It is amazing how the elite media can be dragged along by their noses into accepting that the Trans-Pacific Partnership (TPP) can have a big impact on trade and growth. If I had a dollar for every time the deal was described as “massive,” or that we were told what share of world trade will be covered by the TPP, I would be richer than Bill Gates. The reality is that the vast majority of the trade between the countries in the TPP is already covered by trade agreements, as can be seen:
TPP countries with and without current trade agreements with the US. Source: International Monetary Fund
We continue to hear superlatives even as the evidence suggests the trade impact will be trivial. For example, the New York Times reported that US tariffs on Japanese cars will be phased out over 30 years. Wow! The most optimistic growth estimates show a cumulative gain by 2027 of less than 0.4 percent, roughly two months of normal GDP growth.
This doesn’t mean that the TPP can’t have an impact. It will lock in a regulatory structure, the exact parameters of which are yet to be seen. We do know that the folks at the table came from places like General Electric and Monsanto, not the AFL-CIO and the Sierra Club. We also know that it will mean paying more for drugs and other patent and copyright-protected material (forms of protection, whose negative impact is never included in growth projections), but we don’t yet know how much.
We also know that the Obama administration gave up an opportunity to include currency rules. This means that trade deficit is likely to persist long into the future. This deficit has been a persistent source of gap in demand, leading to millions of lost jobs. We filled this demand in the 1990s with the stock bubble and in the last decade in the housing bubble. It seems the latest plan from the Fed is that we simply won’t fill the gap in this decade.
Economist Dean Baker is co-director of the Center for Economic and Policy Research in Washington, DC. A version of this post originally appeared on CEPR’s blog Beat the Press (10/6/15).
There are many noxious aspects to the TTP/TTIP but by far the most noxious aspect is the associated elevation of TNCs over elected governments.
Should the people be so ‘foolish’ as finally to ban glyphosate in a TPP/TTIP world, for instance, Monsanto would sue and reverse the judgment of the people. The TPP/TTIP regime is the transfer of sovereignty from the people to the TNCs.
That’s MASSIVE!
I know you’re busy, but this is really serious and requires the attention of FAIR staff and not just reposts of third party origin.
Is it just me, or did that cut off before it seemed finished?
Canadian coverage that I have seen covers in exhaustive detail the trade impacts for Canada (mostly bad for various sectors, with the usual vague bromides about improved ‘access’ to export markets).*
They gloss over, or totally ignore, all the ways in which TPP is much more a corporate rights charter than a trade deal. C’mon media, unlike the (U.S.-Canada) FTA, NAFTA, CETA, CAFTA, CCFTA, etc. — in which FTA stands for “Free Trade Agreement” — the name of the TPP is just the broad and vague “Partnership”.
WAKE UP, MEDIA!
* Canadian figures comparable to your pie chart are even more extreme: something like only 4% of imports and 2% of exports are from/to countries with which Canada doesn’t already have trade agreements. So the TPP is obviously NOT REALLY ABOUT TRADE, at least for Canada.
Yes. This is hardly an adequate statement of the facts. Dean is only looking at his from his frame and doesn’t seem to be following along.
This is not a trade agreement. This a sweetheart “deal” between government lackies and selected corporations.
http://www.nakedcapitalism.com/2015/10/full-translation-of-japanese-governments-summary-of-the-tpp.html
That is what Dean Baker is saying–that the major impact on TPP will not be on trade.
I trust Obama. So I’m predisposed to like his TPP. And I’m not sure that Baker’s profile of it is accurate because the TPP limits to 12 years the exclusivity of biological pharmaceuticals, a limitation that caused drug stocks to drop when it became public. The main defect of the TPP is that it excludes (south) Korea and China.
@Kevin- You know what they say about blind trust. Dig deeper into this deal. There’s a reason the (global!) opposition movement refers to it as “NAFTA on steroids.” It’s nothing more than a corporate takeover that’ll destroy the economies of ALL its signatories (yes, including the US).
Obama may seem “trustworthy,” (heck, even I fell for his “hope & change” BS), but don’t be fooled. He’s nothing more than a puppet being controlled by the *real* Powers That (Shouldn’t) Be – multinational banks and corporations (aka the *true* beneficiaries of the TPP).
I don’t trust Obama. I was misled by candidate Obama when I mistakenly supported his candidacy. Obama works strictly on behalf of corporate interests.
American workers and American consumers will not benefit from the TPP.