How TPP Increases Corporate Power vs. Government — And Us

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How TPP Increases Corporate Power vs. Government — And Us

"The corporations writing the TPP agreement wrote into it a special channel for corporations to get enforcement when they need it." (Photo: Backbone Campaign/flickr/cc)

Power is the ability to control, to tell what to do, to get your way. Corporations have a lot of power over working people in our country now, and they might be about to get a lot more.

The proponents of the Trans-Pacific Partnership (TPP) tell us that it will have unprecedented “progressive” protections for the rights of working people, the environment, even wildlife. So there is likely to be flowery-sounding language in TPP, just as President Obama says.

What matters is whether there will be clear and guaranteed enforceability of those words.

Enforcement Matters

Rules are great; enforcement is greater. Without enforcement, a rule may as well not exist – especially when everyone knows there is not enforcement.

We see rules with no enforcement all around us. Here’s an obvious example. Right now several obvious presidential candidates say they aren’t candidates so they can get around rules about contribution limits to their campaigns and coordination with super PACs. The Federal Election Commission is not enforcing the rules that say candidates can’t do this. These candidates know there is no enforcement and thus continue to violate the rules.

We see rules with no enforcement all around us. The labor standards in trade agreements are meaningless without enforcement.

Another example is Wall Street. The Obama administration does not prosecute the people at the top of the big banks for violating laws. Instead they reach “settlements,” and the shareholders – not the executives who committed wrongful acts – pay fines, usually without even admitting wrongdoing. In the early 1990s there were 5,490 investigations and 1,100 prosecutions of individuals, with 890 convictions for major fraud following the “savings and loan crisis.” The number of prosecutions and convictions following the Too-Big-To-Fail Wall Street collapse of 2008 and resulting bailouts has been close to (if not) zero. The banks know there is no enforcement and continue to run various scams and manipulations. (See “Watchdog: Wednesday’s Big Wall Street Settlement Is “Laughably Inadequate”,” “Prosecute Now: The Justice Department Can Still Act Against Bad Bankers,” “Bank of America Settlement Only Proves Invincibility of Wall Street,” “How Big Is a $16 Billion Bank Fraud Settlement, Really?,” “10 Things We Learned (or Re-Learned) In Chase’s Latest Fraud Deal,” “Why Is The FDIC Helping Banksters Avoid Trial?,” “Wrecking an Economy Means Never Having to Say You’re Sorry” and dozens if not hundreds of similar stories.)

An example of (non-)enforcement as it applies to the words in trade agreements is illustrated by the situation in Colombia. The recent Colombia trade agreement has labor standards. The U.S. Trade Representative’s office explains at their website, in “Labor in the U.S.-Colombia Trade Promotion Agreement“:

The U.S.-Colombia Trade Promotion Agreement … includes strong protections for workers’ rights, based on the May 10, 2007, bipartisan Congressional-Executive agreement to incorporate high labor standards into America’s trade agreements. In addition, President Obama insisted that a number of serious and immediate labor concerns be addressed before he would be willing to send the Agreement to Congress. These concerns included violence against Colombian labor union members; inadequate efforts to bring perpetrators of murders of such persons to justice; and insufficient protection of workers’ rights in Colombia.

As a result, the U.S. and Colombian governments announced, on April 7, 2011, an ambitious and comprehensive Action Plan that included major, swift and concrete steps for the Colombian government to take. The U.S. Government has confirmed that Colombia has met all of its Action Plan milestones to date. In addition, successful implementation of key elements of the Action Plan will be a precondition for the Agreement to enter into force.

But since this agreement went into effect, “Colombian workers have suffered over 1,933 threats and acts of violence against unionists – including 105 assassinations of union activists and 1,337 death threats.” The labor standards in trade agreements are meaningless without enforcement.

Flowery language about labor rights vs. labor organizers murdered without enforcement of the flowery words: The contrast between words and results doesn’t get clearer than that.

The words that show up in TPP are relatively meaningless unless there is strong enforcement.

Who Enforces?

Currently enforcement of trade laws is up to the governments that sign the agreements. While China was grabbing tens of thousands of U.S. factories and millions of U.S. jobs in the 2000s, the Bush administration only filed around three trade violation cases per year. The Obama administration created a trade enforcement office in 2012 to “bring the full resources of the federal government to bear on investigations … to counter any unfair trading practices around the world, including by countries like China.” However, according to Politico last August, the Obama administration had also filed around three trade violation cases per year.

Corporations get a special channel for enforcement; labor organizers get murdered. That’s how power is shifted.

That is the record of all trade enforcement, not just enforcement of labor, environmental and other stakeholder language. According to Zach Carter and Dana Liebelson in “Here’s The Biggest Problem With Obama’s New Trade Push” at The Huffington Post:

The U.S. has a poor record on enforcing human rights and labor terms under trade agreements. A 2009 Government Accountability Office report found that American enforcement of labor terms was “ad hoc and very limited” with “minimal oversight.” Another GAO report from November 2014 found that the situation hadn’t improved much. While the Labor Department has brought a handful of workers’ rights cases under prior trade agreements, they have taken years to investigate and remain unresolved.

How Corporations Get Enforcement

The corporations writing the TPP agreement wrote into it a special channel for corporations to get enforcement when they need it. That’s what the Investor-State Dispute Settlement (ISDS) provisions are for. With ISDS, corporations get a special “corporate court” channel which they can take claims to and the cases are decided by corporate lawyers acting as judges. (The post “Now We Know Why Huge TPP Trade Deal Is Kept Secret From The Public” discusses the leak to WikiLeaks and the NY Times of this chapter of TPP. From The New York Times report of the leak, “Trans-Pacific Partnership Seen as Door for Foreign Suits Against U.S.“:

… the accord, still under negotiation but nearing completion, companies and investors would be empowered to challenge regulations, rules, government actions and court rulings — federal, state or local — before tribunals organized under the World Bank or the United Nations.

Corporations get a special channel of their own for enforcement of rules written by their representatives at the negotiating table. Labor, environment and other stakeholders don’t get that in TPP. This is how TPP will increase corporate power over governments and working people.

So if TPP is passed, corporations can, for example, move factories and jobs to Vietnam and take advantage of their low wages and lack of labor protections. The corporations are protected from violations of the agreement that harm their interests – but labor violations depend on the kind of enforcement that lets Colombian labor organizers get threatened and murdered. Then the big corporations can tell any workers left here to accept even more wage and benefit cuts or their jobs will be moved as well.

Corporations get a special channel for enforcement; labor organizers get murdered. That’s how power is shifted.

Lee Saunders, President of the American Federation of State, County and Municipal Employees, recently summed it up, saying, “We cannot create better trade agreements until we get our priorities straight. These priorities should include lifting wages, protecting workers, environmental and safety standards, and enforcing workers’ rights. Unfortunately, TPP will be no different from previous trade agreements that ignore these priorities and approach trade the same old way: by focusing on corporate goals and giving special rights to corporations at the expense of workers and consumers.”

Dave Johnson

Dave Johnson

Dave Johnson is a contributing blogger for the Campaign for America's Future.

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