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Issue #1730      May 11, 2016

Editorial

Remember the TPP

Notable for its absence in the 2016-17 federal budget was any mention of a central economic measure that, if implemented, would impose a profound, binding and punitive regime on Australia’s economic future.

The Trans Pacific Partnership (TPP) so-called free trade agreement is not a trade agreement. The purpose of the “partnership,” drafted by global corporations, is to make corporations immune to the laws of sovereign countries in which they do business. Any country’s sovereign law whether social, environmental, food safety, labour protections – any law or regulation – that impacts a corporation’s profits is labelled a “restraint on trade.” The “partnership” permits corporations to file a suit that overturns the law or regulation and also awards the corporation damages paid by the taxpayers of the country that tried to protect its environment or the safety of its food and workers.

The lawsuit is not heard in the courts of the country or in any court. It is heard in a corporate tribunal in which corporations serve as judge, jury, and prosecutor.

The TPP was been conducted in secrecy. The reason is obvious. Had people known how they were being sold out, there would have been a firestorm of protest.

Resistance by governments to the deal was overcome with bribes and intimidation. All of the negotiations were conducted in secrecy. When the trade representatives signed on to the deal, it was then presented to the legislatures of the particular countries.

These trade pacts originate in the US, because American global corporations and the American mega-banks are the largest players in the world economy.

Among the top banks in the world based in TPP countries are: Mitsubishi UFJ, Mizuho, ANZ, Commonwealth Bank of Australia, Westpac, National Australia Bank, Bank of Tokyo, Sumitomo, Royal Bank of Canada, and Toronto Dominion.

The TPP will allow foreign firms to challenge policies that apply to domestic and foreign firms alike and that have been reviewed and affirmed by US courts.

And not only foreign financial firms but foreign subsidiaries of US firms operating in TPP nations could demand taxpayer compensation for financial regulations and government regulatory actions.

These agreements leave out some very major countries and economies, notably those involved in BRICS – the economic co-operation framework established between Brazil, Russia, India and China and South Africa. The TPP will enhance competition with this rival bloc by stripping away the rights of previously sovereign countries to legislate in any way that limits transnationals’ profitability. Trade unions will be further sidelined.

The rules set out in the TPP will trump any commitments made at the climate change conference in Paris. There are references to a “low-emissions” future economy but none to climate change. These documents were written by and for the big polluters.

Governments, like Australia’s, are given assurances that they will retain the right to regulate. This is misleading. The agreement will work to lock in any weakening of regulation and this has been the trend with governments covered by the TPP, with their commitment to cutting “red tape”, removing “obstacles to investment” and hiring and firing.

The TPP might be referred to as a trade agreement, but only about five of the 26 chapters are about trade. The remainder go to the heart of the powers and role of government, in particular, they seek to override the government’s sovereign powers and responsibility to legislate in the interests of its people, its economy and environment.

A government’s capacity to act or likelihood of not acting because of fear of being sued for hundreds of millions or even billions of dollars covers almost every aspect of life including: price of prescriptions; environmental protection; workers’ rights; local content on TV; foreign investment rules; food and tobacco labelling; coal seam gas mining; financial regulation; internet privacy; environmental protection; government procurement, and much more.

There is already a lot of resistance to many of these developments. Across Europe there have been strikes against privatisation of the public sector, the cuts to social spending, and the decimation of agriculture. Opposition to the TPP is global.

Next article – Royal Commission 25 years on – Call for unified approach

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