The TPP Is a Rigged Agreement

The TPP Is a Rigged Agreement

The Trans-Pacific Partnership will help multinationals, not workers.

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Editor’s Note: Each week we cross-post an excerpt from Katrina vanden Heuvel’s column at the WashingtonPost.com. Read the full text of Katrina’s column here.

“China wants to write the rules for the world’s fastest-growing region … We should write those rules,” President Obama declared in his State of the Union address. To sell Congress on giving him authority to “fast track” consideration of the Trans-Pacific Partnership (TPP), a trade and investment treaty with 12 nations that has been under negotiation for five years, the president argues it is vital that “we” write the rules. The real question, of course, is what does he mean by “we”?

Our global trade and tax policies have been and still are controlled by corporate and financial interests. They, not workers or consumers, write the rules. In the early post-World War II years, trade treaties were focused on lowering tariffs. In theory at least, workers in both nations might benefit from larger markets and increased trade. But now a significant portion of our trade is intra-corporate trade, an exchange between one branch of a multinational and another. Multinationals have different interests than national companies. They profit even if U.S. workers suffer. Increasingly companies choose to report their profits or ship their jobs to countries with the lowest standards where the legal position of companies is the strongest. Companies like Wal-Mart set up global distribution systems designed to drive down wages here and abroad. The Waltons are the richest family in the world. Their workers are paid so little that they are forced to rely on taxpayer subsidies like Medicaid and food stamps.

One product of the corporate-defined trade rules is that the United States has run unprecedented trade deficits, totaling more than $8 trillion since 2000 alone. Trade deficits cost jobs. Worse, companies have used the threat to move jobs abroad to drive down wages here at home. Our corporate-defined trade policies contribute significantly to the reality that,as Nobel Prize economist Joseph Stiglitz writes, “the real median income of a full time male worker is lower now than it was 40 years ago.”

Read the full text of Katrina’s column here.

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