News that doesn't receive the necessary attention.

Saturday, March 28, 2015

With passage of Trans-Pacific Partnership, US towns and cities will be subject to UN and World Bank tribunals. Republicans and Obama admin. seek to fast track this, details secret from US citizens-NY Times

US towns and cities will be subservient to UN and World Bank tribunals. "Under the Trans-Pacific Partnership, a member nation would be forbidden from favoring “goods produced in its territory.”"

3/25/15, "Trans-Pacific Partnership Seen as Door for Foreign Suits Against U.S.," NY Times, Jonathan Weisman

"An ambitious 12-nation trade accord pushed by President Obama would allow foreign corporations to sue the United States government for actions that undermine their investment “expectations” and hurt their business, according to a classified document.

The Trans-Pacific Partnership — a cornerstone of Mr. Obama’s remaining economic agenda — would grant broad powers to multinational companies operating in North America, South America and Asia. Under the accord, still under negotiation but nearing completion, companies and investors would be empowered to challenge regulations, rules, government actions and court rulings federal, state or local — before tribunals organized under the World Bank or the United Nations.

Backers of the emerging trade accord, which is supported by a wide variety of business groups and favored by most Republicans, say that it is in line with previous agreements that contain similar provisions. But critics, including many Democrats in Congress, argue that the planned deal widens the opening for multinationals to sue in the United States and elsewhere, giving greater priority to protecting corporate interests than promoting free trade and competition that benefits consumers.

The chapter in the draft of the trade deal, dated Jan. 20, 2015, and obtained by The New York Times in collaboration with the group WikiLeaks, is certain to kindle opposition from both the political left and the right. The sensitivity of the issue is reflected in the fact that the cover mandates that the chapter not be declassified until four years after the Trans-Pacific Partnership comes into force or trade negotiations end, should the agreement fail.

Conservatives are likely to be incensed that even local policy changes could send the government to a United Nations-sanctioned tribunal. On the left, Senator Elizabeth Warren, Democrat of Massachusetts, law professors and a host of liberal activists have expressed fears the provisions would infringe on United States sovereignty and impinge on government regulation involving businesses in banking, tobacco, pharmaceuticals and other sectors.

Members of Congress have been reviewing the secret document in secure reading rooms, but this is the first disclosure to the public since an early version leaked in 2012.

“This is really troubling,” said Senator Charles E. Schumer of New York, the Senate’s No. 3 Democrat. “It seems to indicate that savvy, deep-pocketed foreign conglomerates could challenge a broad range of laws we pass at every level of government, such as made-in-America laws or anti-tobacco laws. I think people on both sides of the aisle will have trouble with this.”...

Such “Investor-State Dispute Settlement” accords exist already in more than 3,000 trade agreements across the globe. The United States is party to 51, including the North American Free Trade Agreement. Administration officials say they level the playing field for American companies doing business abroad, protect property from government seizure and ensure access to international justice.
But the limited use of trade tribunals, critics argue, is because companies in those countries do not have the size, legal budgets and market power to come after governments in the United States. The Trans-Pacific Partnership could change all that, they say. The agreement would expand that authority to investors in countries as wealthy as Japan and Australia, with sophisticated companies deeply invested in the United States.

“U.S.T.R. will say the U.S. has never lost a case, but you’re going to see a lot more challenges in the future,” said Senator Sherrod Brown, Democrat of Ohio. “There’s a huge pot of gold at the end of the rainbow for these companies.”

One 1999 case gives ammunition to both sides of the debate. Back then, California banned the chemical MTBE from the state’s gasoline, citing the damage it was doing to its water supply. The Canadian company Methanex Corporation sued for $970 million under Nafta, claiming damages on future profits. The case stretched to 2005, when the tribunal finally dismissed all claims.

To supporters of the TPP, the Methanex case was proof that regulation for the “public good” would win out. For opponents, it showed what could happen when far larger companies from countries like Japan have access to the same extrajudicial tribunals....

Civil courts in the United States are already open to action by foreign investors and companies. Since 1993, while the federal government was defending itself against those 17 cases brought through extrajudicial trade tribunals, it was sued 700,000 times in domestic courts.

In all, according to Public Citizen’s Global Trade Watch, about 9,000 foreign-owned firms operating in the United States would be empowered to bring cases against governments here. Those are as diverse as timber and mining companies in Australia and investment conglomerates from China whose subsidiaries in Trans-Pacific Partnership countries like Vietnam and New Zealand also have ventures in the United States.

More than 18,000 companies based in the United States would gain new powers to go after the other 11 countries in the accord.

A similar accord under negotiation with Europe has already provoked an outcry there.

Senator Brown contended that the overall accord, not just the investment provisions, was troubling. 

“This continues the great American tradition of corporations writing trade agreements, sharing them with almost nobody, so often at the expense of consumers, public health and workers,” he said.
Under the terms of the Pacific trade chapter, foreign investors could demand cash compensation if member nations “expropriate or nationalize a covered investment either directly or indirectly.” 

Opponents fear “indirect expropriation” will be interpreted broadly, especially by deep-pocketed multinational companies opposing regulatory or legal changes that diminish the value of their investments.

Included in the definition of “indirect expropriation” is government action that “interferes with distinct, reasonable investment-backed expectations,” according to the leaked document.

The cost can be high. In 2012, one such tribunal, under the auspices of the World Bank’s International Centre for Settlement of Investment Disputes, ordered Ecuador to pay Occidental Petroleum a record $2.3 billion for expropriating oil drilling rights.

Under the Trans-Pacific Partnership, a member nation would be forbidden from favoring “goods produced in its territory.”

Critics say the text’s definition of an investment is so broad that it could open enormous avenues of legal challenge. An investment includes “every asset that an investor owns or controls, directly or indirectly, that has the characteristic of an investment,” including “regulatory permits; intellectual property rights; financial instruments such as stocks and derivatives”; construction, management, production, concession, revenue-sharing and other similar contracts; and “licenses, authorizations, permits and similar rights conferred pursuant to domestic law.”

“This is not about expropriation; it’s about regulatory changes,” said Lori Wallach, director of Global Trade Watch and a fierce opponent of the Pacific accord. “You now have specialized law firms being set up. You go to them, tell them what country you’re in, what regulation you want to go after, and they say ‘We’ll do it on contingency.’”

In 2013, Eli Lilly took advantage of a similar provision under Nafta to sue Canada for $500 million, accusing Ottawa of violating its obligations to foreign investors by allowing its courts to invalidate patents for two of its drugs.

All of those disputes would be adjudicated under rules set by either the International Centre for Settlement of Investment Disputes or the United Nations Commission on International Trade Law....

There are other mitigating provisions, but many have catches. For instance, one article states that “nothing in this chapter” should prevent a member country from regulating investment activity for “environmental, health or other regulatory objectives.” But that safety valve says such regulation must be “consistent” with the other strictures of the chapter, a provision even administration officials said rendered the clause more political than legal.

One of the chapter’s annexes states that regulatory actions meant “to protect legitimate public welfare objectives, such as public health, safety and the environment” do not constitute indirect expropriation, “except in rare circumstances.” That final exception could open such regulations to legal second-guessing, critics say."


"Correction: March 27, 2015 An article on Thursday about provisions in the Trans-Pacific Partnership, as outlined in a classified document, that would allow foreign corporations to sue the United States over actions that hurt their business or investment expectations misstated when the document was made available to members of Congress. Drafts were available for review soon after being written; it is not the case that the latest document was not made available until last week."

"A version of this article appears in print on [Thurs.] March 26, 2015, on page B1 of the New York edition."...

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"For TPP, the main concerns are Vietnam and Mexico."

3/17/15, "Putting the TPP on the Right Track," Politico, "There is a real choice to be made between two different approaches to international trade." by Simon Johnson and Ohio Rep. Sander Levin

p.1 of 2: "Here are some of the salient challenges to getting TPP right. 

First, on the incorporation of international labor standards, recent experience in Guatemala, Honduras and Colombia illustrates how important oversight and enforcement are — and how difficult progress can be when enforcement is weak and follow-through is slow. For TPP, the main concerns are Vietnam and Mexico. 

(p. 2) Vietnam represents the first time the U.S. is negotiating a broad trade agreement with a command economy. As a country that has never allowed workers to choose their own representatives and where the single labor union is part of the Communist Party, Vietnam will require not only major changes to its laws and practices, but also regular monitoring of compliance by a panel of experts.

And if TPP is to serve as a renegotiation of the North American Free Trade Agreement, Mexico willl need to change its labor laws and practices, to properly implement its TPP obligations....

Third, we must preserve the sovereign right of governments to develop legitimate regulations under the TPP’s investment rules. 

The investor-state dispute settlement mechanism creates an arbitration process, through which companies can claim that a country has broken those rules and seek monetary compensation — and a proliferation of such cases in recent years serves as a wake-up call

One of several important changes would be to ensure that, in the event of a dispute, both governments involved — the host and the home country for the company — can jointly agree that a case is inappropriate and should be dismissed....

Fifth, we must meaningfully address currency manipulation — direct government intervention in the currency markets to weaken one’s currency for the purpose of boosting exports and limiting imports. Currency manipulation has cost the United States millions of jobs over the past decade and a half. China manipulated its currency most dramatically in this time period — accumulating the largest stock of foreign exchange reserves the world has ever known. In earlier episodes, Japan, South Korea and others manipulated their currencies."...
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1/13/14, "Noam Chomsky: Obama Trade Deal A 'Neoliberal Assault' To Further Corporate 'Domination'," Huffington Post, Zach Carter, Ryan Grim

"The Obama administration's Trans-Pacific Partnership trade deal is an "assault," on working people intended to further corporate "domination," according to author and activist Noam Chomsky.

“It’s designed to carry forward the neoliberal project to maximize profit and domination, and to set the working people in the world in competition with one another so as to lower wages to increase insecurity,” Chomsky said during an interview with HuffPost Live. 

The Obama administration has been negotiating the TPP pact with 11 other Pacific nations for years. 

While the deal has not been finalized and much of it has been classified, American corporate interest groups, including the U.S. Chamber of Commerce, have already voiced strong support for the TPP, describing it as a free trade deal that will encourage economic growth. The Office of U.S. Trade Representative has also defended the talks, saying the TPP will include robust regulatory protections. 

But labor unions and a host of traditionally liberal interest groups, including environmentalists and public health advocates, have sharply criticized the deal. 

Chomsky argues that much of the negotiations concern issues outside of what many consider trade, and are focused instead on limiting the activities governments can regulate, imposing new intellectual property standards abroad and boosting corporate political power.
.. 
“It’s called free trade, but that’s just a joke," Chomsky said. 

"These are extreme, highly protectionist measures designed to undermine freedom of trade. In fact, much of what's leaked about the TPP indicates that it's not about trade at all, it’s about investor rights.”

The Obama administration is treating the precise terms of the deal as classified information, blocking many Congressional staffers from viewing the negotiation texts and limiting the information available to members of Congress themselves. The deal's only publicly available negotiation documents have come to light through document leaks. Recent documents have been published by WikiLeaks and HuffPost.

According to these leaked documents, the TPP would empower corporations to directly challenge laws and regulations set by foreign nations before an international tribunal. The tribunal would be given the authority to not only overrule that nation's legal standards but also impose economic penalties on it. Under World Trade Organization treaties, corporations must convince a sovereign nation to bring trade cases before an international court. Chomsky said the deal is an escalation of neoliberal political goals previously advanced by the WTO and the North American Free Trade Agreement.

"It's very hard to make anything of the TPP because it's been kept very secret," Chomsky told HuffPost Live. "A half-secret, I should say. It's not secret from the hundreds of corporate lawyers and lobbyists who are writing the legislation. To them, it's perfectly public. They're, in fact, writing it. It's being kept secret from the population. Which of course raises obvious questions."

Several members of Congress, including Obama's fellow Democrats, have attacked the intense secrecy surrounding the talks. But others want to give the TPP the "fast track" to passage; Sens. Max Baucus (D-Mont.) and Orrin Hatch (R-Utah) introduced legislation on Thursday that would prevent members of Congress from offering legislative amendments to whatever final trade deal Obama reaches. 

But the move to fast track the TPP hit headwinds in the House, where no Democrat has agreed to co-sponsor the legislation. Speaker John Boehner (R-Ohio) said the fast track bill cannot pass without Democratic support. Chomsky quipped that of course the administration and lawmakers would want to speed up a sweeping trade deal that may be more in the interest of corporations than the public.

“It’s very understandable that it should be kept secret from the public,"
Chomsky said, "why should people know what’s happening to them?”"


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TPP to be followed by US-EU version, TTIP:

3/28/15, "A new US-EU free trade agreement could make countries subservient to corporations," Business Insider, Don Quijones, Wolf St.

"After eight rounds of secret negotiations, Washington and Brussels are still struggling to breathe life into the Transatlantic Trade and Investment Partnership (TTIP). According to current European Union President, Latvia, the chances of the agreement being signed by the year-end target are growing perilously slim.

The potentially game-changing trade deal is aimed at radically reconfiguring the legal and regulatory superstructures of the world’s two largest markets, the United States and the European Union – for the almost exclusive benefit of the world’s biggest multinational corporations.

However, resistance continues to mount on both sides of the Atlantic. In the U.S. Wikileaks’ perfectly timed exposé of the investment chapter of TTIP’s sister treaty, the Trans Pacific Partnership (TPP), could derail White House efforts to gain fast track approval to bulldoze the treaty through Congress. 

This time, even the mainstream media seems to be paying an interest, with the New York Times in particular publishing a broadly critical report.

On the other side of the Atlantic, things seem to be going from bad to worse — at least for the treaty’s supporters. Even the U.S.’s ever-faithful ally and fellow Five-Eye member, the United Kingdom, is beginning to express reservations about TTIP. Earlier this week an all-party committee of Members of Parliament released a scathing report on the trade agreement. The Business, Innovation and Skills committee said the government needed “stronger evidence” to back up its claim that TTIP would bring a boost of £100bn a year to the UK.

The report also warned that the case had yet to be made for the highly controversial investor-state dispute settlement (ISDS), a provision that elevates individual foreign corporations and investors to equal (or arguably superior) status with a sovereign nation’s government. If signed, it would allow companies to skirt domestic courts and directly “sue” signatory governments for compensation in foreign extrajudicial tribunals."...





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