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Response to airplaneman (Reply #53)

Sun Dec 30, 2018, 11:19 AM

137. I think it was a very bad agreement as it was written then, and do not support it now.

Just because the orange globule Trump is a nightmare and clatters about spewing simplistic America first bullshit and trying to con people into thinking he actually gives a shit about the 99% via dodgy anti-free trade and faux protectionist claptrap doesn't mean I will be gas-lighted into accepting that the TPP and TTIP (the European Version of TTP) were overall good agreements. I wholeheartedly think they were not.

Multiple liberal economists, including Robert Reich and Nobel Prize Nobel laureates such as Joseph Stiglitz laid out rock solid cases why it was a bad agreement.



Beware of TPP’s Investor–State Dispute Settlement Provision
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/beware-tpps-investor-state-dispute-settlement-provision/

While advocates promote the Trans-Pacific Partnership (TPP) as a “free trade” agreement between the United States and 11 Pacific Rim countries, the most economically significant provisions are not cuts to trade barriers. Instead, the key element is TPP’s investment chapter, which gives foreign investors the right to sue governments in private international arbitration when they feel their newly created property rights are violated (a process known as investor–state dispute settlement, or ISDS).

The alleged goal of ISDS is to increase security for investors in states without an adequate “rule of law.” But the fact that the U.S. is insisting on the same provisions in Europe, where legal safeguards are as strong as they are in the U.S., suggests another motive: the desire to make it harder to adopt new financial regulations, environmental laws, worker protections, and food and health safety standards.

While defenders of ISDS sometimes claim that it prevents discrimination against foreign firms, foreign firms have sued—and won—even when they are treated no differently from domestic firms. In fact, these provisions discriminate in favor of foreign firms: A foreign firm can sue the U.S. government in private arbitration for cash rewards if it thinks government actions violate the new rights and privileges granted by TPP, but domestic American firms have no such recourse in U.S. courts. Two arbitrators can, in effect, undermine decisions of Congress and the president, ordering billions of dollars in payments for their lost investment value and guesstimated lost profits.

Under TPP, foreign investors could sue over pretty much any law, regulation, or government decision. The agreement guarantees a “minimum standard of treatment,” a vague standard that corporate-friendly arbitrators have interpreted liberally in past decisions, inventing obligations for governments that do not exist in the actual text of agreements or host countries’ laws.

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Who Gets to Write and Interpret the Rules Under TPP?
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/who-gets-write-and-interpret-rules-under-tpp/

If the Trans-Pacific Partnership (TPP) is enacted, multinational investors will be able to sue the United States and other host country governments in private international arbitration (investor–state dispute settlement, or ISDS) when they feel domestic laws, regulations, or other government actions violate their rights under the new agreement. How will such challenges be handled? No matter how well contracts or treaties are written, disputes will inevitably arise. And there needs to be a low-cost, expeditious, fair, open, and consistent means of resolving disputes. This is a basic public good provided by every democratic society. The system created by TPP to adjudicate investor disputes, in contrast, fails to meet these basic criteria.

Under TPP, tribunals comprised of three individuals—typically, practicing investment lawyers specialized in this boutique area of international law—would decide whether governments had to pay investors potentially billions of taxpayer dollars because of rule changes intended to improve the health and safety of our workers, food, environment, and financial system. Business could demand compensation for any regulation that resulted in the diminution of their expected profits and value of their investment.

These arbitrators would not be tenured, impartial judges. In the ISDS system, arbitrators rotate between representing investors in investment arbitrations and sitting in judgment on investment tribunals—worse, they can fill these conflicting roles simultaneously. This game of musical chairs is played among a relatively small group of lawyers who are either bringing or adjudicating cases against governments; reportedly, 15 arbitrators have decided more than half of all international investment arbitration cases.

Only investors can initiate disputes under this system. They choose not only their own lawyers, but also one of the three arbitrators (with a second chosen jointly by the plaintiff and the defending government). Arbitration lawyers that buck the system risk being culled from the herd. These are glaring conflicts of interest for people asked to judge what is “reasonable” and “fair and equitable” in balancing public and private interests.

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TPP’s Hidden Climate Costs
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/tpps-hidden-climate-costs/

President Obama has said that “no challenge poses a greater threat to future generations than climate change.” Yet the word “climate” is conspicuously missing from the Trans-Pacific Partnership (TPP). Worse, many provisions of the proposed trade agreement between the United States and 11 Pacific Rim countries could undermine critical policies and initiatives needed to contain global climate change. All the evidence suggests that in order to limit global warming to the 2 degrees Celsius that scientists see as critical to avert the worst effects of climate change, we must retrofit global economic structures for production, investment, and trade. Instead, TPP would cement in place a system that treats the environment as distinct from and subordinate to international trade and investment.

Though trade negotiators may treat commerce and climate as separate problems, the emissions giving rise to climate change are in fact an unaccounted cost of the goods and services exchanged in our increasingly complex and globally integrated production and consumption chains. Not paying for these large social costs of pollution in production and global shipping delivers a hidden subsidy to the corporations polluting our global atmosphere.

Any good trade agreement would seek to do away with distorting subsidies to producers. One cannot have fair trade if firms are not required to pay the environmental costs they impose on society, which also present an existent threat to life on this planet. TPP does nothing to prohibit these typically hidden subsidies or others, such as subsidies for fossil fuels, buried within the tax system.

TPP is worse still because it creates the risk of lengthy lawsuits and sizable cash awards to investors for government actions that would rein in many of the current hidden subsidies for greenhouse gas pollution or ban climate-imperiling products and production methods. For instance, under TPP rules, government policies to incentivize more environmentally sustainable goods and services—even with voluntary labeling—can be challenged as illegal “technical” trade barriers unless the government has requested a specific policy exception in the existing agreement. Countries that lose such cases will face millions in sanctions unless they eliminate the policy favoring more socially and environmentally sustainable conditions.

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Will TPP Help to Curb China’s Rise?
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/will-tpp-help-curb-chinas-rise/

With few people buying the argument that the Trans-Pacific Partnership (TPP), a sweeping trade and investment agreement between the United States and 11 Pacific Rim countries, will bring more jobs and higher wages, proponents of TPP now argue that it is a critical front in the geopolitical conflict between the United States and China. President Obama made this case in his State of the Union address: “With TPP, China does not set the rules in that region; we do.” Such rhetoric, reminiscent of Cold War containment strategies, is not constructive for the world’s most important bilateral relationship. The truth is that this strategic rationale for TPP makes little sense.

With China now the world’s largest economy in terms of output (measured in purchasing power parity), trade, and source of foreign direct investment, the ship has sailed on containing China’s influence. This should have been obvious from last year’s failed attempt by U.S. policymakers to block the Asian Infrastructure Investment Bank, created under China’s leadership.

If trade deals were all that mattered for securing influence, the United States could at best hope for a stalemate with China, which already has agreements with more than half of TPP partners, among other nations. What matters for influence is not just signing agreements but the depth and nature of relationships. Given the hundreds of billions of dollars China has committed to finance infrastructure development across the region and the magnitude of China’s trade and investment integration with the world, there is little reason to think that implementation of TPP would tip the balance of economic power in the U.S.’s favor.

The rules to which parties agree do, however, matter a great deal when it comes to determining who wins and who loses. Here, President Obama’s rhetoric obscures the reality that “we” did not write these rules. More than 500 official advisors—overwhelmingly representing corporate interests—had special access to U.S. negotiators and TPP texts to advance their own special interests, not the national interest, but Congress, the public, and the press were shut out of seven years of closed-door negotiations.

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The High Health Costs of TPP’s “Free Trade”
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/high-health-costs-tpps-free-trade/

Despite protests from industry lobbyists who are upset that they did not get everything they wanted, big pharmaceutical companies are some of the biggest winners in the Trans-Pacific Partnership (TPP). This supposed “free trade” agreement between the United States and 11 countries in the Americas and Asia would enshrine expansive monopoly protections for intellectual properties that shield drug makers from competition and provide them with new powers to challenge government decisions aimed at managing health care costs. A win for Big Pharma here will leave virtually everyone else worse off, with their higher profits coming at the expense of higher health care costs for consumers and taxpayers, avoidable deaths and suffering, and health innovations being brought to market at a slower pace.

In order to maximize public welfare, intellectual property rights (IPRs) must strike a balance between providing incentives for innovation and enabling their widespread dissemination so people can benefit from and build on new ideas and technologies. Since past knowledge is the most important input to the production of new ideas, more restrictive IPRs actually restrain opportunities for future innovation. Patents are part of innovation systems in all countries; however, both recent and historical economic evidence shows that patents with varying degrees of strength have little relationship to measures of innovation, investment, or economic performance. In other words, patents are not the only way to incentivize research and development.

Nowhere is it more imperative to get the IPR balance right than in the health care field. The 1984 Hatch-Waxman act struck the right balance, saving U.S. consumers, employers, and taxpayers more than $100 billion per year with lower-cost generic medicines. Since then, pharmaceutical firms have developed new policy devices to claw back their monopoly protections and are advancing these policies in trade agreements. TPP would lock these in place in the U.S. and export them to other countries, tipping the IPR balance for all TPP partners as well as countries outside the bloc.

First, TPP will require countries to implement measures that allow “evergreening” of monopoly protections that prevent the introduction of low-cost generic treatments to the market. TPP achieves this by requiring signatory countries to grant new 20-year patents for new uses of old medicines or for trivial alterations of existing medicines. For example, if a drug that is dosed four times a day is reformulated to be dosed once a day, this would qualify it for an additional 20 years of monopoly protection.

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Why TPP Is a Bad Deal for America and American Workers
By Joseph Stiglitz | 03.28.16

http://rooseveltinstitute.org/why-tpp-bad-deal-america-and-american-workers/

From the rhetoric of proponents of the Trans-Pacific Partnership (TPP), a sweeping trade and investment pact between the U.S. and 11 Asia-Pacific countries, it would be easy to conclude that the agreement is an economic panacea for the shrinking middle class and stagnant wages faced by most workers in America. The reality is more sobering: There are good economic reasons to believe that TPP will not only fail to provide the promised benefits but actually make things worse.

Yes, economic gains can be found through trade liberalization where trade barriers are high, but tariffs are already low (just 2.7 percent on average between TPP member countries). Put this minuscule number next to the surging U.S. dollar, up 26 percent since July 2011. A more expensive dollar makes imports cheaper and exports less competitive in foreign markets. The exchange rate change swamps the benefits from the small reduction in tariffs. And the toothless side declaration on exchange rate misalignments by TPP finance ministers is likely to be as ineffective as current diplomatic efforts to rebalance exchange rates.

While the U.S. Trade Representative boasts of 18,000 tariff cuts for American exporters, the economic significance of many of these to U.S. producers and workers appears negligible. For example, tropical, impoverished Vietnam will eliminate tariffs on skis, snowplows, and caviar, while predominantly Muslim Brunei and Malaysia will eliminate tariffs on pork. In fact, in more than half of the 18,000 categories, the U.S. exported nothing to TPP nations last year; for many of the remaining 7,500 categories, American exporters sold only small amounts. These are areas where American producers are unlikely to develop a comparative advantage.

With trade barriers already so low, it is no wonder that existing modeling analyses from economists at the Peterson Institute and the World Bank show such negligible benefits from eliminating trade barriers in TPP. Both find that gains to the U.S. economy will be less than the statistical error when the Commerce Department calculates our GDP figures. A study by the Economic Research Service found that TPP would have zero effect on U.S. GDP. Even these estimates should be taken with a grain of salt: The models assume that trade will be balanced and no unemployment will ensue. Models incorporating more realistic assumptions, like those from economists at Tufts University, find a net GDP loss for the United States from TPP.

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What is TTIP? And six reasons why the answer should scare you
Have you heard about TTIP? If your answer is no, don’t get too worried; you’re not meant to have

https://www.independent.co.uk/voices/comment/what-is-ttip-and-six-reasons-why-the-answer-should-scare-you-9779688.html

The Transatlantic Trade and Investment Partnership is a series of trade negotiations being carried out mostly in secret between the EU and US. As a bi-lateral trade agreement, TTIP is about reducing the regulatory barriers to trade for big business, things like food safety law, environmental legislation, banking regulations and the sovereign powers of individual nations. It is, as John Hilary, Executive Director of campaign group War on Want, said: “An assault on European and US societies by transnational corporations.”

Since before TTIP negotiations began last February, the process has been secretive and undemocratic. This secrecy is on-going, with nearly all information on negotiations coming from leaked documents and Freedom of Information requests.

But worryingly, the covert nature of the talks may well be the least of our problems. Here are six other reasons why we should be scared of TTIP, very scared indeed:

1 The NHS

Public services, especially the NHS, are in the firing line. One of the main aims of TTIP is to open up Europe’s public health, education and water services to US companies. This could essentially mean the privatisation of the NHS.

The European Commission has claimed that public services will be kept out of TTIP. However, according to the Huffington Post, the UK Trade Minister Lord Livingston has admitted that talks about the NHS were still on the table.

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TTIP: what does the transatlantic trade deal mean for renewable energy?

https://www.theguardian.com/public-leaders-network/2015/aug/05/ttip-free-trade-deal-renewable-energy-transatlantic-partnership-eu-us

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Undermines local government

However, some fear that losing local content requirements would lose political appetite for renewable energy along with it. Concerns were raised at a roundtable held by RenewableUK, which represents the wind and marine energy sector: “If one of the reasons to have more renewable energy deployment is because it is good for [local] jobs and supply chain, how will politicians and the public react to some of the socio-economic value potentially draining to far-flung corners of the globe? This is a big dilemma.”

TTIP could even undermine the democratic authority of local government. The UK’s Local Government Association representative in Brussels, Dominic Rowles, imagines a situation “whereby a public authority, whether local or national, takes a democratic decision on energy generation … that TTIP then makes easier for corporations to challenge.”

More opportunities to sue

The bone of contention here is the investor state dispute settlement (ISDS), which allows private companies to sue governments for loss of profits connected to regulation. It is seen as a key US demand for the trade partnership. Precedents include a US tobacco firm suing the Australian government over packaging restrictions and a US fracking company suing the Québec government following a moratorium on drilling under the St Lawrence River.

“Where the US wants to engage it does so pretty forcefully”, says David Baldock, executive director of the Institute for European Environmental Policy. He questions why an ISDS provision is needed at all, given the robust nature of the courts in both jurisdictions and the “huge levels of trade already between the EU and the US”. Yet an ISDS independent tribunal which would bypass national courts (and “doesn’t sit at all comfortably with the European decision-making process”, says Baldock) appears to be strongly favoured by US negotiators.

Race to the bottom on regulation


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