The dire consequences of TPP: what you need to know

by David Turnoy

Special to the Sounder

What do you know about the Trans-Pacific Partnership (TPP)? After years of negotiations, its text was finally released last week, and it is truly the trade treaty from Hell. Here are some of the very likely consequences:

More early deaths due to lack of affordable medicine.

More unhealthy and unsafe food, resulting in more illness and death.

More pollution.

Tying our hands so we can’t fight climate change.

More restricted freedom on the internet with less privacy protection

Offshoring of more American jobs and reduced wages for American workers

Corporate tribunals that award damages to corporations whose expected profits are reduced due to health, safety, environmental, or other public interest laws that restrict their ability to operate, with no recourse to our courts.

If this first paragraph troubles you, you are not alone. But we are not stuck with this horrible treaty if we all act. Our member of the House of Representatives and our Senators will be voting on this treaty after a 90-day comment period ends Feb. 4, 2016. Rep. Rick Larsen will be holding a forum on TPP this Sunday, Nov. 15, at 11:15 at the Grange in Friday Harbor. The 10:35 ferry gets you to Friday Harbor at 11:15, and it is just a couple minutes’ walk to the Grange at 152 First Street, next to the Whale Museum. Rep. Larsen wants our opinion, so let’s give it to him. I will include some questions just below that you may ask him. If you can’t attend, writing a letter or email to Rep. Larsen and to Senators Murray and Cantwell would be a good alternative. I will discuss more about that a little later in the article. Meanwhile, for those who would like to attend but have no time to read further, here are the questions:

1. How does TPP change the length of time that new drugs are protected from generics?

2. Does TPP allow patents on medicines to be extended for simply changing a formulation, even if it doesn’t improve its efficacy for patients?

3. How will TPP impact the ability of Medicare, Medicaid, and single payer systems in other countries to get a volume discount for purchasing medicine?

4. How will TPP affect food safety in our country?

5. George Bush’s trade agreements were certainly not the best, but they had agreements enforcing seven specific multilateral environmental agreements (MEAs), so that countries signing these trade agreements had to adopt, maintain, and enforce these seven standards in their laws. The TPP wipes out six of the seven agreed-upon standards. Are there other clauses in TPP that counter this loosening of environmental restrictions?

6. Because corporations can challenge any laws or regulations that impact their ability to make a profit, how are we to fight climate change if fossil fuel corporations challenge laws limiting or banning the use of fossil fuels?

7. Previous trade treaties have had language requiring enforcement. TPP simply encourages countries to “endeavor” or “strive” to not damage the environment. How do you think this will impact corporate behavior?

8. Would you please comment on how TPP affects internet use and privacy?

9. Does TPP include language that effectively bans “Buy American” and “Buy Local” preferences in many types of government purchasing?

10. Will TPP make it easier or harder to offshore American jobs?

11. Vietnam is one of the members of TPP, and they often pay their workers less than 65 cents per hour. Won’t this contribute to downward pressure on American wages and to the offshoring of American jobs?

12. There will be a revolving door for lawyers who represent corporations in cases brought before the TPP tribunals and the lawyers on those tribunals. Won’t there be an incentive for those lawyers, when acting as part of the tribunals, to rule for corporations and against countries so as to make it more likely that when serving their corporate clients as attorneys, they have a better chance of winning?

13. Under TPP, American corporations may only use American courts for challenging American laws, yet foreign corporations will be able to use TPP tribunals to challenge American laws. Doesn’t this give foreign corporations an unfair advantage? Won’t many American corporations move their headquarters overseas for this reason, thereby continuing to offshore American jobs?

14. Trade pacts had previously included a security exception at ports that allowed governments to decide how to protect their countries’ security. The TPP removes that exception to trade tribunal investor-state dispute settlement. Won’t that endanger our country?

15. Under TPP, foreign corporations can bring their own workers with them to work in this country. It is one thing to allow them to operate here and use American workers, but coming here with their own workers?

Introduction

Since the early 1990s, a series of “free trade” treaties have been negotiated and approved. What have we learned from more than 20 years of history of these treaties? Mostly, we have seen CEOs get much richer, while good jobs are shipped overseas to countries where workers earn lower wages, and then when another country comes along with even lower wages, multinational corporations move there. So-called free trade treaties have consequences for everyday people.

An instructive example is the North American Free Trade Agreement (NAFTA). Before NAFTA, the price of Mexican corn was protected by Mexico’s Constitution. But one of the prerequisites for Mexico’s admission to the NAFTA club was to strip this provision from its constitution so that American corn could compete with Mexican corn. Sounds fair, right? But there was no way small Mexican farmers could compete with US agri-business, and more than a million Mexican farmers were forced to leave their farms to try to make a living to support their families. Where did they go? Many came north to the United States as undocumented aliens [often called “illegal” immigrants, but that is such an ugly term for people who are acting nobly to try to earn money to feed their families]. We now hear ignorant, bigoted politicians railing against these immigrants, but they came here as a result of a free trade treaty, not because they wanted to leave their traditional villages. It is not true that everyone wants to come to the US because we are better; many with fewer material possessions are perfectly happy where they are, but when survival forces them to emigrate, they do it. So the next time you hear someone criticizing “illegal” immigrants, enlighten this other person on why many have come here.

Moving on to the issue at hand, the Trans-Pacific Partnership (TPP) trade agreement was developed in secrecy over the last several years by its 12 proposed members: The United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam, who together represent 40 percent of the world’s economy. Why was it negotiated in secrecy? You will be able to answer that question yourself by the end of this article. The TPP will set common standards in areas including employment, food safety, pharmaceuticals, the Internet, corporate governance, and intellectual property. After the public comment period ends on Feb. 4, the agreement will be debated by the U.S. House of Representatives and the Senate. Under previously established rules, the House and Senate will only be able to take an up or down vote on the agreement, i.e. approve it or not. A simple majority is needed to pass it. Congress does not have the authority to amend the agreement. The final vote on the agreement is expected sometime during 2016.

The government website maintains that “TPP will make it easier for American entrepreneurs, farmers, and small business owners to sell Made-In-America products abroad by eliminating more than 18,000 taxes & other trade barriers on American products across the 11 other countries in the TPP—barriers that put American products at an unfair disadvantage today.” TPP includes the elimination of 98 percent of tariffs between the 12 members.

Activists around the world have opposed the TPP, warning it will benefit corporations at the expense of public health, the environment, free speech and labor rights. Public Citizen said, “The text shows that the TPP would offshore more American jobs, lower our wages, flood us with unsafe imported food, and expose our laws to attack in foreign tribunals.” The decision to be made is whether the benefits justify the costs.

I have organized this article into different sections about the TPP, though there can be more than one section in a broad area like the environment. While the facts speak strongly for themselves, I have composed questions at the end of many of the paragraphs, which you will find in bold print, that you may direct to your Congress person and Senators by way of email or a letter. You may decide instead to compose your own questions based on the foregoing information. Or you may decide to forward this whole article to your Congress person and Senators, editing it as you see fit. Whatever you do, please register your opinion with your Congress person and Senators so we can ensure that your rep makes the right decision.

Health Care

A major area of concern is health care. Doctors Without Borders (abbreviated MSF), a major humanitarian nonprofit, says, “Generic competition has proven to be the best way to reduce drug prices and improve access to treatment. MSF began providing antiretroviral (ARV) treatment for HIV/AIDS in 2000 when the cost of treatment was more than $10,000 per patient per year. MSF now treats 285,000 people in HIV/AIDS projects in 21 countries, mostly with generic drugs produced in Asia. These generics have reduced the cost of treatment by nearly 99% to less than $140 per patient per year. Ministries of health, humanitarian medical treatment providers like MSF, and donors routinely rely on affordable quality generic medicines to treat a variety of health needs.” The TPP will extend monopoly protection for medicines, keeping prices sky high for longer and blocking generic drugs from entering the market. For example, one rule would allow patents to be extended beyond 20 years. This means that patients will have to wait longer for access to affordable medicines. And this wait is potentially indefinite, because another TPP rule would allow new 20-year patents to be granted for modifications of existing drugs, for a new dosage, for new formulations, even when there is no real improvement in efficacy for patients, so people must wait longer for affordable, generic medicines to become available. The TPP would also require surgical methods to be patentable—for example, how a doctor operates on a patient. All of this means that medicines and treatments will remain unaffordable longer, and more people will die. Free trade is supposed to be about competition so that companies are able to charge lower prices. Isn’t the scenario above, where prices of medicine stay higher for longer, contrary to the idea of free trade?

Related to health care is how TPP threatens health systems designed to serve the public interest like Medicare, Medicaid, and single payer systems in other countries. It does so by giving greater power to pharmaceutical companies to influence the reimbursement costs for purchase of pharmaceutical drugs when even their advertising is included in the cost of the drug. TPP “recognize[s] the value” of pharmaceutical products or medical devices through their “objectively demonstrated therapeutic significance,” regardless of whether there are effective, affordable alternatives. TPP makes it much more difficult for Medicare to negotiate lower prices. Because Medicare and Medicaid help the elderly and the poorest, won’t this make medicine less affordable and lead to more deaths?

Food Safety Standards

Another area of concern is access to healthy food. Lori Wallach, director of Public Citizen’s Global Trade Watch, says that TPP rolls back food safety protections as regards foods we import. Malaysia and Vietnam are two of the TPP countries, and they are major exporters of seafood and shrimp. Currently, a lot of their food products get stopped now for being unsafe. But TPP would give them new rights to basically attack our stopping their products for food safety purposes and flood us with unsafe imports. The agribusiness industry is enthusiastic about TPP’s text because they would have ways to stop attacks on the food they ship to other countries, including GMO foods. But the same rules could allow imports, from Vietnam particularly, where there’s a huge issue of farmed shrimp being farmed in pools that, among other things, are fertilized with human poop, and this is followed with lots of antibiotics being poured into the ponds before the harvest to deal with the diseases that come from the human waste. Right now we over-inspect for countries like Vietnam because we know there are big problems. But one of the new rules allows you to challenge the inspection, both the way you sample, i.e., how you decide to pick out a particular country because they have problems, and also the limits on how long you can hold products to do testing. Food & Water Watch says that TPP will allow corporations “to attack sensible food safety rules, weaken the inspection of imported food, and block efforts to strengthen U.S. food safety standards.” The Center for Food Safety says, “any U.S. food safety rules on labeling, pesticides, or additives that [are] higher than international standards could be subject to challenge as ‘illegal trade barriers’.” Do we want to surrender our food safety standards to corporate profits?

Environment

[The following info comes from 350.org * Center for Biological Diversity * Center for International Environmental Law * Earthjustice * Food & Water Watch * Friends of the Earth * Green America * Greenpeace USA * Institute for Agriculture and Trade Policy * Natural Resources Defense Council * Oil Change International * Sierra Club * SustainUS]

NRDC, one of the country’s biggest environmental groups—and an environmental group that supported NAFTA—came out against TPP, joining the Sierra Club, Greenpeace, Friends of the Earth, and the vast majority of environmental groups. George Bush’s trade agreements were certainly not the best, but they had agreements enforcing seven specific multilateral environmental agreements (MEAs), so that countries signing these trade agreements had to adopt, maintain, and enforce these seven standards in their laws. The TPP wipes out six of the seven agreed-upon standards. Article 20.4 on MEAs marks a clear step backwards from the May 10, 2007 bipartisan agreement on trade. It also fails to meet the standard set in the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (i.e. “fast track”). The only one retained is the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) (Art. 20.17.2). Even so, it is important to note that with respect to CITES, countries are only called on to “endeavor to implement, as appropriate, CITES resolutions that aim to protect and conserve species whose survival is threatened by international trade”; this is a lesser standard than enforcement of such measures.

Of the other six MEAs listed in the “May 10” agreement and in the fast track law, the final TPP text merely requires each TPP country to “maintain” specific existing domestic policies that adhere to the Montreal Protocol on Substances that Deplete the Ozone Layer (footnote 4) and the Protocol of 1978 Relating to the International Convention for the Prevention of Pollution from Ships (MARPOL) (footnote 7). This means that for these two critical MEAs, TPP countries are simply required to keep domestic policies named by the TPP on the books. The provision fails to require countries to effectively implement such policies, or to adopt new policies if the existing ones have proven insufficient for a country to actually fulfill its MEA obligations.

The environment chapter does not even mention the four remaining MEAs – a clear violation of the “May 10” standard and the fast track negotiating objective. The text omits, for example, the International Convention for the Regulation of Whaling (ICRW) – a critical agreement to regulate whale trade and to ensure the conservation of whale stocks. Since the ICRW established a moratorium on commercial whaling in 1985, TPP member Japan has been issuing itself “scientific” whaling permits to kill hundreds of whales each year. In 2014, the International Court of Justice ruled that Japan’s whaling program was commercial, not scientific, in nature and should therefore be cancelled under the terms of the ICRW. After a brief suspension of whaling activities, Japan announced in late 2014 that it would continue issuing itself scientific whaling permits under revised criteria. Given the TPP environment chapter’s failure to even mention the ICRW, and its non-existent provisions on commercial whaling, the final TPP text cannot be expected to have any impact on Japan’s whaling practices.

Also excluded is the Inter-American Tropical Tuna Convention (IATTC), another “May 10” MEA included in recent U.S. FTAs. The IATTC is a regional fisheries management organization (RFMO) that seeks to ensure the long-term conservation of tunas and other marine species in the eastern Pacific via sustainable fishing quotas, fishing bans, data on catch and bycatch quantities, and other measures. In its 2015 report to Congress, the U.S. National Oceanic and Atmospheric Administration (NOAA) cited TPP member Mexico for violations of the IATTC. Mexico’s IATTC violations, according to NOAA, include Mexico-flagged boats killing sharks for their fins, dumping trash at sea, and ensnaring sea turtles in fishing operations. The TPP would fail to curb such abuses not only because it omits any mention of IATTC obligations, but also because it fails to require countries to adhere to trade-related RFMO provisions. Worse still, by failing to require implementation of six out of seven core MEAs, the TPP could actually spur an increase in the environmental degradation that the MEAs aim to reduce. For example, the United Nations reports that ships operating along TPP member Vietnam’s coastline are annually dumping “thousands of cubic meters of waste oil” into the seawater, which has reportedly resulted in environmentally toxic and illegal levels of pollution. Such dumping could be a violation of Vietnam’s obligations under MARPOL, a “May 10” MEA that restricts the disposal of oil from ships. By facilitating increased shipping to and from Vietnam without requiring the country to implement its obligations under MARPOL, the TPP could actually exacerbate oil pollution levels off the coast of Vietnam, further threatening marine life.

The two other MEAs not mentioned in TPP are the Convention on Wetlands of International Importance Especially as Waterfowl Habitat (The Ramsar Convention) and the Convention on the Conservation of Antarctic Marine Living Resources. And interestingly, in several cases, a TPP country is not only party to an MEA omitted by the TPP, but also one of the world’s most notorious violators of that MEA, as seen above with Japan, Vietnam, and Mexico.

Why are we going backward in terms of environmental protection?

Climate Change

One of our most serious problems today is the threat from climate change. The TPP would hand corporate polluters new tools for attacking future climate policies, including controversial investor-state dispute settlement (ISDS) provisions that enable them to challenge U.S. laws, regulations, and court decisions as “regulatory takings” in international tribunals that circumvent the U.S. and any other country’s judicial system. For example, more than 600 corporations have used investor-state dispute settlement (ISDS) to challenge government policies including a moratorium on fracking in Quebec, a nuclear energy phase-out and new coal-fired power plant standards in Germany, a requirement for an environmental remediation in Peru, and an environmental impact assessment in Canada.

The TPP will undermine climate change legislation and policy by encouraging more extreme extraction and export of oil and gas. It will give big oil the power to sue in corporate tribunals to prevent any laws written to prevent extraction in order to protect the Earth from climate change. And, corporate trade agreements will undermine any climate solutions that come out of the UN meeting in Paris. The TPP will be law and any climate agreement will not be able to be inconsistent with the rights of oil and gas to extract, export and profit from carbon polluting products. Friends of the Earth (FOE) says the agreement “is designed to protect ‘free trade’ in dirty energy products such as tar sands oil, coal from the Powder River Basin, and liquefied natural gas shipped out of West Coast ports.” The result, FOE warned, will be “more climate change from carbon emissions across the Pacific.”

Strong obligations with weak or no enforcement would render the environmental chapter meaningless. Language that encourages “striving” or “endeavoring” will not do. Environmental organizations are extremely concerned that the provisions agreed to in the environment chapter will not be enforced. The United States has never once brought a trade dispute against another country for failing to live up to its environmental obligations in trade deals even when there has been documented evidence of non-compliance with environmental obligations. TPP will make it harder to fight climate change, as companies affected by regulations and laws meant to stop climate change can be negated through TPP tribunals. Wouldn’t you agree that TPP basically surrenders us to the inevitability of climate change?

According to Popular Resistance, a US corporation, Sun Belt Water, is suing Canada for $10.5 billion for banning the export of water. Under TPP, water becomes by law a commodity that can be traded, and if a corporation wants to export it, governments can’t stand in their way.

I am reminded of the Native American ideology that no one can own the land, air, or water. Do we really want to make basic human necessities like water a commodity?

Internet Service and Privacy

Under the TPP, Internet service providers become copyright police enforcing expanded copyright laws with the power to take down websites that violate copyright or ISPs will face high fines. But this section does not require countries to have a system for counter-notices, so a U.S company could order a website to be taken down in another country, and there would be no way for the person running that website to refute their claims if, say, it was a political criticism website using copyrighted content in a manner consistent with fair use. Section J makes it so ISPs are not liable for any wrongdoing when they take down content, incentivizing them to err on the side of copyright holders rather than on the side of free speech. Copyrights are expanded until 70 years after the death of the creator, keeping information, art, and more out of the public domain. TPP does not include the “fair use” provisions of current copyright law. The TPP attacks whistle blowers by broadly criminalizing “trade secrets” and expands trade tribunals to allow corporations to sue for intellectual property damage. TPP poses a grave threat to our basic right to information and free speech on the web, and it could easily be abused to criminalize common online activities and enforce widespread internet censorship. The internet has been such a powerful tool to spread knowledge and to democratize our culture. Won’t TPP, in limiting our access to material on the internet, reverse this trend?

In this era of concern over government overreach in obtaining our personal information,

Chapter 14 of the agreement on ‘electronic commerce’ reads, “Each Party shall allow the cross-border transfer of information by electronic means, including personal information, when this activity is for the conduct of the business of a covered person.” The wording raises fears that TTP may be used to override laws in individual countries which keep government data on individuals, such as health information, on servers inside their borders countries. In other words, the personal information of individuals can be transferred out of the country. Are we willing to give up even more of our privacy?

Labor, Legal, and Miscellaneous Topics

According to Tikkun Magazine, TPP is so poorly written that it would enable products assembled from parts made in “third party” countries that aren’t subject to any TPP obligations to enter the U.S. duty free. It also includes language that effectively bans “Buy American” and “Buy Local” preferences in many types of government purchasing. What do you know about this?

The Council on Foreign Relations is quoted as saying, “The TPP deal has the potential to reshape an important part of the U.S. economy, strengthen American diplomacy, and launch a new generation of international economic cooperation.” The Council on Foreign Relations tends to be a cheerleader for trade agreements. They’re going to make the argument that somehow this will help us contain China. It’s unclear what the strategy is here. That’s the usual argument you hear when actually the argument about creating more jobs fails, because TPP will make it easier to offshore American jobs, and it will push down our wages by putting Americans into competition with folks in Vietnam who make less than 65 cents an hour. Won’t corporate access to foreign workers who are paid a fraction of the pay of US workers bring down American wages further and lead to offshoring of American jobs?

Are we willing to give up the sovereignty of our courts? The TPP replaces federal courts with what are basically kangaroo trade tribunals that are designed by and for foreign corporations and under which corporations can sue governments for laws that affect their profits. The legal mechanism is called the investor-state dispute settlement, or ISDS. These trade tribunals will have no standards for transparency or due process common in federal courts and courts in TPP countries. The “judges” will be three corporate lawyers who can also serve as advocates for corporations suing in the tribunals. This conflict of interest would not be ethical in federal courts. Thus there is an incentive for a “judge” to expand the power of corporations in their decisions, so they can then sue on behalf of corporations they represent. There is no appeal, so these “judges” will not have their decisions reviewed. The tribunal has full discretion in determining how much governments must pay in damages, which can include “expected future profits.” Even when governments win, under TPP rules they can be ordered to pay for the tribunal’s costs and legal fees. It does not matter why a government put in place a new law, e.g. an environmental crisis, financial crisis or new health discovery; this is not relevant. TPP also provides a two-tier playing field, with foreign firms provided greater rights than domestic firms. Foreign firms are empowered to skirt domestic courts and laws to directly sue governments in foreign tribunals, whereas domestic corporations cannot use the TPP tribunals but must go through the courts of their country. American courts are, obviously, our pillar of justice. Are we willing to allow foreign corporations to bypass American courts when American corporations will have to use our US courts? Might not many American corporations decide to relocate overseas so they too can sue in TPP tribunals, which would take more jobs overseas?

The Obama administration is claiming that this is the most progressive trade agreement in history, but it is actually weaker in multiple ways than many of the Bush-era agreements of 2007. As has already been documented above, the TPP has rolled back some of the progress activists made during that era on issues like limiting monopolies to ensure access to medicines and protection of the environment. Trade pacts had also importantly included a security exception at ports that allowed governments to decide how to protect their countries’ security. The TPP removes that exception to trade tribunal investor-state dispute settlement. In this post-9/11 era, are we no longer concerned about security?

Under Chapter 10 of TPP, foreign corporations can come to the United States to compete with US companies. These foreign corporations can bring their employees with them; they do not have to hire US workers or pay US wages. They will compete with US workers who are providing the same service, thereby displacing US workers and causing a downward spiral in wages. If the US does not allow foreign corporations entry into the US, they can sue in the corporate trade tribunals and be forced to do so. TPP allows foreign companies with foreign workers to come here to compete with our companies and workers. This hardly requires a comment because it is so ridiculous, but would you please comment nonetheless?

The more one reads about the actions that will result from TPP, the more concerned one becomes. While we live in a country and world that seem to believe in a capitalist system where innovators, entrepreneurs, and investors are entitled to a return on their investment, shouldn’t a fair or reasonable return be enough? Shouldn’t the inventor or patent holder of a new medicine that saves lives be satisfied with a reasonable profit plus the satisfaction that s/he is saving many lives? Must we have more environmental destruction, disease, and death so that innovators, entrepreneurs, and investors make unlimited profits? Will there even be a habitable world left in which to spend those profits if TPP goes through?

[If you decide that you would like to read the actual text of the TPP, you can read it at https://ustr.gov/trade-agreements/free-trade-agreements/trans-pacific-partnership/TPP-Full-Text. Be advised that it is more than 6,000 pages long. Full disclosure: I obviously did not read the whole text, though I glanced at it. Instead, I relied on information from more than a dozen organizations whose mission is to work for the public interest and whose information I trust.]