A guest column by Barry Sheppard, a long-time comrade of mine who lives in Hayward, California. Similar reasoning applies to the Comprehensive Economic and Trade Agreement (CETA) recently negotiated between Canada and the European Union but (like the TPP) not yet adopted by the Trudeau government. – Richard Fidler
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The three remaining presidential candidates, Donald Trump, Hillary Clinton and Bernie Sanders have all come out against the Trans Pacific Partnership (TPP) agreement in varying degrees. All stress a reactionary argument against it.
That argument is that U.S. workers should oppose it because it supposedly gives advantages to capitalists in other countries as against U.S. capitalists, and thus is harmful to U.S. jobs. “Don’t send U.S. jobs to China!” is how Sanders puts it, however illogically since China is not part of the TPP.
In fact, the TPP is part of a drive by the U.S. to consolidate a bloc of countries around the Pacific Ocean to challenge China economically, politically and militarily. It is part of Obama’s “pivot to Asia.” His recent visit to Vietnam illustrates this.
Moreover, U.S. capitalism is the dominant force among the nations encompassed by the TPP. The U.S. delegation involved in the secret negotiations that resulted in the TPP, in addition to government officials, had a high proportion of lawyers for the big corporations. They made sure that U.S. capitalists’ interested were well-protected.
The thrust of this xenophobic argument takes the focus off the real reason for the dire economic situation the U.S. working class is facing – the workings of the capitalist system itself, including the Great Recession and its aftermath.
Moreover, it cuts across international working class solidarity, pitting U.S. workers against “foreign” workers, who are allegedly taking jobs away from “us.” This thinking has its domestic counterpart with the argument that foreigners, immigrants, Blacks, and so forth are taking jobs from white workers, Trump’s main talking point.
However, there are many very good reasons why U.S. workers and all the workers encompassed by the TPP should oppose it. Fundamentally, it would strengthen the hand of capital in all its countries against workers’ interests. That’s why it was negotiated in secret, without public input.
It really shouldn’t be called a “trade” agreement. In the past there was a debate about “free trade” vs. “protectionism.” But tariffs are generally lower than in the past, so this isn’t the real issue. Most of what the TPP is about is regulations on a host of issues including intellectual property rights, financial regulations, labor laws and rules for health, safety and the environment.
From what has been leaked about it, what U.S. big business has obtained is rules that secure and extend their patents, trademarks and copyrights abroad, and protections of their global franchise agreements, securities and loans. New rules make it easier for corporations in the richer countries to outsource parts of production to lower wage countries.
At the same time, TPP rules mean less protection for consumers, workers and the environment. These rules would allow them to override such protections, including in labor laws.
For example, Big Pharma gets extensions of its patents under TPP, delaying cheaper generic versions of drugs. In the U.S. this will drive up medical costs even more. Workers and peasants in poorer countries will be denied affordable drugs, including many life-saving ones.
Corporations also get an international tribunal composed of private attorneys, outside any nation’s legal system, which can order compensation for any lost profits found to result from a nation’s regulations. The tribunal can also order compensation for any “unjust expropriation” of foreign assets.
A similar system exists in a “trade” agreement between Switzerland and Uruguay. The tobacco giant Phillip Morris is suing Uruguay under this agreement claiming that Uruguay’s strong anti-smoking regulations unfairly diminish the company’s profits.
The already existing North American Free Trade Agreement (NAFTA) has a similar provision (the TPP has been characterized as NAFTA on steroids). When the Obama administration, under great public pressure, ruled against the XL pipeline that would have transported Canadian tar sands oil to refineries on the Gulf of Mexico, the company has tried to sue the U.S. for $15 billion in lost future profits. Given the dominant role of the U.S. in NAFTA, this suit may not get far.
The environmental organization “350” – referring to the parts per million of greenhouses gasses in the atmosphere beyond which there would be a tipping point to major global warming – says, “the TPP would give foreign fossil fuel corporations the right to sue city, state and national governments if climate action hurt their profits. It would also eliminate environmental reviews of fracked gas export facilities that would make Big Oil billions of dollars.”
These examples just scratch the surface of the myriad of pro-capitalist and anti-worker regulations in the TPP. It should be opposed on these grounds. Sanders, it is true, does refer to all this, but increasingly centers his fire on chauvinist appeals to U.S. workers. What is needed is international working class solidarity, not division along national lines.
We should also take a closer look at whether the increasingly precarious situation facing U.S. workers is primarily due to imports and outsourcing of production by U.S. corporations to lower-wage countries. Writer Kim Moody, a founder of Labor Notes, whose magazine and conferences seek to bring together class-struggle union militants, takes up one aspect, that of the decline of manufacturing jobs in the U.S., in a recent article.
He says, “Probably the most commented on … is the decline of manufacturing employment from 27 percent of private employees in 1980 to 11 percent in 2010…. While manufacturing has been declining for some time, the dramatic loss of nearly five million manufacturing, production and nonsupervisory jobs calls for an explanation.
“Many, particularly in the labor movement, argue that the culprit was trade. Clearly some industries like basic steel, textiles, garments, etc. saw big losses to imports. But these losses account for only about 20 percent of the five million. Nor does ‘offshoring,’ which grew over much of this period but recently slowed down, account for massive losses as domestic content in U.S. manufacturing still averages about 85-90 percent, well above the global average of 72 percent. As the United Nations observed, ‘Large economies, such as the United States or Japan, tend to have significant internal value chains and rely less on foreign imports.’
“The problem with trade-based explanations is that manufacturing output hasn’t shown a decline, but had grown in real terms by 131 percent from 1982 to 2007 just before the Great Recession reduced output. At an annual average of five percent this is only slightly less than the six percent annual growth of the [boom years] of the 1960s.
“The mystery behind this massive lose of jobs lies in both the destruction of capital, on the one hand, and its increased application in the last 30 years, on the other. The disappearance of manufacturing jobs hasn’t followed the the more or less steady upward trajectory of imports since the mid-1980s. Rather massive job destruction has occurred during the four major recessions of this period as capital itself has been destroyed: in 1980-82 2.5 million manufacturing production jobs lost; 1990-92 725,000; 2000-03 about 678,000, and during the Great Recession another two million jobs gone.”
Moody points to two factors in the periods of “recovery” after these recessions that kept employment flat. One was the “increased application of capital” in new technology that displaced workers, and the other was greatly increased intensification of labor under the rubric of “lean” and “just on time” production. Both have increased productivity but not working class improvement.
In other words, the recessions of the business cycle, with a long-term tendency toward stagnation, capital investment in labor-saving, and neoliberal assaults on workers resulting in intensification of labor and the other workings of the capitalist system are the culprit, with NAFTA and TPP piling on top of this.
