Happy Valentine’s Day everyone!
Trump was vocal on his opposition to NAFTA and TPP….so vocal that he probably got him some votes from labor…..he promised to re-negotiate NAFTA and end the TPP….(and the peasants danced)…..
Most Americans are all in favor of free trade…..but are they?
Free trade is the economic policy of not discriminating against imports from and exports to foreign jurisdictions. Buyers and sellers from separate economies may voluntarily trade without the domestic government applying tariffs, quotas, subsidies or prohibitions on their goods and services. Free trade is the opposite of trade protectionism or economic isolationism.
Politically, a free trade policy may just be the absence of any other trade policies; the government need not positively do anything to promote free trade. This is one reason it is sometimes referred to as “laissez-faire trade” or “trade liberalization.” Governments with free trade agreements (FTAs) do not necessarily abandon all control of taxation of imports and exports. In modern international trade, very few so-called FTAs actually fit the textbook definition of free trade.
One can hear the cry ringing through the boardrooms of capital: “Free trade is dead! Long live free trade!”
Think the ideas behind the Trans-Pacific Partnership or the so-called “free trade” regime are buried? Sadly, no. Definitely, no. Some of the countries involved in negotiating the TPP seeking to find ways to resurrect it in some new form — but that isn’t the most distressing news. What’s worse is the TPP remains alive in a new form with even worse rules. Meet the Trade In Services Agreement, even more secret than the Trans-Pacific Partnership. And more dangerous.
Take a closer look at TiSA…..
Here is where things gets scary. Team TiSA – a consortium of multinational financial, logistics, and big data corporations – are looking to set severe limits on how governments can regulate economies domestically while providing strict investor rights provisions. Deborah James outlined ten aspects of TiSA that have been accepted by all parties or are under negotiations that could have significant consequences:
- Companies are expanding the category of “services” in order to make it all-encompassing so that the agreement could apply as broadly within the economy as possible.
- Offshoring and outsourcing of jobs and downward pressure on wages could greatly accelerate as TiSA would lock in labor, tax, and regulatory arbitrage.
- Not only would TiSA promote offshoring of jobs, but it would also greatly expand domestic “inshoring.” Foreign contractors (say from Japan) would be able to bring in workers (say from Philippines) to conduct work inside a consumer country (say the United States) on terms well below the minimum local pay and standards.
- The TiSA does not include a labor chapter, and in fact the draft texts only mention labor rights once.
- Preventing governments at the national, state, and even municipal levels from supporting local business and local employment.
- The principle of “technological neutrality which TiSA negotiators take as a given would have immeasurable job impacts particularly with regard to the “gig” economy. So if a country opened its market to passenger transport services, it could not apply new and different rules to Uber than to traditional taxicabs.
- Job loss as a result of privatization would increase as publicly owned utilities would have to compete under the same rules as private companies, reducing the benefits of public ownership, resulting in the elimination of jobs that inevitably follows privatization.
- The financial services text of the TiSA is the closest thing imaginable to a guarantee of another job-killing financial crisis. If the draft texts were accepted, the TiSA would constrain governments from implementing most of the regulations that are recognized, both domestically and internationally, as essential to prevent another global financial crisis.
- Workers would have to shoulder even more of the tax burden as corporate tax evasions would accelerate.
- The TiSA could potentially be used as the basis of a foreign company’s claim against the United States
Where are all the yells and cheers now? I am waiting!