Warren Comes Out Against TPP's NAFTA-Style "Trade Court"​

Without "Fast Track" Legislation, TPP can't pass.

​by Gaius Publius

I've been writing, along with many others, in opposition to NAFTA-style "free trade" agreements in general and the upcoming TPP (Trans-Pacific Partnership) in specific. For one thing, these agreements have little to do with "trade" and more to do with unrestricted capital flow — they ensure that capital can flow anywhere it wants, seeking any profit it can, with no restrictions whatsoever, including from local or national governments. (For my recent thoughts on trade agreements, see here.)

The primary enforcement tool of "free trade" agreements like NAFTA is "investor-state dispute resolution tribunals" — in essence, courts outside the judicial system of any country, in which corporations ("investors") can sue "states" — countries, provinces and cities — for "unfairly" restricting the opportunity to make money. An example of "unfair" restriction — "buy American" programs, since they disadvantage foreign "investors." Another — tobacco packaging laws that encourage giving up smoking, since they preference local lungs over foreign profit. Another — removing dangerous additives from gasoline, since ... well, you get the idea. It's all about the dollars with these people.

In all of these cases, an affected "foreign" company — or the foreign affiliate of a domestic company — can sue for the future profit it "lost" if the restrictions were not in place. Future profit. The decisions of these "tribunals" — courts — cannot be appealed under the terms of these treaties.

A Dream for the Rich; a Nightmare for the Rest of Us

It should be obvious that TPP is a One-Percent dream and a nightmare for everyone else. Now Elizabeth Warren weighs in. From the Washington Post (my emphasis):

The Trans-Pacific Partnership clause everyone should oppose

by Elizabeth Warren

The United States is in the final stages of negotiating the Trans-Pacific Partnership (TPP), a massive free-trade agreement with Mexico, Canada, Japan, Singapore and seven other countries. Who will benefit from the TPP? American workers? Consumers? Small businesses? Taxpayers? Or the biggest multinational corporations in the world?

One strong hint is buried in the fine print of the closely guarded draft. The provision, an increasingly common feature of trade agreements, is called “Investor-State Dispute Settlement,” or ISDS. The name may sound mild, but don’t be fooled. Agreeing to ISDS in this enormous new treaty would tilt the playing field in the United States further in favor of big multinational corporations. Worse, it would undermine U.S. sovereignty. 

Also the sovereignty of every nation that signs it. Only the international super-rich would benefit. (See what I mean about world-wide wealth-captured government being the great evil of our time?) You would think this would get at least some right-wing voter attention, right? After all, this really is the "one-world government" they've been so frightened of since None Dare Call It Treason hit the stands.

Warren first goes where I went, looking at the power of these corporate lawsuits:

ISDS would allow foreign companies to challenge U.S. laws — and potentially to pick up huge payouts from taxpayers — without ever stepping foot in a U.S. court. Here’s how it would work. Imagine that the United States bans a toxic chemical that is often added to gasoline because of its health and environmental consequences. If a foreign company that makes the toxic chemical opposes the law, it would normally have to challenge it in a U.S. court. But with ISDS, the company could skip the U.S. courts and go before an international panel of arbitrators. If the company won, the ruling couldn’t be challenged in U.S. courts, and the arbitration panel could require American taxpayers to cough up millions — and even billions — of dollars in damages. 

Then she looks at the tribunals themselves. Who are the "judges"?

If that seems shocking, buckle your seat belt. ISDS could lead to gigantic fines, but it wouldn’t employ independent judges. Instead, highly paid corporate lawyers would go back and forth between representing corporations one day and sitting in judgment the next. Maybe that makes sense in an arbitration between two corporations, but not in cases between corporations and governments. If you’re a lawyer looking to maintain or attract high-paying corporate clients, how likely are you to rule against those corporations when it’s your turn in the judge’s seat?

These tribunals ("courts") are only open to corporations; not, for example, citizens, countries or labor unions. Thus:

[I]f a Vietnamese company with U.S. operations wanted to challenge an increase in the U.S. minimum wage, it could use ISDS. But if an American labor union believed Vietnam was allowing Vietnamese companies to pay slave wages in violation of trade commitments, the union would have to make its case in the Vietnamese courts.

It's a rigged game, these agreements, all the way through. "Investor-state dispute tribunals" are a part of most trade agreements, bilateral (between just two countries) as well as broader ones. Warren writes:

Recent cases include a French company that sued Egypt because Egypt raised its minimum wage, a Swedish company that sued Germany because Germany decided to phase out nuclear power after Japan’s Fukushima disaster, and a Dutch company that sued the Czech Republic because the Czechs didn’t bail out a bank that the company partially owned. U.S. corporations have also gotten in on the action: Philip Morris is trying to use ISDS to stop Uruguay from implementing new tobacco regulations intended to cut smoking rates.

We covered the Philip Morris case here; it's ugly (also funny, since John Oliver is our source; do click if you get a chance).

Your two takeaways (three if you haven't already figured out that TPP is a terrible deal): First, Warren will undoubtedly oppose "Fast Track" — the necessary TPP enabling legislation — in the Senate, and will likely join Reid and others in filibustering (my guess; no inside information here). Two, Warren is publicly opposing the deal, meaning her prominent and noticeable pulpit will have No Fast Track on it for all to see. Good all round. As she concludes:

This isn’t a partisan issue. Conservatives who believe in U.S. sovereignty should be outraged that ISDS would shift power from American courts, whose authority is derived from our Constitution ...

Yet another feather in her cap. Let's hope it's also a notch in her belt.

"Obamatrade"?

For those who watch the other side of the aisle, here's something. There's an interesting Lou Dobbsian segment of the right that's already opposed, and strongly. They're calling it Obamatrade and they hate it for all the right reasons (for a change). This is the kind of bipartisanship we need more of.

If you live in a Republican district, feel free to lobby your representative with a clean conscience. You don't need permission to call, just an interest in pushing your person in the right direction, letting them know you're watching. Talking points at the link — or in the Warren article above. Senate phone numbers here. House phone numbers here. And thanks!

GP

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