The TPP is not about 'free trade', but corporate profits

July 15, 2016

The media and advocates of the proposed Trans-Pacific Partnership (TPP) trade agreement have repeatedly described opponents of the deal as opposed to trade itself.

For instance, after US Republican presidential candidate Donald Trump pressed his Democrat rival Hillary Clinton to swear off passage of the deal, the New York Times said Trump was embracing “nationalistic anti-trade policies”.

The Wall Street Journal said Trump expressed “protectionist views”. US President Barack Obama warned that you cannot withdraw “from trade deals” and focus “solely on your local market”.

But opposition to the TPP, involved 12 Pacific Rim nations including Australia, is not accurately described as opposition to all trade — or even to free trade.

In fact, the deal's major impact would not come from lowering tariffs, the most common trade barriers. The TPP is more focused on crafting regulatory regimes that benefit certain industries.

So the key parts of the deal actually undermine the free flow of goods and services by expanding some protectionist, anti-competitive policies sought by global corporations.

“[The United States already has] trade agreements with six of the 11 countries,” Dean Baker, an economist at the Washington-based Center for Economic and Policy Research, told The Intercept. “Canada and Mexico — our two biggest trading partners — are in there. The tariffs are almost zero [with those countries] anyhow.

“What's in the deal? Higher patent and copyright protection! That's protectionism.”

It is true that past trade deals such as the North American Free Trade Agreement (NAFTA) have dramatically lowered tariffs, freeing companies to move manufacturing jobs out of the country. And as a result, the very notion of trade agreements has left many Americans understandably sceptical.

Concerns that the TPP would lead to even more job losses “are real,” said Melinda St Louis, director of international campaigns at Public Citizen. But, she noted: “I do think that the trade aspects of the TPP are a small part of it. It's only six of 30 chapters that have to do with trade and goods really at all. The rest of it is about setting global rules.”

One of the proposed TPP rules, for instance, involves the expansion of copyrights, which would impose anti-competitive costs on economies.

The agreement has been harshly criticised by humanitarian groups such as Doctors Without Borders (MSF), which deploys thousands of doctors overseas to offer medical care to those who cannot afford it, because it expands monopoly protections and patents for various pharmaceutical drugs.

For instance, the agreement requires the countries involved to offer eight years of market exclusivity, or five years plus other mechanisms, to assure “comparable market outcome” for a class of pharmaceutical products called biologics.

These cutting-edge, biologically manufactured drugs have been used to treat Crohn's disease, arthritis and other common ailments — and expanding market exclusivity means there is less room for competitors to produce cheaper generic drugs to compete.

“We do not have a position on the TPP as a whole, we're not anti-trade, we're a humanitarian organisation,” Judit Rius Sanjuan, a legal policy adviser for MSF explained. “Some of the provisions in the text will also make it much more difficult to have innovation, because they create patent monopolies for big pharmaceutical companies.”

The TPP also seeks to strengthen and extend monopoly patents for the entertainment industry.

In a victory lap early this year, Disney CEO Bob Iger wrote to company employees boasting about the role his company played in expanding the intellectual property provisions in the TPP. Iger said Disney was able to “advocate successfully for a strong IP chapter in the Trans-Pacific Partnership trade negotiations”.

Disney played a major role in lobbying for a 1998 US law that extended copyrights for media creations. Congress's 1998 rule change was a boon to Disney, which was due to lose its Mickey Mouse copyright in 2003. Thanks to this law change, which opponents derided as the “Mickey Mouse Protection Act,” Mickey's copyright was extended to 2023.

The TPP seeks to expand on that, establishing a global Mickey Mouse Protection regime. US trade representative Michael Froman made a trip to Hollywood in May to remind a trade group that the TPP would require countries to lift their copyright terms to the 70-year standard in the United States.

This would be an increase from 50 years, the current standard in many of the countries that are part of the negotiations.

[Abridged from The Intercept.]

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