Hell, no”. Behind the scenes (and in front of them too sometimes) Japanese impacted groups — farmers especially — are being similarly vocal so they’d appreciate a bit of international solidarity if you can help provide it. While Japan is not about to throw itself under the TransPacific Partnership bus jus’ ‘cos the U.S. wants it to, support from the U.S. populous demonstrating that you guys think it sucks too is emboldening.

    Sounds cheesy I know, but often people who live in smaller countries (e.g. England or Japan) do — still — look up to the U.S. (lots of history there) and when we see “ordinary” people demonstrably trying to hold back the tide of bad government ruling solely for a small elite, we do say to ourselves “hey, it’s not just us…” America (actually, Americans) does (do) show leadership — only not the sort that your government thinks it has.

    1. C

      I agree wholeheartedly. I have spoken to my rep multiple times. The last time I got a nice soothing letter reminding me that: a) negotiations are not concluded so noone really “knows” what is in the TPP (it might be a new lounge suite, or cake!) and b) that he was absolutely adamant that this free trade deal help to deal with China and its rising status and currency manipulation.

      Notice that he did not say how B would be acheived nor did he promise to do anything about A but I’m hoping that the new R model we have will be more excited about embarrasing Obama for sport alone if not for his constituents.

  2. Jack

    So what in short is the central divide between the Japanese elites and Washington? I’m assuming it isn’t any great desire to represent and protect the Japanese people. Is it that they’re okay with screwing the plebs over, but don’t like the specifics of this particular screwing? Does the US have any leverage to force them to sign? Just how desperate will Obama and company get? “You know Japan, we have an awful lot of bases and soldiers in your country. It would be a…shame, if anything bad were to happen…”

    1. Yves Smith Post author

      This is more Clive’s territory than mine, but basically Japan has been a military protectorate of the US since WWII. The US thinks it can therefore make Japan do what it wants to do and dictate treaty terms. But the Japanese have been playing a very adept game between the US and China. It feels less need to jump when the US says jump. And many in the younger generation feel even more so that way.

      The big issues are agricultural tariffs and intellectual property protection. But the even bigger issue may be that the US has been appalling in its conduct towards Japan, substantively (refusing to negotiate) and protocol-wise (being astonishingly rude by Japanese standards and even general standards for diplomacy, repeatedly) as chronicled by Clive.

      See here for backstory:

      1. Clive

        Yves has basically covered everything in the above, I’ll just add a bit of lower level detail.

        Japan, like every country, has a cultural history and a social structure. Trying to explain this to outsiders (people from other countries / cultures) is always tricky and pretty much doomed to failure — there’s some things that can only be learned and experienced by living in a society and, especially, being born into that society. To the Japanese to a very great extent (but this does not just apply to the Japanese), it can be somewhere between faintly embarrassing and pretty excruciating having to explain this foreigners.

        The social issues in play around the TransPacific Partnership are to do with the special place in Japanese culture held by farmers and agricultural production, especially rice. If it wasn’t for agriculture and related products being deemed by the U.S. as a “must not capitulate” area for an agreement (for some bizarre reason), a TransPacific Partnership deal with Japan would almost certainly have been done by now.

        This article gives a good background to how Japanese society was ordered — and while no longer a feudal society, many of those notions about how the political class, the farming class, the “workers” and the “merchants” were (are) stratified and who is held in what regard persist.

        Historically, U.S. diplomats and negotiators have been a pretty intelligent bunch as a rule and have — even in very highly charged situations — at least understood (or tried to) and complied with peculiarly Japanese concerns (keeping the emperor after the end of WWII being the most widely cited).

        U.S. Trade Representative Froman, on the other hand, is a complete oaf. NC rightly shredded Froman and he is, in my mind, easily the worst member of the Obama inner circle (readers may disagree, that is a pretty low bar to have to crawl under, but he gets my vote). He apparently sees, like all neoliberals, the world in terms of simple ideals like “commodities” and gives in to reductionism when thinking about concepts such as “free trade”. If he is in the slightest aware of how the Japanese don’t quite see things the same way — and certainly that not all “commodities” or “industries” can be treated in the same way — he has not demonstrated an ounce of this understanding in the TransPacific Partnership negotiations. More likely is that he neither knows nor — I think the rather crude phrase is unavoidable here — does he give a sh1t.

        1. Brooklin Bridge

          […]he has not demonstrated an ounce of this understanding in the TransPacific Partnership negotiations. More likely is that he neither knows nor — I think the rather crude phrase is unavoidable here — does he give a sh1t.

          Do you think they (Froman , Obama, etc.) are in a sort of bubble where they imagine everything is going smoothly and that Japan is just putting on a front of reserve? Do they imagine that simply flexing their muscles behind the curtain, so to speak, will make Japan – like every other country – bend to their will? I imagine that would not generally be too far from the truth, the thugs, but if I understand correctly, that is ironically at least partly what is working most strongly against them in the case of Japan? (Come to think of it, it’s not working too well in Ukraine either).

          1. Brooklin Bridge

            What I was trying to get at above, is simply that one would imagine the WH to have some experts on Japan available especially for something as important as this trade deal is to Obama.

            Another more general, but equally naive, question is why in the world do these trade agreements attract Obama as part of his legacy? I can understand, grab the money and run, as the motive, but historical legacy?

            Granted Obama is vein, but is he so stupid or high on his own brand of tea that he thinks screwing the public will guarantee him a place in their hearts and minds any more than NAFTA has done for Clinton?

            1. Clive

              One of the big problems for the TPP negotiations is that they are being handled by the USTR (i.e. they’re viewed as a “trade deal”) but in reality they are well into foreign policy territory. The U.S. (and the White house too of course) does have very able and experienced diplomats and experts on international relationships — but I’d imagine they won’t be allowed any input at all lest the USTR lose influence or ground in the internal politicking turf war that passes for government in the U.S.

              1. Banger

                It isn’t just turf war–it’s about serving particular constituencies in the private sector and Congress. USTR is more directly, as I understand it, connected to the political process whereas State is, in part, a power unto itself and not necessarily manipulated by private industry, the WH, and/or Congress–though it is. Business interests are much more involved in diplomacy than most people thin even at State.

                As we’ve discussed here the trade pacts are all about shifting power to large corporations as part of the ongoing neofeudal project.

          2. Clive

            A good question ! “are they really crazy, or are they just acting crazy?”

            Unfortunately, I think they are in their own self-constructed reality. I got a glimpse of how it affects people in that situation when our CEO came round to our office a few weeks back. I was peripherally involved in the arrangements, and they bordered on the outright whacky. People had to stay in their desks while the CEO walked round. No-one was to approach the CEO. If the CEO wanted to ask about you, your work etc. then you could reply. Someone went round removing all the union flyers from the noticeboard. Maintenance jobs were tackled (a backlog of loose carpet tiles, blown lights, dead plants and water leaks on the ceiling tiles were sorted out pretty much overnight). During the visit, there was a full-on retinue of ex-military bodyguards, an EA, a couple of PAs, at least three of four other minders. Plus a car and driver of course. The front car park was cleared — that day, no-one could grab the front of house spaces, goodness knows what would have happened if he’d had to walk a few paces. He might have met — gasp — “the public”. It was then I realised, this guy cannot know anything that isn’t filtered, explained and tweaked with for presentation.

            That’s for a CEO of a bank. What it must be like for the PoTUS or anyone at the top table… it’s a wonder they manage to hang onto any semblance of sanity.

            1. Demeter

              They really are crazy, Clive. You’d have to be crazy (or incredibly stupid, ethics-free and narcissistic, which amounts to the same thing) to live like that and neither catch on, or feel so entitled as to think such special handling was your due.

              1. Banger

                That is how the ruling elites tend to live and furthermore how they want to live. Everything has to be carefully controlled everything moves towards the ceremonial. It is this sort of thing that our rulers aim at and, mostly, achieve. It has to be very seductive.

              2. Brooklin Bridge

                incredibly stupid, ethics-free and narcissistic -Certifiably nuts to imagine that having the TPP, not to mention the other so called trade deals, as your presidential legacy would ensure you any desirable place in history except for those who crave infamy.

                Yves and Clive have gone over this before. I know. But it still boggles the mind how far beyond the pale these people must be, particularly Obama; it’s in the same league as to believe (or allow yourself to be coaxed into believing) that torture builds character.

                1. C

                  And yet sadly that is exactly what they believe. Back in 2013 the NY Times ran an editorial by Keller I believe claiming exactly that. The cusp of the argument was that Obama must pass the TPP to “ensure his legacy” with no comprehension of what that legacy would be.

                  More recently the Amazon Newspaper (formerly the Washington Post) ran an editorial claiming that the TPP must pass because trade has always been good for America. I saw no awareness anywhere in it that “Good for America” was actually bad for many people in it.

                  Obama’s spokesperson has also exhibited similar detatchment when he defended the trade deal by assuing us:

                  The president won’t do anything that is bad for American companies.

                  If that is not a defense from a bubble I don’t know what is.

                  1. Brooklin Bridge

                    Good observations. Obama’s theme song might as well be, I’m forever blowing bubbles, pretty lethal bubbles in the air…

            2. C

              I had a similar experience when the head of our organization visited. We all had to craft, get approval on, and rehearse speeches about our jobs. We got sent multiple e-mails about dress code. A separate individual reviewed our desks for cleanliness and “appropriateness.” I got criticized for having too many visible cables connected to my computer (God forbid he see a power cable, he might get scared). Eventually he just walked through without saying a word to anyone and probably never looked at us.

            3. Brooklin Bridge

              Had to run earlier.

              Thanks very much Clive, (and Yves), for all the work you have done on this. It’s really quite amazing to have such an inside and perceptive view of Japanese subtle attitudes and perceptions, not to mention your familiarity with the US side of this agreement as well.

        2. efschumacher

          On the Oafishness of Froman

          There’s that small, cynical, suspicious sliver of me that thinks maybe selecting Froman with all his skills as the prime negotiator is a feature not a bug. This would assume that the Potus has been bought and paid for by the usual menagerie of beasts behind the woodwork. However supposing he doesn’t agree with all of the odious positions they think they’ve bought him for, while he is on the public face of it pushing fo things like TPP and TTIP, his selection of an oaf guarantees that the cack-handed negotiations will fail. It’s hard to know, given the number of faces this President has.

          1. Ernesto Lyon

            I would put that as an outside chance. These people live in an alternative reality. From got the job because he represents the views of the people who actually selected him.

        3. C

          Clive, let me ask a related question. How much can Abe even afford to give away?

          Most “Free Trade” deals have the predictable pattern of sending jobs and money flowing down to the cheapest level. The U.S. got away with NAFTA and our longstanding Most Favored Nation trading only because enough credit remained to paper over the losses. But Japan right now, at least to an outsider seems to be dangling on a cliff edge economically with jobs already being lost and companies already in trouble. Add the economic costs of Fukushima and it seems like they couldn’t afford, or paper over, any losses right now.

          Is this a correct assessment?

        4. Jack

          But that still leaves the issue of leverage. How far are Obama and cronies willing to go to secure his last chance at a ‘great legacy’, and what means do they have at their disposal to achieve that goal? Is there anything they can bring to the table that will force the Japanese to sign, even if it’s highly destructive to relations with Japan in the mid-to-long term?

        5. different clue

          We are ( and should be) grateful for having material like this to read and understand. I just nope no one in the Administration is reading it and trying to force any action on it . . . action which might raise the danger of TPP getting passed.

  3. Banger

    Since I view the current level of trade talks as an attempt to move sovereignty away from nation states towards a different world order dominated by corporations and structures they control what does the Japanese corporate sector think of all this?

    1. Clive

      Some are all for it, but there’s more than a few industries (especially insurance, healthcare and agribusiness) who are at best ambivalent and even downright hostile. Japanese industrialists have a lot of sway in domestic politics, but not as much as agriculture and the rural vote. I’d call it a draw.

  4. Jackrabbit

    I’m losing comments again.

    No ‘in moderation’ message. Just disappears. But then I am told that a duplicate comments is detected.


    1. Banger

      Seems to happen at times–happened to me frequently for a short time and now hasn’t happened for a few months. WordPress has a lot of strange DB issues–I used to try and hack it but didn’t like the way they managed data. But, no the whole, it ends up working–you must have triggered some flags that have nothing to do with content–I think Lambert has kind-of addressed this before. Be patient.

  5. Jackrabbit

    IMO the notion that the trade deals / Fasttrack are being brought back from the dead is faulty. The trade deals were never dead.

    1. Jackrabbit

      IT SHOULD BE CLEAR that the neolibCON agenda is one that puts a special emphasis on CON. The neolibCONs have the upper hand so they do not give up – they double down. And they slyly push their agenda across the board. We see this time and time again: shutting down debate on Fasttrack before the mid-terms is just one of many examples. Consider: stuffing the Supreme Court, stacking the deck against prudent regulation, media control via access journalism; numerous foreign adventures, plus numerous lies and misdirection like: “the most transparent administration ever”; “if you like your doctor, you can keep your doctor”; “if you have nothing to hide, you have nothing to fear”, etc.

      1. Jackrabbit

        Note: I wrote about my misgivings about Reid and Pelosi’s sideline of Fasttrack last year (Feb 2014) saying that I believed it was just political maneuvering before the mid-terms.

        H O P

        1. hunkerdown

          Didn’t they say as much? “Now is not the time” from Reid is absolutely code for “Don’t spook the horses”.

    2. Yves Smith Post author

      If they were not dead, Obama would have been able to get them done in the lame duck session.

      It is a routine ploy of negotiators to pretend there is momentum when there actually is none.

      1. Jackrabbit

        By “never dead” I meant that the Obama Administration did not give up on getting the trade deals done.

  6. flora

    Thanks for this post. Does Abe’s re-election have any effect on Japan’s stance in the trade talks?

    1. Clive

      No, not really. Japan’s LDP wants to be seen to be “reforming” the economy and TPP is part of that kabuki (and big business interests certainly in some industries would welcome it — the LDP is no stranger to cronyism with Japan’s commercial elite) — but even the LDP won’t do a TPP deal at any price. It has signalled all along that agriculture protection is non-negotiable and the U.S. must understand that and be prepared to make concessions. Japan’s main opposition party is only slightly more verciferous in taking a “Japan’s interests first and foremost” stance.

      It is also entirely plausible the Japan is only going along with the TPP to keep the U.S. happy and has no intention of agreeing to anything particularly meaningful. But it’s always a risk that either side may end up doing something stupid and U.S. lawmakers need to be given clear instructions from the electorate that you won’t put up with rubbishey trade deal sell-outs.

      1. jl

        I think it may be more simple. The anti-red “alliance” between Japan and USA was predicated on Japan protecting their markets, while raping ours, and USA got diplomatic cooperation. People in Japan had low self-confidence in relation to USA because of its post-war power. With the internet and the general degradation of USA’s image through more nasty, but truth-depicting television, most Japanese have caught on to our decline.

        Likewise, Japan is not immune to falling rates of profit. They, in stride with their whole history, are copying our playbook: off-shoring, financialization, organized labor destruction, opening up to immigration (labor importation), etc. The happy labor pact in Japan is eroding quickly and they are moving to their own default authoritarian ways, a la the Meiji Period. The old, dying farmers in the inaka might not be enough to derail this horrible corporate profit sop, TPP…

      2. jl

        I agree with your assessment. The flip SOP of the free traders would be, the elimination of sets of redundant industries in the first world and off-shoring would increase global productivity, making goods cheaper.

        The gaping whole in that argument is that it’s wealth destruction for hundreds of millions of people, decreasing demand, increasingly corrupt societies, collapsing dynamism, controlled markets, consolidation, and the ability of government to tax and use spending for the public good.

  7. susan the other

    One thing that puzzles me is what appears to be the BoJ funding Japan Inc. to go on a foreign policy grand tour and probably investment spree around the world. Is this the spending that is to revive the Japanese economy? Japan started up some corporations in Spain recently, and Spain’s exports have now jumped up. So this prolly helps japan’s big corporations in the same way it helps ours to offshore the wealth. And Abe is on a veritable diplomacy blitz going to deal and treat with Netanyahu even. Making sympathetic statements to Israel against the terrorists. Japan is fully on board for some anti-terrorism measures. I think it is odd since the “terrorists” don’t terrorize Japan. It looks like Abe is distracting the press from domestic problems – just like Obama does. But it also raises the question about anti-terrorism: Is it just another way to achieve the TPP and TTIP? More than one way to skin a cat.

  8. sierra7

    All of the “new” trade “agreements” are a continual extension of globalization that got a big push back when NAFTA was passed.
    The major problem is what has been mentioned above, namely, the huge clash of cultures that have been precipitated between the treaties themselves and those that have been subjugated beneath, mostly without their real consent whatsoever.
    Corporate rule, financial, productive, agricultural, etc., is the rule with these “agreements”.
    Doesn’t matter who is president, which party is in power; the program must continue until, until, the common folk revolt, either here in the USA, or overseas.
    Not only do these agreements between countries’ elites crush the ordinary folk, the fine print also subverts laws and regulations and courts in the signing countries.
    In my opinion, as they are structured, these agreements do nothing for the common people of any transacting countries.
    To me, they are almost treasonous agreements.

    1. different clue

      One could well refer to them as the TTAs . . . Trade Treason Agreements . . . and see if that meme catches hold. Perhaps one could also start referring to treasoNAFTA.

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