More than 2,000 people across the United States joined Citizens Trade Campaign in submitting comments to the U.S. International Trade Commission (ITC) about the Trans-Pacific Partnership’s (TPP’s) likely economic impacts. The ITC will use these comments in an official study it is publishing about the pact that is sure to garner attention from both Congress and the media.
The following comments were sent both to the ITC and to Congress:
Re: Comments on No. TPA-105-001, Trans-Pacific Partnership Agreement: Likely Impact on the U.S. Economy and on Specific Industry Sectors
The Trans-Pacific Partnership (TPP) would make it easier for corporations to offshore American jobs and push down American wages, by throwing U.S. employers into deeper competition with companies exploiting workers in low-wage countries such as Vietnam, where many people make less than 65 cents an hour, and Malaysia, where many people in export-oriented industries are the victims of human trafficking. These countries could set their minimum wage at $1/day and their maximum hours of work at 24/day and still be in compliance with the TPP’s abysmally-inadequate new labor requirements.
As if this weren’t incentive enough for increased offshoring, the TPP includes investor protections that reduce the risks and costs of relocating production to low-wage countries. The proposed pact would also roll back the number of multilateral environmental agreements signatory countries are obligated to “adopt, maintain and implement” in their domestic laws from the seven included in all previous U.S. trade agreements since the George W. Bush administration to just one.
Americans deserve an honest assessment of how these and other TPP provisions would affect U.S. jobs, wages, income inequality and balance of trade. As such, when studying the TPP, we strongly encourage the International Trade Commission (ITC) to please:
(1) Avoid unrealistic assumptions, such as full employment, neutral trade balances and static income inequality. Business-as-usual trade agreements have offshored jobs, increased deficits and driven down wages. Rather than honestly assess these phenomena, methodologies and models employed in the past by the ITC, and others such as the Peterson Institute, simply “assume” one or more of these problems away. To create a truthful picture of the TPP’s impact on working families, the ITC’s modeling must recognize that people can lose jobs to offshoring and not find new work; that trade deficits can increase; and that economic benefits from trade policies can be concentrated among the rich, while working people suffer income losses.
(2) Assess how anticipated export gains could be wiped out by currency manipulation. The TPP fails to include the binding disciplines against currency manipulation that were requested by large numbers of Democrats and Republicans in Congress in order to protect U.S. firms, farmers and workers from unfair competition. The ITC’s study should detail how potential export gains associated with tariff reductions could be negated by currency manipulation.
(3) Take into account how weak “rules of origin” could affect U.S. jobs and wages. In particular, automobiles that are assembled primarily from parts made in non-TPP countries such as China, which are not subject to any TPP obligations whatsoever, could enter the United States duty-free under the TPP, because the TPP weakens the “rule of origin” for autos included within NAFTA. The ITC’s study should include an assessment of how weak rules of origin impact U.S. trade balances, job loss and income inequality.
(4) Investigate how increased fossil fuel exports could increase energy costs for U.S. producers and consumers. The TPP would require the export of natural gas to TPP countries — including Japan, the world’s top importer — be automatically deemed in the national interest, thus bypassing certain economic and environmental reviews. Please consider how anticipated fossil fuel exports under the pact might increase energy costs for U.S. producers and consumers, and please at least acknowledge the economic costs of associated environmental degradation.
Finally, we’d like to add that the ITC’s requirement that 8 hard copies of any testimony be submitted to its Washington, DC office is a barrier to public comment and public participation. Such a requirement may have been understandable in an age before computers and the Internet, but is unnecessary and inappropriate when considering a 21st Century trade agreement.
Thank you for your consideration.
Thank you to everyone who participated. A PDF of the comments is available online here.