What the TPP Should Look Like

SanFranTPPRound_0610Proponents of a corporate-driven Trans-Pacific Partnership (TPP) like to pretend that those who oppose race-to-the-bottom trade policies are somehow “anti-trade.”  It’s an asinine accusation.  The thousands of organizations and millions of people in the United States questioning the TPP want a better way forward, not no trade at all.

In the early stages of the TPP’s development, Citizens Trade Campaign’s coalition of faith, labor, family farm, consumer, environmental and social justice organizations wrote to President Obama suggesting that “The TPP negotiations provide a long-overdue opportunity to decide what policies future U.S. trade agreements should and should not include so as to deliver on our shared goals … of economic justice, poverty alleviation, healthy communities, human rights and a sound environment.”

Among the specific recommendations for the TPP made in our January 2010 letter to the White House were:

– Labor and Environmental Standards and Their Enforcement. The Peru FTA and the three leftover Bush FTAs require countries only to implement the vague terms set forth in the ILO Declaration on Fundamental Principles and Rights at Work, and they explicitly do not refer to the ILO Conventions, with their associated jurisprudence and protections. The labor standards of a prospective TPP agreement must require signatories to enforce the core International Labor Organization’s (ILO) standards as set forth in the ILO Conventions. Requiring in the TPP that countries implement in their domestic law the ILO Convention standards will be a historic accomplishment for international worker rights. Indeed, all future U.S. trade agreements must include a requirement that countries implement in their domestic law the ILO Convention standards. They must also include provisions stating that the failure to enforce or the weakening of such policies would constitute a violation of a trade pact provision, for which the consequences will be just as stringent as commercial violations. The record of implementation of the Peru FTA demonstrates why better enforcement of trade pact labor and environmental terms must be a goal of a prospective TPP. Despite inclusion of the 2007-revised labor and environmental language, the Peru FTA was implemented in 2009 without Peru fully implementing its labor commitments as required and after its government rolled back existing environmental protections. Given the disconcerting labor rights records of Vietnam and Brunei, the issue of enforcement will be a critical one in the TPP negotiations.

– Foreign-Investor Rights and Private Extra-judicial Investor-State Enforcement. The TPP must not include the same foreign investor terms included in NAFTA, CAFTA and the Bush FTAs that led many Democrats to oppose these pacts. These past rules afford foreign investors operating here with greater rights than those enjoyed by U.S. investors. The past FTA investment provisions also allow foreign investors and corporations to directly enforce their special FTA investor rights and privileges by suing governments in foreign tribunals to demand cash compensation. You cited these investment rules as problematic during the campaign. The past FTAs’ investor rights terms create incentives for U.S. firms to offshore their U.S. production to foreign jurisdictions where they can operate under privileged FTA foreign investor status rather than be forced to deal with that country’s regulatory policy and courts. They also subject our domestic environmental, zoning, health and other public interest policies to challenge by foreign investors in foreign tribunals. The Australia FTA does not include investor-state enforcement, providing the starting place from which substantive reforms to the foreign investor rules can be built. The TRADE Act describes a model for trade agreement investment rules that can ensure security for U.S. firms investing abroad while avoiding the overreach of past pacts which established extraordinary new rights for foreign investors.

– Food and Product Safety. NAFTA, CAFTA and the Bush FTAs contain language requiring the United States to accept imported food that does not meet our domestic safety standards and limiting import inspection of food and products. In all future U.S. trade pacts, the right to send food and products into the United States must be conditioned on meeting U.S. safety and inspection standards.

– Procurement Provisions. Past FTA procurement rules subject many common federal and state procurement policies to challenge and directly forbid other common procurement policies. These procurement rules continue the NAFTA/CAFTA ban on anti-offshoring and many Buy America policies, and expose U.S. renewable-energy, recycled-content and other environmental safety requirements to challenge. These terms must be changed in the TPP to provide the policy space for exciting “Green Economy” proposals needed to get our economy back on track.

– Service-Sector Deregulation. Future U.S. trade pacts must not limit domestic policy regarding the regulation of health, energy, and other essential services. As well, the financial crisis has shown the perils of locking in deregulation of banking, insurance, and other financial services, as has occurred in past pacts.

– Agriculture Provisions. Past FTAs contain the NAFTA-style agriculture trade rules that have simultaneously undermined U.S. producers’ ability to earn a fair price for their crops at home and in the global marketplace. Multinational grain-trading and food-processing firms have made enormous profits, while farmers on both ends have been hurt. If this model is continued, hunger is projected to increase, along with illicit drug cultivation, and undocumented migration. Failure to establish new agriculture terms would intensify the race to the bottom in commodity prices, pitting farmer against farmer and nation against nation to see who can produce food the cheapest, regardless of labor, environment or food-safety standards.

– Access to Medicines. While the most egregious, CAFTA-based terms limiting access to affordable medicines were removed from the last four Bush FTAs, the texts still include NAFTA-style terms that undermine the right to affordable medicines that were contained in the WTO’s Doha Declaration. The TPP negotiations must build on the 2007 reforms on medicine patents rules.

These are suggestions we also brought directly to Obama administration’s negotiating team at the TPP round in San Francisco in June 2010, and to more than a half-a-dozen other negotiating meetings held in the United States since.

Today, of course, there is little indication that any of our recommendations were taken to heart in the TPP negotiations.  Leaked TPP texts actually indicate that the opposite is true.  If those leaks prove accurate, the tidal wave of opposition the TPP will face will not mean Americans are “anti-trade,” but rather, that they are sick to death of policies that put corporate profits ahead of human needs.

We have consistently demanded a “fair deal or no deal” on Trans-Pacific trade, and that’s what we’re going to insist our elected officials deliver.