As we reflect on a tumultuous year in the realm of global corporate treaties, we can allow ourselves a brief moment to celebrate the demise of the Trans-Pacific Partnership Agreement (TPPA) in its present form. Looking back on the 6-year campaign our overseas allies pay tribute to the leading role we played in Aotearoa. Our combined action across most of the 12 countries ultimately defeated the deal. We need to remind those who attribute this to Trump that it was progressive activists working with Bernie Sanders who put the TPPA at the centre of the US presidential election campaign, forcing Clinton and Trump to follow suit.
The failure of the TPPA was just one of many signs that this limb of the neoliberal paradigm is in crisis. 2016 saw the paralysis of the US-EU negotiation known as TTIP, well before Trump’s election. The Belgian regional parliament of Wallonia vetoed the ratification of the lesser-known Canada-EU deal (CETA), setting conditions for their approval, leading European activists to embrace the slogan: ‘we are all Wallonians’.
By then Brexit had thrown the spanner in the works. No one (in their right mind) wants to finalise an agreement with the EU without knowing the status of the United Kingdom, which is the largest market for many parts of those deals.
In our part of the world, Papua New Guinea said it wasn’t interested in the PACER-Plus deal driven by Australia and New Zealand since negotiations began in 2009. Fiji remains lukewarm.
These dramatic about turns at the negotiating table are mirrored among key intellectuals. as The weight of opinion among leading international economists has turned sour. Long-time critic Joseph Stiglitz has been a joined by many other luminaries who were once supportive, and even cheerleaders, for free trade deals.
Last month Harvard economics professor Dani Rodrik said: ‘Instead of decrying people’s stupidity and ignorance in rejecting trade deals, we should try to understand why such deals lost legitimacy in the first place. I’d put a large part of the blame on mainstream elites and trade technocrats who pooh-poohed ordinary people’s concerns with earlier trade agreements’. He challenged the mis-branding of ‘free trade agreements’ saying ‘Adam Smith and Ricardo would roll over in their graves if they read, say, any of the TPP chapters’.
Former neoliberal evangelist Jeffrey Sachs came out against both the TPPA and TTIP because ‘they are more than trade agreements’ and ‘would give too much power to large multinational companies, the corporations whose lobbyists have helped draft the agreements’.
Even Larry Summers, Treasury Secretary under Bill Clinton’s and champion of NAFTA, described the ‘revolt against global economic integration underway in the West’ as ‘not wholly unwarranted’. This month in the New York Times Summers called for the redirection of global economic dialogue ‘to the promotion of “responsible nationalism” rather than on international integration for its own sake’.
Whatever one thinks of these guys, they provide a litmus test for the neoliberal orthodoxy of these agreement. Their radical repositioning can’t be ignored. Yet many political leaders and corporate lobbyists are doing so, as they seek to rescue the TPPA or to decant the old wine into new bottles.
The TPPA, as it stands, may be dead in the water. The bad news is that TPPA is already morphing into different forms. It has already created a new ‘norm’ where even countries that vehemently opposed various chapters in the TPPA are promoting the same texts in other negotiations. I am seeing that in the two remaining mega-regionals under negotiations: the Trade in Services Agreement (TiSA) in Geneva and the China and ASEAN-led Regional Comprehensive Economic Partnership (RCEP) negotiations just held in Jakarta. The latter is moving slowly, in part because of the extreme demands from Australia and New Zealand. TiSA is much more dangerous – think of it as the ‘Uberisation of the global economy’. However, a proposed ministerial meeting to close the deal scheduled for early December was postponed because of some fundamental disagreements between the US and EU.
Looking into next year, we cannot assume the TPPA won’t be resurrected in some form. Trump is a billionaire. He is surrounding himself with corporate leaders from Wall St, the Oil industry, Hollywood, as well as the military. He opposes the TPPA because America did not get enough – not, as Bernie Sanders said, because the neoliberal model is deeply flawed. Future Trump deals will be skewed even more to enhancing the power of the corporate elites. This will be the ultimate test for declining US hegemony. Will the other governments surrender to his demands because they are desperate for an economy/foreign policy deal? Messaging from Japan suggests Japan’s Prime Minister Abe will lead the way.
What are the chances that our politicians may wake up and smell the roses? Certainly not National. Speaking to the Policy Exchange in London last month Trade Minister Todd McClay acknowledged ‘the erosion of support for the benefits of trade liberalisation’. His solution: ‘ we must talk about it to ensure the benefits of free trade are better understood’.
McClay’s complacency is staggering: ‘At the signing of TPP 10,000 people marched in protest. Not all of them knew why they were there. That doesn’t sound like many, but proportionally that was 135, 000 on the streets of Britain or 1.6 million on the streets of the EU. When the final readings of the TPP bill took place only 20 protesters turned up. In part that is because we had engaged more widely than on any trade agreement before. We talked, explained, fronted up. … As a Minister, my answer is to keep talking about the issues – people need to be informed; people need to feel that they have been heard, that we take their views seriously and take them into account.’
Despite the fact he has manifestly failed to do so. (Excuse me if I don’t revisit the democratic deficit in the parliamentary process for the TPPA) …
McClay’s main initiative, branded as a ‘trade policy refresh’, is a vanity project to allow the incoming minister to distance himself from the damage wrought by Tim Groser, his abrasive and unpopular predecessor. After long delays, the reply to my Official Information Act request did not include a single policy paper to the Minister, let alone Cabinet, proposing the review. Consultations with business had been quietly occurring for several months before the ‘refresh’ was announced publicly with promises of ‘public consultation’.
The documents suggest they finally recognised that notching up more ‘free trade’ deals wouldn’t actually provide an economic bonanza if the exporters didn’t have the capacity to use them. All the other critiques were ignored.
Labour is breathing a sigh of relief that the TPPA looks like dying without them having to do anything decisive, and remains committed not to scaring the horses in election year. The Greens are stronger with Barry Coates having taken over the trade portfolio. New Zealand First remains staunch, but that may change if the pro-TPPA Shane Jones joins their ranks next year. The Maori Party and Mana together would provide an effective and authentic voice for Maori concerns.
What then do we do next year? This is a long game. We have fought and won battles before – the Multilateral Agreement on Investment (MAI), the expansion of the General Agreement on Trade in Services (GATS) in the World Trade Organisation, the Anti-Counterfeiting Trade Agreement (ACTA). Every time updated versions of the same proposals resurfaced in new forums. There is a fatal tension as obsessive levels of secrecy fuel the crisis of legitimacy.
We need to build on 2016 and do what our allies in the US did – force this policy onto the electoral agenda alongside the other life and death questions of poverty, homelessness, safe work and climate change.
On 3rd February next year – the anniversary of the mass mobilisation against the signing of the TPPA in Auckland – we will be launching the New Zealand campaign to stop TiSA. So have a great break. We have a lot to do next year.