[x-pubpol] Timothy B. Lee on TPP

[Joly MacFie]

http://www.vox.com/2015/5/24/8647103/tpp-free-trade-cronyism

Why killing Obama's trade deal could be good for free trade


Something that often gets obscured in debates over the Trans-Pacific
Partnership is that experts who disagree about Barack Obama's trade deal
often don't have a lot of disagreements about the specific policies the
deal contains.

Among economists, there's fairly broad support for trade-related provisions
like lowering tariffs on sugar and light trucks. And there's a lot of
skepticism about provisions to boost generic drug costs, lengthen copyright
terms, and create a new process for corporations to challenge government
actions outside of the traditional court system.

This last question is key. Even assuming Cowen is right that the TPP is a
good deal on net, it might still be worth killing if doing so will lead to
a better set of economic policies in the long run.Where experts disagree,
however, is how the defeat of the Trans-Pacific Partnership would shape
future trade negotiations. Supporters like Tyler Cowen think the economic
gains from the TPP's trade liberalization
​ ​
exceed the harms from provisions that mostly benefit special interests. So
he thinks we should take the deal. And he believes killing the TPP now will
lead to worse, not better, trade deals in the future.

Killing the TPP could be good for free trade

The US has been using trade deals to push counterproductive copyright and
patent policies on the rest of the world since the 1990s. Each time a deal
comes up for a vote, supporters play up the trade provisions and downplay
the corporate giveaways. If the TPP is approved, we can expect the same
kind of terms in the next trade bill the US negotiates.

KILLING THE TPP COULD LEAD TO FUTURE DEALS THAT ARE NOT AS LARDED UP WITH
CORPORATIST PROVISIONS

On the other hand, if the TPP is defeated, and the defeat is widely blamed
on excessive special interest giveaways, it will change the dynamics of the
next round of trade negotiations. When special interest groups started
lobbying for another round of goodies, US trade negotiators would be able
to say, "We'd love to help but we can't risk having the deal rejected."
Killing the TPP could lead to future deals that are not as larded up with
corporatist provisions.

Of course, this only works if people believe that it was these kinds of
concerns — rather than old-fashioned protectionist sentiments — that led to
the deal's downfall. The reality is that if Congress rejects the deal,
different members of Congress will vote for different reasons. Yet there
are some signs that opposition to the TPP isn't primarily driven by
protectionist concerns.

Liberals mostly aren't making protectionist arguments

In the 1990s, opponents of trade deals were often straightforwardly
protectionist. (Remember Ross Perot's famous statement about NAFTA creating
a "giant sucking sound" pulling jobs to Mexico?) But this kind of argument
is rare today.

Today, opposition to the TPP mostly comes from the left. Sen. Elizabeth
Warren (D-MA) has emerged as a standard-bearer for left-leaning TPP
critics. And, notably, she's not warning about a giant sucking sound. Her
critique of the TPP focuses on an otherwise obscure TPP provision called
investor-state dispute settlement that allows corporations to challenge
countries' policies outside of the regular legal system.

Liberal pundits like Paul Krugman have been sounding similar themes. "The
real arguments are not about trade but about intellectual property and
dispute settlement," he wrote earlier this week.

The labor movement has always been a key left-leaning constituency against
trade deals. Yet if you read the arguments of AFL-CIO head Richard Trumka,
he has carefully avoided making protectionist arguments. He says he's upset
about a lack of currency provisions, is opposed to ISDS, and wants stronger
labor and environmental standards.

Finally, public support for foreign trade is higher than it's been in 15
years, and surprisingly it's more popular among Democrats than among
Republicans:

So if the TPP dies in Congress at the hands of congressional Democrats, it
will be totally plausible that the deal died because liberals became fed up
with special interest groups hijacking trade deals to win goodies for
themselves. And if that becomes the conventional wisdom, it could be a
powerful political constraint on the next president when he or she is
negotiating future trade deals. And that could lead to future deals that
give us beneficial trade liberalization plus a lot less corporate
rent-seeking.

​Slideshow: http://www.vox.com/cards/trans-pacific-partnership​


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