Last week, representatives for 12 countries signed the Trans Pacific Partnership in New Zealand with little fanfare. Shortly thereafter, at an unrelated public ceremony, New Zealand’s Economic Development minister was hit by a dildo thrown by an anti-TPP demonstrator.
Whoa, what? Someone threw a sex toy?
This kind of passionate dissent is hardly isolated. The debate for and against the TPP has been raging on the internet for years.
Why did this thing take so many years?
Trade negotiations usually take forever, and especially when they involve many countries. The Doha round of negotiation for the World Trade Organization started in 2001. Negotiations broke down in 2008 and have yet to start again. In the meantime, the United States and the other TPP countries decided to go it alone and do a side-deal.
Who actually signed it?
Twelve countries around the Pacific Rim: U.S., Canada, Mexico, Peru and Chile on the Americas’ side, and Australia, New Zealand, Singapore, Vietnam, Brunei, Malaysia and Japan on the Asian side.
It seems like a big country on the Pacific is missing there…
China is the elephant in the room, or rather the great absent in this major treaty.
What does the TPP actually do?
The agreement is sweeping. It covers everything from fisheries and auto parts to labour law and intellectual property.
Why does the internet hate it?
Because of how secret it was for years, with negotiations taking place behind closed doors, and because of what it means for global control of the internet. We knew the internet was a crucial part of the treaty, but for years, the public wasn't allowed to see what the new rules might be.
Why was it so secretive?
Governments argue that you cannot negotiate in public. Supposedly, secrecy allows negotiators to put forth positions and offers on the table that would otherwise be controversial.
Why was the internet so convinced it was bad?
In December, Wikileaks released the then-secret Intellectual Property chapter of the treatise. Internet freedom advocates Electronic Frontier Foundation criticized it as did writer Cory Doctorow, who wrote at BoingBoing, that the TPP "establishes punishing regimes for censoring and controlling the internet, as well as allowing corporations to nullify safety, environmental and labor laws that limit their profits."
So now that it's signed, what does it mean?
The Obama Administration signed the agreement but Congress still needs to vote yes on it for it to go into effect. It's unclear exactly when that will happen.
Did we sign it because it's good for the economy?
The economic merits are still being debated by economists. Some paint a rosy picture. Peter A. Petri and Michael G. Plummer project that incomes in the United States will rise by $131 billion annually by 2030, and by $490 billion for the world.
Nobel Prize winner Paul Krugman, on the other hand, thinks the economic benefits will be at best, marginal, on account that trade between the countries is already largely free and unregulated. Krugman argues that the main motivation behind the deal is not economic growth per se, but rather expanded enforcement of intellectual property regulations based on US laws.
So that's what the internet is afraid of. But how does extending the US's approach to the internet make things worse?
Critics believe that such expansion of the U.S. IP regime will entrench the dominant position of multinational corporations, handing them even more power than they already have and stifling innovation.
Critics also claim that provisions regarding drug data and drug patents will be harmful to health care policy worldwide, preventing countries from developing cheaper generic drugs. Those critics include the New England Journal of Medicine, which is not usually a hotbed of radical anti-globalization activists.
What is actually good about it?
Fewer sweatshops in the world! These 12 countries just agreed to fairer labor practices, including freedom for workers to unionize and to bargain collectively, as well as curbing child labor and human trafficking.
Oh cool, and all those countries are going to change their ways!?
Well, that's the hope though the U.S. doesn't seem so sure. It insisted on a side agreement to the main treaty that stipulates it will continue its import tariffs, say if Vietnam doesn't comply.
But the agreement does contains specific policy recommendations with respect to women’s rights and gender equality (Chapter 23, Development).
Yeah, there are no enforcement mechanisms. So for instance, gender inequality is enshrined in Malaysia where family law, for example, greatly privileges men in case of divorce. These legal biases, based on a conservative interpretation of Islamic law, reflect a broader social and economic discrimination against women in Malaysian society. If, however, Malaysia does not make progress in protecting women's rights… ¯\_(ツ)_/¯.
Okay, what else?
The Environment chapter has provisions to rein in overfishing. Fishing is a big industry around the Pacific, especially for Japan and the United States.
I like the idea of my great-great grandchildren getting to try toro. How are they doing that?
Several ways: requiring countries to enact science-based fishery management; allowing countries to sue other countries for illegal fishing; and finally, abandoning subsidies for fishing endangered species. An estimated 30% of fish products are caught illegally (affecting fish stocks worldwide): the TPP requires member countries to forbid access to market for illegal catch. It even contains legal enforcement mechanisms, such as sanctions and penalties.
So, for those who like TPP, what's the big picture?
Parts of the treaty are intended to nudge the less developed and less politically free countries towards the same legal standards of openness as the more developed ones. Even the possibility of free trade unions in communist, one-party Vietnam is indeed a very big deal. The treaty's goal is essentially political, or even geopolitical: gradually bring Vietnam, Malaysia and Brunei into the club of advanced democracies. The model is probably Mexico, which moved away from democracy-in-name-only to competitive multi-party governance around the time NAFTA was negotiated and enacted.
Why isn't China part of the agreement?
China doesn't view the treaty as hostile (it is apparently “evaluating it”). However, it has its own agenda, in particular the Asian Infrastructure Investment Bank, meant to compete with Western-led institutions such as the World Bank.
Defenders of the TPP point out that it secures the long-term influence of the United States and Japan in the hotly contested Pacific region. The Atlantic Ocean was the proverbial pond and economic engine of the 19th and 20th centuries. With the return of China on the world stage, the center of gravity of the world has now shifted. The 21st century is already China’s century, and therefore it appears critical to U.S. policymakers to maintain their country’s position vis-a-vis the new superpower.
So what's the really bad stuff?
In the name of securing the future economic and political position of countries like the U.S. and Japan, multinational corporations and their lobbyists larded the agreement with anti-democratic provisions. Negotiations were conducted in secret, according to a diplomatic convention that is supposed to favor the open exchange of ideas. And in the U.S. at least, ratification of the agreement will be fast-tracked, thus greatly limiting debate and yes, the free exchange of ideas in public.
Is there a part of this huge agreement that I should be troubled by?
As Paul Krugman described it, the key to the entire agreement is the Intellectual Property chapter. The provisions are quite stringent and one-sided: they run the gamut from copyright extension for content owners and patent owners (especially drug companies) to the criminalization of the removal of digital protection (even without any intent to distribute).
Among several potentially damaging new rules, the TPP would extend the life of copyrighted material for an additional 20 years, on top of the existing 50 years after the end of the author's life. The EFF calls this extension a misappropriation of the public domain. The EFF concludes that the TPP will “rewrite global rules on Intellectual Property enforcement.” Furthermore, once ratified the TPP will require changes in local copyright laws and enforcement without the normal public input that comes from democratic debate.
OK. But what's the worst that can happen to me?
Well, according to the EFF, if you post a video that contains copyrighted material and it goes viral, you might be criminally and financially liable for copyright violation.
Wait. Does that mean I can't cosplay anymore?
Well, at least not without being liable for copyright violations. Which does not necessarily mean that copyright owners will make their die-hard, dedicated fans pay a fee for cosplaying. Although you never know, stranger things have happened.
What about corporate power vs. democratic institutions?
That too is complicated. The so-called Investor-State Dispute Settlement (or ISDS) clause allows private corporations to seek arbitration against national laws and regulations that affect their freedom to trade. The arbitration process gets around local court systems. Decisions are binding and could potentially cost taxpayers gigantic sums. Arbitration supercedes national sovereignty and democratically-elected institutions. Not good.
So does anyone besides internet freedom advocates seem troubled by this thing?
Well, one of the most striking criticism comes from a very unexpected quarter: Jim Balsillie….
You know, co-founder of Research In Motion (aka the Blackberry).
Whoa, that company still exists?
Yes. Anyway, Balsillie can hardly be classified as a left-wing activist firebrand and therefore his opinion is all the more remarkable. He detailed his opposition to the TPP in a long interview on CBC’s “The Current” on February 4 (transcript here). If a respected and successful entrepreneur like Jim Balsillie cannot get behind the TPP, one really wonders if it is worth the trouble.
What's his criticism?
Balsillie describes a world where most economic value is derived from high level research and development. In agriculture as well as in software or entertainment, growth is driven by technological innovation and intellectual property in one form or another. This is what he calls “intangibles.” That “intangible” economy is based on the two pillars of public investments in human capital (education in particular) and patent/copyright systems that allow innovators and creators to get compensation for their inventions.
So smart people who have the ability to cash in on their creations.
Right. Balsillie looks at “intangibles” from the Canadian perspective, where economic policy for decades has been focused on the extraction of natural resources (especially oil from the infamous tar sands). He points out that the TPP, with its lopsided intellectual property rules, will favor U.S. and Japanese corporations who already have a leg up in the “intangible” economy.
In effect, from drugmakers and Apple to Walt Disney, the TPP will secure the rents of existing multinational incumbents and will stifle innovation and competition from countries whose economies have not yet fully pivoted towards “intangibles.” His point is not limited to Canada but readily applies to the much less developed signatory countries as well (Vietnam, Malaysia, Peru in particular).
So what does that mean?
The TPP creates higher barriers to entry in the growth sectors of the economy—those like pharmaceutical and software which rely heavily on R&D and intellectual property. As a result, the TPP might prevent other countries from fully realizing the benefits of tech-driven development.
But at least the countries in the TPP will benefit, right?
The TPP benefits the very same intellectual property owners, pharmaceutical and tech companies, who have become masters at keeping their profits offshore in tax havens. The U.S. government negotiates very advantageous conditions on their behalf, only to see them skirt their duties to the U.S.
What can I do next?
It's important to let your US representatives and Senators know your opinion on the agreement. Take the time to send them personal and courteous emails stating your views. Believe it or not, our representatives actually listen and respond to constituents’ correspondence.
Um, who is my representative and Senator?
Seriously? Well, you can find your US Congress representatives and Senator using your zip code here.
Manu Saadia, the author of Trekonomics, hails from Paris, France. He lives in Los Angeles where he helps tech startups get off the ground. His first and only passion is the future.