Why I am on the fence about TPP.

[DanTex]

I'm neither gung-ho for it like Obama nor gung-ho against it like most progressives. The closest view to mine is Paul Krugman who thinks it's not a big deal, although he is against it whereas I am undecided. Maybe leaning slightly against, but I can see Obama's side of the argument as well.

Let's get one thing out of the way. I am not a free market fundamentalist, I don't think free trade is automatically good, I don't believe in supply-side or trickle down, I think the tax rate should be more progressive, higher capital gains taxes, I support unionization, I am for more spending on social safety net and less on military, stronger environmental regulation, higher minimum wage, and so on. I am an economic progressive. Having said that, about TPP...

First, one thing to keep in mind is that China is not part of TPP. In fact, a big part of TPP is a geopolitical move against China, trying to assert our economic influence in Asia. As far as things like offshoring, China is the big culprit in Asia. That's where your electronic products are made. The largest economies participating in TPP, after the US, are Japan, Mexico, South Korea, Canada, Australia. Aside from Mexico, these are not really the places you think of where the "giant sucking sound" takes place. And if we are able to exert pressure on China to, say, improve labor standards, stop currency manipulation, etc., that is a very good thing.

What other good things could happen? Well, for example, if (and it's a big "if&quot we were able to finally pry open Japan's market for cars, that would be good. Right now, US car companies export almost no cars to Japan. Why? Not because of import tariffs -- there aren't any. Instead there are "non-tariff barriers" -- things like currency manipulation and complex regulations designed to make exports to Japan expensive. This is one reason that trade agreements have to be more complex these days, it's not enough to just say "let's all drop our tariffs." Now, Obama spent some political capital to save the Auto Industry in the face of Republicans who wanted to let it fail. So it's a good bet that one of his objectives with TPP is to open more markets for US cars.

Now, the elephant in the room. Most progressives oppose TPP, and most Republicans and corporate lobbies support it. Why? Well, the second part is easy. Trade agreements are good for the 1%, and Republicans support anything that is good for rich people. In most cases, things that are good for the 1% are bad for the 99%, but not always.

Why do progressives oppose it? Part of it is intelligent and informed criticism and fears that it will lead to lowered wages and greater wealth disparity, along with other bad things (environmental risks, labor standards, etc.). Part of it is that "free trade" has become a bad word on the left, partly due to NAFTA, partly because it benefits corporations and the wealthy, whereas benefits to the 99%, if they do exist, are less tangible.

And then there are labor unions, which many Democratic politicians have to answer to. Labor unions are going to oppose most any free trade deal, especially after NAFTA. Even in an ideal world, where free trade is net beneficial, it is not beneficial uniformly, for example, to workers in industries where comparative advantage lies elsewhere. And this is often the case in, for example manufacturing. Now, usually, what is good for labor unions is also good for the nation as a whole, but not always. Environmental regulations are an example: pipeline workers will mostly be in favor of Keystone because the benefit to them of good jobs is greater then the personal harm from the pollution. But since everyone suffers from the pollution, for society as a whole it is not net beneficial.

The question here is whether on the whole TPP will be net beneficial for the 99%, or whether it will just further enrich the rich while leaving the 99% further behind. It's not an easy question, which is why I'm on the fence. One thing for sure, though, Obama is right when he says he has a track record of working for middle class Americans. I don't believe he would knowingly sign an agreement that would screw the 99%. The risk is that he would do it mistakenly, and that is a risk, because trade is complicated. On the other hand, he is right that the status quo with regards to free trade is not working for average Americans, we have a huge trade deficit, and China becoming more powerful economically and continuing its current policies does not point to things getting better.

One last thing. I do agree with critics that Obama is spending too much political capital on this. I wish he had fought this hard for the public option, or for a minimum wage increase. Not only that, but he is putting Hillary Clinton, who is likely to be the nominee, in a tough political situation. I care much more about keeping the White House in 2016 than about what happens with TPP, either way.

[BlueCaliDem]

1. President Obama seeks to globalize rights for workers. Currently, the deck is stacked against us.

Multinational corporations are offshoring jobs because it's cheaper and worker's rights are unenforceable. He seeks to change that via the Trans-Pacific Partnership and via Transatlantic Trade Investment Partnership (that's being simultaneously negotiated with the EU although I hear NO complaints about those trade negotiations with Europe from prominent Democrats - and wonder why).

You can read more about the the goals that President Obama has for the TPP from someone who's been studying every aspect of it here at The People's View. Just keep your open mind as you read it and until the negotiations are finalized (which still gives Congress 90 days to vote it down, thanks to the TPA).

[DanTex]

2. Thanks for the link. Yes, my mind is open.

Being "on the fence" is actually a shining endorsement compared to what most of DU feels about TPP. The fact that economists I trust like Stiglitz oppose it gives me some pause. Even the usually pro-trade Krugman has stated (mild) opposition. I can see both sides of the issue, but if it really does raise rather than lower labor and environmental standards, and gives us more leverage over China, that is good.

[BlueCaliDem]

3. Christina Romer, a renowned Berkeley economist who helped draft recommendations for the Stimulus,

is in support of TPP. She was correct regarding the stimulus in order to bring our economy back from the brink of catastrophe and, based on that, I have no doubt she's correct about the TPP.

Here is a link to the first part of the three-part series at that site: http://www.thepeoplesview.net/main/2015/3/17/the-tpp-education-project-preface-fast-track-secret-deal-nafta

There is a third part, too: http://www.thepeoplesview.net/main/2015/3/26/the-tpp-education-project-ip-an-intelligent-look-at-intellectual-property

[Erich Bloodaxe BSN]

6. Pretty much anyone with half a brain wanted a stimulus, and a bigger one than we got.

Including most of the folks who are against the TPP, so I don't think you can proclaim being correct on a stimulus being needed as some rare and magical stance that you had to be a genius to come up with.

[ismnotwasm]

14. That's very interesting

I hated NAFTA but not as much as I depise CAFTA, and I admit to not doing any but the most cursory research on TPP, which is why I've remained silent. I simply don't know enough and I don't listen to uninformed opinion or parroting responses, I like to research myself. I'm doing that now

[Erich Bloodaxe BSN]

4. I don't think most 'anti-TPP' people are 'anti-trade'.

I buy items produced in Germany. In Austria, in Japan, in the UK, in the Phillipines. And no doubt dozens of other countries.

But what I actually want is a world in which all workers are paid better, share more of the profits of production, are safe from harm when they work. And I know that all of these goals are begrudged by capital. They're all on the 'expenses' side of the balance sheet. So when I see that labour has no representation allowed in to work on the treaty, and that capital is swarming all around, I don't expect good things to come out for workers.

[Hoyt]

5. Excellent post.

[Sheepshank]

7. Like you, I too am on the fence

So much hyperbolic rhetoric and so much misinformation has actually turned me off the topic entirely. It's not logical for me to turn my back on such an important topic, but I can't help but feel there are motives at play when the same group that make post after post of their disregard for Obama and now HRC land on one more topic with which to bash them. I for me, the ranting and raging against TPP has become annoying rather than informative

[Erich Bloodaxe BSN]

8. And, btw...

One thing for sure, though, Obama is right when he says he has a track record of working for middle class Americans.

More Americans are in poverty than before, fewer Americans are part of the job market, there are fewer people IN the middle class, almost all of the 'recovery' went to the rich, and most lower class Americans have less wealth than when he came to office. Economic policies pushed by his chosen (Republican) treasury people have almost entirely benefited the wealthy and ignored the poor.

So how is it 'for sure' that he has an (economic) track record of working for middle class Americans?

[DanTex]

10. The policies he has pushed for have consistently been pro-middle class.

The trend of wealth disparity has been going on for decades. He also inherited the worst economic disaster since the depression. And he had to fight the Republican congress.

[Erich Bloodaxe BSN]

12. And the policies he has ignored have been consistently anti-middle class.

When you mostly leave the status quo of a 'trend of wealth disparity' and nibble around the edges in a way that doesn't reverse the trend, you're not really helping all that much.

[DanTex]

13. The Republicans are to blame for that.

ACA wasn't "nibbling around the edges". Neither was preventing a depression or saving the Auto industry.

But, look, if you don't think that Obama actually cares much about the middle class, then I can see why you don't trust him to negotiate a trade agreement. But I do, and I do.

[Erich Bloodaxe BSN]

17. ACA was a major giveaway to the private insurance industry.

Which was self-destructing, and we finally could have gotten rid of them. Yes, many Americans got more medical coverage - myself included. By paying extra premiums to a bunch of parasites who simply get in between patients and doctors out of public funds that could have otherwise been used to actually provide care, rather than 'insurance'. And from where I sit, the depression wasn't prevented, just made less worse than it could have been. After six years, I wonder if I'll ever get another job. The stimulus could have been far better if it had simply been directed to the poor, rather than the rich. Rather than propping up bad banks and insurance agencies, we could have prevented massive numbers of foreclosures by simply making the payments for folks for a while, for instance.

Everything he's done, he's done in a way that benefits the rich first and foremost, and THEN helps other folks in a hit or miss style. Only to be expected, given that he kept on George Bush's economic folks for so long.

[sendero]

9. I'm on the fence also..

.. as to whether it is just stinks-on-ice bad, like NAFTA, or catastrophically bad, like the way the macro-economy has been handled since about 2002.

I'm leaning towards the latter.

[DCBob]

11. Excellent!

Finally some balanced intelligent discussion of the issues. I'm leaning for it since I generally agree with the President and I generally think more free trade is good for all sides when properly regulated and enforced.

[BeyondGeography]

15. Seems our President just can't help but volunteer for punishment sometimes

For instance, you make a good point about exporting cars to Japan, but the UAW is opposed to the deal because, NAFTA!

Plus, does anyone think our cars would get a fair market hearing from the Japanese no matter what this deal mandates? I don't. Maybe that's uninformed cynicism on my part, but there's a lot of that.

If the UAW shared Obama's enthusiasm for this deal, he'd be in a much better position. But, here he is again, the President going into a fight with one arm tied behind his back thinking he can reason with folks.

[gollygee]

16. The paragraph I have a problem with:

And then there are labor unions, which many Democratic politicians have to answer to. Labor unions are going to oppose most any free trade deal, especially after NAFTA. Even in an ideal world, where free trade is net beneficial, it is not beneficial uniformly, for example, to workers in industries where comparative advantage lies elsewhere. And this is often the case in, for example manufacturing. Now, usually, what is good for labor unions is also good for the nation as a whole, but not always. Environmental regulations are an example: pipeline workers will mostly be in favor of Keystone because the benefit to them of good jobs is greater then the personal harm from the pollution. But since everyone suffers from the pollution, for society as a whole it is not net beneficial.

I think it would be very good for the US if unions became strong again. You say that something that is bad for unions isn't necessarily bad for the US, and you make a comparison to environmental regulations, but you don't really explain how this is good for the US despite being bad for unions. And I have no reason to believe that the environmental comparison is apt because it's obvious how Keystone is bad but it isn't obvious how labor unions are bad.

I am a daughter of former union members and I grew up in an industrial area that was hurt very badly by NAFTA. I am going to remain skeptical of TPP. I need more specifics than "it's kind of like Keystone" to even slightly ease my discomfort.

[DanTex]

18. It's not like Keystone.

My point there was that labor union opposition doesn't imply necessarily that TPP is bad. Keystone is just a (totally unrelated) example of labor unions being on the wrong side of an issue. Since labor unions generally oppose free-trade agreements, particularly after NAFTA, for me the opposition of labor unions to TPP doesn't give me much information. It's basically a given.

Whether TPP is good or bad, as I said in the OP, is a tough question. There are potential good and potential bad things.