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TransPacific Partnership Will Undermine Democracy, Empower Transnational Corporations

Published: April 22, 2013
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Source: Truth-Out

Our country's democratic values could be under threat if President Obama fast tracks the Trans-Pacific Partnership.

On critical issues, the massive Trans-Pacific Partnership (TPP) being negotiated in secret by the Obama administration will undermine democracy in the United States and around the world and further empower transnational corporations. It will circumvent protections for health care, wages, labor rights, consumers' rights and the environment, and decrease regulation of big finance and risky investment practices.

The only way this treaty, which will be very unpopular with the American people once they are aware of it, can be approved is if the Obama administration avoids the democratic process by using an authority known as "Fast Track," which limits the constitutional checks and balances of Congress.

If the TPP is approved, the sovereignty of the United States and other member nations will be dissipated by trade tribunals that favor corporate power and force national laws to be subservient to corporate interests.

Circumventing the Checks and Balances of US Democracy

President Nixon first developed the idea of "Fast Track" in 1973 as a way to secure Congressional approval of trade agreements, and it has been a key to passing many unpopular agreements such as the World Trade Organization (WTO) and NAFTA. As people have caught on to the offshoring of jobs and other detrimental consequences of these agreements, civil society now understands how important it is to not allow a president to circumvent the democratic role of Congress. Fast Track expired in 2007, so President Obama must have it re-instated in order to pass the TPP. His administration is moving to have Fast Track approved and hopes it will happen by this summer.

Under Fast Track, the president was allowed to negotiate and sign trade agreements with whatever countries the executive branch selected - all before Congress voted on the agreement. Fast Track meant that the Congressional committee processes were circumvented and the executive branch was empowered to write lengthy implementing legislation for each trade pact without Congress. These executive-only authored bills required US law to conform to the trade agreement. For example, Glass-Steagall had to be repealed under President Clinton to conform to the WTO. And, Fast Track empowered the president to submit the executive-branch written bill for a mandatory vote within a set number of days, with all amendments forbidden, normal Senate rules waived, and debate limited in both chambers of Congress. Fast Track clearly undermined democracy.

Indeed, Fast Track turned the US Constitution on its head. Under Article I Section 8, Congress has exclusive authority "to regulate commerce with foreign nations" and to "lay and collect taxes [and] duties." Under the Constitution, the president is empowered to negotiate treaties, but Congress must vote to approve them. Thus, Fast Track took constitutional power from Congress and prevented the checks and balances needed to prevent an imperial presidency.

For most of the history of the United States, treaties and trade agreements went through the normal congressional process described in the Constitution. Fast Track is a relatively new concept that coincides with an era of increasing presidential power, which includes the power to declare war and to murder US citizens without warning or judicial oversight. If Congress had reviewed agreements such as the WTO and NAFTA beforehand and civil society had been able to participate in a democratic process, would the United States have made the mistake of passing these laws that have so injured our economy and others?

Fast Track is very unpopular, so now President Obama and others who advocate for it do not use the term. Instead they call it by the euphemism "Trade Promotion Authority." But changing the name does not change what it is - a method of ceding the constitutional power of Congress and undermining the checks and balances built into the constitutional framework.

Congress needs to consider what agreements such as the TPP will do to jobs, trade balances and the environment. Since Nixon, Fast Track has been used by presidents to go way beyond trade and tariffs. These agreements have been used to change US law by establishing "rules related to domestic environmental, health, safety and essential-service regulations, including deregulation of financial services; establishment of immigration policies; creation of limits on local development and land-use policy; extension of domestic patent terms; establishment of new rights and greater protections for foreign investors operating within the United States that extend beyond US law; and even limitation of how domestic procurement dollars may be spent." Thus, not only has the constitutional power of Congress to regulate commerce with foreign nations been undermined, but a whole host of domestic laws have been rewritten to satisfy international trade.

The TPP Undermines US Law, Prevents Progressive Policy Around the World

The TPP is much broader than the usual trade agreement and will impact many aspects of society from the Internet to health care to regulation of risky bank speculation. For this reason alone, it is especially important to have a transparent, public debate on the agreement. The TPP contains 26 chapters, but only five of them concern traditional trade issues. The TPP has been negotiated in secret except for over 600 corporate representatives who have been advising the US trade representative on its language. In Washington, DC K Street lobby firms have been getting involved in the process, including pushing for Fast Track. Many of those corporations that have failed to get what they want from Congress are now getting their way through the secret back door of the TPP.

Though the TPP negotiations are being conducted in secrecy, portions of the text have been leaked. Here is what is known about some of the key issues that the TPP will affect:

Prevent Buy America Manufacturing Preferences: The TPP's procurement chapter ends 'Buy America' preferences by requiring that all firms operating in any signatory country are provided equal access to US government procurement contracts over a certain dollar threshold, the same access that domestic firms have. To implement this, the United States would agree to waive "Buy America" procurement policies.

Undermine Environmental Laws and Regulations: Similarly, governments who are seeking to encourage localization and green manufacturing through procurement preferences will be stopped. A recent example involved Ontario, Canada, which has employed a renewable energy program that requires energy generators to source solar cells and wind turbines from local businesses so as to cultivate a robust supply of green goods, services and jobs.  The program has earned acclaim for its early success in generating 4,600 megawatts of renewable energy and 20,000 green jobs. But, the WTO ruled that this violated WTO rules. In another case, a US company Lone Pine Resources is suing the Canadian government under NAFTA for more than $250 million due to lost profits from Quebec's moratorium on fracking, which prevents Lone Pine from fracking under the St. Lawrence River. This is not an isolated incident:

. . . corporations such as Chevron, Exxon Mobil, Dow Chemical, and Cargill have launched 450 investor-state cases against 89 governments, including the United States. Over $700 million has been paid to corporations under US free trade agreements and bilateral investment treaties, about 70 percent of which are from challenges to natural resource and environment policies. Corporations have launched attacks on a range of public interest and environmental regulations, including bans or phase-outs of toxic chemicals, timber regulations, permitting rules for mines, green jobs and renewable energy programs, and more.

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