Letter from the US: We should oppose TPP on a class, not national, basis

Big Pharma gets extensions of its patents under the TPP, delaying cheaper generic versions of drugs.

The three remaining presidential candidates — Republican candidate Donald Trump, and Democratic contenders Hillary Clinton and Bernie Sanders — have all come out against the Trans-Pacific Partnership (TPP) agreement in varying degrees.

The TPP, a “free trade agreement” involving 16 Pacific Rim nations (including Australia), is an undisguised corporate power grab. However, all candidates in the US presidential election stress a reactionary argument against it.

This argument is that US workers should oppose the deal because it supposedly gives advantages to capitalists in other countries as against US capitalists — and thus is harmful to US jobs.

“Don't send US jobs to China!” is how Sanders has put it — illogically since China is not part of the TPP.

US power

In fact, the TPP is part of a drive by the US to consolidate a bloc of countries around the Pacific Ocean to challenge China economically, politically and militarily. It is part of US President Barack Obama's “pivot to Asia”. Obama's recent visit to Vietnam illustrates this.

Moreover, US capitalism is the dominant force among the nations encompassed by the TPP. The US 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 US capitalists' interests were well-protected.

The thrust of this xenophobic argument takes the focus off the real reason for the dire economic situation the US 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 US 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.

Strengthening corporate power

However, there are many good reasons why US workers, along with ordinary people in all countries affected by the TPP, should oppose it. Fundamentally, it would strengthen the hand of capital in all these countries against their own working people. That is why it was negotiated in secret, without public input.

It should not really be called a “trade” agreement. In the past, there was a debate about “free trade” versus “protectionism”. But tariffs are generally lower than the past, so this is not the real issue.

The TPP is mostly about imposing regulations on a host of issues — including intellectual property rights, financial regulations, labour laws and rules for health, safety and the environment.

Sections of the agreement that have been leaked show that US big business has obtained rules that secure and extend their patents, trademarks and copyrights abroad. It also provides them with protections for their global franchise agreements, securities and loans.

New rules also 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 labour laws.

For example, Big Pharma gets extensions of its patents under the TPP, delaying cheaper generic versions of drugs. In the US, this will further drive up medical costs. 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), involving the US, Canada and Mexico, has a similar provision (the TPP has been characterised 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 tried to sue the US for $15 billion in lost future profits. Given the dominant role of the US in NAFTA, this suit may not get far.

The environmental organisation 350.org — referring to the parts per million of greenhouses gasses in the atmosphere scientists say is the limit for a safe climate — said: “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.”

Class divisions

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 these factors. But he has increasingly centred his fire on chauvinist appeals to US 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 US workers is primarily due to imports and outsourcing of production by US corporations to lower-wage countries.

In a recent article, 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 US.

He said: “Probably the most commented on … is the decline of manufacturing employment from 27% of private employees in 1980 to 11% 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 labour 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% 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 US manufacturing still averages about 85-90%, well above the global average of 72%.

“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% from 1982 to 2007 just before the Great Recession reduced output. At an annual average of 5% this is only slightly less than the 6% annual growth of the [boom years] of the 1960s.

Job losses

“The mystery behind this massive loss 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 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. The other was greatly increased intensification of labour under the rubric of “lean” and “just on time” production.

Both have increased productivity, but without improving the position of the working class.

In other words, the recessions, with a long-term tendency toward stagnation, capital investment in labour-saving and neoliberal assaults on workers, resulting in intensification of labour and the other workings of the capitalist system, are the culprit. |

Agreements like NAFTA and the TPP pile on top of this, further strengthening capital's hand at the expense of working people.

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