By David Dayen, a lapsed blogger and author of Chain of Title, to be released May 2016. Follow him on Twitter @ddayen.
The U.S. Trade Representative’s Office has been maligned for its network of Trade Advisory Committees, allegedly “independent” counsel for trade agreements. The Washington Post did the best work on the Advisory Committees back in February of last year, showing that 85 percent of the cleared advisors (meaning cleared to read the text of trade agreements as they are being negotiated) either worked directly for private industries or their trade groups.
But there’s another, more obscure group called the Labor Advisory Committee. Its 19 members are all the heads of major labor unions (Clayola Brown, president of the A. Phillip Randolph Institute, I guess technically isn’t, but that organization is a constituency group of the AFL-CIO). And like all Advisory Committees, they are required by law to write a report to Congress expressing their opinions about any finalized trade agreement. That means we now have this 121-page document, giving labor’s full argument against the TPP, from the people who have been following it from the inside for several years.
This was an argument that labor’s cleared advisors have been prevented from making. Because of the secretive nature of trade talks, those opposed to the deal fight with one hand tied behind their backs, unable to speak about what they knew about the agreement. And they are at the mercy of USTR’s deliberate, dissent-crushing rules.
According to the report, USTR and the Department of Labor “refused to share the specific text of proposed changes to the labor chapter” for over three years, until the text was substantially complete in August 2015. The Committee was never consulted on side agreements with Vietnam, Malaysia, and Brunei, which deal entirely with those countries’ labor laws. The Committee believes this actually violated the law, but who would enforce it?
Despite being kept somewhat in the dark, the Committee released an “interim report” to USTR, based on what they knew, in April, and asked Congress to request a copy. The Administration blocked the report because they claimed the Committee didn’t follow the Federal Advisory Commission Act, because under the law, committee chairmen cannot call their own meeting, and the report was written under those auspices. Twenty-one Democratic Senators appealed to U.S. Trade Rep Michael Froman to release the report, but he refused.
That depressing but predictable bit of obstruction is over now, and we have labor’s side of the story. It gets off to quite a start in the first words of the executive summary:
On behalf of the millions of working people we represent, we believe that the TPP is unbalanced in its provisions, skewing benefits to economic elites while leaving workers to bear the brunt of the TPP’s downside. The TPP is likely to harm the U.S. economy, cost jobs, and lower wages.
Not really anywhere to go from there!
This document puts all of the arguments against TPP in one accessible, readable place, and if you’re interested in really understanding what this agreement would do, this is a great place to start. I hasten to summarize such a dense document, but I wanted to highlight some things that I specifically learned:
• The report is supposed to answer whether the TPP advanced the negotiating objectives provided for in this year’s fast track law passed by Congress. The Committee rejects the premise. “Many of the negotiating objectives are so vague that meaningful analysis is nearly impossible. Other objectives are quite literally antithetical to U.S. worker interests.”
• There’s a special process in the rules of origin chapter called “hybrid deemed originating” that would allow a far lower standard of percentages of goods to be made in TPP countries than they already low standard embedded in the agreement, especially for autos and auto parts. Effectively that standard includes NO threshold percentage, making this even more of a boon for China, which is already integrated into every TPP member’s supply chain, than I initially thought.
• USTR has made much out of the fact that TPP has a first-ever chapter on state-owned enterprises. But every subsidy and support already provided to SOEs before TPP is implemented gets grandfathered in. Furthermore it allows nations to exempt some of their SOEs from coverage. The combination of these factors makes the SOE chapter almost meaningless.
• “Acceptable conditions” on labor issues like the minimum wage, hours per week and workplace safety are “as determined” by member countries, which means that Vietnam could make a minimum wage of 1 cent a day and have that be OK by the language of the agreement. The deal also only requires parties to “discourage” trade in goods made with forced labor.
• The side letter with Vietnam allows them five years to comply with TPP rules, while getting the benefits of the agreement immediately. This is a direct violation of the benchmark “May 10” agreement between Congress and the Bush White House, which stipulated that member nations had to reach compliance first, before even a Congressional vote on the trade deal.
• Not only do procurement rules knock out federal “Buy American” laws by forcing TPP member countries at chance at the bid, but it requires that parties expand that to the sub-national level within three years, putting state “Buy American” laws at risk.
• The IP chapter allows for “evergreening” of prescription drugs, a scam whereby corporations can extend their patents for 20 years simply by tweaking the formulary slightly or finding a new use for an old drug.
• They caught the doublespeak of how the agreement puts up all sorts of safeguards on ISDS, as long as they are “consistent with the Investment Chapter.” The Committee rightly calls this a “legal nullity” – it’s saying that things like public health or prudential regulation will be protected from the Investment Chapter, as long as it’s in line with the Investment Chapter.
• The Committee asked for a rewrite of the boilerplate “prudential exception” to allow member nations to take action on financial regulations without the deterrent effect of legal challenges by the private sector. In the end, the prudential exception is exactly the same as the ineffective language in the Peru Free Trade Agreement. Financial services firms actually get new powers to make ISDS challenges under TPP.
• There’s a specific highlight on call centers, which comprises 4 percent of the entire U.S. workforce. The Committee notes three incentives to outsource what’s left of call center jobs, including data localization measures which allow cross-border transfer of personal information and forbid nations from requiring local computing sources.
• TPP provides three separate rounds of consultations before a violation of the Environment Chapter can even be brought to a dispute resolution. Every other obligation requires only one consultation round. TPP also does not require all parties to adopt and implement obligations under six multilateral environmental agreements.
• The report hits the wishy-washy language, especially in the Environment Chapter, which obligates countries to “strive to act consistently” on conservation, or “endeavor not to undermine” fisheries. You could not set up a dispute resolution on whether or not a country “strives” or “endeavors.”
• Even though the report focuses on countries with particularly bad labor records (Brunei, Malaysia, Mexico, Vietnam, etc.), it posts an interesting 2010 letter from AFL-CIO president Rich Trumka to New Zealand Trade Minister Tim Groser, showing that the country amended their own labor laws to attract the production of the Lord of the Rings movies, by classifying every employee on that production as an independent contractor. This violates International Labor Organization rules and even every free trade agreement since NAFTA. So it’s not just the “bad seed” countries that take advantage.
• Under current “dock-on” rules, if another country wants to join TPP, Congress would not get a vote on allowing that.
There’s more here, on investment, public services, air transport, agriculture and more. The upshot is that TPP recapitulates the shortfalls of past trade agreements, failing to “break the elite stranglehold on trade policy and put working families front and center.” The report predicts hundreds of thousands of lost jobs and an advance for “the interests of global corporations rather than the national interest.”
TPP may actually be on life support right now, after Mitch McConnell said it had no shot of passing Congress before the 2016 elections. That’s mainly because it doesn’t roll out the red carpet for corporations enough for his liking. But if you want to know what a left-wing critique of TPP looks like, this report is a great place to start.
Another thorough debunking of the TPP. It is nearly unanimous that this deal (and its ilk) are dreadful failures for everyone but the plutocrats. So this will be a real test of just how powerful the corporatocracy is. I am not sanguine.
the tpp is not on life support. mcconell will either get his tobacco gifts or he won’t. it’s being delayed mostly so no candidate for president will have to seriously take a stand on it. that would sink it for sure.
I think that’s right. It all seems timed for a post-election lame duck ratification vote. HRC can urge a no vote and shake her head sadly when it passes. After that, it’s the law and of course it has to be enforced.
Statements like this seem like a smokescreen to lull the people into complacency (or, more accurately, to keep them there) to more easily pass it. I think you may be more correct, in that they are trying to keep it out of the presidential debates.
You got it right!!
I honestly can’t see what’s to like in this monstrosity. The USTR can’t either so he’s kept it under lock and key. Isolate China? Doesn’t sound like it, unless they mean isolate them as the factory of first resort. Globalisation is such a nice and inclusive word, but the details are pretty stunning, looks now like the objective is global equality of poverty in order to assure that the elite get as rich as they possibly can (efficiency is important) during their too short lives…
“• TPP provides three separate rounds of consultations before a violation of the Environment Chapter can even be brought to a dispute resolution. Every other obligation requires only one consultation round. “.
I’ll be running that little gem past the limosine liberals in the near future but don’t expect much in the way of critical thinking from them. Global warming, well they can talk for hours about that topic. How can you be against globalisation? It’s un american…
The divine right of kings reinstated. Don’t argue or be upset, go shopping and buy stuff, it will make you happy. Pay no attention to the man behind the curtain dorothy, just click your heels and wish real hard.
If you maintain a positive attitude everything will be fine. If things aren’t fine, then you don’t have a positive attitude.
Watch the medical tourism to China from the usa jump! Do your kids a favor a make sure they have some basic Chinese literacy. With luck, they will find affordable meds on the American black market, which is guaranteed to skyrocket once this fire sale of master’s us plantation is completed.
Depressing. It turns out Obama is the Manchurian candidate the right warned us about, only for multi-national corporations. Obama has been consistent, however. Since election night in 2008 his every move has embraced and followed the desires of finance and industry. The only quibble they have with him is that he did not just give them everything the wanted right then and there. But they are going to have everything they want, the only question now is the timing. Obama shut labor out and shit on them; Hillary will carry the torch from here.
I used to be a yellow dog Democrat. Obama forced the scales to fall from my eyes.
I’m expecting TPP to pass in a lame duck. That’s all McConnell was signaling. Also, expect Democrat for the Donor Class, like Ben Cardin, to loudly oppose it, now that their votes aren’t needed for passage. He did his job by voting for cloture on fast track. That vote assured eventual passage of fast track and the TPP.
Don’t forget Cardin voted no on fast track passage but only after he hung around the chamber to make sure it had enough votes to pass before casting his then-only-symbolic vote. Thus ends the Democratic Party.
RE: But if you want to know what a left-wing critique of TPP looks like, this REPORT is a great place to start.
Good luck finding it; Barry says Expletive Deleted!
Obama has made much of the “TPP letting the USA define the rules in Asia rather than China” and also mentions that China might join the TPP.
How does the TPP prevent all the associated Asian nations from NOT doing separate trade deals with China on more favorable terms?
There is no way the USA will undermine the Chinese-USA trade in consumer goods as I believe that is partially used to pacify the USA’s population.
And there is a large investment from US companies in Chinese manufacturing facilities that must be preserved.
If the TPP backfires from onerous rents from big Pharma, big Media, Investor state dispute settlements stripping assets from countries, and environmental law roll back, China can look like a hero to Asia by coming to the rescue with better trade laws that exclude the USA.
It will be interesting to see if Obama is rewarded with a very lucrative retirement, courtesy of the connected elite, as the Clinton’s were.
Perhaps the powers-that-be will stiff him, and Michelle will be left singing Peggy Lee’s “Is that all there is?”
The USA will still be left with his toxic legacy.
Comments from Obama like the “TPP is letting the USA define the rules in Asia rather than China” simply do not make sense, especially given the consideration for keeping China in the supply chain for TPP nations. What exactly are the rules we think we don’t want China to define? And if they can just set up a company in Vietnam and get all the benefits of the TPP, the entire notion is silly. I think this is pure race baiting, like the republicans and their southern strategy. We are being taught to fear the Chinese as the foreign “other.”
I doubt the Chinese are foolish enough to join the TPP, as it would strip the government of the power to make laws beneficial to China. As heavy-handed as the Chinese government is, it seems to negotiate trade rules to benefit the Chinese. Our government does not appear to have any interest in supporting the American worker or citizen. Adam Smith warned us that those who got rich through capitalism would turn on the system and try to destroy it to eliminate competition. The TPP would seem to be the final attempt by corporations to ensure their hegemony over any government interference for the next generation or two. But maybe that’s just my interpretation….
The TPP tide might be turning, even among the aspirational elite.
Immediately after the text was released, the search result for `TPP editorial’ was almost universally favorable.
Doing it again just now, there is a lot of skepticism out there, even among newspaper editorial boards.
So, today’s Jeopardy™ clue is, `This important piece of legislation will be rammed through
during the 2016 lame duck session.’
I think you’re right, lame duck is still what we should expect. Make it sound like a falling leaf before all the xmas dinner conversations, out of sight out of mind, then pass it quietly on a mid january friday afternoon by hitching it to a bill for patching potholes. Not that I’m cynical or anything.
“We must pass this bill because pothole filling is job creation, are against job creation?”
To me this is America signalling to the world that we give up. We can’t make better cars than the Germans or Japanese. We can’t make better clothes and shoes than the Vietnamese and China. We can’t grow better livestock than most European countries and we can’t grown better fruits and vegetables than non-GMO countries. We can’t handle democracy here at home so we have to hand off governing to an international cartel of corporations. We can’t support Buy American because that would shut off all the benefits that global trade brings to our beyond the law corporations and anything other than lowering American wages would cut into their profits. We can’t handle truth and justice as the American way anymore. We can’t take care of the citizens like every other advanced nation in the world. This is pitiful. They’re throwing out 200 plus years of hard fought and won victories for democracy. Did we not have a civil war to save the Republic? Ours is a proud history – yet they want to just give up because they say they can’t compete on a global level anymore. Will the ISDS hurt American taxpayers? Nations see this folding up of America and it’s disregard for it’s own proud history and this agreement and the many like it, announce to the world that we give up, come and take it all. Shit. Can’t we impeach all these a-holes?? Boiling pot and frog, that’s America anymore. We need to all wake up. The “let them eat technology group” is somehow winning.
There’s a better chance that this Colonial-IP Empire’s last stand will be challenged on unconstitutional grounds before it can sneak through like a feral gorilla on Macy’s ground floor during LameDuckmas Season between Nov 5, 2016 and January 19, 2017.
i hope you are right, but are we talking about the supreme court here, cause they dont look to be on the side of the citizens…
The report predicts hundreds of thousands of lost jobs and an advance for “the interests of global corporations rather than the national interest.”
From above article
A partnership to destroy jobs! This is to prevent China from destroying the jobs? Better to have jobs killed by fellow Americans than let foreigners do it for us?
(Minor typo note: I think autocorrect inserted “hasten” where you were wanting “hesitate.” In this sentence: “I hasten to summarize such a dense document…”)
Thank you, David, for this important analysis of the Labor Advisory Committee Report. When TPP is rammed through the lame-duck congress, we will fully understand how completely we have been PWN’d by our overlords…
The Kenyan Prince/Nobel Peace Prize-winner need not avoid dark alleys — Americans love to be lied to!