A new trade model is necessary for future pacts to gain broad public, and thus congressional, support. One template for such a trade agreement has been proposed in the bipartisan Trade Reform Accountability Development and Employment (TRADE) Act. A majority of House Democrats and a diverse array of faith, small business, labor, environmental, consumer, and family farm groups support the TRADE Act, which lays out a framework for future trade deals so that they benefit working people instead of simply a narrow class of investment interests.
American families, both on the right and the left, recognize that the North American Free Trade Agreement (NAFTA) and its progeny have helped large firms move factories out of the U.S. to venues that offer lesser protections for workers, consumers, and the environment. Regardless of party affiliation, polls confirm this broad public opposition to more NAFTA-style deals. These agreements have accelerated the shift of good jobs out of the country, hollowing out our nation's productive manufacturing capacity. The loss of that capacity is making it all the more difficult to emerge from our current economic crisis.
The creation of American jobs -- rather than merely increasing the stock prices of a relatively small number of very large businesses -- must be the central goal of an Obama trade agreement. The TPP must therefore build on the initial improvements to the Peru Free Trade Agreement that Democrats negotiated with the Bush Administration in 2007. It must also resolve other issues left unaddressed at that time.
Among the unaddressed issues are excessive foreign investor privileges found in NAFTA and other pacts. As a candidate, President Obama rightly criticized these "investor rights," which empower foreign corporations to sue our government in private international tribunals, bypassing our own courts. The existence of these extraordinary rights undermines state and national efforts to protect public health, safety, and our precious natural resources -- and exposes the U.S. to potential liability for countless millions. The American people never voted to put the interests of foreign corporations on equal footing with public health and safety laws. As representatives of the people, we must do everything in our power to ensure that their rights are not subjugated to the private interests of a few, powerful foreign entities.
The TPP agreement should also ensure that imported food and manufactured goods meet the same strict safety and inspection standards that U.S.-made food and products do. It should preserve our prerogative to use tax dollars to "buy American" or to promote domestic, renewably-sourced energy. And the agreement should, of course, promote, not endanger, U.S.-based green manufacturing.
The U.S. already has NAFTA-style trade pacts with four of the seven countries involved in the TPP talks (Australia, Chile, Peru, and Singapore). We believe that supplanting these existing pacts with the improved TPP provisions we support would best protect the American economy.
We also note that there are some special problems with the set of countries negotiating the TPP that even a new fair-trade model might not adequately address. We find it troubling that the TPP would include the countries of Vietnam and Brunei, which have long histories of limiting political freedoms and abusing labor rights. That is why many in Congress are calling for trade agreements to include a democracy clause and for these countries to reform their domestic laws and practices before Congress considers their inclusion. Vietnam manipulates its currency exchange rates to promote exports and has already emerged as the low-wage export platform of choice for many companies.
As a result, instead of promoting President Obama's laudable goal of doubling U.S. exports, the net impact of the TPP could be another flood of sweatshop goods. This is especially true given that U.S. already has trade pacts with the four countries that comprise 86 percent of the total combined GDP of all target TPP countries. Moreover, the inability of most people in Vietnam to afford American-made goods will only further the perception that our trade agreements are little more than thinly-disguised vehicles to off-shore American jobs to nations with extremely low wages and weak enforcement of labor and environmental laws.
By taking important steps toward a new trade model, the Obama administration can advance a trade policy we can all believe in, creating a new bipartisan consensus in favor of trade expansion. In the TPP negotiations this week, the President has the opportunity to show the world that the U.S. is leading the charge when it comes to expanding trade fairly while guaranteeing well-being at home and abroad.
Cross-posted from the Huffington Post.