Junk Explained: Everything You Need To Know About The Trans-Pacific Partnership
If you care about affordable healthcare, privacy, Internet freedom, the environment and the rule of law, you should be concerned.
[UPDATE — Tuesday October 6]: The Trans-Pacific Partnership is now a done deal. The pact was signed in Atlanta by all twelve participating nations late last night, concluding years of negotiations. US President Barack Obama, for whom the TPP is a legacy victory, issued a statement highlighting the elimination of thousands of trade taxes; alluding to fierce opposition on the left, he said: “It includes the strongest commitments on labor and the environment of any trade agreement in history.”
The deal has yet to be ratified by lawmakers in each country. Negotiations between the US and Australia on the minimum time period of biotech patents held things up, and a compromise looks to limit the impact it will have on drug prices in Australia – one of the more controversial elements of the TPP for local critics. Prime Minister Turnbull said, “This deal has no impact on the Pharmaceutical Benefits Scheme. We believe we’ve got the balance right.”
Activist groups and other naysayers remain sceptical, especially of the investor-state dispute settlement (ISDS) clause; the Greens’ Peter Whish-Wilson warns of “corporations taking strategic litigation through these shady tribunals”. Meanwhile, the vexing secrecy surrounding the deal, also a sticking point for opponents, is still in place: the TPP countries are “finalising arrangements” for the release of details to the public.
So we’ll be unpacking all of this for a while, but in the meantime, get your head around the TPP with our explainer.
Sure, we haven’t had much to go on. The ginormous trade deal, which has been driven by the United States and includes Australia and ten other nations along the Pacific Rim, has so far been highly secretive; what we do know, we mostly owe to Wikileaks. But while international trade agreements can be deadly dull, it’s not fair to say no one’s listening.
The Project’s Waleed Aly tackled the deal in a snarky but informative segment last week, and his suggested campaign, #FreeTheTPP, immediately began trending in Australia. The show’s Facebook posts of the segment racked up 360,000 views, and Junkee’s recap of it 30,000 more. So there’s interest, and it’s growing – but given the TPP could be signed and ratified within weeks, is it too late?
If you care about affordable healthcare, privacy, Internet freedom, the environment and the rule of law, you should be concerned about the TPP. Here’s everything you need to know.
What’s The Deal With This Trade Deal?
The Trans-Pacific Partnership is a free-trade agreement (FTA), a treaty intended to remove certain barriers in order to promote international trade. The TPP is currently under negotiation by twelve nations: Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. These nations include both developed and emerging economies, and account for 800 million people and some 40% of the planet’s GDP.
The TPP has been in the works for years; so far, though, the deal has been kept tightly under wraps. That’s not unusual for top-tier trade negotiations, but in this case it rankles activists and consumer advocates because of all that’s at stake. What’s more galling is that despite this secrecy, some of the big corporations who stand to gain have had seats at the table.
We’re only able to have this conversation because of a series of Wikileaks releases, including one revealing a draft chapter on intellectual property. To give you an idea of the immense scope of the TPP, that chapter clocked in at over 11,500 words. Another release detailed the intense pressure applied by the US in securing its interests in the deal.
It’s been a challenge for the Obama administration to get the deal past the US Congress. The President has found more support amongst the Republican opposition than his own Democratic party, demonstrating the kind of neoliberal realpolitik that doesn’t play so well in a media landscape dominated by the culture wars, where the Republicans are supposed to be the bad guys. Many on the left, including lefty hero and presidential candidate Senator Bernie Sanders, have rebelled, warning of the impact the deal will have on the party’s traditional blue-collar base. The North American Free Trade Agreement or NAFTA, a precursor to the TPP which took effect in 1994, is estimated to have cost the US 700,000 jobs, so it’s no surprise that American labor unions are staunchly opposed to the TPP. Obama has been obliged to downplay these concerns – though holding a rally at Nike headquarters wasn’t such a good look – while pushing for fast-track legislation for the TPP. Fast-tracking it would let legislators read the treaty only when it’s done drafting and pass it yay or nay, without letting them change it – but after intense debate, both houses of Congress passed fast-track last month, bringing the TPP that much closer to reality.
The Abbott government’s stance, meanwhile, has essentially been, “Yay TPP! What’s that? Information? Don’t worry! You don’t need information!” Trade Minister Andrew Robb has accused the naysayers of being “anti-trade”, and when asked what’s in the treaty has said, “It’s quite complicated”. Right. Meanwhile, Parliament has been presented with the same all-or-nothing proposition as the US Congress: read, and sign off or not — no changes — and Labor is just going along with it all, as they do. The Greens and advocacy groups like GetUp! have been the ones left to sound the alarm.
What Does The TPP Entail, Exactly?
Ostensibly the TPP is meant to lower tariffs and other trade barriers between the new partners. That’s just PR though; punitive tariffs are mostly a thing of the past, and account for barely a scratch of the US GDP, for example. The real aim of modern FTAs is “regulatory harmonisation,” making rules and standards the same across borders and generally working in favour of (you guessed it) multinational corporations. You don’t have to be Noam Chomsky to understand that these agreements really just aim to grease the works for business elites so they can consolidate market dominance overseas. If anything, they limit actual free trade.
The TPP’s draft chapter on intellectual property, which leaked through Wikileaks, contains some pretty nervewracking stuff. American pharmaceutical companies’ patents for drugs and clinical trial data will receive much the same protection overseas as they do at home. Big Pharma’s monopolies will be entrenched in Australia, preventing competition from generic labels, weakening the Pharmaceutical Benefits Scheme (PBS) and driving medicine prices up to US levels – including those for some life-saving treatments. (I’m American myself; believe me, you don’t want any part of the healthcare system in the States.)
Hollywood is another American industry with a stake in the TPP’s intellectual-property bits. The treaty would further criminalise illegal downloading of copyrighted entertainment, possibly meaning fines or jailtime for minor or unintended infractions. Internet service providers would be required to collect data on their customers and rat them out, which is good news for some content producers, but bad news for fans of, y’know, the right to privacy. We’ve already seen this pointless war on piracy in action here in Oz; the TPP would expand and intensify it.
What Is ISDS And Why Is It So Terrifying?
One of the scariest parts of the TPP is the ISDS clause, which stands for investor-state dispute settlement. ISDS clauses in FTAs allow private corporations to sue signatory governments if they harm or interfere with business via policy that reduces their earnings or, unbelievably, their expected earnings. For instance, if the Australian government were to raise its carbon-emissions standards (don’t laugh), an American energy company with operations here might be able to sue it for harming its bottom line.
Unfortunately, we don’t need to imagine hypothetical consequences of this insanity. It’s happening right now: under the auspices of the ISDS-laden NAFTA treaty, American firm Lone Pine is suing the government of Canada for USD$250 million because the province of Quebec banned fracking — one of dozens of such suits in NAFTA’s 21-year history. Closer to home, ISDS is also the culprit behind tobacco giant Philip Morris’s nefarious pending lawsuit against Australia’s plain-packaging laws, via our trade agreement with Hong Kong. (As covered in the linked article, they actually moved their Australian shares to Hong Kong to exploit the agreement.) Plain-packaging laws work – they definitely reduce the sale of cigarettes and improve public health. Philip Morris knows this, and they’re attempting to use ISDS to strongarm their way back into higher profits in Australia.
The TPP will likely make such cases commonplace. Australia has never had an ISDS clause in any agreement with the United States – the Howard government successfully blocked it out of the Australia-US FTA of 2004. For Australian taxpayers, it’s a Pandora’s box waiting to be opened.
Worse, the cases would be decided not by a nation’s appointed judiciary, but by private, secretive arbitration panels made up of corporate lawyers, who may have conflicts of interest (and, let’s face it, tend to not be very nice people in general). Their judgments could overturn the laws of a given country, but not be reviewed or overturned themselves. And ISDS is a VIP-only party: corporations would have exclusive access to it, while citizens or unions would have to go through normal judiciary channels to make claims against the same companies.
Observers fear that in the long run, the potential legal and financial drain caused by ISDS could produce a chilling effect on legislation for the public good. Think it’ll be easy for governments to take action against climate change with such powerful, transnational threats hanging over them?
That’s Why So Many Smart People Sound So Concerned
Even the most sober overview of the TPP makes it sound like dystopian fiction. Secret tribunals? Really? Many observers fear the TPP could imperil national sovereignty and democracy, too.
Nobel Prize-winning economist Joseph Stiglitz compared the TPP to a “secret corporate takeover.” Cornel West told the Q&A audience last month that it amounts to “NAFTA on steroids”, and warns that it’s a component of creeping fascism. Speaking in the Senate a year ago, Greens Senator Scott Ludlam said this “trade agreement” should instead be called an “investors’ rights agreement” and called it “disgraceful” and “utterly amoral.”
But it’s not just the usual lefty suspects. The TPP’s opponents also include stuffy pro-business types like the Productivity Commission, which says it offers no benefits for the Australian economy that justify the hassle and risk. High Court Chief Justice Robert French has cautioned against the deal, as have the Australian Medical Association and consumer-rights group CHOICE. Not exactly the tinfoil-hat-wearing crowd.
Depressingly, though, even more such deals are on the way: one between the USA and the European Union states; and another that liberalises trade in service sectors (everything from transport and travel to financial services and health care) across basically the entire developed world. The latter contains truly frightening “standstill clauses” that freeze legislation concerning trade regulation (worker-safety standards, let’s say); and a “ratchet clause,” meaning that once a trade barrier is removed it cannot be replaced. It also streamlines data retention across international borders. A rearrangement of the global economy — playing havoc with financial security, wages, the right to privacy and and health and safety regulations everywhere — is on the cards.
Another big question: Why keep it secret? Is it because most voters – even (or especially) conservative voters – don’t like the idea of private companies holding sway over foreign governments?
Is it because when greenies, unions, consumer advocates and rights activists come together, the result often looks like this?
The TPP stands to have a profound impact on our lives and our futures. Regardless of what you think of globalisation, I think we can all agree that Australia’s sovereignty is worth protecting, and we should know more about this thing. Do we need more petitions and hashtags to help spread the word? Do we need more silly memes and gifs? Do we need a viral PSA soundtracked by a spoof cover of Naughty by Nature’s ‘OPP’? (Why hasn’t someone thought of this already? Make it happen, Internet!)
Given the powerful forces in motion and the lateness of the hour, it won’t be easy — but the next challenge is to translate our growing concern into some kind of action.
Jim Poe is a writer and editor based in Sydney. He contributes to inthemix and The Guardian, and tweets from @fivegrand1
Feature image taken at a protest march in Washington in May 2015, by Saul Loeb for Getty.