Painful as it may be, even Tea Party clouds have a silver lining. The trade ministers and political leaders of the other eleven countries in the Trans-Pacific Partnership Agreement negotiations put a brave face on the absence of US President Obama from the APEC jamboree in Bali this week.
This was meant to be the meeting where the political horse-trading on the TPPA began. Even though the negotiations are a mess, somehow there was always the chance – or from my viewpoint the risk – that other political leaders might cave with Obama in the chair. The bottom lines that their negotiators have stuck to for several years would give way and a deal could be pulled out of the ashes by the end of 2013 (apologies for the very mixed metaphors).
Once Obama cancelled, all bets were off. Even before the meeting the cautious Malaysians were insisting that the deal couldn’t be finished by the end of the year and they weren’t going be rushed. John Key also tried to dampen expectations, while maintaining the sales pitch that this will be the deal of the century. The first story from Audrey Young in the NZ Herald on 8 October was headlined ‘Let’s not be hasty on TPP’. In the next story, Key was urging business in Asia to go out and sell the deal, but in a more tempered tone – presumably because he was about to chair a meeting that would reaffirm the goal of completing by the end of the year! According to the Americans, Kerry actually ‘helped lead’ the discussion with Key, who was asked to step in because New Zealand administers the TPPA.
The TPPA Ministers statement was full of recycled rhetoric from previous years. Discussions were productive. They continued to explore mutually acceptable solutions. They would continue their commitment to a transparent process (sic!). There was a new timeline to accelerate the face of work on access to markets. Ministers would remain actively engaged in advancing negotiations to a successful conclusion. But the final stage of the talks would require an intensification of effort at all levels.
The Leaders’ three paragraphs were even more anodyne. They were ‘on track’ to complete the negotiations and had agreed to ‘an objective’ of completing the deal by the end of the year. Japan’s Kyodo News had sighted a draft of the leaders’ statement, which showed the US wanted to say the negotiations were ‘substantially finished’, but some countries objected that did not reflect the reality. The final text was still hyperbolic, but relatively more accurate, claiming that they have made ‘significant progress’ in various fields. In a further display of discord within the APEC family, the Indonesian hosts of APEC told the TPP leaders they had to meet outside the formal venue so it did not overshadow their event.
The stated objective is still to finish by the end of the year. The negotiators have been told they must conclude the ‘less contentious’ areas – but if it were a straight-forward task, they would have done so already! To break through on the big issues of medical patents, copyright and the Internet, the environment and state-owned enterprises, as well as market access for agriculture, motor vehicles and garments, would require some serious political leverage.
The US background briefing after the meeting was uncharacteristically low-key about the outcome. There may be several reasons. The first is that the US Trade Representatives and the rest of the massive team the TPPA negotiations currently have no budget.
The second is a timing and process issue. Any real political movement on these super-sensitive issues will require the kind of schmoozing that only Obama can do. There is no scheduled time when the TPPA leaders will next meet will meet against this year. It could happen biletarally, but that’s far from optimal. US Trade Representative Froman confirmed that TPPA trade ministers will meet again on the margins of the WTO ministerial meeting in Bali in early December. But that can only be a stocktake. Period APEC meetings are when they normally next get together. But China chairs APEC in the 2014 and China made it very clear in Bali that it is not a big fan of the TPPA.
The third, political obstacle is Obama’s fractious relationship with the Congress. The US Congress has constitutional authority over trade. Obama does not have the ‘fast track’ authority that constrains that authority to voting yes or no to a final deal. So, even if the twelve countries reached agreement on a text, Congress could pick it apart. Obama was expected to ask Congress for fast track, formally Trade Promotion Authority this month. But he will not move on it unless he is sure he can get it through. The budget standoff shows the Tea Party is not about to do anything that makes Obama’s life easier – and they hate these agreements. The rest of the Republicans are hostage to challenges from the fringe. The US corporate lobby would enlist their supports in Congress to oppose a compromise deal that is less than a ‘gold standard’, as would the unions and environmentalists if those chapters are weak from their perspective.
Does this mean we can take the pressure off the government to release the text and justify what it has been doing in our name? Hell no! Almost every report on the APEC meetings has referred to what the critics are saying. TV and newspapers have been running the snapshot of the celebrity ‘Its not democracy’ video. In just a week almost 7500 people have gone to itsnotright.org.nz and signed the petition to release the text.
I would never be reckless enough to say the Tea Party’s budget boycott has plunged the troubled negotiation into a death spiral – although a number of journos tried to get me to say so this week! This deal is so highly political that anything could still happen. But the odds are mounting against them. Any government that signed up to a TPPA knowing that diverse captive interests in Congress could cherry pick the bits they like and throw back what they don’t would have to be mad. Wouldn’t they, Mr Key?