U.S. Sen. Orrin Hatch (R-Utah) just announced that fast-track trade legislation won't be introduced until April. Thanks to the objections of U.S. Sen. Ron Wyden (D-Oregon), the effort to fast-track fast track has been put on hold.
Fast track -- "Trade Promotion Authority" -- is designed to grease the skids for passage of the Trans Pacific Partnership (TPP) trade agreement that is still being negotiated behind closed doors.
The postponement opens up a month to have a true national debate on our global trade tax policies. Surely one is long overdue.
The Full Catastrophe
The U.S. has racked up a staggering $6.75 trillion in trade deficits since 2000. Good jobs have been shipped abroad; thousands of manufacturing companies have packed up and moved overseas. Those that stay use the treat of leaving to bully wage concessions here at home.
Large trade deficits -- over $500 billion in 2014 -- are a central reason most workers haven't yet experienced the so-called "recovery." The jobs that are being created aren't as good as the jobs that are being lost. The Center for Economic and Political Research estimates that simply balancing our trade would generate 4.2 million jobs directly and another 2.1 from the consumer demand that those new workers would generate.
Our trade deficit with China -- over $320 billion in 2014 -- is the largest imbalance with a single country in the annals of history. And now the trade deficit in high technology products with the Chinese is setting new records as well. Our trade policies are literally trading away our future.
There Is an Alternative
Thus far, the debate over TPP and fast track has produced more heat than light. The president, the Republican leaders in Congress and the corporate lobby assume that they can muscle the deal through while whistling the same old refrains. They tout the potential of new exports without mentioning the cost of greater imports. They boast about strong labor-rights provisions, not mentioning that Vietnam, the designated low-wage producer in the deal, doesn't even allow independent trade unions. They say it's vital that we, not the Chinese, write the rules, but they don't mention that the "we" in that sentence refers to the corporate and banking lobbies that sit in on the negotiations, not the American people who are locked out of them.
If the supporters of fast track seem to be in denial of the ruinous record of trade accords, the opponents are dismissed as luddites, protectionists who want to turn their backs to the new global marketplace.
The mainstream media could use the next month to educate Americans about the stakes in this debate -- and about the choices that are about to be made.
To aid in that debate, the Congressional Progressive Caucus -- the largest caucus in the House -- has broken through the mire to release its "Principles for Trade: A Model for Global Progress."
The principles shows that there could be an alternative, a global strategy designed to benefit workers, not investors, and serve the nation's interests, not the special interests of global companies and banks. The CPC seeks more trade, but on terms that will strengthen, not sabotage, working families. Key elements include:
The CPC's fundamental principle is that the U.S. should commit to balanced trade and implement a "trade regulatory program" to achieve this. This might include a presidential commitment to moving to balanced trade in five years, putting multinationals on notice that they have to produce here to sell here, and putting mercantilist nations like China on notice that they no longer can rely on Uncle Sucker as a growth strategy. This can be enforced initially by cracking down on currency manipulation and sustaining a sensible level for the dollar while ending the subsidies and tax dodges that reward companies for moving abroad.
The CPC principles upend the thrust of current trade negotiations. The CPC argues that trade accords should "put workers first," containing labor-protection provisions that can be enforced, by Congress itself if necessary. All trade accords should require that signatories adopt the domestic labor rights as provided by core International Labor Organization conventions. This would require the U.S. and other countries to strengthen their labor laws.
Then the CPC lays out common-sense principles for trade negotiations. Any agreement should prohibit currency manipulation, the central tactic of China and other mercantilist nations to capture markets.
Any agreement should provide a floor under environmental protections while enabling countries to raise their standards above the floor. This is a stark contrast to current provisions that empower multinationals to pocket damages if tighter environmental standards impact their potential future profits.
Any agreement should enable countries to pass consumer-protection measures without challenge. Trade accords would be prohibited from superseding domestic food and safety standards, financial regulations, and other consumer policies.
Any agreement should enable strong "buy American" provisions in government contracting, and their equivalent for other countries. Surely taxpayers in any country should have the right to use their taxes to give preference to domestic producers, not to foreign manufacturers.
Any agreement should secure affordable access to essential medicines and health services. The backroom deals driven by Big Pharma to protect and extend their patents make medicines too costly for many. No trade accord should delay access to affordable generic drugs.
Any U.S. trade accord should uphold the UN Universal Declaration of Human Rights. Trade accords should be an instrument that promotes basic human rights rather than undermining them.
Most importantly, the CPC would terminate the creation of a private court system for foreign investors. As recently detailed by U.S. Sen. Elizabeth Warren (D-Massachusetts), the current Investor-State Dispute Settlement (ISDS) provisions give foreign investors the right to sue a government in a specially created, private arbritation system. A small tong of high-priced lawyers serves as both advocates and arbiters, a classic conflict of interest, and profitable work if you can get it. There is no appeal. Companies have sued countries for damages when those countries have strengthened their environmental laws, curbed cigarette packaging, or decided to shut down dangerous nuclear plants. This obscure subsidy to foreign investors -- domestic corporations have no such protections -- exemplifies what happens when deals are cut in the backrooms with the lobbies at the table and the public locked out.
The CPC would also strengthen trade-adjustment assistance so that workers displaced from their jobs and communities devastated by plant closings would gain the assistance they need to get back on their feet.
All these principles are basic common sense. All are elements of a trade policy that would better serve the interests of the American people as opposed to the interests of global corporations and investors. If accepted, they would provide a framework for expanded trade in which workers both here and abroad would benefit. If refused, we could continue to trade with various countries, but without locking ourselves into trade deals that steal our jobs, undermine our wages, and trample our laws.
No Fast Track
Yet the TPP agreement now in negotiations clearly violates each of these principles.
So the CPC insists that trade authority -- the so-called fast-track bill -- protect the power of Congress to set the standards for negotiation. They call for a trade authority that gives Congress the power to determine whom the U.S. will negotiate with and create mandatory objectives for what must be included or not included in any agreement. The trade authority would also require a prior congressional vote on whether those conditions have been met before the president could sign the treaty. It would require that legislators have access to the ongoing negotiations, including various draft texts.
In contrast, the authority that Sen. Hatch wants to fast-track through Congress has none of these protections. The treaty has been under negotiation for five years. Congress has had no say in who is at the table or what is included. Any conditions set now would be dismissed as too late. Congress has no right to vote before the president signs the deal.
Instead, under the fast track peddled by Sen. Hatch and the White House, legislators would have 20 hours to debate a many-thousand-page bill packed with special-interest deals. They would have no right to amend. The president will have already signed. Congress would only have an up-or-down vote on whether to approve a treaty about which they know little or embarrass a president by defeating it. This is more than a minor insult, but a full-court press by the White House, the Republican leaders in Congress, and the corporate lobby is usually enough to drive the bill through.
Not surprisingly, fast track has been central to passing the trade deals that have put us in the hole we are in. The CPC shows that there is an alternative. Now if PBS, the networks, and the mainstream media step up, we could have a major debate on whether we want to keep digging that hole deeper. Surely that is a debate that is worth having.