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TPP Dead

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This is certainly not the way I wanted it to happen, but the Trans-Pacific Partnership is dead. Personally, I’d take neoliberalism and the TPP over Trumpism and no TPP any day. The killing of the TPP in this fashion really isn’t going to solve any of the problems with it. The Trump administration is still going to be a boon for corporate domination, for pharmaceutical companies, and for employers seeking to exploit workers. I can’t really comment on how this affects U.S. relationships with its allies in Asia but given the utter disaster that Trump’s foreign policy is going to be, I imagine China is going to be a huge winner in the next 4 years with or without the TPP. Not subjecting even more workers and more national laws to the ISDS courts is a good thing. Rejecting the TPP is at least a sign that maybe, just maybe, the U.S. is going to start revisiting its 50 year tradition of encouraging American jobs to go overseas and then call anyone who questions that as the greatest thing in history a moral monster. But then we all know the Trump administration isn’t going to do anything to keep American workers employed. And this is more about hating Obama and denying him a policy goal than any actual opposition to anything in the TPP.

In the hell that is to come, it’s important not only to fight but also to still articulate a more just world for global workers. What I called for in Out of Sight seems even farther away than ever, but nevertheless, I still believe in the ideas of global workplace standards and enforceable labor rights across the world as the future for which we should envision and demand.

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  • Bitter Scribe

    I wonder how much higher this will drive prices of imported goods.

    • aturner339

      Especially when added to a Fed rate hike and crowding out from stimulus at or near full employment. We are about to learn if the Austrians had even the faintest shadow of a point.

      • Alan Tomlinson

        Full employment?

        I really don’t think so. Not in any way.

        Cheers,

        Alan Tomlinson

    • leftwingfox

      Probably not much. China already has pressures in place against workers, and profits greatly from being a worldwide source of cheap labor and finished goods. Eliminating the TPP just means less goods from nations other than China.*

      *And potentially less exploitation from multinationals, but right now the options given are “bad opportunities” versus “no opportunities”, and there’s really nothing on the plate that’ll offer “better opportunities”.

    • liberal

      First, we don’t have TPP now; the question, I would think, would be whether import prices would stay the same (instead of going even lower).

      Even if TPP passed, why would it really make imports cheaper? AFAICT most trade agreements don’t really affect tariffs that much anymore; tariffs are already really, really low.

      …OK, Wikipedia claim the Fed Gov collection about $25B ($25*10^9) in tariffs; the average tariff rate was 1.3%. That’s really not that far from zero

    • Rob in CT

      As against the counterfactual where TPP was passed? Probably such a tiny impact we couldn’t tease it out.

  • aturner339

    It occurred to me this morning that for all the talk of the rural urban divide rural Americans have been perhaps the chief beneficiaries of globalization. Cheaper fertilizer and capital imports, vast new markets available all over the world, lower price levels over all.

    This seems to be borne out by the relatively low unemployment rates as well.

    Why is rural America not a constituency for trade?

    • twbb

      The unemployment rates hide a lot.

      • aturner339

        I’m sure it does. What statistic doesn’t? My point is it makes sense for those in exporting industries to back lower trade barriers.

        If Trump is making a play for anti trade why won’t we at least try to inform rural voters of what they stand to gain?

        • twbb

          A lot of these people don’t see benefits from cheaper exports, even if they work at those companies. Also, a lot of them work in the area where the exporting companies are, but they’re working the lower-paying, more unpleasant work to support the guys making the money.

          • rhino

            Like with every other worker, the benefits or their productivity don’t go to them anyway. Free trade benefits middle men and owners, not producers and front line workers.

            • aturner339

              So shouldn’t our argument be “Free Trade helped the mega farm down the road. Why not spread that benefit around?”

              • leftwingfox

                Unfortunately, the American Dream is working against this. About 65% of Americans know the wealth gap is increasing, but 60% still believe that hard work will get them ahead in life.

                People believe they’ll be wealthy someday, and know people who believe themselves to be wealthy. If they believe one solution targets their neighbors and future selves, that’s a harder pitch than blaming foreigners they’ll never meet.

                • aturner339

                  Maybe. But I think that maybe we underestimate the power of small town resentment. We are constantly being accused of class warfare.

                  Am I am awful person for saying we might want to actually fire a few (theoretical) shots?

            • mds

              Free trade benefits middle men and owners, not producers and front line workers.

              The thing is, protectionism benefits middle men and owners over producers and front line workers, too. Everything benefits the middle men and owners without strong labor unions, pro-worker government regulations, etc., in place. The gains of increased productivity used to be shared with workers; any fruits of free trade could have been, too. But organized labor was declining long before NAFTA.

              Which brings us back around to our current situation. Organized labor was already in trouble by 1980, but Ronald Reagan was a disaster. Yet somehow, a bunch of white male union members voted for him anyway. And Lee Atwater certainly knew why.

              • BartletForGallifrey

                Organized labor was already in trouble by 1980, but Ronald Reagan was a disaster. Yet somehow, a bunch of white male union members voted for him anyway. And Lee Atwater certainly knew why.

                Economic anxiety?

            • Manny Kant

              And, you know, consumers.

          • aturner339

            Sure income inequality does exist. This does not mean however that freer trade has not been a boon for the central components of the rural economy. That those gains have not been shared is even better ground from Democrats. To pretend they do not exist is not.

    • mongolia

      correct me if i’m wrong, but i thought iowa was always fairly pro free-trade, as an example of how viewing “the midwest” and “heartland” as being uniformly protectionist being an incorrect assumption. coincidentally, assuming IA is pro-trade, would actually bolster the case of those of us who view trumps “anti-trade” message as the key to his appeal as wrongheaded, since states that are most anti-trade shifted less to the right than states that don’t really care – with the key variable appearing to be how many white people are in the state. i’d be curious to see how his fans heard his anti-trade screeds – is it the “trade” part that appealed, or the “china” and “mexico” parts that did?

      • aturner339

        Yes this is also a thought that occurred to me. Trade did not win Trump white voters.

      • liberal

        i thought iowa was always fairly pro free-trade

        In what sense?

        I grew up there. AFAICT, might be wrong, the state still gets big, big, big agricultural subsidies.

        Those subsidies might be legal under the current free trade regime, but they’re hardly in the spirit of so-called “free-trade agreements” as we understand them.

        • mongolia

          meant in terms of the fact that there’s a lot of exports of ag products to other countries. ag subsidies, while obviously violating the “spirit” of free trade, can fit perfectly well into a framework of “we got ours, screw you”

          i could be wrong, but i remember reading about iowa’s low level of anti-trade sentiment this somewhere recently – i’ll post it if i can find it

      • nemdam

        Same story in Minnesota and Wisconsin. Wisconsin was not a “rust belt” state until November 8th. It is an agriculture state which benefits from free trade exporting. But sure, rural voters in those states shifted heavily to Trump because they are against free trade. Repeat for South Dakota, Nebraska, and Missouri. (Kansas actually went slightly more Democratic. I think Brownback can take credit for that.)

        • Jackov

          Really? Southeastern Wisconsin has been considered rust belt since the term was coined. Garreau’s The Nine Nations of North America published in 1981 included that part of the state in “The Foundry” – the declining industrial areas of the northeastern US and Great Lakes.

          That would be four of the top five counties in population, ten of the sixteen counties with over 100K people and about 45% of the state’s total population.

          • nemdam

            Huh, didn’t know that. I guess it’s my Iowa/Minnesota bias showing as I always viewed Wisconsin as an agriculture state. Maybe it’s half rust belt/half ag. I still stand by my larger point.

    • lunaticllama

      There were several articles this campaign season about the contradiction of farmers in the Midwest whose business is entirely reliant upon exporting beef, soy, and corn products around the world railing against the evils of free trade.

      • gkclarkson

        If American farmers and ranchers actually gave a shit about improving their economic well-being and objectively examined their situations, they would demand federal antitrust enforcement against the consolidation of agricultural buying conglomerates into monopsony, which is what’s really been choking their bottom lines.

        But it’s much easier to blame the brown and black and foreign people and form some militias.

    • Dilan Esper

      Agribusiness has definitely been a beneficiary. Perhaps other parts of rural America have benefitted less directly.

      There are also beneficiaries on the coasts, of course (e.g., Silicon Valley, Wall Street).

      And everyone benefits from low prices at Wal-Mart.

      However, if you wanted to pinpoint on a map where the victims of American trade policies were located, it would be concentrated in the rust belt….

      • aturner339

        I agree but by point is purely pragmatic. The democrats are unlikely to become the party of protectionism (because they largely believe the stance is wrong on the merits) if that is the case we need to overcome the collective action problem. Get the beneficiaries of trade on board.

  • AMK

    The NAFTA “renegotiation” is going to be an interesting bit of political theater. Trump sitting down with Trudeau and Nieto for 20 minutes to talk about his new gold toilets on Air Force One, then emerging to declare NAFTA renegotiated through the Art of the Deal.

    • If we’re lucky the same process will lead to the Affordable Care Renaming Trumpcare Act of 2017.

  • Harkov311

    And this is more about hating Obama and denying him a policy goal than any actual opposition to anything in the TPP.

    I liked it better when we did things because they were good ideas (or at least we thought they were) without worrying about whether the other side might get credit.

    • aturner339

      Agreed. Only from my perspective half of the angst over free trade is having to admit that maybe the capitalists were right about something.

      I don’t think the way forward for the left lies in adopting polices we cannot support with evidence.

    • AMK

      Trump ran against trade as a central theme of his campaign, beyond just hating Obama.

    • Joe_JP

      Not sure when being concerned about the other side getting credit was not a thing.

      To underline Erik’s apparent point, it is not really that he’s concerned Republicans will get credit. It is that net he thinks they really aren’t concerned big picture with the things he felt made TPP a bad idea. So no more TPP is of limited value.

      • mds

        It is that net he thinks they really aren’t concerned big picture with the things he felt made TPP a bad idea.

        Yeah, it’s not like Republicans have made a habit of opposing copyright extensions or draconian intellectual property enforcement. So they could literally take the same trade agreement, slap a “Protecting American Property Abroad Act” sticker over “Trans-Pacific Partnership” on the cover, and pass it without any of the oh-so-concerned Trump base batting an eyelash.

        • gkclarkson

          Why not? My money’s on them ending up essentially doing the same thing with Obamacare, except they’re going to make a huge show of how it’ being repealed and replaced, and will call it Ryancare or Trumpcare.

      • Harkov311

        Not sure when being concerned about the other side getting credit was not a thing.

        Well, to take just one example (and admittedly maybe an odd case) nobody backed away from creating the EPA because they were afraid Nixon would get credit for signing the bill.

        • gkclarkson

          This particular ratchet only goes one way.

        • Joe_JP

          Well, to take just one example (and admittedly maybe an odd case) nobody backed away from creating the EPA because they were afraid Nixon would get credit for signing the bill.

          Being “concerned” doesn’t mean each and every time you reject something because the other side will get credit.

          You said “when we did things.” Again, aside from what I said about Erik’s main point, I think each side always to some degree was wary about letting the other side get credit for something positive. Don’t think it is just something that happens these days.

  • Gregor Sansa

    Note that the TPP was almost certainly dead if Clinton had won, too. Obama wanted it, but even if you think that Clinton still wanted it in her heart of hearts, it’s pretty clear that both of them would have been spooked enough by breaking a key campaign promise of hers this quickly, that they wouldn’t have done it.

    • Anna in PDX

      Yes.

      • Dilan Esper

        No. I think Hillary was completely insincere and planned to make some cosmetic changes or include some mild protections for labor and the environment and then put it through. That was always her husband’s MO on trade.

        • Gregor Sansa

          How does that work?

          Hillary comes into office. Tells her people to negotiate some labor and environmental fig leafs. “OK, boss” and they do it in record time.

          Now, she has to get Senate approval. For something that’s clearly just breaking her promise with a fig leaf. In the best case, that swings on votes like Warren and Sanders. In the worst case, it’s Republicans, with zero motivation to give her a win.

          Note that if she expects to lose that fight, there’s good reasons for her not to even try.

          Even if you think that she’s pure evil, AND that the US always has the power to boss other countries around, it just doesn’t make sense. And on both of those pessimistic assumptions, there is at least reasonable doubt.

          • Ahuitzotl

            It’s Dilan – it’s unfair to expect him to make sense

        • TopsyJane

          I doubt she would have been raring to pick a fight right out of the box with a left wing already suspicious of her motives. That would be the way to get her administration off to a splendid start, getting hit on both flanks.

          No. If Clinton had won, it would pass during the lame duck session or not at all.

          Oh,well. Score one for the Chinese. (Trump voice: “We make deals! Lots of deals! Thank you, Donald!”)

  • I imagine China is going to be a huge winner in the next 4 years with or without the TPP

    Yes. I think that one unintended consequence of the Trump years will be making China appear to be the good guy.

    • twbb

      After 4 years of Trump, maybe China WILL be the good guy.

    • AMK

      Organized, efficient, climate-conscious authoritarianism is going to have lots more fans that chaotic, incompetent, factually illiterate kleptocracy.

    • Just_Dropping_By

      I wasn’t aware that China appeared to be the bad guy (at least by any objective metric).

    • Much better without the TPP since there is now no counterbalance to China’s own Asia-Pacific Trade Agreement (APTA) setting the terms of trade as well as labor and environmental standards (i.e., none) for the region without the participation of the US.

      • Xi Jinping is heading on a whirlwind tour of Chile, Ecuador, and Peru (not yet APTA members) this month, not waiting for the inauguration.

        • Sorry, my stupid error, make that the Regional Comprehensive Economic Partnership (RCEP) bringing together Brunei, Burma (Myanmar), Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand, Vietnam, Australia, China, India, Japan, South Korea, and New Zealand. Japan and Australia are focusing their attentions on RCEP. If you thought the TPP was bad, wait until you see this.

          • I wouldn’t be surprised if President Trump’s new friends got him to sign off on it, and Republicans would leap on. “This is the hugest, most fabulous trade agreement ever!”

  • joshjosh

    “Rejecting the TPP is at least a sign that maybe, just maybe, the U.S. is going to start revisiting its 50 year tradition of encouraging American jobs to go overseas and then call anyone who questions that as the greatest thing in history a moral monster.” But who says it’s the greatest thing in history. At least from the “establishment elite” left, I believe the assertion is that it is a net good. That’s it.

    • liberal

      Yeah, that’s it. It’s not like they lobby hard for it or anything like that. /snark

  • solidcitizen

    The article says that it will not be brought during the lame duck session. I am not sure this means it is dead. I think we’ll see it again, perhaps called something else. I believe President Trump will tell us it’s amazing and he totally negotiated a great deal for the American people. Many on the left will point out it is the same damn deal as before, with some new bells and couple less whistles.

    • nemdam

      Exactly! Trump is a master class bullshitter. Why won’t he do the same with trade as he does with everything else? Republican elites tell him that, actually, trade deals are good, and we shouldn’t get rid of them. Since Trump doesn’t care, he would just go “OK” and probably slap on some cosmetic change to make it look like he fulfilled his campaign promise. He will sell out his anti-free trade position like he will any other vaguely non Republican idea.

  • Tracy Lightcap

    I’ve been waiting for a chance to say this.

    You want to know what Trump will end up offering rural America and the “disgruntled” white working class?

    Nothing. Absolutely nothing.

    I can say this with assurance because I’m sure that the Republicans are the party of international capital and they are pretty well satisfied with the way things are now. The GNP of the US when I was young – back in the blue collar industrial job heyday – was 5% dependent on trade. Today it is more like 25% and growing all the time. We will not repudiate NAFTA, GATT, or any of our other trade deals because nobody who has the power to affect the policies involved has any interest at all in doing so.

    By the same token, there will be virtually nothing done on immigration. The biggest industry in the country and the one that is our trade leader – agriculture – depends on it. I suspect that the Trumpistas will continue the present immigration regime – we’ve been deporting record numbers of illegals – and make a big publicity splash about it. Since the number of immigrants is actually down in recent years, I doubt there will be any overall change.

    What’s left? Unfortunately, that would be foreign policy. And, probably, another needless war or two. Let’s hope that doesn’t happen. But it almost certainly will.

    Finally, I will say yet again that trying to convince American industrial workers that the world their parents knew will come back because of a new regime on trade (as if one is coming and would make a difference) is both bad politics and bad policy. Trade has made a tremendous difference, largely for the better, in the world and in the US and will continue to do so. All the fulminations to the contrary are, imho, completely worthless as policy and lies too boot.

  • Not subjecting even more workers and more national laws to the ISDS courts is a good thing.

    Only the TPP would not have done that, in the first place because the US already has bilateral agreements including ISDS arrangements with all the TPP parties. What we lose with TPP is the protection of a government’s right to regulate that was developed by the Obama administration for this agreement which was meant to supersede the abusive old ones (which now will remain in force).

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