The Trans-Pacific Partnership Threatens Our Liberty - by David Cay Johnston

Under the agreement, corporations could challenge federal, state and local laws without court oversight

The Trans Pacific Partnership, one of the biggest multinational trade deals ever, has been signed by ministers from its 12 member nations in New Zealand.

The ceremony in Auckland brings the huge trade pact, which has been five years in the making, another step towards to becoming a reality.
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The 12 nations account for some 40% of the world's economy - they now have two years to ratify or reject the pact.
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Economic theory holds that removing trade barriers among nations should increase global wealth. But the proposed 12-nation Trans-Pacific Partnership that Congress must soon give a straight up-or-down vote threatens our liberties as Americans and is likely to add almost nothing to U.S. economic growth.

I have been a longtime critic of the agreement, especially since WikiLeaks obtained a draft of its intellectual property provisions, showed a clear bias in favor of corporations.

Since Washington made the text public in October, I have come to see some very real benefits in the agreement — but not nearly enough to warrant making it the law of the land.  What I see now is a pact that would make government subservient to corporations, posing a real threat to freedom and self-governance.

Does little on tariffs
There are two chief reasons to reject the TPP.  First, the partnership does little for the U.S. on tariffs.  In fact, the TPP was only minimally about U.S. tariffs on imports, which overall are insignificant at 1.5 percent, amounting to only a fraction of a penny of each dollar of federal tax revenue.  However, the same is not true for exports:  Some U.S.-made goods are subject to tariffs of up to 70 percent.  Tariffs on U.S. goods imposed by the 11 other countries fall to zero, encouraging more exports of machinery, automotive parts and other manufactured products.  But these issues could be resolved in bilateral negotiations without expanding corporate powers.

Second, the agreement would allow foreign corporations and governments to challenge federal, state and local laws in every other partnership country.  The arbitration panels will likely to be composed of trade lawyers agreed to by each side.  Despite some precedents in existing treaties, this raises fundamental questions of sovereignty, especially since corporate agent­s, not judges in courts of law, would make decisions binding on the body politic.  That no case brought against the United States under the North American Free Trade Agreement (NAFTA), for example, has resulted in damages should not blind us to the fact that huge damages could be awarded under the TPP.

The TPP would create a system of arbitration run by insiders, who could be advocates one day, arbiters the next, an arrangement almost guaranteed to produce corrupt backscratching for the benefit of corporations and at the expense of we the people.

Worse, no matter how economically damaging, unfair or just plain wrong the decisions of TPP arbitration panels, the rulings will not be subject to review by any court.  This is justice of, by and for corporations, which means it cannot be justice.

You could even pay more taxes to cover damages awarded by these unaccountable arbitration panels.  More than $400 million in damages have been paid and $14 billion is sought under trade agreements already in effect.

Minimal gains
Supporters of the pact try to divert the public from these issues with promises of big economic gains that imply more jobs.  Take the Peterson Institute for International Economics, which is sponsored by Wall Street mogul Peter Peterson.  News reports last week cited a Peterson estimate that if the agreement were approved, American exports in 2030 would grow by an extra 9.1 percent, or $357 billion, in 2030.

For people to remain free and governments to remain sovereign, corporations must remain subject to state control, not the other way around.

That sounds terrific.  The problem is in a related fact all the news reporters missed because they read the press release, not the actual study.  The report predicts that imports will rise by the exact same $357 billion as exports, making the net result a big fat zero, as economist Dean Baker pointed out in his invaluable Beat The Press blog.

Actual results will be not much better than zero, at least for America, the World Bank estimates.  It projects the American economy in 2030 will be larger by an extra four-tenths of one percent. That’s roughly equal to the economy of metropolitan Oklahoma City.  Australia, Canada, Chile and Mexico would see growth increase by a fraction of one percent to about 2 percent.

Read more at The Trans-Pacific Partnership Threatens Our Liberty