About TPA
Trade Promotion Authority, often called “fast track,” is legislation that would give the president and Congress the ability to negotiate trade treaties with other nations or economies in a streamlined way. The trade deals would be negotiated and then presented to Congress for up or down votes - no amendments allowed.
Proponents, including business groups and many governments, say fast track is needed because trade partners need to be able to negotiate with one authority and not have a deal altered by legislators who may be influenced by parochial concerns back home. Oddly, President Obama and many of his usual opponents, congressional Republicans, favor fast track. Backers say the two trade treaties now under negotiation are impossible without fast track.
Critics, such as organized labor and most Democrats, vehemently oppose TPA. They say the trade deals are typically negotiated in secret and that a treaty may contain positive and negative elements, and that Congress often feels pressure to vote yes despite qualms about aspects that could undermine worker rights or safety standards, for example.
The TPA bill is being considered by the U.S. Senate. Both Georgia senators, Republicans Johnny Isakson and David Perdue, support it.
About TTIP
The Transatlantic Trade and International Partnership is a proposed trade treaty between the U.S. and the 28-member European Union. It would eliminate already low trade barriers between the two sides and create the world’s largest free trade zone.
Boosters, including U.S. businesses and governments on both sides of the Atlantic, point to $137 billion worth of economic benefit on this side of the Atlantic alone, and standardization of regulations that would benefit both parties. Even the AFL-CIO is not opposing the treaty in hopes that regulatory standards in the U.S. might be improved along the lines of those in Europe.
However, the treaty is deeply controversial among the European public, which fears that the U.S. would come out on top, high standards for workers would be undermined and that the gates would be opened to U.S. foods not currently allowed by the E.U. due to differing standards.
TTIP negotiations, which resumed last month, appear to be stalled.
About TPP
The Trans Pacific Partnership is a proposed trade treaty between the U.S. and its NAFTA partners, Canada and Mexico, and a grab-bag of mostly Pacific nations: Australia, Brunei, Chile, Japan, Malaysia, New Zealand, Peru, Singapore and Vietnam. It’s focused primarily on standardizing regulations and investment, though it could also open markets to some U.S. goods. It’s been in negotation for more than a decade and appears to have momentum.
Proponents include the business community, which argues it would create new markets for U.S. products and services and make existing markets more affordable. The pact would create a free trade zone comprising about 40 percent of the world economy, they say. The Obama administration has called the treaty a top priority.
But the treaty is opposed by the AFL-CIO, environmentalists such as the Sierra Club and others who say the pact would allow for offshoring of American jobs to low-wage, low-regulation markets such as Vietnam. They also argue some participating nations have abysmal worker pay, safety and other standards that the U.S. should not support.
You, an average American, eat about 60 pounds of poultry a year. That’s a lot of chicken wings and turkey legs.
Outside the U.S., however, people eat less than half as much.
Making it easier – and cheaper - to sell more chicken to foreigners makes Georgia Poultry Federation president Mike Giles salivate, pardon the pun. Georgia chicken farmers are, after all, America’s largest producers.
“We want access to world markets without unfair trade impediments,” Giles said from his office in Gainesville. “To really move the needle (on Georgia sales) we’re going to need to tap export markets. We produce a great, nutritious product. We will be able to compete as long as it’s a level playing field with predictable rules.”
Two trade agreements under negotiation – the Transatlantic Trade and Investment Partnership and the Trans Pacific Partnership - might help Georgia farmers and other businesses by lowering barriers to international trade.
In addition to farmers, many major businesses, notably Sandy Springs-based UPS, are strong supporters.
VIDEO: UPS makes the case for freer trade
The pacts would enhance foreign investment as well as increase trade in Georgia goods and services, proponents say. The impact would be massive: a combined foreign investment in the U.S. of $173 billion, according to a study by the Organization for International Investment. Georgia could get $5.7 billion of that, along with 44,000 jobs, the group estimates.
But critics say there are plenty of downsides. More American jobs could be moved overseas, environmental standards could be compromised and worker safety regulations could be weakened, they say.
BLOG: Economist Robert Reich gives a dissenting view
Celeste Drake, trade expert for the powerful union umbrella AFL-CIO, said poorly done free trade agreements can be a “race to the bottom” for workers.
“Given that these agreements are not just about moving goods and services across borders, they should also be about ensuring food safety, workplace safety and other protections aside from giving corporations special legal rights,” Drake said.
The labor group says at least 137,000 jobs have been lost in Georgia since the NAFTA agreement two decades ago.
Presidential power
Underlying these two trade treaties is Trade Promotion Authority legislation now moving through Congress. It would give the president the power to present a negotiated treaty to Congress for an up-or-down vote; no amendments.
TPA, dubbed “fast track,” has been the subject of intense debate. Some say neither trade treaty can happen without its passage.
“The Europeans … are not going to negotiate with 435 members of Congress,” said U.S. Sen. Johnny Isakson, R-Ga., who supports TPA. “They want to negotiate with the U.S. Trade Representative who negotiates for the president.”
Georgia’s other senator, freshman Republican David Perdue - a former corporate executive - also supports fast-track.
Critics deride the secrecy of the trade negotiations and argue that even a generally sound agreement can contain damaging provisions that TPA wouldn’t allow Congress to fix.
“Workers across Georgia are standing up for higher wages but Congress is considering legislation that will speed through corporate-driven trade deals,” Georgia AFL-CIO president Charlie Flemming said in a statement last week.
“For decades, we’ve seen how fast-tracked trade deals devastated our communities through lost jobs and eroded public services. Georgia can’t afford another bad deal that lowers wages and outsources jobs.”
So what are Georgians to make of all this?
Penelope Prime, professor of international business at Georgia State University, said free trade is a positive for the world economy. But transitions – causing temporary job losses or requiring worker retraining, for example – can be messy.
“Trade helps everyone in the end. People worry about the changes along the way,” she said.
Differing details
Economists note that the two pacts are not identical in character.
TTIP, which would create the world’s largest free trade area between the U.S. and European Union, would be a deal between highly developed economies.
TTIP is deeply controversial in Europe. One reason is the E.U.’s standards for imported food products. American chicken isn’t allowed because of processing practices the E.U. rejects.
Giles said those practices have been used in the U.S. for years and some European researchers have recently confirmed their safety.
Still, thousands of Europeans recently rallied against TTIP.
TPP would create a trade zone comprising 40 percent of the world’s economy, marrying the U.S. and its NAFTA partners, Canada and Mexico, with a hodgepodge of mostly Asian and Pacific nations: Japan, Vietnam and Australia, among others. The players are a mix of first-world and developing economies.
TPP has been a decade in the making. It would standardize customs regulations and other practices across major Asia-Pacific economies and create opportunities for American businesses large and small to sell their products profitably in markets where it currently isn’t feasible.
UPS leading push
UPS is among businesses leading the push for both free trade agreements as well as “fast track” authority. UPS says after a trade agreement is approved the company typically sees a 20 percent increase in export volume.
“We’re a union company that believes growth through trade helps create jobs and also helps customers,” said Laura Lane, UPS President of Global Public Affairs in Washington, D.C.
UPS created a 2-minute cartoon video to explain the issues to employees as well as congressional members and staffers.
Lane said the company has calculated that for every 22 packages that cross a border, the money supports one UPS job.
But the AFL-CIO, environmental groups and others have deep concerns about the Asian pact and fast-track presidential power. They argue that while free trade is a worthy goal, TPP could send American jobs to low-wage nations, degrade worker safety and environmental standards, and saddle taxpayers with unexpected costs, all to the benefit of large corporations.
“There are very low wage economies in places like Vietnam, a total lack of independent labor unions or much in the way of worker protections,” the AFL-CIO’s Drake said. “Child labor. Overfishing. Sharia law. Those practices do not make for good partnerships.”
Drake said the U.S. should take a broad look at trade with the goal of helping set strong standards for businesses and workers around the world.
“We are not against trade,” Drake said. “If there’s a deregulatory agenda, that’s a problem. But certainly there are needless barriers to trade and governments should take the opportunity to reset the rules in a responsible way.”
Staff writer Daniel Malloy in Washington, D.C., contributed to this report.
