This might be our best-timed topic in a long time! Friday, the House of Representatives rejected President Obama’s request for “fast track” trade authority, officially known as Trade Promotion Authority. TPA is a voting rule that would prohibit Congress from amending any trade agreements that a president submits to it within a set period of time. Legislators still can vote any agreement up or down, but only exactly as submitted, unaltered. The politics of the vote were complicated, and I still think it will pass next week.
Yet, even though Obama has been pushing fast track really, really hard, he has hit a wall of fierce resistance from most Democratic members of Congress and progressive interest groups. So, this time might be different. We may have reached a tipping point on the Democratic voter base’s willingness to countenance free trade policies. If fast track really is dead, it will spoil Obama’s plans to ask Congress to approve the Trans-Pacific Partnership pact (TPP). TPP is a huge, 12-nation trade agreement that’s 30 or so chapters are in the final stages of being negotiated. Several lesser-known but still important trade pacts could be in danger, too, if fast track is killed.
What’s going on, here? Our topic is going on. More and more liberals are convinced that decades of free trade policies have been a major contributor to decimating the American middle class. This is highly debatable, IMO. But, there’s no debate on how sweeping modern trade agreements have become, nor on how poorly average Americans have fared economically in the last 30 years. The TPP, like NAFTA or the WTO regime, do much more than lower tariffs and barriers on manufactured goods trade. They’re about internationalizing the basic rules of commerce – all commerce, from services (inc. financial regulation) to agricultural trade to intellectual property rights. These agreements, most controversially, are enforceable by binding dispute settlement procedures. Progressives say these procedures could be used by foreign companies to challenge U.S. health and safety, environmental, and other laws.
This complexity makes our job harder on Monday because it makes it very hard even for the experts to judge the impact trade agreements have had on U.S. jobs and wages. Even knowing that would not settle the issue, because U.S. trade policy is also about broader, strategic goals (like countering China’s influence, a major TPP goal) that few people bother to think about when they add up free trade’s effects on the United States.
So, with all of this, I think it’s best for Monday if we have a two-part discussion.
- Trade agreements: What they are and their impact on the United States, esp. jobs and wages.
- TPP and related deals: Even though there is no final TPP yet, WikiLeaks has leaked enough draft chapters to reveal its broad outlines.
I will open each of the two subjects with a 5-7 minute presentation, each presentation followed by its own discussion. Sound good?
DISCUSSION QUESTIONS –
- ABCs: What is fast track, why do presidents say they need it, and why is it so hard to pass this time? What does “free trade” mean, really? What do modern trade agreements cover/not cover and why?
- Effects: How have past free trade-oriented agreements affected the United States, especially jobs and wages? How can we separate the effects of trade from everything else that’s going on in the economy (like growing automation, collapse of labor unions, etc.)?
- Other rationales: Are there any other benefits/costs from free trade aside from the economic ones? (National security, diplomatic, etc.) How much should they matter?
- TPP: What is the Trans-Pacific Partnership and what’s s controversial about it and why? What are the main arguments both sides use?
- Alternatives: Are there any good alternatives to free trade agreements that would do more for Americans? Is the U.S. in a position to dictate an about face on trade even if it wanted to?
SUGGESTED BACKGROUND READING –
Has Free Trade Been Good for Us?
- It’s been harmful:
- Wrong: Free trade has helped us immensely. Recommended.
- Keep in mind: Experts’ prediction can be wrong.
Trans-Pacific Partnership –
- What is the TPP? What are the pros and cons? Two good explainers. Either recommended.
- It’s about much more than trade. My point.
- Obama’s reasons for pushing so hard on this. Recommended.
- TPP will be good for American workers. At the least, arguments that it won’t be are not very convincing so far.
- Robert Reich: It’s not a free trade deal; it’s something else and something worse. Recommended.
- Elizabeth Warren: TPP’s corporate dispute resolution panels should be a deal breaker. Joseph Stiglitz says TPP is a corporate takeover of U.S. legal system.
- [Optional: A long, detailed opposition piece at Public Citizen.]
- [Update: If you’re really interested in the TPP’s investor-state dispute settlement process and whether it would allow U.S. health and safety laws to be undone, read this, from a respected legal blog.]
Next Week: Is God a human invention?