By Teamsters General President James P. Hoffa
Published in the Detroit News, November 11, 2015
The much-awaited text of the 12-nation Trans-Pacific Partnership (TPP) was finally released for public consumption last week. But sunshine and scrutiny of the pact isn’t making the deal look any brighter for workers in Michigan or around the country.
As the Teamsters and others long suspected, the TPP text contains many of the most controversial items included in past lousy trade agreements that will continue to encourage job outsourcing and lower wages for U.S. workers. But it goes even further. Frankly, it makes clear why everyday Americans were kept in the dark about this Pacific Rim deal for so long.
Take the beloved “Buy American” procurement program, which has been around for more than 80 years. It was created to give U.S. firms a leg up in securing federal government contracts that keep dollars in this country and Americans working. A report last year found Michigan’s taxpayers finance federal government purchases to the tune of some $13.4 billion annually. That’s an estimated $1,851 that every state taxpayer sends each year to Washington to procure goods.
But language included in the TPP procurement chapter jeopardizes Buy American. It would give companies operating in any of the 11 other Pacific Rim member countries equal access to many of the U.S. government contracts that now go to local businesses that build and provide upkeep to key infrastructure in our communities. And that would lead to fewer jobs at home.
Other language in the trade deal would also lead to jobs being shipped overseas. For example, because the TPP ends U.S. tariffs with other member nations, competitors there will have open access to the American market while some other countries will slowly phase out their own tariffs in place. The result could be devastating for U.S. workers especially when it comes to competition with Vietnam, which would still have tariffs in place and pay their workers much lower wages.
The effects of the tariff provision could also be exacerbated by language included in the TPP rules of origin chapter that would allow a product to be called American made even if only 45 percent of its content comes from this country. Under NAFTA, 62.5 percent of content must be from the U.S. to be considered “Made in the USA.”
All of this doesn’t even address the issue of currency manipulation, which allows countries to tamper with their monetary values in an effort to make their exports less expensive and imports from the U.S. and other nations more expensive. The U.S. auto industry for years has suffered from such trickery, and that is not likely to change because the TPP doesn’t do anything to curb currency manipulation.
And then there is the provision included in the trade deal’s investor chapter that would allow even more foreign investors to challenge government rules in the U.S. and other TPP nations they don’t like. Those decisions would be made by international tribunals with no accountability to the citizens of member countries. And American taxpayers could be left on the hook for decisions those panels ultimately hand down.
This, mind you, is only the tip of the iceberg. It’s impossible to address all the matters contained in the deal given that it spans more than 6,000 pages. But it’s bad. And it leaves Congress with just one option when it comes to considering TPP — just say no.