Real work starts on TPP ac­cord

Toronto Star - - BUSINESS - Jen­nifer Wells

So let’s get down to busi­ness.

Just be­fore Hal­loween, the House of Com­mons Stand­ing Com­mit­tee on In­ter­na­tional Trade ex­tended the dead­line for pub­lic com­ment on the Tran­sPa­cific Part­ner­ship (TPP) trade agree­ment from Oct. 31 to Jan. 27.

That neatly pushes the pub­lic brief dead­line be­yond the Jan. 20 in­au­gu­ra­tion of the newly in­stalled U.S. pres­i­dent, thus al­low­ing Ottawa to re­main rel­a­tively quiet on the file while the fo­cus on rat­i­fi­ca­tion stays south of the bor­der, with the spot­light on out­go­ing Pres­i­dent Barack Obama.

Oth­ers, Ja­panese Prime Min­is­ter Shinzo Abe chief among them, have been push­ing for swift rat­i­fi­ca­tion of the 12-coun­try Pa­cific Rim part­ner­ship that Hil­lary Clin­ton once de­clared the “gold stan­dard,” a po­si­tion she later walked back in what can only be de­scribed as a fact-duck­ing ma­noeu­vre.

The bob-and-weave put Clin­ton and her pro-glob­al­ized trade be­liefs in an awk­ward spot. It wasn’t just the “gold stan­dard” dec­la­ra­tion of­fered in a speech four years ago when she was sec­re­tary of state and one of Obama’s chief TPP ad­vo­cates. This past July, Vir­ginia Gov. Terry McAuliffe of­fered that, should she be vic­to­ri­ous, Clin­ton would re­state her sup­port, al­beit with mod­i­fi­ca­tions. “Lis­ten, she was in sup­port of it,” McAuliffe told Politico. “There were spe­cific things in it she wants fixed.”

That didn’t go over so well with the Clin­ton cam­paign, as made clear by cam­paign man­ager John Podesta. “Love Gov. McAuliffe,” Podesta tweeted. “But he got this one flat wrong. Hil­lary opposes TPP BE­FORE and AF­TER the elec­tion. Pe­riod. Full stop.”

McAuliffe amended his com­ments in a tweet of his own, clar­i­fy­ing that “Hil­lary is against TPP and she is al­ways gonna stay against TPP. Let me be crys­tal clear about that.” In a later in­ter­view with the Wash­ing­ton Post, McAuliffe shifted the fo­cus. “This is go­ing to ride on the pres­i­dent’s shoul­ders,” he said of Obama.

So here we go — a 10-week lame­duck race tak­ing us right through Christ­mas.

Will Obama emerge vic­to­ri­ous and gift to Clin­ton (I’m as­sum­ing here she wins) rat­i­fi­ca­tion of the trade deal, thus spurring Ottawa to move more quickly than in­tended on rat­i­fi­ca­tion here at home?

Last April, No­bel Prize-win­ning econ­o­mist Joseph Stiglitz drew an Ottawa crowd to a speech he gave on the TPP.

“If it is the gold stan­dard, I would sell gold short,” he told his au­di­ence. He poked fun at tar­iff elim­i­na­tion — no more Viet­namese tar­iffs on skis and snow­plows — but kid­ding aside, Stiglitz said it’s a mis­take to re­fer to the TPP and its like as a “free trade” agree­ment. “It’s a cor­po­rate agree­ment,” he said. “These are not free trade agree­ments — they are man­aged trade agree­ments.”

Pro­po­nents will high­light pro­vi­sions in the agree­ment that they be­lieve will en­sure that worker in­ter­ests are not tram­pled by cor­po­rate in­ter­ests.

Chap­ter 19, the chap­ter on labour, is a good place to start. It’s one thing to de­clare that the statutes and reg­u­la­tions of the In­ter­na­tional Labour Or­ga­ni­za­tion will pre­vail, specif­i­cally free­dom of as­so­ci­a­tion, the elim­i­na­tion of forced or com­pul­sory labour and a pro­hi­bi­tion of child labour.

But free trade agree­ments do not have a great track record in this re­gard (see Mex­ico and NAFTA) and the TPP lan­guage does lit­tle to as­suage con­cerns that en­force­ment mech­a­nisms will be in­suf­fi­cient to en­sure that, say, the gar­ment in­dus­try in Viet­nam will emerge the bet­ter for it.

Stiglitz high­lighted this in a let­ter to Congress, cit­ing Viet­nam in par­tic­u­lar, with its “forty-year le­gacy of a po­lit­i­cal sys­tem built, in part, on deny­ing what U.S. law says and what the world com­mu­nity agrees are core labour rights.”

The en­hanced al­lure of cheap­labour Viet­nam can be seen in for­eign in­vest­ment data. Just con­sider that China’s in­vest­ment in that coun­try ex­ploded to $7.9 bil­lion (U.S.) in 2014 from a pal­try $312 mil­lion in 2012, ac­cord­ing to Viet- nam’s For­eign In­vest­ment Agency.

As Sec­re­tary of State, Hil­lary Clin­ton cited Viet­nam as the largest po­ten­tial ben­e­fi­ciary of TPP, in part due to growth in ap­parel and footwear “where China’s com­par­a­tive ad­van­tage is fad­ing.” She did add that the coun­try “would face sig­nif­i­cant chal­lenges in im­ple­ment­ing an agree­ment that re­quires strin­gent dis­ci­plines in ar­eas such as labour and govern­ment pro­cure­ment.” Yet even a sep­a­rate con­sis­tency plan fails to re­as­sure that labour pro­vi­sions will be ef­fec­tively en­forced.

Amer­i­can vot­ers may have been more fo­cused on the promised net ben­e­fit of the TPP which some, in­clud­ing Stiglitz be­lieve is il­lu­sory. (In his Ottawa speech the econ­o­mist said the TPP will fur­ther evis­cer­ate North Amer­i­can man­u­fac­tur­ing.)

Both Hil­lary Clin­ton and Don­ald Trump rode a wave of anti-TPP sen­ti­ment through the cam­paign. But that was just elec­tion­eer­ing. The hard work be­gins now. jen­wells@thes­


Amer­i­can vot­ers may have been more fo­cused on the TPP’s promised net ben­e­fit than they were on labour rights.

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