On Wednesday, a key U.S. House committee is scheduled to consider granting “fast-track” authority to the Obama administration to expedite negotiations on the mammoth Trans Pacific Partnership trade agreement. The Senate is expected to put forward companion legislation Wednesday as well, making this a pivotal week in the controversial evolution of the TPP deal, which would affect 40 percent of the global economy
The likelihood that Congress will approve the president’s negotiating request appears to be growing daily. House and Senate tax committee leaders last week agreed on a bill that would guarantee Congress the right to give the final trade accord a simple up or down vote but prevent amendments that could effectively kill the deal by dragging out a vote indefinitely.
Passage of fast-track authority would set the stage for resolution of final differences between the U.S. and the other 11 nations included in the deal. It would also clear the ring for what promises to be a much more public and colorful fight — the battle to convince Congress that the agreement will be good for labor and for business.
President Obama and other leaders of Trans Pacific Partnership agreement nations at a 2010 meeting.
Via Wikimedia Commons
In the wake of the North American Free Trade Agreement, many are wary of big trade accords. That 1993 legislation more than tripled U.S. trade with Mexico and Canada, but is criticized for pushing hundreds of thousands of manufacturing jobs south of the border and depressing U.S. wages overall. It should surprise no one that big business is lining up behind TPP, while big labor is looking to kill it. The AFL-CIO is said to be mounting a major ad campaign to pressure Congress to deny fast-track authority.
Though economists say NAFTA has been good overall for its three trading partners, skeptics say the devil is truly in the details of such large agreements — details that can have a huge and lasting impact on workers and specific industries, if not properly addressed. And TPP is much bigger than NAFTA, with more inner workings over which to be concerned.
The secrecy that has characterized TPP negotiations thus far has only fueled suspicion. Administration officials initially were even reluctant to share draft language with congressional leaders. WikiLeaks began posting purloined drafts from the negotiating process 18 months ago, and much of what has drawn concern from interest groups was represented in those postings and other details that have bubbled up in press coverage, which President Obama says do not reflect the current state of draft language.
It’s not hard to understand why the Obama administration has been so secretive. On the right, he faces Republican opposition that in its latest act of belligerence, sent a letter signed by 47 GOP senators to Iran seeking to kill a nuclear agreement while U.S. negotiators were still in talks. On the left, he faces labor, environmental and progressive groups often overly eager to lash out at anything perceived to support corporate interests.
The president’s political calculus seems to be to postpone a full debate until it can be had on its merits, preserve the integrity of the negotiating process and take his lumps on transparency.
The essential framework of the deal as it’s known thus far shows the Obama administration has learned from the shortcomings of NAFTA and is putting that knowledge to good use. It’s not enough, for instance, to take countries at their word that they will protect their workers, as NAFTA did. Labor Secretary Thomas Perez told the Washington Post requirements are “baked into” TPP for nations to ensure workplace health and safety, freedom of association and acceptable work conditions.
Such requirements could be transformative for workers in countries like Vietnam, which Perez criticized as having “no meaningful labor rights.” Making them mandatory for participation in TPP lessens the likelihood of U.S. jobs being outsourced to these sorts of environments, where labor today is cheap, abundant and exploited. (Vietnam’s largest employer, Perez pointed out, is Nike.)
Obama articulates a larger strategic goal for the deal: Overcoming the “gravitational pull” of China, which is not a TPP participant and seeks to write its own rules for trade among Asia-Pacific countries. Japan shares the president’s interest, and Japanese Prime Minister Shinzo Abe announced Sunday that his nation and the U.S. are close to mutual agreement on the trade deal. As the two dominant partners in TPP, these nations must be in alignment for a deal to be struck between all 12 countries that could effectively counter China’s hulking influence.
“The question is, do we [compete] under rules where we can succeed? Or do we do it under rules that are set by China, and we lose,” said Obama.
The emerging consensus between Japan and the United States — and TPP overall — is potentially very good news for Hawaii, where exports hit a record $1.5 billion last year, supporting 3,000 jobs across the state. TPP markets make up more than 60 percent of Hawaii’s export economy, and lifting tariffs in such countries as Japan, Malaysia and Vietnam could provide a significant boost to Hawaii exporters.
As negotiators continue to hammer out the agreement, it’s important to remember that at the end of the day, TPP would only create a free-trade environment. It would not obviate the United States’ responsibility do all the things it must do domestically to compete successfully in that environment — things like educate its populace, grow business creation and address the nation’s crumbly infrastructure, said the president in an interview with MSNBC’s Chris Matthews on Tuesday.
“The question is, do we do it under rules where we can succeed? Or do we do it under rules that are set by China, and we lose,” said Obama.
We encourage Congress to permit the president and his negotiating team to continue work on those rules on a fast-track basis. There are many legitimate reasons why such a deal may or may not merit final approval by the House and Senate at the end of the day, but in order to make a fair judgment, the administration should be allowed to first complete the full agreement draft. The facts of the deal can then be subjected to full and unfettered scrutiny.
“Some of the information that’s been getting thrown out there plays into legitimate fears that Democratic voters have and progressives have,” said Obama. “But they’re not accurate. They may apply to previous trade deals, but they don’t apply to this one.”
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