Election Eve Epiphany: Hillary has new concerns over TPP's auto industry provisions

[Cheese Sandwich]

Hillary Clinton hardened her stance against the Trans-Pacific Partnership agreement Saturday in a last-ditch effort to prevent Democratic rival Bernie Sanders from riding a wave of populist anger to another victory Tuesday in a key industrial state.

Clinton will criticize auto provisions of the 12-nation agreement that she believes are too weak at a rally Saturday evening in Youngstown, Ohio, a Clinton campaign aide said. The union-heavy state holds a primary Tuesday along with Florida, Illinois, Missouri and North Carolina.

The former secretary of state will single out "rules-of-origin" provisions that would allow Japanese cars and trucks to qualify for duty reductions even if more than half of the parts are made in China or other countries that are not part of the pact, the aide said.

The expected announcement comes after Sanders challenged Clinton to oppose congressional action on the agreement in the "lame duck" session of Congress, which trade experts believe provides the best chance to win approval of the pact this year in the face of harsh attacks from both Sanders and Republican front-runner Donald Trump.
...

more: http://www.politico.com/story/2016/03/clinton-hardens-line-against-tpp-trade-deal-220674

[onecaliberal]

1. Shapeshifter.

[Cheese Sandwich]

2. I know right?

At this point we ought to be rejecting TPP outright. She still hasn't got there.

[onecaliberal]

13. Even if she says she's against it, I don't believe her

[restorefreedom]

3. bull fucking shit. more pandering to be adjusted later. nt

[cyberpj]

4. Mirror, mirror, on the wall, who is in this day's town hall?

What of lies they may recall?
How can I deflect them all?


Mirror laughs out loud.....
'you can't'.

[Jitter65]

5. She actually read the agreement and then made an informed decision. There are parts of the TPP

that, if enforced, are very beneficial to the US worker. And there are parts that need to be modified or they will do harm to the US worker. Agreements can be modified. Labeling all trade agreements as bad before the agreements are fully understood or examined is really bad practice.

[kristopher]

20. Obama has fast track authority - meaning it is all or nothing - since 6/2015

No modifications allowed. By design, that gives the bought and paid for pols a thousand ways to bullshit their way around responsibility for voting away the interests of the public.

[amborin]

6. still will really hurt suppliers, local manufacturers, etc:

Under NAFTA, only auto parts containing 60 per cent North American content could move duty-free between Canada, the U.S. and Mexico. Earlier this fall, the Harper government admitted that the TPP would reduce this local content threshold to 40 per cent. The final text shows that for some crucial auto parts, the new threshold is even lower - 35 per cent.

What this means in practice is that automakers operating within the TPP will be able to obtain up to 65 per cent of their parts outside the trade bloc - from cheap-labour countries like Thailand.

The Toronto Star

November 7, 2015 Saturday

[Cheese Sandwich]

7. Thanks for the info

That's good too know about.

[amborin]

11. more here:

maybe someone can use some of it to compose an OP or tweet some of it out to Ohio; the cites follow the text:

Speaking of fracking, we could see a whole lot more of this dirty and destructive practice in our backyards thanks to the TPP. The pact would require our Department of Energy to automatically approve all exports of liquefied natural gas (LNG) to all TPP countries-including Japan, the world's largest LNG importer. This means more fracking, air and water pollution, climate emissions and reliance on fossil fuels-when we should keep those fuels in the ground and fully embrace clean energy.
#3 WE'D LOSE MILLIONS OF MANUFACTURING JOBS.
Between 1997 and 2014, America lost more than 5 million manufacturing jobs. The vast majority, according to the Economic Policy Institute, vanished as a result of growing trade deficits with America's free-trade and investment-deal partners. Some 850,000 jobs were lost to NAFTA after it took effect in 1994. China's entry into the WTO in 2001 cost the United States a staggering 3.2 million manufacturing jobs over the next dozen years.
But the numbers on the TPP look even worse. The Wall Street Journal calculates that by 2025, the deal would increase the U.S. trade deficit in manufacturing, car assembly and car parts by $55.8 billion a year. At that rate, based on the U.S. Department of Commerce formula for jobs created by exports, the TPP would cost another 323,000 American manufacturing workers their jobs. That's almost a million jobs every three years.
And that is a conservative estimate, because the TPP negotiators failed to include enforceable methods to stop foreign labor abuses, including poverty wages and perilous working conditions. This facilitates a race to the bottom. Corporations move factories overseas because they can't get away with paying Americans the $107 a month that is the wage floor in Vietnam.
Also, disastrously, the TPP would lower the minimum requirement for cars and auto parts to be considered pro- duced by a U.S. trade partner. The proportion would fall from 62.5 percent under NAFTA to 45 percent under the TPP, which means more than half of a vehicle could be manufactured in China while auto companies would still benefit from zero U.S. tariffs.
For decades, regulations for free-trade agreements like the TPP have lined the pockets of the wealthy and emptied those of workers. This must stop.
-Leo Gerard, President, United Steelworkers
#4 IT DOES NOTHING TO FIX OUR ENORMOUS TRADE DEFICIT.
Our current trade deficit is close to $500 billion annually, or 3 percent of our GDP. This money is creating demand and employment in other countries, not the United States, and implies the loss of close to 3 million U.S. jobs a year.
This matters hugely in the context of an economy facing a shortfall in demand, or "secular stagnation." In more normal times, the demand lost to the trade deficit could be replaced by more investment or consumption spending. But under secular stagnation, neither will fill that loss.
Yet the TPP fails to address the main reason for our large and persistent trade deficit: currency manipulation by other countries. Lowering ones currency by 10 percent against the dollar has the same effect as imposing a 10 percent tariff on all imports and paying a 10 percent subsidy on exports. Raising the price of exports and lowering the price of imports makes U.S. goods and services less competitive internationally and domestically.
A number of countries, including TPP parties Japan, Malaysia and Vietnam, have engaged in this practice over the last two decades, driving up the U.S. trade deficit.
8 Terrible Things About the TPP
Moberg, David. In These Times 40.1 (Jan 2016): 24-25,27,29.

Perhaps the major reason why the TPP will not produce even the minor gains for the United States that are forecast by the models is the impact of exchange rates. These models do not assume that nations manipulate their exchange rates, but several TPP members do just that. Indeed, as I write, China has just devalued its currency by about 3 percent amid slowing growth and falling stock markets. When currencies can move 3 percent in just a day, or 2 percent to 30 percent over a period of several months, negotiation of tariffs, subsidy rules, and market-opening measures loses much of its meaning.
Because the TPP will not change this situation, it almost automatically cannot be good for the U.S. economy or the average American. Indeed, it is important to underline that no one in the Asia-Pacific or Latin American regions believes the TPP will in any significant way change the structure of regional trade that has long resulted in huge American trade deficits and lost American jobs, as the United States has played the role of global consumer of last resort.
In view of this, it has been extremely disappointing to hear President Obama demonstrate complete misunderstanding of the realities of global trade and of the TPP. For instance, he has asked rhetorically in his speeches how anyone could be opposed to opening the Japanese auto market to enable Fords and Chevys to roll on Japanese roads. The very question showed his ignorance of the fact that nothing on the TPP agenda alters the Japanese manufacturers' control of Japanese dealerships, which is the main mechanism of closure of the Japanese auto market. For example, even though the Koreans are low-cost auto producers and have been taking market share from the Japanese in the European, Chinese, and U.S. markets, they have completely withdrawn from trying to sell in Japan. Since that is not being discussed, the TPP cannot put American or Korean or European or any other mass-market cars on Japanese roads.
THE ECONOMICS OF TPP
Prestowitz, Clyde. The American Prospect 26.4 (Fall 2015): 18-19.


U.S. News: Trade Pact Stalls Over Car-Parts Dispute
Mauldin, William; Althaus, Dudley. Wall Street Journal, Eastern edition [New York, N.Y] 04 Sep 2015: A.2.


Detroit auto makers in general prefer rules of origin somewhere in the middle, because strict rules could crimp their reliance on global supply chains, while lax rules open Detroit up to increased competition from Asia, an executive at one U.S. auto maker said.

A fight over how cars are assembled is pitting North America's auto industry against Japan's in a dispute now holding up a major trade agreement spanning the Pacific.
The spat over which cars should be eligible for duty-free trade surfaced during high-level talks in late July that failed to wrap up the 12-nation Trans-Pacific Partnership. The auto impasse is the most recent complication to finishing the TPP talks, along with dairy trade and the intellectual-property protections afforded to biologic drugs, as well as the election season in Canada and the approaching campaigns in the U.S. and Japan.
Japanese auto makers rely to a larger degree than their North American peers on components produced in other countries, such as China and Thailand, outside the proposed TPP bloc. They don't want the agreement to disrupt that supply chain.
The Mexican auto industry is leading a campaign to ensure cars freely traded within the TPP have at least half their components originating in the bloc. American labor groups and some suppliers, worried about more jobs being moved overseas, also favor tighter rules in the TPP.
In the middle of the dispute are U.S. officials, who have been negotiating intensely with Japan for more than a year on auto and other issues but who also don't want to upset American workers or North American neighbors.
The stakes are highest for Mexico, which uses existing free-trade agreements to attract investment and boost production.
"We are very worried about this," said Eduardo Solis, executive director of the Mexican Automotive Industry Association, known as AMIA. As leading suppliers of cars and parts to the giant U.S. market, Mexico and Canada don't want a Pacific deal to shift trade advantages to Japan.
The car and parts dispute highlights how the two-decade-old North American Free Trade Agreement has built an automotive powerhouse within the U.S., Canada and Mexico.
"We're going to lose what we have gained under Nafta," said Oscar Albin, executive director of the National Auto Parts Industry, Mexico's industry association. "We're going to lose production of auto parts and the United States is going to lose the prime materials markets. This is a grave danger."
Mr. Albin and other industry officials are pushing for at least a 50% content rule for auto parts under the TPP. With some 700,000 employees and export sales of $60 billion -- mostly to the U.S. and Canada -- the auto-parts industry serves as a linchpin of Mexican manufacturing.
U.S. and Japanese officials say the rules are complicated and that percentages in Nafta don't translate easily into the so-called rules of origin under negotiation in the TPP.
"We are working toward a strong rule of origin in TPP that meets our objective of making sure that TPP benefits go to TPP countries and that promotes a vibrant domestic automotive industry and the jobs it supports," said Matt McAlvanah, a spokesman for the U.S. trade representative's office.
Detroit auto makers in general prefer rules of origin somewhere in the middle, because strict rules could crimp their reliance on global supply chains, while lax rules open Detroit up to increased competition from Asia, an executive at one U.S. auto maker said.
But labor groups that represent a swath of the industry, including auto-parts workers, want tight rules to prevent the bulk of auto components from being produced in countries, including China, that aren't preparing to sign on to the labor and environmental standards of the TPP.
"It will cost jobs," AFL-CIO President Richard Trumka said Tuesday in Washington. Mr. Trumka said he sent a letter last month to the U.S. trade representative, Michael Froman, to push for stricter rules.
For Mexico, loose rules of origin in the TPP could undermine its efforts to push into the luxury car business and give Japan's producers a leg up, industry experts say. "We could see very cheap Toyotas or Lexuses arriving in the U.S. with lots of Chinese parts, said Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Mich.
Lax rules of origin also would undermine the Obama administration's argument that the TPP would establish rules of the road that put pressure on China's dominance of the region.
A Japanese official said Tokyo backs allowing a greater percentage of parts from outside the bloc in order to defend auto makers' existing supply chains, not to encourage outsourcing to China.
Car States Balk at Trade Pact; Opponents say president's push could cost jobs and not result in a more open Japanese market
Mauldin, William. Wall Street Journal (Online) [New York, N.Y] 18 May 2015: n/a.


"When they decide to build a plant in the state, they consider a lot of things." Because of the foreign car investments in his state and other factors, Mr. Sessions says he may join a small group of Republicans expected to vote against so-called fast-track trade legislation, a procedural measure that would allow the Pacific trade deal to get an up-or-down vote in
President Barack Obama's Pacific trade agreement is raising alarms not only in Michigan and surrounding states dominated by Detroit's Big Three, but also farther south where backers of Japanese car makers worry about the fate of current and future plants in the region.
The proposed Trans-Pacific Partnership among the U.S. and 11 other countries would lower tariffs on imported cars from Japan as part of a much broader agreement to cut trade barriers and abide by a set of shared commercial rules. At the same time, the U.S. could agree to reduce or eliminate its import tariffs on cars, trucks and parts in 10 years or less.
While most U.S. industries are unlikely to notice much difference under the TPP, the auto sector is set to see a tangible impact. In the transportation sector, led by cars, the TPP could boost imports by an extra $30.8 billion by 2025, compared with an exports gain of $7.8 billion, according to a study co-written by Peter Petri, professor of international finance at Brandeis University.
"The tariff cuts would help Japan, but 10-plus years is a long time in a dynamic industry," Mr. Petri said. The auto makers "are looking beyond the TPP, at tough global competition around the bend" in China and other Asian countries.
Disappointed that Japan joined the Pacific talks, the Detroit-centered auto industry is pushing to get as much possible in the deal, even if that means seeing it defeated in Congress. With the dollar's rise eating into profits, Ford Motor Co. is pressing allies in Congress to include rules cracking down on potential currency manipulation in Japan.
At the same time, unions and lawmakers wary of lowering trade barriers warn the TPP could reduce the appeal of U.S. operations for Japanese producers, which currently avoid a small but significant tariff on cars produced and sold in the U.S.
"In truth, if you eliminate the 2.5% tariffs on imported automobiles, that might reduce the desirability of a foreign country to invest and build a plant in the United States," Sen. Jeff Sessions (R., Ala.) said in an interview last week. "When they decide to build a plant in the state, they consider a lot of things."
Because of the foreign car investments in his state and other factors, Mr. Sessions says he may join a small group of Republicans expected to vote against so-called fast-track trade legislation, a procedural measure that would allow the Pacific trade deal to get an up-or-down vote in Congress without amendments.
The White House is seeking the legislation to help conclude the TPP talks and ensure a timely vote on the deal.
Mr. Obama has brushed aside static from Detroit and other defenders of the car makers, promising in an interview last month with The Wall Street Journal "to show that it is a good deal for them." Indeed, the U.S. is seeking to lower regulatory and other barriers Detroit faces in Japan's car market as part of the broad trade pact.
But while opponents in Detroit would welcome improved access to Japan and other Asia-Pacific markets, they fear currency manipulation could undermine any benefits. Ford and other Detroit producers want Congress to enact rules to deter currency manipulation, backed by the threat of trade sanctions.
Rep. Sander Levin, a Michigan Democrat who has emerged as one of the top critics of Mr. Obama's trade policy, is calling for the tariff to be cut in 25 years and phased out over 30 years if Detroit doesn't gain a foothold in the Japanese car market. Many observers say the deal may erase the duties in 10 years, with potential reductions in auto-parts tariffs sooner. Cutting the main duty on cars could save Japanese producers $1 billion a year.
Mr. Petri, the Brandeis trade expert, said car imports would see less of a jump in that period if the U.S. tariff cut is delayed.
But Mr. Levin--like Sen. Rob Portman, an Ohio Republican who previously served as U.S. trade representative, and many other lawmakers--is backing strong versions of currency rules that the Obama administration and other trading partners oppose. Sen. Debbie Stabenow, another Michigan Democrat, has warned about cutting auto part tariffs, and Sen. Sherrod Brown (D., Ohio) is one of the biggest critics of Mr. Obama's trade policy over workers' issues, especially in steel and manufacturing.
"Japan's one-way street in the automotive industry has cost U.S. jobs for decades," Mr. Levin said. "Any reductions in the U.S. tariff on Japanese autos and trucks must be tied effectively into the opening of their long-closed markets."
Many backers of freer trade--including the Japanese auto giants that produce many cars in North America--dismiss the concerns of Detroit and politicians in the region as outdated protectionism. Cutting car duties could benefit consumers through lower sticker prices, they say.
"Because this is a free-trade agreement, we support all auto tariffs in the TPP--cars, parts and trucks--going to zero as soon as possible," said Ron Bookbinder, the Japan Automobile Manufacturers Association's U.S. director.
Trade agreements can also lure more investment from companies that want to sell to the broader trade bloc. "In our experience, auto companies invest in Tennessee and elsewhere in the country because of our vibrant market and skilled workforce, and lowering trade barriers would lead to an increase in auto manufacturers in the United States," said Sen. Bob Corker (R., Tenn.).
Observers say Japan's auto makers have invested heavily in the U.S. and aren't likely to move based on the TPP. "There are huge fixed investment costs and firms can't just pick up and move with every exchange-rate fluctuation or tariff change," said Douglas Irwin, trade expert and economics professor at Dartmouth College.
Those assurances may not be enough for labor unions and allied Democratic lawmakers worried about the TPP's effect on Japanese producers in the U.S.
"The reason they came here is because they had to," said Glenn Johnson, head of local 1112 of the United Auto Workers, which runs the General Motors Co. plant in Lordstown, Ohio. UAW members operate plants that supply Asian producers. "We don't know what the trickle-down effect could be" if the U.S. tariffs are removed, he said.

[Hydra]

8. *lmao*

"I got Berned! Have to scramble to cover a few bases with a fig leaf, that will fix it!"

[Skwmom]

9. Voila! She followed the NYT's recommendation. I knew that was coming. n/t

[Cheese Sandwich]

12. Wait she released her speech transcripts?

[Rosa Luxemburg]

10. Hillary's Golden Standard TPP?

[AzDar]

14. Good Lord... who would believe *anything* she says?

[CharlotteVale]

15. #whichhillary

[Mufaddal]

17. It gets so hard to keep track

[reformist2]

16. It's too late. She's losing the audience. Her votes are coming almost all from loyalty & nostalgia.

I don't see her winning any new votes with anything she says. In bet she loses support with every new policy change. She'd probably be better off not saying anything new at all.

[IDemo]

18. Has she criticised Sanders yet for not standing behind her on this? n/t

[Motown_Johnny]

19. The internal polling must be troublesome.

Then again, it doesn't take much to make her flip flop.

[Uglystick]

21. I wonder how her internals are for 3/15

It has to be *that* bad.