Wednesday, May 13, 2015

Can TPP Be Saved And Is It Worth It?

Of those who post here and probably most of our readers, I remain more attached to the general argument for free trade, which is the cause that the TP, now doing badly in the US Senate after the failure to stop debate on fast track authority for it.  However, as Dean Baker has been pointing out from Day One, it is unclear if it is really a free trade agreement at all.  I see three big problems with it, and one possible thing that might both improve it and help it pass.

The one that would help improve it would be add some serious assistance for laid off workers.  It may be that the GOPsters simply will not support this, but this would probably get some Dems in the Senate to change their votes, and it is the right thing to do.  I have been looking at the international data on Active Labor Management Policies, and the US simply has near zero.   We are way behind all other high income nations on this.  Those Nordic nations are very open, far more than we are, totally dependent on exports, and so very free trade, and they spend a lot on this, with Denmark spending 2.3% of its GDP on it.  Sweden used  to be tops, but they are down to 1.1%, making Denmark the "new Sweden."  OTOH, the US is barely above zero, and if anything the TTP is supposed to cut the little we have.  What is with this?  This is really a no brainer.  Help those who might lose out, and maybe it might be worth it.

Maybe.  The next big problem with it is all the secrecy.  We do  not know what is in this, and the president and its supporters have gone out of their way to keep it secret.  This is just insane.  Senators can only look at it in a sealed room with no aides.  What are they hiding?  This just makes me lose pretty much all enthusiasm I might have for this.  What were (are) they thinking.  Just plain nuts.  (BTW, I have read that Vietnam would be the big gaining country, which I have no problem with, but given all this secrecy, how is anybody supposed to know?)

Finally, there is the whole intellectual property rights part.  Again, details are missing, but most reports suggest that enforcing US intellectual property rights abroad is a very big part of this, maybe the biggest, a point Dean B. has emphasized.  But it is probably the case that we have overdone this already in the US.  We are already paying way too much for drugs, and why on earth should Disney own the rights to Winnie the Pooh nearly a century after the books were written.  We are supposed to support the imposition of this sort of rent seeking nonsense on the rest of the world too?  My enthusiasm is nowhere at all on this part, quite the opposite.  Dump this stuff.

Again, at the bottom line, given that we do not even know which industries in the US are  most likely to be hurt by all those Vietnamese imports, it would behoove the supporters to do something to minimize the damage to those who might be injurned, the laid off workers.  Put some decent support in their for those, and this thing might be worth passing, might.

Barkley Rosser


Kenneth Thomas said...

Investor-state dispute settlement would be expanded under TPP, which is not a good thing. The Eli Lilly case against Canada under NAFTA's ISDS is one bad example (though not yet decided) as well as Philip Morris against Australia. This is why Australia has completely opted out of ISDS in the TPP. said...

Yeah, the ISDS looks like it might not be the greatest, although I have not figured it out enough to really have a strong opinion.

One item some critics are hot on, including both Dean Baker and some in the Congress, I am not hot on, which is getting into the matter of supposedly manipulated exchange rates. I think this is just a sinkhole to a nightmare of politicized nonsense.

Thornton Hall said...

So strange that "politicize", meaning "to move a decision of public policy from unaccountable experts to democratically elected representatives of the people" is a pejorative term.

You might say, "given our current dysfunctional politics..." but it has always had a negative connotation.

Perhaps the problem is the use of the term by politicians, always applied to a decision that has already been politicized to mean "framed in a manner deliberately designed to persuade voters".

But then, that's actually a pretty good definition of political leadership, So the idea must be that one or both sides will lie to persuade voters. At this point, however, the negative connotation attached to "politicized" reveals itself to simply amount to a distrust (perhaps justified) of democracy.

Sandwichman said...

Oh, Thornton, you're politicizing the comment thread. said...

Traqde issues have always been political, although usually along regional lines that have sometimes corresponded to party IDs and sometimes not. So now the Dems are mostly protectionist and the Reps mostly "free trade" (although as already noted one of the criticisms of the TPP, got it spelled right now, has been that it is not really a free trade agreement at all but a spread the monopoly of rent seeking through intellectual property rights one). But the Dems most likely to support the TPP where export industries based on trade with Asia are based (although Carper is in DE, a big corp HQ state), with Republicans from states like SC with textile firms competing with imports are more likely to be protectionist.

I note that the issue that seems to have revived the TPP fast track is the anti-currency manipulation bill attached to it. I am sorry to say I do not support this and think if passed it will lead to a general outbreak of these in other countries, with this very difficult to measure and open to really blatant political manipulations of the worst sort. Let there be solid assistance to laid off workers, not this tripe, which will prove to really horrendous.