Jane Kelsey: TPP compromised by Obama deadline

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Secrecy surrounding partnership negotiations perceived as an assault to fundamental democratic values
US President Barack Obama is pushing to get the TPP agreement resolved during his tenure. Photo / AP
US President Barack Obama is pushing to get the TPP agreement resolved during his tenure. Photo / AP

Time is running out for the controversial Trans-Pacific Partnership agreement (TPP). Negotiators in New York last week were under intense pressure to finalise the list of unresolved matters for ministers to decide in March.

The United States has a serious deadline. If the TPP is to form part of President Barack Obama's legacy, it must be concluded in the next three months. The text and a cost-benefit analysis by the International Trade Commission needs to reach Congress by around August. Once that window is past, Obama is likely to lose interest in spending political capital on pushing it through, knowing his successor would gain any kudos.

Whether the parties can achieve that is a political question. The technical work is largely over. One major obstacle to the political endgame is the reassertion of core democratic principles, evidenced by two recent developments.

First, the politicians still seem to believe they can get away with signing a deal of this magnitude while keeping it secret. New Zealand Trade Minister Groser and his colleagues insist that it's impossible to negotiate such deals under public and democratic scrutiny.

Yet the European Commission has released a series of legal texts it has tabled in the parallel Transatlantic Trade and Investment Partnership (TTIP) negotiations with the US. In early January, the commission announced it would publish the whole text once negotiations are concluded, well in advance of its signature and ratification.

The commission was responding to trenchant criticisms from European Union Ombudsman Emily O'Reilly in an inquiry into the secrecy surrounding TTIP. She found the significant potential impact of TTIP on the lives of citizens meant that key documents had to be published. US resistance to publishing those documents was not in itself sufficient to keep them from the European public. The same reasoning applies to the TPP.

Pressure is mounting. US Senator Elizabeth Warren is demanding release of draft texts that might affect re-regulation of Wall Street, while Senator Bernie Sanders has threatened a bill to require disclosure that allows proper analysis and advice.

A week ago Japanese lawyers launched a constitutional challenge to the TPP, as usurping their Parliament's supreme law-making authority, threatening the separation of powers and violating human rights.

Expect renewed demands for release of draft chapters before the crucial decisions at the mid-March ministerial, and legal moves in several countries to force publication of the text to enable debate before it is signed.

The second backlash involves the US certification process, which is little less than blackmail.

Forget the rhetoric about Japan being recalcitrant. The US is just as protectionist. Both are playing a high stakes game. Obama's urgent need for a deal strengthens Japan's hand. But Japan also knows the US Congress will seek to impose its will unilaterally on the other TPP governments. A final deal is never final until Congress is satisfied.

Body counts in the House of Representatives suggest Obama can't get Fast Track negotiating authority, which would limit Congress' ability to pick apart a final deal, at least in time to give other parties any reassurance the deal won't be undone.

The biggest threat hanging over Japan is the US conditions for certifying Japan has complied with its obligations.

There is a head of steam in Congress to use the TPP to punish currency manipulation, which it claims is making US exports uncompetitive. Those rules could unleash a series of challenges, backed by crippling sanctions, and spell the end for the monetary arrow of Abenomics.

The issue has not been raised in the negotiations. Japan knows the US is likely to play the currency card in the certification end game.

The latest story on certification should make New Zealand as nervous as Japan. Australia passed a law in 2004 to implement its free trade deal with the US. The US said that wasn't enough and demanded further legislation that tightened the copyright laws beyond what was required in the agreement. Otherwise the US would not bring the agreement into force.

An Australian Parliament select committee was given 24 hours to consider, hear submissions and report on the new bill.

The Parliamentary Library's Bills Digest suggested "Parliament might note with concern the process that has preceded this bill" and observed the correspondence between US and Australian ministers "has effectively created new obligations for Australia".

Whether and how these assaults on fundamental democratic values and processes are addressed will prove as significant to the endgame politics of the TPP as the substantive concerns, such as the price of medicines, foreign investors' powers to sue governments, privacy and decent livelihoods.

Jane Kelsey is a law professor at the University of Auckland.

- NZ Herald

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