By Adam Kaiser ’19
If you’ve been paying any general attention to the news, politics, and the presidential debates, or even happen to flip on a TV lately, you’ve probably heard about the Trans-Pacific Trade Partnership (TPP) by now. Every politician, pundit, and armchair analyst is ready to sing the TPP’s praises or condemn it as a corporatist scheme. The Trans-Pacific Trade Partnership is poised to be the crowning achievement of Obama’s second term, and this appears to be his follow-up of Bill Clintons NAFTA moment. Depending on whom you ask, the TPP is either a symbol of bipartisan cooperation on Capitol Hill or a perfect example of executive overreach. Hillary Clinton helped design it but flipped her position. Most Republican candidates have expressed tentative support for the deal while Donald Trump and Bernie Sanders have both joined Clinton in voicing extreme criticism. It’s confusing, complex and just might turn out to be one of the defining issues of the 2016 election.
So what exactly is it? The Trans-Pacific Trade agreement is a deal between member nations to foster trade and improve relations by lowering tariffs, quotas, and strengthening intellectual copyright enforcement throughout members. There are also are a number of provisions that attempt to even the playing field between state-owned monopolies and private companies, reduce corruption, improve transparency, and enhance regulatory coherency.
However, the TPP is not without detractors. People from across the political spectrum have attacked the secrecy of the negotiations. Even congress wasn’t privy to the negotiations. There are also the usual suspicions that the TPP will lead to mass outsourcing of American jobs. Another major concern is the strengthening of intellectual property protections across the member nations, drug patents in particular. Due to mandated patent extensions critics claim it will greatly hinder the development of cheaper generic drugs in developing countries. Environmentalists also have a bone to pick with the deal. For example, environmentalists are upset over the projected increase in US energy exports especially natural gas and corporations new ability to sue governments over perceived unfair regulations. This is something they believe will lead to a weakening in environmental laws.
So how will it all shake out? The closest comparison for the TPP might be the North American Free Trade Agreement (NAFTA). Similar to the TPP, NAFTA lowered trade restrictions between the US, Mexico, and Canada. NAFTA faced much of the same resistance from people fearing job loss and environmental destruction. However, comparing the 11 years before and after NAFTA’s implementation we see that unemployment dropped from 7.1% to 5.1% and real GDP rose 48%. As for the environment, almost none of the catastrophic predictions were realized. NAFTA is one of the closest things to an undisputed success as there is in economics.
However, one must be cautious with such a comparison. The Trans-Pacific Partnership is a far larger and more expansive agreement then NAFTA. As with any deal that big and comprehensive it’s not perfect. So coming into this election season, don’t let your eyes glaze over and zone out when the candidates speak about “that one big trade agreement”. Pay attention and get involved because the one thing that’s guaranteed about this deal is that it will affect you.