Recent Items

Don Quijones: A Blow to Transatlantic Corpocracy – Support for TTIP Begins to Unravel

Posted on by

By Don Quijones of Spain and Mexico, editor at Wolf Street. Originally published at Wolf Street

A new survey conducted by YouGov for the Bertelsmann Foundation showed that only 17% of Germans believe the Transatlantic Trade and Investment Partnership (TTIP) is a good thing, down from 55% two years ago.

In the United States, only 18% support the deal compared to 53% in 2014.

Such low popularity ratings are an incredible feat for a trade agreement that until last year the public had barely even heard of, purposefully, even as it had been on the negotiation table for years, while the governments associated with it had expected to pass it with flying colors.

During his visit to Germany at the weekend, President Barack Obama tried to breathe life back into the deal, insisting that “the majority of people still favor trade” and “still recognize, on balance, that it’s a good idea.” While that may be so, TTIP, like the other alphabet-soup trade agreements, is not really about promoting trade; it’s about reconfiguring the legal apparatus and superstructures that govern national, regional, and global commerce, business and society, for the benefit of the world’s largest multinational corporations.

Obama could not have chosen a worse possible location to plug his sacred trade deal. Offering a quite visible contradiction to his rose-tinted interpretation of corporate-sponsored trade deals, tens of thousands marched against TTIP in the streets of Hanover on Saturday. Opposition to the trade agreement is also fierce among Germany’s Mittelstand (small and medium-size companies), which represent over 90% of firms in the country. A 2014 Commerzbank study found that only 15% of Mittlestand companies believe TTIP would be a good thing for their business.

Germany’s not alone. Across the old continent, public opposition to TTIP is swelling. Just in the past week three vital developments took place that spell even more trouble for the transatlantic corporatocracy.

1. “Incompatible with Democracy.”

The first blow came from UN human rights expert Alfred de Zayas, who in a hearing with the Council of Europe’s legal affairs and human rights committee on April 19 warned that the “private or semi-private settlement of disputes between investors and states,” at the core of these trade agreements, “is incompatible with democracy, the rule of law and human rights.”



De Zayas’ pronouncement comes hot on the heels of a hammer-blow ruling last February by Germany’s Association of Judges that not only is there no legal basis for an international investment court, but it would have no jurisdiction in any European country. As we reported at the time, the growing opposition to the idea of an Investment Court System (ICS) leaves the Commission’s trade representatives stuck in no man’s land:

Having as good as abandoned the deeply unpopular Investor-State Dispute Settlement (ISDS) and bet all its horses on ICS, it now has to find a third way that not only placates European policy makers who oppose ISDS but also appeases the demands of its negotiating partners and the corporate behemoths that have been pushing for this deal. And that is not going to be easy.

To make matters worse, a Freedom of Information request in the UK just led to the release of a 2013 risk assessment report commissioned by the Department for Business Innovation and Skills that shows that a TTIP agreement would pose “lots of risk and no benefit” to the British economy. “Ultimately, we conclude that an EU-US investment treaty that does contain ISDS is likely to have few or no benefits to the UK, while having meaningful economic and political costs,” the report said.

2. A Thousand-city Resistance.

This weekend the city of Barcelona played host to the first summit of European Cities Against TTIP. The event was attended by representatives of over 40 major European cities opposed to the trade agreement, including Vienna, Seville, Birmingham, Cologne and (irony of ironies) Brussels itself.

In the last year, more than 1,300 European municipalities have declared themselves “TTIP-free zones”. On the other side of the Atlantic, over 100 U.S. cities have declared their opposition to TTIP’s sister agreement for the Pacific region, the TPP, including New York, Seattle, and Miami.

In Europe, resistance to TTIP is not just growing at the municipal and regional level. The next month could see the election of the continent’s first openly anti-TTIP national government. In Austria, the EU Member State that was already most opposed to TTIP (according to the latest Eurobarometer survey, December 2015), voters just put into the presidential runoff vote two candidates who vehemently oppose the deal.

3. A $50 Billion Judicial Reversal.

The biggest blow to the transatlantic corporatocracy took place last Wednesday, when a Dutch district court overturned an award of more than $50 billion to former shareholders of the defunct oil company Yukos that Moscow was ordered to pay by a Hague-based arbitration panel in 2014. It was by far the largest award damages in the history of investment treaty arbitration.

The irony is that the original Yukos trial was an open-and-shut case of shareholder expropriation, albeit one with serious geopolitical connotations. In 2003, the Russian authorities arrested Yukos’s chairman, Mikhail B. Khodorkovsky, on charges of embezzlement, tax evasion, and money laundering and sold off his company piece by piece over the next several years. Much of it ended up as part of Rosneft, now the world’s largest publicly traded oil company.

The court in the appeals trial said that the panel of arbiters that had made the original award had “lacked jurisdiction” to do so, since although Russia had signed the international Energy Charter Treaty, it had not ratified it and so was not bound by it. According to Jeff Sullivan, a partner and expert on energy arbitration at the law firm Allen & Overy in London, Wednesday’s ruling was “a significant victory for Russia.’’

“Certainly the decision of the Dutch court will impact on the ability of Yukos shareholders to enforce the arbitration award in various countries around the world,’’ Mr. Sullivan said. The ruling also raises further questions about the role and jurisdiction of investor arbitrators in international trade law. Given that it is they who would be the front-line enforcers of trade agreements, this could be very bad news for TTIP’s architects whose dreams appear to be in the process of unraveling.

You know things are bad when even the firmest believers begin questioning their faith. That’s what’s happening in the EU, which faces a constellation of threats and challenges. Now even the staunchest Eurocrats are beginning to express doubts – amid fears of  “further escape referendums.” Read…  It’s Gotten So Bad in Europe, Even Eurocrats Begin to Worry

Print Friendly, PDF & Email

Subscribe to Post Comments
24 comments

  1. Quentin

    A Europe side petition against TTIP is now circulating: TTIP petition. It already has more than 3 million signatures.

    1. IDG

      Thanks, signed up.

      This monstrosity is the final nail in the coffin of whatever little democracy we have left.

  3. Quentin

    And signatures are bing collected for a referendum in the Netherlands against TTIP:

    https://ttip-referendum.nl.

    It has close to 125,000 and needs 300,000 to go through. The turnout will be strong and predominately no. The result is not binding, yet the political fallout will be significant.

    1. Clive

      We tried in the UK, here’s what we got for our efforts:

      The Government is working with its EU partners to open markets around the world as increased trade and investment are two of the main drivers for growth, which is the best way to ensure British workers can enjoy better living standards. Businesses which export are more productive, resilient and pay higher wages.

      The Transatlantic Trade and Investment Partnership – a free trade agreement between the European Union and the United States – is a once-in-a-generation opportunity to create the largest free trade area in the world. It would bring huge economic benefits on both sides of the Atlantic, increasing trade and investment, creating jobs, reducing prices and increasing choice for consumers.

      Independent analysis shows that an ambitious agreement could give an annual boost to the UK economy of as much as £10 billion each year. This translates to additional disposable income of about £400 per year for an average UK household. That is why we are pushing for a broad agreement that eliminates the vast majority of tariffs on trade between the two markets and reduces other unnecessary barriers to trade such as duplicate regulatory tests and customs delays.

      Over several decades the UK and EU have signed numerous trade agreements. These treaties have helped both UK and EU businesses grow and create high quality jobs. They have not prevented the Government from taking regulatory action to protect the public or the environment, nor have they forced the Government to change laws, open markets or privatise public services. The agreement with the US will be no different. We expect that there will be no transfer of sovereignty to the EU as a result of this trade agreement.

      There has been, and continues to be, extensive consultation on the agreement. The European Commission has run four online public consultations to get stakeholder views on various elements of the deal. The Commission is holding regular meetings with an advisory group, as well as civil society groups throughout the negotiations. The Department for Business, Innovation and Skills (BIS) also holds regular meetings with organisations representing those with a particular interest in this trade deal. These meetings help to inform the Government’s approach to the negotiations.

      Parliament oversees the negotiations via regular updates from Ministers. This trade deal has been debated in the House of Commons on four occasions and once in the House of Lords. Three Parliamentary committees have considered this trade deal and published their findings. The Government has responded to the report made by each committee.

      The agreement is expected to be a mixed agreement to which the UK will be individually a party. In that case, it will be subject to agreement by each Member State (including the UK), the EU Council (representing governments of the EU countries) and the European Parliament. As part of this process, the UK Parliament will receive the complete draft text of the agreement in order to scrutinise it through debates in both Houses. The draft text will also be published online at the same time.

      Given the level of scrutiny of any deal between the EU and US, we do not believe that a referendum would be an effective use of taxpayers’ money.

      Department for Business, Innovation and Skills

      So that’s alright then. I for one welcome our new corporate overlords.

        1. Clive

          I wish I had more time to shred this fully but since you’ve started so ably, I’ll add…

          The Department for Business, Innovation and Skills (BIS) also holds regular meetings with organisations representing those with a particular interest in this trade deal.

          Yeah, I’ll bet it has. I don’t need three guesses as which the “organisations” have “a particular interest in this trade deal”. They weren’t Big Pharma, Big Agriculture, Big Patents and other assorted Big Pains in the Arse by any chance, do you think?

      2. Brooklin Bridge

        Obama threatening Mr. and Mrs. EveryOne UK that it would take up to ten years to come up with an effective trade deal replacement for TTiP if they vote for Brexit was priceless. “Think of what you would be missing…”

        In many areas, he reads his script just as mechanically and thoughtlessly as his MSM counterparts.

      3. Fiver

        Yes, support ‘free trade’ because it “reduces other unnecessary barriers to trade such as duplicate regulatory tests.”

        Wow. Wouldn’t want something so archaic as a country calling into question the standards the Corporates think appropriate, would we? Monsanto comes to mind….

  4. ke

    Majorities behave like ants, randomly as individuals, organizing with density, but still with no effective feedback loop, and so seek a leader. The leaders they choose are superstitious like themselves, with a distribution of outcomes, remaining only so long as short term benefits accrue to the majority. Being superstitious, the leaders are just smart enough to know they depend on luck, unless they can identify individuals in the minority with an effective feedback loop, which they confiscate to maintain leadership, with majority vote. This is the process, currently passing for democracy.

    At reboot, demographics accelerate and the system gets better at identifying nonparticipants, until it collapses, as the minority increases distance. Trump is very good at identifying his counterparts. Hillary represents those that benefit most from the prevailing superstition, which is collapsing.

    Maintain your distance. Trump is a RE guy, financed by ignorance, and the RE people are turning on each other. They must have quantum advance, and gold isn’t it. What Trump becomes depends upon what you give him. By the end of the day somebody has to do the work, for redistribution. That much Trump knows.

    1. Brooklin Bridge

      That’s truly an insult to ants who at least have a proven record of evolution to base their behavior on.

    2. Fiver

      You bet Trump knows it. He says being President is pretty much like filling out a work order and then just signing it. He wants to add a spot for a tip is what I’m hearing.

  5. sid_finster

    Since when does it matter what the populace wants?

    In Europe, perhaps even more than the United States, what matters is what the rich and powerful want.

  6. DJG

    “De Zayas’ pronouncement comes hot on the heels of a hammer-blow ruling last February by Germany’s Association of Judges that not only is there no legal basis for an international investment court, but it would have no jurisdiction in any European country.”

    Which makes me wonder why the constitutionality hasn’t been tested in the U S of A. A competing court system with greater reach than that of the U.S. courts, headed by the Supreme Court? Dubious.

    Many of facts of the article above and the comments reminded me that the US-UK “special relationship” truly is a marriage made in hell. Neither of the spouses had a couple of working brain cells to at least check with those on the Continent? The rebellions in Germany and the Netherlands are no surprise. Let alone France and Spain. No wonder Obama is on the “indisputable” not-with-a-bang-but-a-whimper tour before he joins the board of General Electric as lead “independent” director.

  8. ke

    FANG is bleeding the country dry from the inside. Do you really think a wall, even closer is going to reduce pressure? Funny, I haven’t heard Trump say we were going to be allowed separate associations. I have 4 elevators right here right now, a boatload in San Fran, and a ton that want development across this county.

    1. ke

      I could put 50 of my guys to work tomorrow, at $250k, so they can raise families, but I’m not putting any of their aholes to work, building me a smaller jail cell, and I am obviously not alone.

  9. rkka

    “The irony is that the original Yukos trial was an open-and-shut case of shareholder expropriation, albeit one with serious geopolitical connotations. ”

    That’s what fraud Khodorkovsky’s legal mouthpieces claimed when he sued the Russian government for $98 billion at the European Court of Human Rights in 2005.

    In May 2011 the ECHR ruled that Khodorkovsky’s conviction for tax evasion on a galactic scale was amply supported by testimony and evidence, and the penalties the Russian government imposed on Yukos were not excessive considering the scale of the crime. Further, the ECHR found Khodorkovsky’s claim of political motivation for the charges to be unsupported by any actual evidence.

    They did give him 35,000 Euro for a few minor proceedural abuses. Not quite the 98 gigabucks fraud Khodorkovsky was looking for…

    1. archer

      Agreed. The cliam “the original Yukos trial was an open-and-shut case of shareholder expropriation, albeit one with serious geopolitical connotations” – demonstrates he knows nothing whatever about the Russian matter.

  11. Fiver

    What is it in these ‘trade’ agreements, I wonder, that is so important to the US Admin it is prepared to alienate virtually everyone in order to impose them? The purported ‘gains’ are so paltry relative to the political effort invested/expended it compels the question as to what these agreements lock in we don’t know about now and perhaps never will, or at least until it’s far too late.

    On another front, Germany, China, Japan, South Korea and Taiwan and others have been named under Congressional legislation which authorizes sanctions against other nations’ economic policies deemed detrimental to US business interests. China was frozen out of TPP in order to attempt to force it to commit economic suicide, then join, while the others all have substantial domestic interests in opposition to these ‘trade’ deals:

    http://www.marketwatch.com/story/us-calls-out-asias-leading-exporters-germany-over-economic-policies-2016-04-29

Comments are closed.