May 11, 2015
Sometimes politics make for strange bedfellows and that certainly seems to be the case with President Obama’s Trans–Pacific Partnership (TPP) trade treaty that encompasses 11 countries. Many senior Republican Party leaders are “all in,” while the president struggles to convince his own party that the new trade pact is good for the middle-class.
The White House says the deal would expand economic opportunity for American workers, farmers, ranchers as well as businesses by easing trade regulations with favored countries. Critics, including the AFL-CIO argue the global corporate agenda has pushed for deregulation, privatization, tax breaks at the expense of American families. AFL-CIO communications director Eric Hauser said, “Decades of experience have taught us that corporate-driven trade policy too often accelerates a global race to the bottom.”
The United States and 11 Pacific Rim nations—Australia, Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and Japan—make up the TPP Free Trade Agreement.
Further complicating President Obama’s sales pitch was his choice to discuss the details—Nike in Beaverton, Oregon. The famous athletic shoe company promised 10,000 new US jobs if the deal passed, however the job hiring details remain sketchy.
Teamster President Jim Hoffa wasn’t buying the job-exporting giant’s claims. “Nike’s announcement that the Trans Pacific Partnership would lead to 10,000 new U.S. jobs at the company and up to 40,000 new jobs throughout the supply chain is nothing more than the same empty trade rhetoric we have heard over and over again since the passage of NAFTA more than two decades ago.”
A critical vote is set for Tuesday, but outgoing Democrat minority leader Harry Reid says fast-track should not move without a promise from Republicans to pass a Trade Adjustment Assistance and African Growth and Opportunity Act (AGOA), which aims to assist displaced workers with an increase in trade. That legislation also includes a customs enforcement agreement in an effort to give developing nations trade preferences.
The vote, scheduled by Senate leader Mitch McConnell (R-Kentucky), will formally open debate on legislation that generously gives Mr. Obama a fast-track authority, allowing him to give Congress trade deals that only require a straight up-or-down approval. The process would also prevent lawmakers from offering any amendments. McConnell, who campaigned on the platform to get Obama out of office, said he realized the significance of the deal and the trust involved by acknowledging the president’s fast track is, “an enormous grant of power.”
But is a trade deal what America needs or will it only help China’s economic power?
Senator Jeff Sessions (R-AL), a persistent thorn in the side of establishment Republicans, says the US ran a record $51.4 billion trade deficit in March. “This is especially concerning since assurances were made from the Administration that the recent South Korea free trade deal would ‘increase exports of American goods by $10 billion to $11 billion.’ But, in fact, American domestic exports to Korea increased by only $0.8 billion; an increase of 1.8 percent, while imports from Korea increased $12.6 billion, an increase of 22.5 percent. Our trade deficit with Korea increased $11.8 billion between 2011 and 2014, an increase of 80.4 percent, nearly doubling in the three years since the deal was ratified.”
Sessions explained that five promises in the deal remain factually troubling.
1. Regarding the “Living Agreement”: There is a “living agreement” provision in TPP that allows the agreement to be changed after adoption—in effect, vesting TPP countries with a sweeping new form of global governance authority. TPP calls this new global authority the “Trans-Pacific Partnership Commission.” These measures are unprecedented. While I and other lawmakers have been able to view this provision in secret, I believe it must be made public before any vote is scheduled on TPA, due to the extraordinary implications. I call on you today to make that section of TPP public for the American people to see and review.
2. Regarding trade deficits: Will TPP increase or reduce our cumulative trade deficit with TPP countries overall, and with Japan and Vietnam specifically?
3. Regarding jobs and wages: Will TPP increase or reduce the total number of manufacturing jobs in the United States generally, and American auto-manufacturing jobs specifically, accounting for jobs lost to increased imports? Will average hourly wages for U.S. workers, including in the automobile industry, go up or down and by how much?
4. Regarding China: Can TPP member countries add new countries, including China, to the agreement without future Congressional approval?
5. Regarding foreign workers: TPA is a six-year authority. Can you state unconditionally that no agreement or executive action throughout the lifetime of TPA will alter the number, duration, availability, expiration enforcement, rules, or processing time of guest worker, business, visitor, nonimmigrant, or immigrant visas to the United States?
But President Obama has remained steadfast. He has been using the Oval Office, cell phone and campaign trail to encourage nervous Democrats that this trade deal is much different than the North American Free Trade Agreement that saw an exodus of US jobs in the 1990s. The president also pointed to other countries like Korea, Japan, Australia as well as others across the Pacific Rim who have spent a significant amount of time ensuring the trade deal passes the US Congress.
After a grueling sales pitch to wary Democrats, Diane Feinstein said the Obama administration presented a compelling case for the trade deal. “It was a good lengthy discussion and a number of different aspects of this came out. I saw things that I didn’t see before,” Feinstein concluded.
But the fact remains that the U.S. trade deficit with China reached $31.2 billion last month– the largest in history. In March, Americans’ bought $239 billion in automobiles, cell phones, furniture, clothes and machinery.
That staggering import number means more lost manufacturing jobs and shuttered factories. Those lost jobs will create jobs in China, Mexico as well as other Pacific Rim nations.
Another consideration for those addicted to cheap foreign “stuff” is the future of the next generation. The millennial’s futures are leveraged by cheap offshore labor rendering their pricey diplomas’ useless while political class and corporate elites enrich their bottom lines. This translates into a much wider income gap.
“On trade, I actually think some of my dearest (Democrat) friends are wrong. They’re just wrong,” Obama said last week. “This is the most progressive trade deal in history.”
Old school Republican Pat Buchanan asked a very good question about the impending TPP deal. “Who benefits more if we get access to Vietnam’s market, which is 1 percent of ours, while Hanoi gets access to a U.S. market that is 100 times the size of theirs?” He answered the question by saying, “The bankruptcy of a U.S. trade and foreign policy, which has led to the transparent decline of the United States and the astonishing rise of China, is apparent now virtually everywhere.”
Sessions concurred and said the president was wrong about this trade deal. “Overall, we have already lost more than 2.1 million manufacturing jobs to the Asian Pacific region since 2001. Due to the enormity of what is at stake, I believe it is essential Congress have answers to questions before any vote is scheduled on ‘fast-track’ authority.”
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