UNITED NATIONS – The Obama administration’s release Thursday of the more than 2,000 pages of the text of the Trans-Pacific Partnership agreement, known more commonly as Obamatrade, has prompted a rash of criticism from both the political left and the right.
Critics charge the pact undermines U.S. sovereignty by establishing a secret, unaccountable TransPacific Partnership Commission with sweeping regulatory powers over 40 percent of the world’s economy while sending jobs abroad.
“This trade agreement would allow foreign corporations to challenge our health, safety and environmental protections in a foreign tribunal outside our legal system, and it would weaken those bedrock safeguards in the United States,” said Jake Schmidt, international program director at the Natural Resources Defense Council. “While there are some positive conservation measures, the agreement’s substantial shortcomings should lead Congress to reject it.”
Chapter 28 of the TPP agreement, titled “Dispute Settlement,” specifies that trade disputes will be adjudicated by a three-person panel in accordance with international law, including any World Trade Organization obligations that have been written into the various sections of the TPP agreement.
AFL-CIO President Richard Trumka, head of a union known for supporting Democratic Party political candidates and causes, said that from what he and his colleagues have reviewed so far, “we are deeply disappointed that our policy recommendations and those of our trade reform allies in the environmental, consumer, public health, global development and business sectors were largely ignored.”
Rick Manning, president of Americans for Limited Government, said the TPP “will continue to outsource American jobs overseas, fail to do anything about currency manipulation, and once adopted, will create an international, unelected commission with broad authority to implement and interpret the agreement without any votes of Congress.”
Under the “fast track” authority Congress granted President Obama last summer, lawmakers can only vote “yes” or “no” on TPP. Filibusters are disallowed, and no amendments to the treaty can be introduced, with a simple majority required to vote the FPP trade treaty up or down.
Should Congress fail to act during a 90-day review period, President Obama, under the fast track authority, would be free to sign the pact under his own authority.
The 12 nations comprising the TPP are the United States, Canada, Japan, Mexico, Peru, Chile, Vietnam, Brunei, Singapore, Malaysia, Australia, and New Zealand.
China has responded by creating its own 16-nation compact, the Regional Comprehensive Economic Partnership, a free-trade area including India that is estimated as the world’s largest such bloc, encompassing some 3.4 billion people.
Expansive new powers to foreign businesses
Trumka said the trade deals’ investment rules “still provide expansive new legal rights and powers to foreign businesses to challenge legitimate government actions, the labor enforcement provisions are still inadequate to address the enormous challenges posed by this deal and the lack of enforceable currency rules subject to trade sanctions mean the promised new export markets may never materialize.”
Manning stressed that the regulatory and judicial powers of the commission, in Article 27.2.2 of the agreement, will be akin to rogue agencies and activist courts in the U.S. that regularly issue edicts contrary to the law passed by elected representatives.”
Lori Wallach, director of Public Citizen’s Global Trade Watch, said it appears that the TPP’s proponents “resorted to such extreme secrecy during negotiations because the text shows TPP would offshore more American jobs, lower our wages, flood us with unsafe imported food and expose our laws to attack in foreign tribunals.”
“When the administration says it used the TPP to renegotiate NAFTA, few expected that meant doubling down on the worst job-killing, wage-suppressing NAFTA terms, expanding limits on food safety and rolling back past reforms on environmental standards and access to affordable drugs,” Wallach said.
Peter Maybarduk, director of Public Citizen’s Access to Medicines program, noted many in Congress “said they would support the TPP only if, at a minimum, it included past reforms made to trade pact intellectual property rules affecting access to affordable medicines.”
“But the TPP rolls back that past progress by requiring new marketing exclusivities and patent term extensions, and provides pharmaceutical firms with new monopoly rights for biotech drugs, including many new and forthcoming cancer treatments,” Maybarduk said.
“The terms in this final TPP text will contribute to preventable suffering and death abroad, and may constrain the reforms that Congress can consider to reduce Americans’ medicine prices at home.”
‘Wish list for special interests’
Evan Greer, campaign director of Fight for the Future, said, “Now that we can read the final TPP text, it’s obvious why it was kept in total secrecy for so long,”
He called the agreement “a wish list for powerful special interests and multinational corporations.”
“The Intellectual Property chapter confirms our worst fear about the TPP’s impact on our basic right to express ourselves and access information on the Internet,” he said. “If U.S. Congress signs this agreement despite its blatant corruption, they’ll be signing a death warrant for the open Internet and putting the future of free speech in peril.”
Judit Rius Sanjuan, U.S. manager and legal policy adviser for the Doctors Without Borders/Médecins Sans Frontières (MSF) Access Campaign, said her non-profit “remains gravely concerned about the effects that the Trans-Pacific Partnership trade deal will have on access to affordable medicines for millions of people, if it is enacted.”
“Today’s official release of the agreed TPP text confirms that the deal will further delay price-lowering generic competition by extending and strengthening monopoly market protections for pharmaceutical companies,” Sanjuan emphasized.
“At a time when the high price of life-saving medicines and vaccines is increasingly recognized as a barrier to effective medical care, it is very concerning to see that the U.S. government and pharmaceutical companies have succeeded in locking in rules that will keep medicine prices high for longer and limit the tools that governments and civil society have to try to increase generic competition.”
The pact’s three-person dispute panel is to be composed of one panelist selected by the complaining party and one by the responding party. The third is chosen by mutual consent, or failing mutual consent, by the two initial panelists.
The TPP also incorporates many provisions of the Investor-State Dispute Settlement procedure, ISDS, a common provision in bi-lateral and multi-lateral international investment agreements and treaties that allows investors to sue national governments over treaty violations.
The TPP agreement is estimated to double to 18,000 the number of foreign corporations that could be authorized by TPP to utilize ISDS procedures to challenge U.S. laws and regulations in favor of international trade rules and WTO regulations. It allows a demand of compensation for damages in a wide range of business areas affected by TPP rules and regulations, including disputes over intellectual property and patent rights, challenges over financial service regulations and protections such as safety inspections extended to food and medicine sold in the United States.
While ISDS provisions have existed in international trade agreements since the 1960s, just 50 known ISDS cases were launched through the 1990s. Case volume has increased dramatically in recent years, with 50 known ISDS cases being launched in each of the last three years. Recent ISDS cases have targeted tobacco, climate, financial stability, mining, medicine, education, pollution, water, labor, toxins and development policies, according to a trade group opposing the TPP.
ISDS tribunals have ordered more than $3.6 billion in taxpayer compensation to foreign firms to date. More than $34 billion in ISDS claims are pending under U.S. trade pacts, with disputes contesting U.S. policy in environmental regulation, energy, financial regulation, public health, land use and transportation policies.
Alan Morrison, the Lerner Family Associate Dean for Public Interest and Public Service at George Washington University Law School, in an article published in The Atlantic in June, proposed a scenario of the type of case the TPP is anticipated to allow by expanding ISDS procedures.
Morrison postulated that should the TPP become established U.S. law, a Vietnamese company that owns 15 restaurants in San Francisco could file a lawsuit charging that a minimum wage increase authorized by the mayor of San Francisco was a violation of the “investor protection” provisions of TPP. It would authorize the Vietnamese corporation to bring an ISDS case under TPP before a three-person arbitration tribunal, with the U.S. government the only defendant and the city of San Francisco participating only if the U.S. allows it.
Morrison further points out that under ISDS, the arbitrators are typically lawyers who specialize in international trade and investment, for whom serving as arbitrators is the only one source of income. They are paid by the hour and allowed to rotate between arbitrating cases and representing foreign investors and corporations suing governments in the United States.
Back door for ‘climate change’ regulations
While the TPP is not intended to be a “climate change” treaty imposing carbon surcharges, it introduces environmental regulations in Article 20.15, titled “Transition to a Low Emissions and Resilient Economy.”
The first paragraph states “transition to a low emissions economy requires collective action.”
The pact acknowledges “each Party’s actions to transition to a low emissions economy should reflect domestic circumstances and capabilities” but says the members “shall cooperate to address matters of joint or common interest.”
“Areas of cooperation may include, but are not limited to: energy efficiency; development of cost-effective, low-emissions technologies and alternative, clean and renewable energy sources; sustainable transport and sustainable urban infrastructure development; addressing deforestation and forest degradation; emissions monitoring; market and non-market mechanisms; low-emissions, resilient development and sharing of information and experiences in addressing this issue. Further, the Parties shall, as appropriate, engage in cooperative and capacity-building activities related to transitioning to a low emissions economy.”