Let's kill the "but, but China..." argument in favor of the TPP
Council on Foreign Relations: The TPP: Why it Won’t Address Security Concerns with China
As the debate over the Trans-Pacific Partnership (TPP) heats up in Congress, some (including myself) have argued that the trade deal would advance U.S. security interests in the Asia-Pacific. In this guest blog post, Daniel Slane and Michael Wessel argue this view is misguided. The authors serve, respectively, as a Republican and Democratic Commissioner on the U.S.-China Economic and Security Review Commission. The views they express are their own.
The Trans-Pacific Partnership (TPP) is now being touted as the answer to U.S. security concerns with the People’s Republic of China. This is just the latest argument from TPP proponents to advance fast track trade negotiating authority in Congress and to ease passage for the TPP under expedited and preferential procedures. Unfortunately, this argument just doesn’t hold up to scrutiny.
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In some ways, the increasing investment by U.S. companies in TPP countries identified as an objective of the agreement by the United States might diminish our foreign policy and national security flexibility. Our experience in China provides some guidance. Because of the vast investments by U.S. companies there, they have often acted as lobbyists for the PRC because they are worried about protecting their investments. We can expect that, as U.S. company investments in the TPP countries increase, the potential for our firms to “protect” their investments by advocating for the interests of their host country might be counter to some of our foreign policy or national security interests. If a TPP country, for example, wanted to provide expanded access to port facilities for Chinese vessels at a time when they were adverse to U.S. security interests, our companies might put pressure on their friends in Congress and the U.S. government to moderate their views in support of the TPP partner.
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China’s increased military spending is also, in part, fueled by its massive currency manipulation, which has allowed China to build enormous currency reserves and has helped fuel its economic success. Addressing currency manipulation in the TPP has been deemed off limits by U.S. negotiators, signaling to China and others, that the subsidized Chinese exports can continue to support budget expenditures on military modernization.
Finally, the further dispersion of supply chains puts our national security at risk by creating the potential for increasing procurement of materials for our military from outside the United States. The offshoring and outsourcing of production has an impact on the defense industrial base, ranging from loss of capabilities to reduced skill levels to diminished R&D. Supply chains are vulnerable to natural disasters as well as human events. Of course, the U.S. is not going to be totally independent in meeting its defense procurement needs, but the domestic defense industrial base is at risk and TPP has the potential to further undermine our domestic capabilities.
It’s been a long time since advocates for the TPP tried to sell the agreement as a net job creator for America. Yes, exports may increase, but imports will certainly increase as well and, if history is a guide, our trade deficit will increase. Deficits are not a sign of strength–if they were, every nation would be trying to run them. Deficits diminish economic growth which is one of the foundations of a strong nation.
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http://blogs.cfr.org/renewing-america/2015/05/15/the-tpp-why-it-wont-address-security-concerns-with-china/
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