Is Obama’s TPP trade deal worse than NAFTA?

The campaign against the new Trans-Pacific Partnership Free Trade Agreement is picking up steam. It’s a bigger, maybe worse, version of NAFTA aimed at a tariff-free pacific rim, backed up by an extreme intellectual property rights protection agenda (software and pharma in the main). It establishes a supra-national authority, ultimately subject to the World Trade Organization, with power to overrule national laws to maintain consistent international trade terms. It reflects unstoppable pressures from globalization that are very likely irreversible.

The Trans-Pacific Partnership (TPP FTA) is discussed here, here, and here – in mostly negative terms. The articles raise the following questions for me.

1.            How should international trade be governed, and by whom? Many objections are raised regarding environmental, sovereignty, democratic, workforce and labor rights and protections. But there is not much agreement on solutions.

2.            What about consensus between all major stakeholders as a governance model in trade agreements? Would that work?

Since trading motivation ideally includes sacrificing some less-productive work in favor of focusing on the work you do better, or more productively, all trade impacts to some degree a changed division of labor within each trading country. People move from one occupation to another as one part of the previous division of labor is in decline, and another rising. Such change is inherently contradictory.

In addition economies of scale in both agriculture (for example, corn) and manufacturing (as with China) can easily make outcomes asymmetric. The classic example is U.S. corn inputs in Mexico under NAFTA driving millions of low-productivity farmers and farm labor to the United States.

There will never be unanimity between relative loser and winner interests in that process, no matter how “fair” the terms of trade are, as long as market commodities (scarce items allocated by price) are the things being traded. That is likely to be a long time.

So – not much trade would take place if unanimity is required. Perhaps some would prefer exactly that outcome – less trade. But it is naive to expect globalization to recede, given the technology available to us and the ability to buy and sell anywhere in the world for now and the foreseeable future.

3.            How do you measure the relative values of market and non-market goods, market and non-market external factors? This is a huge problem in international negotiations when trying to weigh environmental and democratic “costs” or the real benefit of items like advanced labor rights or health care-in short, measurements necessary to accurately weigh benefits vs. harm of international economic agreements. Not so easy to do.

There is in fact no official statistic on public goods “benefit” value, and the energy lobby in the Senate once threatened to cut off funding for statistics agencies that even tried to calculate environmental cost indexes.

Nor is there agreement across different countries on how to measure the value of a public good. Or a partial public good, like software.

But, even if these measurements are technically challenging, there nonetheless must be a political answer and solution that results, practically, in the right number of votes on the governing boards and officers of the supranational courts and infrastructure established under trade agreements. What is that right number? It’s clear only a president can appoint representatives to these bodies. Under what circumstances should labor or non-market stakeholders have veto power over an agreement? Right now only commercial stakeholders (mostly corporations) appear to be in on the negotiations.

The first step must be publish the voices of the working class stakeholders in all the countries considering participation in the TPP FTA.

The second is to seek an internationalist position that reflects the broadest common ground. Joseph Stiglitz’s overlooked but outstanding agenda for globalization reforms is an excellent framework for seeking that common ground.

4.            What about no governance? That’s kind of “he/she who has the most guns wins” – we have a lot of that now and it aggravates global conflict and instability, especially in a depression. So, there must be governance. The real question then seems not to be “Will we lose sovereignty?” Yes, we will, and we should as the world becomes more integrated and interdependent culturally and economically.

Environmental protection is a public good that cries out for international governance.

Labor rights everywhere cry out for global governance and redress of grievances against multinational corporations.

Elementary democratic and human rights in the struggle for food, water, health and energy cry out for global protection, for trade that serves rather than harms social and economic development – as it often does, especially in the countries “cursed by oil.”

5.            How does support, opposition, or reform of TPP affect getting out of the depression? This will be the number one, question on the mind of every worker across the world. And they will be right. All other questions go nowhere and mean nothing if unemployment does not fall, and working class incomes continue their decline. Exports are an important component of job growth, although secondary to a substantial expansion of public works employment, in getting us out of the depression. A rigid defense of intellectual property rights will actually restrict rather than encourage innovation. Consider the predatory practices of IP trolls like former Microsoft Chief technology officer Nathan Myhrvold.

We need more exports, and we have a ton of national side-effects of globalization that need to be addressed, but we need global labor unity most of all. This was a big defect in the fights over NAFTA. Let’s not do the same on TPP. Those who do the work of the world need to speak together, if not in exact unison, then at least harmoniously.

Photo: Assistant US Trade Representative for Public & Media Affairs Carol Guthrie Meets with Labor Representatives at the 12th Round of TPP Negotiations in Dallas, Texas




John Case
John Case

John Case is a former electronics worker and union organizer with the United Electrical, Radio and Machine Workers (UE), also formerly a software developer, now host of the WSHC "Winners and Losers" radio program in Shepherdstown, W.Va.