by June Zaccone, Executive Committee, National Jobs for All Coalition and Assoc. Prof. of Economics (Emerita), Hofstra University
ABSTRACT: The Trans Pacific Partnership [TPP] is an ambitious “trade” agreement currently under secret negotiation. It covers far more than trade, and much of what we know is thanks to Wikileaks. TPP is the latest in a series of postwar agreements that set the rules for multinational corporations as they manage the global economy. Both this and the agreement being negotiated with Europe will further inhibit regulating corporate activity, by giving foreign corporations the power to sue governments before tribunals for loss of expected future profits. Current pacts are more about freeing corporate investment from constraints than about free trade. These agreements have always been justified as growth and jobs-promoting, though their results usually don’t support the predictions. Instead, they have encouraged global firms to outsource, sometimes to other industrial economies but frequently to lowest-wage countries with few labor protections. Their ability to relocate freely and sell that output here, and avoid taxes on their profits so long as these are kept abroad, has undermined worker bargaining power and wages. The result is that now our economy’s productivity gains are not adequately shared with workers. How will the terms of the agreement modify current arrangements? What is our experience with previous agreements? This paper will look at these questions as well as arguments of critics and, to some extent, defenders of trade agreements.
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