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Can anyone summarize why this is so bad for everyone except the super rich? I understand how manufacturing will be hurt and it sounds like agriculture comes ou

by mason55 11y ago

Can anyone summarize why this is so bad for everyone except the super rich? I understand how manufacturing will be hurt and it sounds like agriculture comes out to be mostly a wash. But it sounds like the US services industries will be helped by the agreement.

tptacek 11y ago
There are two specific issues that come up regularly, and two background issues with the whole concept of free trade agreements. Specific issue #1: the TPP, like a bunch of other trade agreements, includes semi-binding arbitration. Enact a system of regulated free trade and you generate disputes. But there's no meaningful international legal system (a "world trade court" that can resolve those disputes. Trade dispute resolution is therefore extrajudicial. (TPP's arbitration is "semi-binding" in that TPP arbitrators have authority only to impose fines; they can't change our laws). Specific issue #2: a key goal of TPP is to harmonize worldwide IP laws with those of the US. But much of the world has lax IP laws compared to the US, specifically for drugs. Dean Baker at CEPR --- a credible and fiercely liberal economist --- believes drug regulation will increase prices in the US (by how much, I haven't really seen estimates). Pretty much everyone believes that if TPP is actually enforced for pharma, it will increase drug prices in the rest of the world, and also squeeze out companies that have carved niches for themselves by arbitraging the different patent regimes to manufacture drugs that are still on-patent in the US. Background issue #1: modern free trade agreements always involve IP regulations, and IP is a valence issue on Internet forums: most vocal Internet commenters ambiently oppose all IP regulation. TPP doesn't significantly alter IP law in the US, but it does further ratify that law, taking us steps away from reforming them. If you think IP reform was in the cards, you don't like TPP. Background issue #2: the US economy is, by design, owned by large companies; those companies are in turn mostly owned by large investment firms. A plurality of the stakeholders in those firms are "wealthy elites" (not scare quoting). Free trade agreements that the US supports are designed to juice the economy, and thus improve outcomes for big companies. "Wealthy elites" have far more direct exposure to investment upside than "workers". So there's a natural concern about conflict-of-interest: TPP will benefit the wealthy more than it will the working class. There are reasonable rebuttals to all these points, but you asked for the liberal brief against TPP, and I think that's a solid summary of it.
- mason55 11y ago
  Thank you. So it doesn't sound like there is much that specifically hurts middle class to lower upper class Americans, it's just that it contributes to continued power & wealth accumulation in the upper upper class, the prevention of which could be seen as a reasonable goal in its own right.
  - tptacek 11y ago
    If you asked a manufacturing worker in Youngstown, OH what they thought of the TPP, their answer would immediately be "it's just a way to help rich people export our jobs to Asia". On the other hand, it might be reasonable to assume that the barriers to that were already so low that jobs that can be exported to Asia already have been.

by mason55 11y ago

tptacek 11y ago

There are two specific issues that come up regularly, and two background issues with the whole concept of free trade agreements. Specific issue #1: the TPP, like a bunch of other trade agreements, includes semi-binding arbitration. Enact a system of regulated free trade and you generate disputes. But there's no meaningful international legal system (a "world trade court" that can resolve those disputes. Trade dispute resolution is therefore extrajudicial. (TPP's arbitration is "semi-binding" in that TPP arbitrators have authority only to impose fines; they can't change our laws). Specific issue #2: a key goal of TPP is to harmonize worldwide IP laws with those of the US. But much of the world has lax IP laws compared to the US, specifically for drugs. Dean Baker at CEPR --- a credible and fiercely liberal economist --- believes drug regulation will increase prices in the US (by how much, I haven't really seen estimates). Pretty much everyone believes that if TPP is actually enforced for pharma, it will increase drug prices in the rest of the world, and also squeeze out companies that have carved niches for themselves by arbitraging the different patent regimes to manufacture drugs that are still on-patent in the US. Background issue #1: modern free trade agreements always involve IP regulations, and IP is a valence issue on Internet forums: most vocal Internet commenters ambiently oppose all IP regulation. TPP doesn't significantly alter IP law in the US, but it does further ratify that law, taking us steps away from reforming them. If you think IP reform was in the cards, you don't like TPP. Background issue #2: the US economy is, by design, owned by large companies; those companies are in turn mostly owned by large investment firms. A plurality of the stakeholders in those firms are "wealthy elites" (not scare quoting). Free trade agreements that the US supports are designed to juice the economy, and thus improve outcomes for big companies. "Wealthy elites" have far more direct exposure to investment upside than "workers". So there's a natural concern about conflict-of-interest: TPP will benefit the wealthy more than it will the working class. There are reasonable rebuttals to all these points, but you asked for the liberal brief against TPP, and I think that's a solid summary of it.

mason55 11y ago
Thank you. So it doesn't sound like there is much that specifically hurts middle class to lower upper class Americans, it's just that it contributes to continued power & wealth accumulation in the upper upper class, the prevention of which could be seen as a reasonable goal in its own right.
- tptacek 11y ago
  If you asked a manufacturing worker in Youngstown, OH what they thought of the TPP, their answer would immediately be "it's just a way to help rich people export our jobs to Asia". On the other hand, it might be reasonable to assume that the barriers to that were already so low that jobs that can be exported to Asia already have been.