What if the federal government was negotiating one of the biggest international trade deals of our time?
And what if that trade deal might weaken the public's ability to demand social and environmental accountability from our own government and multinational corporations?
And what if that trade deal might cast a chilling effect on cities and states creating their own progressive laws?
And what if the reason no one was talking about this deal at, say, the bar after work was because negotiations happened behind closed doors, and some of our own members of Congress say they had limited access to the text of the deal itself?
That would be kind of alarming, right? Well, those are some of the concerns behind the Trans-Pacific Partnership, or TPP.
Last week, the Seattle City Council committee on planning, land use, and sustainability voted on a resolution that expresses concern about the TPP and opposes the authority for the president to fast-track the trade agreement through Congress. Shortly thereafter, the Seattle Times editorial board came out with an op-ed in support of the TPP, or really, against the city council devoting any critical thought to it. The Seattle Chamber of Commerce likes the TPP; labor and environmental groups pretty much unanimously distrust it.
By Wednesday, new leaks of the draft deal had stirred up controversy over the kind of powers it would give to multinational corporations. On Thursday, a coalition of more than 50 local environmental, labor, religious, and community groups presented a letter to Mayor Ed Murray and the Seattle City Council asking the elected officials to support the council's resolution.
"As participants in civil society—labor unions, environmental groups, community organizations, small businesses—we oppose NAFTA-style trade agreements that have cost the US, and Washington State, jobs, [and] increased income inequality, and contributed to stagnating wages," the letter read.
Here's everything you need to know about the TPP and what it means for Seattle.
What is it?
A free trade agreement among the United States and 11 Asia-Pacific countries.
What's the big deal?
The TPP is enormous—representing "40 percent of global GDP and about a third of world trade"—and very little is known about it. Comparisons are often made to NAFTA, the free trade agreement the US, Canada, and Mexico signed in the '90s.
Much of what the public now knows about the TPP has come from leaks. In 2014, WikiLeaks revealed a draft environment section of the TPP that lacked enforceable environmental standards. Earlier this week, WikiLeaks further leaked a draft section of the deal that would allow foreign corporations the ability to sue governments over things like environmental regulations and arbitrate those lawsuits in an international tribunal.
Some critics within Congress have said their access to the deal is limited. In February, Representative Alan Grayson (D-Fla) told the Huffington Post that he wasn't able to have staff in the room where he viewed the TPP. He said he also wasn't allowed to take notes or discuss what he saw.
What's a "fast track," and why is everyone so upset about it?
The Obama administration has been putting pressure on Congress to introduce and pass what's known as a "fast track" authority. Fast track would allow the administration to usher trade deals like the TPP through Congress without any amendments or filibusters. Instead, Congress could only issue yea or nay votes. Critics of fast track say it effectively removes congressional oversight of trade deals.
What about the "investor-state dispute settlement" provision, or the thing people got upset about on Wednesday?
Much of what the public knows about this part of the deal was revealed by WikiLeaks and the New York Times this week. The investor-state dispute settlement (ISDS) clause would allow corporations to sue TPP governments for "violating their property rights" outside of domestic courts, as Rachel Wellhausen, an assistant professor at the University of Texas at Austin, explained to the Washington Post.
Translation: If a multinational corporation feels a government's regulation of an industry—like in the interest of environmental or labor standards—disturbs its business, it can sue the government in an international tribunal. There's no appeal process outside of that.
And why would anyone want such a thing? In theory, it's supposed to increase investment between borders.
"[Investor-state arbitration] is generally nightmare," Marco Simons, legal director at EarthRights International in Washington, DC (and originally a native of Bainbridge Island), told The Stranger. "The studies have not shown that investor-state arbitration clauses provide any benefit in the form of increased investment, which should be the point of it, right? And on the other hand, [those clauses] have resulted in very troubling, somewhat abusive procedures against state's efforts to regulate environmental and public health issues."
Simons fired off a number of examples of this sort of thing under existing trade agreements: that time that Philip Morris Asia took Australia into arbitration over the country's tobacco packaging law. That time multinational mining company Pacific Rim sued El Salvador because of its refusal to let the company dig a mine in a place that locals say could devastate community water supplies. That time a major US investment company took Peru into arbitration over the country demanding a pollution cleanup process.
"There's a lot of examples how giving these rights to multinationals is not only creating real problems for governments in terms of environmental regulation, but also chilling their desire to do so," Simons said. He then pointed to a New York Times article from 2013, explaining how tobacco companies have started threatening to drag poorer countries into arbitration over laws that hadn't even been executed yet.
A TPP international arbitration case, he added, could even occur over something like a city's living wage law. If a foreign company said the living wage law affected its investment, the US could get dragged into an international tribunal.
Why are so many labor groups opposed to the TPP?
Here's what that coalition of community groups wrote in their letter to the Seattle City Council: "[Trade agreements] affect the likelihood of jobs being offshored, they impact small businesses both when workers don’t have income to spend and when cheap products flood the market. Businesses committed to local communities, who want to keep production in America, are put at a disadvantage."
David Wessel at the Brookings Institution writes that most union workers are actually affected very little by trade agreements. Instead, he says, there's evidence to show that other factors of globalization—like technology and the acceleration of developing economies—have more impact on jobs being offshored. But, he adds, much of the TPP probably helps out intellectual property protections for big industries (like pharma) more than it helps out workers. "If pharma gets to charge more for drugs in developing countries, do the benefits flow back to US workers?" economist Paul Krugman asks. "Probably not so much."
Another Nobel Prize winner, Joseph Stiglitz, put it another way: "Trickle-down economics is a myth. Enriching corporations—as the TPP would—will not necessarily help those in the middle, let alone those at the bottom."
What about enviros?
Aside from the whole investor-state thing, environmentalists say one section of the TPP, dated November 2013, shows some seriously weak environmental protections. The section dealing with overfishing, poaching, and illegal logging, for example, contained mostly voluntary standards, without criminal consequences. Environmental groups are also worried about what the TPP could mean for efforts to address climate change. With the investor-state provision, enviros say oil companies could sue governments in trade tribunals for their climate policies.
What does this have to do with Seattle?
The Seattle Times editorial board thinks that the city council issuing an opinion on an international trade deal is silly, mostly because the city council isn't as well-versed on trade as the people writing the deal or Congress. Without acknowledging many of the very real concerns listed above, the Times editorial board flung out a beautiful what-abouting argument for the cul-de-sac boomer set: "How about focusing on matters closer to home, such as a downtown rife with street disorder?" they asked.
Simons, the EarthRights lawyer, disagrees. "I think cities should be concerned," he told The Stranger. "Cities and state governments are the ones who would be the subject of arbitrations if a foreign company doesn't like what they do."
Take, for example, $15. If a foreign company didn't like it, they could take the US into an international arbitration, according to Simons's argument. And Simons reiterates the possibility of a chilling effect: "It could make states and cities think twice about taking strong measures to protect the environment, or workers, or public health. I absolutely think the City of Seattle should be concerned."
The full city council will vote on the resolution this afternoon.
This post has been updated.
