Thursday, May 14, 2015

The Trojan Horse in the TPP that Should Make all Americans Oppose It

Also posted on and

By Dan Riker

Opponents of fast-tracking the Trans-Pacific Partnership ("TPP") won one round, but lost the second in the Senate, and now appear unable to block it there. However, the battle is far from over. Passage in the House is far less certain. And even with the Republicans compromising on some  amendments progressives want attached, perhaps the most dangerous provision of the TPP will remain untouched, a possible "Trojan Horse" that could nullify much of federal, state and local environmental and consumer protection laws and regulations.

The actual provisions of the TPP are being kept secret, with only members of Congress allowed to see them. Of course, there have been many leaks of various details. New York Attorney General Eric T. Schneiderman wrote in Politico Magazine[i] last month: "One provision of TPP would create an entirely separate system of justice: special tribunals to hear and decide claims by foreign investors that their corporate interests are being harmed by a nation that is part of the agreement. This Investor-State Dispute Settlement provision would allow large multinational corporations to sue a signatory country for actions taken by its federal, state or local elected or appointed officials that the foreign corporation claims hurt its bottom line."

Consider what this means. Major multinational corporations, many of which moved their headquarters out of the U.S. to avoid taxes, would be able to evade American federal, state and local judicial and regulatory systems that currently have authority over them.  The implications are enormously dangerous to the American democratic system of government and justice, as well to environmental, consumer and health safety. Schneiderman describes exactly what could occur:

"To put this in real terms, consider a foreign corporation, located in a country that has signed on to TPP, and which has an investment interest in the Indian Point nuclear power facility in New York’s Westchester County. Under TPP, that corporate investor could seek damages from the United States, perhaps hundreds of millions of dollars or more, for actions by the Nuclear Regulatory Commission, the New York State Department of Environmental Conservation, the Westchester Country Board of Legislators or even the local Village Board that lead to a delay in the relicensing or an increase in the operating costs of the facility."

The fast track temporarily was blocked in the Senate because supporters could not overcome the filibuster mounted by the progressives over the refusal of the Republicans to simultaneously approve three amendments to the bill that would mitigate some of the potential negative effects of the TPP. Strong arming by the White House and Mitch McConnnell compromising on the amendments led to a victory for fast tracking today. But Republican support in the House is weaker than it is in the Senate.

One of the amendments limits the ability of participating countries to manipulate their currencies. This is critically important because lowering tariffs does no good for American companies if other countries are able to manipulate their currencies to keep them worth less than the American dollar. That makes their products less expensive in the United States, thus giving them a competitive advantage over rival American products.

But none of the amendments deals with the TPP's new system of regulation that sidesteps American governmental and judicial regulation. As long as this provision remains in the TPP, the treaty, and, especially its "fast-track" should be opposed by all Americans.

That the actual provisions of the TPP are being kept secret and that this separate system of regulation is included are more than adequate reasons for Americans to be deeply suspicious of the real purposes of the TPP. It does not appear to be a real "trade" deal. It does not appear to have great benefits to the people of the United States. It appears to be the work of special corporate interests, multinational corporations already operating almost beyond government regulation. The TPP appears to be another case, a major case, of government largesse for major corporations at the expense of the people.

This is not a conservative vs. liberal issue. This should not be a Republican vs. Democrat issue. It is not an issue of federal vs. states' rights. This is an issue of preservation of the existing American federal system that provides states and local communities the powers necessary to protect themselves from hazardous behavior by corporations.

It is time for Americans to put a stop to the TPP.

[i] Eric T, Schneiderman, Don't Let TPP Gut State Laws: The partnership's potential to undermine state laws should concern Congress. Politico Magazine, April 19, 2015.

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