Transatlantic Trade and Investment Partnership is the official name. The secret, bilateral TTIP negotiations between the EU and US have now reached a critical stage this October 2015. Without being alarmist, individual citizens are at risk.
The issues and risks of TTIP go beyond economics to reshape citizens’ rights and consumer choice.
The side-show of the Greek Euro Crisis and more the important wheezing Chinese stock-market dragon have masked a development which will have much more far-reaching effects and threatens to roll back many liberties Europeans have become accustomed to. This latest saga is brought to you by the same people who delivered the: NAFTA; the Fed Bubble; sub-prime financing; the Credit Crunch, Sovereign Crisis and Austerity! TTIP is one of a raft of jumbo trade agreements being discussed which also include CETA, TISA and TPT.
Ostensibly TTIP is focused on reducing regulatory barriers to trade: an excellent idea in theory. Essentially, TTIP is streamlining policies, laws, and regulations to more closely follow existing US standards as well as transfer accountability and maintenance standards from sovereign governments to corporations. Negotiations are being held in secret, and any information is only being disseminated by use of Freedom of Information provisions.
The dangers are in the detail. http://www.theguardian.com/membership/2015/feb/18/guardian-live-what-is-ttip-and-how-does-it-affect-us
The TTIP covers six main areas.
- Food and Environmental safety. Past restrictions on so-called “Frankenstein foods” in the EU could be removed. The EU’s REACH regulations are far stricter, with 1,200 substances banned, compared to only 12 in the US. Big Pharma also seems set to benefit from the same thinking as does the Oil&Gas industry. “Fracking”, with its unknown net effects, is an example.
- Banking. While these have been strengthened on both sides of the Atlantic; with the American ones being more onerous, they do allow the banks much greater control. This relaxation would be a roll-back for the current raft of European restrictions recently deemed vital to protect economies and society.
- Privatization of national institutions (such as Britain’s NHS, Swedish schools) could face privatization from US as well as EU private investors. The track record in Sweden has been less than impressive to date
- Employment. There is likely to be a net loss on the EU side given the above and if the experience from NAFTA is any guide.
- Privacy. It is highly likely that the contentious Anti-Counterfeiting Trade Agreement (ACTA) will be, defeated by the European Parliament in 2012, will be resurrected. It would mark a relaxation of European data privacy laws.
- Democracy. Much discussed by the Greeks, the TTIP seeks to introduce Investor-State Dispute Settlements (ISDS). This mechanism allows for corporations to sue governments for loss or financial distress. ISDS allows for enterprises to dictate policy to government. ISDS already exists in bilateral agreements but are hotly disputed; such as the Vattenfall case in Germany. More fundamentally, proposals for new laws are to be pre-screened before government agencies can develop them. It is imagined that this mechanism will be administered by a, Regulatory Cooperation Council – with a remit to protect trade, rather than welfare.
Strangely, academic comment has been muted; from the likes of Harvard
http://www.lse.ac.uk/publicEvents/events/2015/02/20150212t1830vHKT.aspx, and Stockholm School of Economics. Others have been more animated, Researchgate https://www.researchgate.net/publication/282662296_Transatlantic_Trade_and_Investment_Partnership_TTIP_-_treaty_to_induce_panic_Key_considerations and elsewhere http://www.bruegel.org/nc/events/event-detail/event/447-should-the-us-and-eu-be-negotiating-a-free-trade-agreement/.
Even the vox populi of You Tube is muted https://www.youtube.com/watch?v=AAp6cD5i8O0
TTIP promoters and proponents speak of an €119 billion annual windfall to be shared equally, €545 per European capita, from the successful conclusion of TTIP. Yet NAFTA, a precedent agreement, has not delivered the promised nor balancing effects its drafters imagined. 20 years on US consumers have seen a 65% increase in food costs; approximately 3 million jobs have been lost and there is a backlog of over US$ 12 billion in “investor-state” legal disputes. One could argue the mismatch between design & delivery that is symptomatic of such agreements is well evidenced for the EU and certainly the Eurozone – certainly from current experiences.
The TTIP negotiations may fail for unforseen geopolitical reasons but bad ideas with such momentum have a tendency to become a reality.
In short, while trade liberalization is a critical element of a healthy economy it needs to be done for the right reasons, in the correct manner with appropriate metrics. Get engaged!