Seven Lies About International Trade

Leah Sullivan writes:

On Monday the biggest international trade deal the world has ever seen, the Trans Pacific Partnership (TPP) was agreed in Atlanta.

With TPP, and its European counterpart, TTIP, we are being promised the earth – enforceable clauses on labour and environmental protection, more jobs, bans on child and forced labour and support for the establishment of minimum wages.

However, these promises mask serious threats to public services, labour and environmental standards, and equip corporations with unprecedented power over public policy and expenditure.

Here are some of the biggest lies proponents of international trade deals are telling us:

1. It’s a free trade deal

Free-trade deals are about a reduction in tariffs between trading partners. In the case of the TTIP, tariffs on goods traded between the EU and US are already very low, and TTIP would eliminate ‘non-tariff barriers to trade’, such as the differing standards in place on safety testing for drugs, cosmetics and food.

US standards are often much lower than EU standards, which makes ‘harmonisation’ will require an adjustment either to US or to EU standards.

2. EU standards simply aren’t up for negotiation

The European Commission has demonstrated its lack of resolve when it comes to upholding our safety standards.

In May it was revealed that the EU scrapped plans to ban cancer-causing chemicals due to US pressure over the incongruity this would cause with US regulations on the same cancer-causing chemicals in TTIP.

3. Strengthening the multilateral trading system remains a priority

There exists a well established rules-based forum for trade in the World Trade Organisation (WTO), and this system is being ignored, because it does not suit US interests.

TTIP, TPP and CETA bypass the WTO entirely, as it attempted to enable economically weaker countries to benefit from global trade.

‘This partnership levels the playing field for our farmers, ranchers, and manufacturers’, said Obama on Monday, setting a fantastical scene in which, somehow, beleaguered CEOs from the world’s only superpower require some sort of special conditions to enable them to compete with farmers from the global south.  

4. These deals will ban child and forced Labour and include the highest standards ever on labour rights

The US, which seeks to be a standard bearer in fighting human trafficking, was widely criticised for upgrading the ranking of Malaysia in its annual ‘Trafficking in Persons’ report, despite serious labour rights violations.

Without the upgrade, the US might have struggled to justify the inclusion of Malaysia in the TPP.

Malaysia aside, the US seems to suggest that US labour standards are something other countries should be seeking to emulate.

The US has ratified only two of eight core labour standards, and failed to ratify the UN International Convention on the Rights of the Child.

According to Human Rights Watch, hundreds of thousands of children under 18 work in agriculture in the US in hazardous conditions, exposed to tobacco poisoning and pesticides.

5. It’s going to be different this time

This is not the first time that a trade deal has claimed to adopt ‘unprecedented’, and ‘strongest ever’ levels of protection on labour and environmental standards.

A report, Broken Promises, by US Senator Elizabeth Warren documented the litany of failures of previous trade agreements to uphold standards.

Deals with Mexico, the Dominican Republic, South Korea, Colombia and Panama have failed to deliver on protections – five years after the signing of the US-Guatemala deal, Guatemala was the world’s most dangerous place to be a trade unionist.

6. Corporations require protection, and ISDS mechanisms stimulate growth

ISDS mechanisms have enabled corporations to drain public money by suing governments for passing legislation to protect basic human rights.

Also, studies on whether International Investment Agreements (IIAs) are necessary to attract investment are far from conclusive, with some studies finding no or very little correlation between IIAs and investment. Brazil, China and India all attract large amounts of investment from countries with whom they do not have IIAs, and they seem to be doing just fine.

So well, in fact, that these three countries along with the other BRICs have been excluded from the unholy trinity of US deals altogether.

This is highly indicative of the real geopolitical agenda behind them – wresting power from potential competitors that pose a threat to US hegemony.

7. TPP will protect the freedom to form unions and bargain collectively

This would put the cart before the horse; in the US and some signatory countries like Vietnam, where independent trade unions are illegal, these freedoms are not enshrined in law.

The US has not ratified conventions on freedom of association and collective bargaining, while ISDS enables multinationals to exert pressure on governments to crush attempts to organise, with transport company Veolia using ISDS to sue the Egyptian government for increasing the minimum wage.

While the TPP has been signed, agreement on TTIP is far from certain, and faces heavy criticism.

Yesterday civil society celebrated the collection of over 3.2 million signatures to a petition against TTIP in a European Citizens Initiative. You can add your signature here.