As many of you know, WSJ is my morning paper. I know what I think; I’m not always sure what they are thinking. As many of you also know, I teach economic theory and history at UC Berkeley. So, yes, I buy into the “gains from trade,” “trade-offs,” and the like. And then there’s this morning’s headline:
This should have no one scratching their heads. In WSJ-speak “U.S.” always means large private corporations and those who invest in them; it never means mom-and-pop shops and working families — I mean never.
But now let us suppose that the TPP is a legacy issue for President Obama. Let us say he needs this feather in his already surprisingly substantial plumage. There are really three questions Obama needs to answer: (1) when; (2) how badly; and (3) is it politically feasible?
When. If President Obama wants TPP now, that ain’t gonna happen. Not in an election year. Not with HRC running against an anti-TPP Republican; go figure. The only way TPP happens is under HRC’s watch. But, since this is so, nothing can be lost (and much can be gained) going back to the drawing board; only this time with a bevy of environmental, consumer, and labor advocates at his shoulder. TPP was never a good deal, not for U.S. working families, not for the environment, not even for free trade. It was good for business. But, listen: business is global. No TPP, and business is more than happy to take its capital elsewhere. Business is simply rent-seeking. That’s what business does. President Obama could vastly strengthen HRC’s hand and add a whole peacock of plumage to his legacy by saying “No” to this TPP and renegotiating a trade agreement that works for working families, the environment, and free trade.
How Badly. Listening to the rhetoric coming from the White House, President Obama wants this agreement very badly. So, too, do pro-business Republicans. Of course, there are going to be trade-offs. The question here is, how close can President Obama stand to working families without losing Congress? Right now there is significant leeway. Close those health and safety gaps. Close the windfall for pharmaceuticals. Eliminate the threat to Internet freedom. Strengthen the protections enjoyed by working families. Strengthen environmental protections. With each of these steps, President Obama obviously shrinks the rent corporations will take home from TPP. At some point business will tell their lap-dog legislators to wait for a “more favorable business climate”; meaning HRC. Nevertheless, something is better than nothing, and at the moment the President is nowhere close to the margin. Moreover, the closer he gets to this margin, the higher the turn-out in November, which actually strengthens the hand of pro-environmental, pro-working family activists. How badly do you want TPP Mr President?
Political Feasibility. Now, it may be that a pro-environment, pro-working family TPP simply isn’t in the cards at this moment. And it may also be that business has already determined that TPP is not going to happen before 2017. TPP was the trophy the President felt he could win. It may turn out that he can’t under any circumstances.
But let us assume for the sake of argument that trade is good and that gains from trade are real. I need clothes. I can’t make clothes. I teach. I trade my teaching for clothes. I win. The tailor wins. Unless we are simply luddites, then we want trade, but not at any cost. We want trade that does not lead to a net loss in externalities: environmental degradation, poor health, less freedom, lower wages and benefits. These are not negotiable points. They never should have been. If business cannot prosper unless it harms our environment, health, freedoms, and livelihoods, then business should not prosper. Its that simple. But that is not an argument against trade agreements. Rather is it an argument for trade agreements that truly benefit the communities they claim to serve — not on the authority of the business community, which will always claim that its benefits are enjoyed by all, but on the authority of those who have a stake in the outcomes: environmentalists, consumer advocates, and trade unions.
So, Mr President, how badly do you want to save TPP? If you want it this badly, then get in touch.