NEW YORK – The Trans-Pacific Partnership, the most sweeping free-trade agreement since NAFTA. appears ready to be added to the growing list of Obama administration second-term setbacks, with Obama’s failure to obtain Japan’s signature during his recent trip to Asia.
The lack of an agreement with Japan on the TPP, a centerpiece of the Obama administration’s free-trade agenda, could doom the12-nation meeting scheduled for Vietnam next month.
Even if progress toward an agreement is made in Vietnam, a coalition of union-supported Democrats in Congress have joined with conservative Republicans to deny the Obama administration the “fast-track authority” needed to push the TPP through Congress.
Fast-track authority would allow the Obama administration to move the pact through Congress with a simple majority vote. The rules would limit debate so that no amendments could be introduced to modify the language of the agreement the Obama administration has negotiated behind closed doors.
The failure of the TPP could mark an end to the “new world order” free trade era that began when the administration of President George H. W. Bush started pushing NAFTA as a strategy to boost the U.S. economy by creating jobs through increasing exports.
The Obama administration appears to have failed to convince not only Congress but also Japan that Pacific Rim trading partners should join with the U.S. to contain China economically as Beijing positions itself bypass the U.S. as the world’s No. 1 economy.
An Obama-pushed non-starter?
Curtis Ellis, communications director of the American Jobs Alliance, believes the TPP was not really about free markets.
“The corporatist agriculture and their water carriers in the U.S. Trade Representative’s office are the Commodore Perrys of today, demanding Japan throw open its doors to the gaijin,” he said.
“Japan said no,” Ellis continued. “If that makes the Japanese protectionists, then this is a battle of Japanese protectionists versus American corporatists – this has nothing to do with free markets.”
During Obama’s two-day summit with Japan’s Prime Minister Shinzo Abe, TPP negotiations fell apart despite aides on both sides pulling all-nighters.
Japan was unwilling to buck powerful agricultural lobbies by making concessions demanded by U.S. agri-businesses that would have seen Tokyo lower tariffs for U.S. imports of beef, pork and dairy products.
Politico.com reported the administration tried to make something of the failure, with U.S. Trade Representative Michael Froman saying the teams working under orders from Obama and Abe made significant progress “in narrowing gaps on difficult agriculture and auto market access issues even if a final deal was not reached.”
Ellis insists, however, that after four years and what seems to have been countless rounds of negotiation, the TPP is dead in the water.
That’s despite the Obama administration’s attempt, with its new “Asia pivot,” to transform the TPP from a trade agreement into a political strategy to contain China.
“Obama sees Americans’ jobs and industries as a form of foreign aid he can trade for military bases in East Asia,” Ellis said. “This is how the Trans-Pacific Partnership fits into his ‘pivot to Asia’ strategy.”
David Dodwell, executive director of the Hong Kong-Apec Trade Policy Group, sides with Ellis, arguing in a column published in the South China Morning Post April 28 that the TPP has pushed out of the realm of economic policy into the world of geopolitics.
“An Asia-Pacific trade agreement that excludes China is next to useless,” Dodwell wrote. “My original thesis that FTAs (fast-track authority) are history is completely wrong because the TPP is much more to do with international diplomacy than it is to do with any economic benefits that might arise from trade liberalization.”
Dodwell noted that Japan’s Abe pushed the TPP because the agreement would “unite 12 countries in the world’s largest trade area,” but he pointed out the agreement failed because local agricultural politics and Japan’s farmer voter bloc prevented an agreement from being reached.
Consequently, Obama returns from Japan with empty hands to the U.S., where he cannot convince even the Democrats in charge of the Senate to move forward on the administration’s desire to be granted fast-track authority.
“Our economic futures sit as much with China as anywhere else, and to try to carve a glorious future without reconciling this reality is fantasy,” Dodwell concluded.
GOP at risk supporting Obama on TPP
WND reported in January a nationwide, bipartisan survey of voters made clear that any Republican lawmakers who support giving fast-track authority for the TPP to President Obama are risking their careers. Further, they risk ensuring Hillary Clinton has eight years in the White House to follow Obama’s eight years.
Fully 68 percent of Republican respondents nationwide and an overwhelming 74 percent of GOP conservatives said they were “less likely” to vote for a member of Congress who supported giving President Obama fast-track negotiating authority.
“Republican members of Congress and their political advisers ignore at their peril the massive opposition of Republican and independent voters to congressional passage of fast-track trade authority,” said Kevin L. Kearns, president of the U.S. Business and Industry Council, in releasing the survey results.
He said Republican and independent voters are also “gravely concerned about the negative impact the proposed TPP will have on jobs in this anemic recovery.”
“These voters know firsthand what the Republican leadership studiously ignores: Since the U.S. runs persistently high trade deficits under current outmoded trade policies – a cumulative deficit of $10 trillion in goods since NAFTA – trade displaces many more jobs than it creates and small businesses and their employees suffer disproportionately.”
Kearns said the poll has implications not only for the mid-term congressional elections in 2014 but perhaps even more importantly for the 2016 presidential elections.
“The GOP is now sitting through eight years of an Obama presidency,” he said. “If the GOP wants to sit through eight more years of a Hillary presidency, then all the party needs to do is to support John Boehner and vote fast-track authority for the TPP, a free-trade agreement the Republican voter base does not want to see passed into law.”
Republicans overwhelmingly opposed giving fast-track authority to the president (8 percent in favor, 87 percent opposed), as do independents (20 percent to 66 percent), while a narrow majority of Democrats are in favor (52 percent in favor, 35 percent opposed).
In January, WND was first to report House Republicans were preparing to follow the lead of the White House and Senate Majority Leader Harry Reid to rubber-stamp the TPP.
In a little-noticed press release in January, Senate Finance Committee Chairman Sen. Max Baucus, D-Mont, together with ranking member Sen. Orrin Hatch, R-Utah, and House Ways and Means Committee Chairman Rep. Dave Camp R-Mich., announced they were introducing fast-track trade legislation.
WND reported an impressive group of 564 labor, environmental, family farm and community organizations regarded as core elements of the Democratic Party’s voting base sent President Obama a strongly worded letter charging the TPP undermines the president’s message on income inequality.