TTIP - A little party never killed nobody

As economic theories go, Ricardian comparative advantage, which says countries should specialise in what they're good at and trade freely to make both countries richer, is about as robust as it gets. And when two economies are comparable in terms of wages and technology, pretty much every argument against free trade vanishes.

Nonetheless, TTIP has become an acronym to conjure demons in the mind of left wingers on both sides of the Atlantic. Europeans fear chlorinated chicken and privateering raids on the NHS while Americans fear being undercut by low-wage Europe.

International laws can be abused by companies and vigilance is useful, but with negotiations still under-way and nothing finalised, the hysteria (part Luddism, part Anti-Americanism, part New World Order paranoia) surrounding TTIP is bizarre to observe.

What TTIP will do is make many things cheaper and easier to buy and sell and that will create more jobs than it destroys. It doesn't mean you'll get a spinal column in every bap you buy, your plums won't have beaks. Nonetheless, if you think TTIP is to be feared, then this is the event for you:

"TTIP: What, why and what's in it for us?" Question the experts [sic]
Tuesday 24th February: 7.15 - 9pm Lewisham Civic Suite, Catford, SE6 4RU

The meeting is sponsored by: People Before Profit, 38 Degrees, Green Party, Unite the Union, Peoples Assembly, Keep our NHS Public, War on Want and United Nations Association-UK

64 comments:

Ez said...

Nice to see such unbiased sponsorship.

Jon said...

Yeah. Why aren't the Tories and the EU sponsoring it?

Anon said...

Maybe should ask if an Estate Agent should exploit hard working ordinary people by jacking up house prices and profiting from selling former publicly owned housing?

terrencetrentderby said...

Churchill will be rolling in his grave at this group of commies leading his beloved Lewisham folk astray

Brockley Nick said...

A BIS official (who went to college with me and thus has unquestionable integrity), rather than Minister.

Tamsin said...

Even New Scientist - hardly politically motivated reporting - had an article on this last November and cited the number of cases being brought by multi-nationals against governments for loss of future profits. At least matters are now being discussed and people aware it is happening so the more regrettable effects can be mitigated. Should be an interesting evening.

Brockley Nick said...

And why shouldn't you as a shareholder in a company have some recourse if some government takes action which unfairly discriminates against you and does you financial damage? Are governments to be above the law? As a principle it's fine. Of course, in some cases, the law is an ass.

Anon said...

It's not just shareholders who are financially hit by government decisions it also hardworking ordinary people that get clobbered.

We hear a lot from public sector pensions being reduced or stolen but it is on the back of hard working ordinary people who those unviable public pensions are funded. Not a squeak from those claiming to represent hard working ordinary people when the previous government slashed those peoples hard earned pensions by £5bn a year.

Not only are hard working ordinary people forced to pay public workers contributions and employers contributions to public pensions those same people are forced to subsidise the public pensions paid whilst their own pension funds have been slashed by a third due to government decisions probably supported by the organisers of this event.

terrencetrentderby said...

The light touch approach of the state towards business failed (note the Great Recession) and increasingly multinationals are bullying democratically elected governments. This is not right, no matter what kind of PR spin is put on it.

Monkeyboy said...

Will no one think of the 'just working enough not to be sacked' ordinary person?

Iain said...

Are you kidding? So you think democratic states should be kept in check by corporate power. That's exactly why meetings like this need to happen, because it's a fundamental change you are lapping up in the hope of some cheap twinkies.. You should probably attend the meeting, think you need it more than most, get some perspective.

Brockley Nick said...

No, I think democratic states should be kept in check by the law. The laws they agree and sign up to, in order to create a fair and level playing field.

James said...

As far as I'm aware, TTIP will use a system of investor-state arbitration which is governed by the rules of private arbitral institutions, not the law of the specific state making national legislation redundant. That is the problem.
And in terms of suing for loss of profit, see the Ecuador (I think) example - mining rights were awarded and then they discovered the proposed mining is likely to contaminate the water supply and revoked the licenses. Why is it right for a company be able to make claims for loss of profits against a government that is simply trying to protect the welfare of its citizens?

Brockley Nick said...

But that's what being part of a trade bloc like the EU is all about! Surrendering national sovereignty over trade issues in return for others doing the same, so that everyone prospers. Are you saying you agree with UKIP, that we should claw back our sovereignty over trade?


As for the Ecuador example, I don't know it and I am no lawyer, but IF the government created a bidding process they shouldn't have because they didn't do their due diligence about safety in the first place, then why shouldn't a company that spent millions of pounds bidding and tendering be able to sue for recompense?

Iain said...

Yeah, well said. Can't say I believe in rule of law if it means prioritising private arbitral institutions over laws that are designed to protect citizens- from either corporations or states or whoever else.

Not sure rule of law is meant to be a device for unrestrained corporate power either, nor something that means barely accountable trade agreements should be introduced as the highest power.

TTIP is not being written by people with any interest in rule of law. It's about profit at the expense of democracy.

Brockley Nick said...

The PM example is the one I linked to in the article. In that case, the court ruled against PM - so the system worked. I hate the tobacco industry and welcome plain packaging, but you have to admit that there is surely a case to answer that destroying their brands in a major market is something they have the right to protest. In that case, the court threw them out. The system worked.

Iain said...

Bollocks. Think you'll find public sector pensions have always been viable. Just because they're good, doesn't mean they're unviable. My pension went up in order to put something like £138 million into the budget deficit, a deficit that is still increasing. So my increased pensions contribution was little more than an extra tax on nurses etc.

And yes, your taxes pay for public sector workers and their pensions. In turn, we provide your healthcare, education, welfare, housing, and practically everything else that makes society function humanely.

Not saying it's perfect, or we're perfect, but we're a lot better than the private fuckwits neglecting the infrastructure of railways, water, energy, hospitals in Cambridgshire etc

Monkeyboy said...

I don't know much about the TTIP but the law is also not meant to be a device that the state can use close down anything it objects too. We have the equivalent (I think?) within the EU. Public sector HAVE TO by law open up their procurement to European suppliers, they can't simply award things to their domestic suppliers. Is this agreement more onerous?

Monkeyboy said...

this.... http://en.m.wikipedia.org/wiki/Government_procurement_in_the_European_Union

Newby said...

Viable as they are paid for by private sector workers, the idea that a teacher or nurse funds their final salary pension from their pension deductions is clearly not true. But thanks for humanising the rest of society, where we would be without social workers, the nhs and like I don't know. Back to the OP why are lefties so against free trade when it has lifted so many billions of people out of poverty? The real sort of poverty as well.

Iain said...

Because it's systematically condemned swathes of the planet to exploitation of resources and people. Is working relentlessly in a sweatshop, soiling oneself because you can't leave your station, then sleeping in chambers, because it's the only paid work you could find or because traffickers have your passport an alleviation of poverty? It's a consequence of the growth of free trade, we know that much.

Monkeyboy said...

And paid for by public sector workers who also pay tax. We all pay each others wages and pensions everytime we use a service. I'm paying the bonus of a city boy trader when he invests my share ISA. It takes a fee regardless of the performance. The interconnectedness of everyone's finances makes the ideologically pure arguments a little muddy.

Monkeyboy said...

...but free trade also means that UKPLC cannot prevent a poor southern European supplier bidding for work in the rich UK. He can challenge in court if the UK does not apply procurement rules fairly. It's not all 99p Y-fronts from Bangladesh.

Iain said...

We've reached that part of the comments section where probably no one is reading, and the post has done its bit by stirring up some arguments to try and get a few more hits.

The quality of an employee's life in southern Europe is a total victory for lefties, rather than free trade, which seeks to exploit us all to the maximum we will tolerate.

And the existence of complex interactions does not make principles obsolete, or whatever point is being made there. Yeah, everyone's taxes part for public sector wages, and by extension, their pensions, which in turn, have been used to plug deficits caused by a free market banking system that we can't afford to sustain for the cost austerity. Most of us, anyway

Iain said...

If it's not more onerous, it wouldn't be necessary.

I'm no expert about the agreements that pre-date it, but allowing the same rights to American corporations is something I have reservations about, given their relative strength and ability to dominate the markets and take profits out of the continentcontinent they're made in- except for the pittance in tax they may pretend to paypay.

Headhunter said...

I agree with this to some extent. Power has definitely shifted into the hands of private enterprise in the past few decades and globalisation has allowed them to hold governments to ransome to some degree - particularly over tax rates and employment law.

On the face of it the TTIP seems to give corporates even more power, it seems to allow them to sue governments for loss of income following change of policy or law. Of course there needs to be some certainty in governance for private companies to be able to operate effectively but I think I would prefer the balance of power to remain with our government or even with the EU than a major global corporation which owes everything to its shareholders rather than the local population...

Monkeyboy said...

Do you accept the southern Europe has benefited from being in the EU? They seem keen to stay in, presumably because they recognise the benefits of being a member of a bit trading block. Even syrzia want to stay, albeit with a reduced payback for the bailout. Of course the rich part of the Eu made money by trading with Greece, the bailout for Greece is actually bailing out German banks who would otherwise be exposed. Complex innit?

Newby said...

Are their any employees left in Southern Europe? Certainly not many below the age of 30. It's a shame that the EU is not about free trade then it may actually succeed in raising the standards of living for its workers. Hey they may not be the fulfilling and worthwhile jobs that's only the uk state can provide but would be jobs none the less. Of course people like me think that it would be better to cut the deficit by cutting taxes (specifically my taxes)but I guess try anti free traders would find this rather vulgar also.

Monkeyboy said...

The link is for the EU legislation that allows European companies to bid for public sector works in other European countries. That has cross party support, the 'common market' wouldn't work without it. My question is whether the TTIP is a similar thing but transatlantic. If so, is it a problem? Like I say I don't know whether TTIPS is more onerous.

Monkeyboy said...

Yep, that's an issue. All countries want the benefits on their own terms. I think (and I'm really no expert on euro finances) that the point of many EU grants is to redistribute some of the imbalances. The rich northern block want the benefits of trade but the electorate baulks at 'giving money' to the south. I don't think people get how it's supposed to work. Membership isn't free for either party.

terrencetrentderby said...

Quite and the financial crash shifted the balance of power noticably to private business. We even printed money and lent it to said private businesses at rock bottom rates, this money far from trickling down boosted corporate balance sheets even more. International bond holders are also increasingly powerful as virtually every government in the world is seriously indebted to them, a great leverage to have against nations when you are after something!

Max Calò said...

Well, the Greeks are understandably not very happy with the balance between the grants received and the austerity program imposed on them that is flogging off the bulk of the Greek infrastracture to the same bankers that are imposing the austerity. Add to the picture that at the same time rich Greeks bring all their money here to buy properties and young Greeks need to move abroad to have a future it doesn't seem like the opportunity to work for UKPLC is a great deal for them.

Newby said...

The eu grants are a tiny proportion of eu GDP and are in no way comparable to say transfer payments around the uk. Germany has followed a mercantilist export policy since ww2 (why anyone wants the uk economy to be silimilar to Germany's is beyond me) and levered the euro to these ends. When the imbalances exploded in the euro crisis the Germans used their size to bully smaller debtor nations into making German banks and thus their savers whole on their loans. The tragedy is that surely the Germans of all people would understand that you can't force all the pain onto the debtor. I meet lots of eu policy makers and they genuinely seem to believe that mass unemployment across the south of Europe is a price worth paying so that the eu project stays on the road. I am amazed that the left hasn't rediscovered its inate euro scepticism.

Brockley Nick said...

If I wanted clickbait, I wouldn't be posting articles about trade negotiations. Crime is what drives clicks. I happen to be interested in the issues and I figured readers would be too, especially with the local angle.


Anyway, are you seriously praising the Southern Europe labour market? It's an absolute tragedy. Bully for the insiders who still have jobs, unlucky everyone else.

Iain said...

I answered that, I think. A reason why expanding these regulations to include American companies, is that it would just be increasing the market which the American companies would inevitably dominate. It would bring down some prices, it would also bring down European corporations.

Does the earlier law allow corporations to sue states in the same way- if they change their laws. I presume the earlier one says- if tendering takes place, anyone in Europe can tender. TTIP says, if a government takes a decision that affects profits, a corporation can sue for loss of earnings. Doesn't it?

Brockley Nick said...

That's that anti-Americanism again. Did you know that there are more European companies than American companies in the Fortune 500 list of the world's biggest and the number has risen in the last decade, while the number of American companies has fallen?


The trade deal is a two-way street and the EU actually stands to gain more from this deal than the US - not least, as a consumer market, the EU is an absolute mess right now. 119bn Euros of GDP for the EU, 95bn Euros for the US. Those Eurocrats who have helped deliver your Southern European labour market nirvana are predicting the deal would be worth 545Euros per head. Still, we're all flush right now, so who needs it?

Brockley Nick said...

Pure ignorance. See my post above. Europe has more large companies than the US.

Iain said...

You hadn't posted that when I posted. I don't think it's ignorant to be unaware of GDP, forbes 500 etc, it just means I have a busy life, where I don't look at that stuff.

In any case, whether European corporations benefit more is still less important to me than whether democracy is sacrificed the name of GDP etc.

But I do appreciate that by your stated measures (which I will never be in a to challenge because it's time-consuming enough replying to all this) European corporations are better at capitalism than American corporations at this moment in time. I shall endeavour to hate then moremore now

Tamsin said...

But to take the really emotive extreme - what right have you the shareholder and your company to locked in security when it turns out that what you are flogging is toxic and properly tightened regulations in the interests of the public/environment/whatever mean that such sales have to cease? To flip the argument left/right politically - if the dockers, miners, luddites, etc. cannot be guaranteed jobs for life as technology and knowledge move forward why should commercial profits be guaranteed?

Brockley Nick said...

They have no right other than to test their claim in a court of arbitration.


If it was really against the best interest of government to agree to these systems, they wouldn't do it. But they do, because they realise that free trade needs mechanisms that ensure a level playing field.


To take your comparisons with workers, they have legal recourse if they believe they have suffered from discrimination or wrongful dismissal. So it is very similar.

Tamsin said...

http://www.newscientist.com/special/ttip
This was unfortunately one of the few issues we did not buy as it came out. I just saw the map of who is suing whom that was cherry-picked and passed around. So I have some on-line reading to do - a pity I am immersed in a proof-read of Cities and Citadels in Early Bronze Age Anatolia!
But anyway have some nuance, pro-con, balanced and knowledgeable to enhance the experience of next Tuesday evening.

Monkeyboy said...

Like you say, work in progress. One of the arguments that i think left and right kind of agree on from different directions is that monetary union and a common currency requires an element of similarity in how the various economies work. The EU wanted a common currency but didnt want closer political union or alignment of how the economies worked. One thing Gordon got right was his 5 tests, he new (and many on the right would agree) that you cant have a common currency and not have the other alignments. Greece and cyprus have taken a kicking for the failure of the EU but they are not blameless.

Monkeyboy said...

if the UK was an independent trading nation then it would have to negotiate with the EU but not be part of the organisation making the rules. Doubt we'd be better off.

Iain said...

No. The point I was hastily trying to make was that the reason labour laws in southern Europe are better than sweatshops (which is part of why it was mentioned in the context of a treason to applaud free marketmarket, I presume) is because of lefties.

Lefties have won us many things we take for granted, many more benefits than the free market (as opposed to capitalism).

The thing is, old phone, multitasking, and a comments system that wipes every thing if I get interrupted and screen locks, meant my point was lost before i hit send, then trampled on by esoterics.

Max Calò said...

Yes, they're not blameless but that's not why they're taking this kicking, they're been kicked for being the weak part in the situation where the big ones are bullies. Greece cooked the books also because their partners allowed it to. The EU bosses wanted Greece and Italy and the others in and they allowed stuff to happen and now they're getting all stiff about it, they are as responsible as Greece about this. Just like those payday lenders that keep on lending fully knowing that you won't be able to repay.
And yes, monetary union should have meant political union because it can't be that the highest authority is a bank, what are elections for otherwise?

Max Calò said...

Indeed, and people that think that they have a right to future profits and that this right should be protected by special courts show an obscene sense of entitlement. It makes you wonder how did they get this proposal to be seriously discussed.

Monkeyboy said...

common misconception, 'the state delivering' actually means the state tendering and procuring services. 'the state' hasnt built a railway...well ever really. They employ outside expertise, as do the French, the Germans, the Chinese. What they cannot do now is simply award it to a home company. They HAVE to open it up to any European contractor. Remember Thameslink got a kicking because Siemens had a better offer for trains than Bombardier (actually canadian but with a factory in the UK).


The legislation OJEU doesnt mean you have to put things out to tender just that if you do you cannot give preferential treatment for UK companies. I guess the TTIP legislation will mean that the yanks can have a stab and not be excluded - and visa versa. Whether thats good or bad, I dont know.


Take your point about procurement/legal expertise. Cant avoid that but can be bought in, have to use consultants though as a civil service salary wont pay for a professional procurement department capable of negotiating £bn projects.

Max Calò said...

Ok, but there is a difference between tendering for engineering and outsourcing public sector jobs like Serco running prisons. Remember G4S and the Olympics.

Newby said...

The eu isn't a trading bloc. If you detrend intra eu trade levels over last 40 years for the trend in global trade there is no evidence that the eu has generated any increase in intra eu trade. Most countries in the eu are immature democracies and I can see why they join the eu, I am not sure what reason there is for the uk to be a part of the eu.

Tamsin said...

Your second paragraph is unexpectedly naïve. The government are not omniscient and omnibenevolent although, regrettably, it seems they are omnipotent (with the whip system operating in the House of Lords - which really rather shocked me when I found out - I was being naïve - and many examples of the executive riding roughshod over the legislature and appointing the judiciary - alas for the classic balance of powers!).

They agree these systems because as individuals they have either bought into the Thatcherite mantra that the market economy is the solution to everything or else callously know which side their bread is buttered (look at the lists of interests and connections) or both.
Workers suffering unfair dismissal is not the comparison I was making - what long-term preservation of the status quo was there when a whole industry collapsed because the coal became uneconomic to mine? None... Nor should there have been. Times change.
You are getting slightly personal with my TH three bedroom/one loo/one bathroom mansion - but again a false comparison. It is the only roof over my head rather than just one enterprise out of many that a global corporation has on the go at any one time and should be able to take a knock on - a win-some/lose-some, don't bully your way into a risk-free contract.
It is the power of these multi-nationals, with no accountability and able to dictate to governments that is the matter of concern.

Tamsin said...

Because successful politicians - i.e. the Government rather than the run-of-the-mill elected MPs - in the sheer nature of things have the same arrogance.

James said...

Or because Governments are owned by big business and the EU technocrats all seem to have their noses in the trough...?!

Monkeyboy said...

Yes, I agree some things are better kept in house. But the legislation doesn't say you have to put it out to tender or privatise in some way. It simply says you can't restrict your supplier base (or at least can restrict it but not for nationalistic reasons) or give special dispensation. Fully agree that privately run prisons etc are a disaster waiting to happen.

Monkeyboy said...

I actually have no idea of the detail of this so should probably butt out...bye

Iain said...

Cheers. Appreciate the point that I could've checked, but not sure evidence that the USA has 100 more companies in the top 500 gold me with confidence the benefits will be felt here

Tamsin said...

Like it! And me likewise. Need to read up a bit more before I start again on things.
Talking of butting out - I do love today's Chinese New Year ram on Google....

Brockley Nick said...

Yeah, they're not though are they? If they were, we wouldn't have all these regulations that you are so keen not to erode. They are the same people who created them in the first place?


After all, we're always hearing from EU supporters (of which I am one) that if it weren't for the sainted lawmakers of the EU, our own politicians would have deregulated so much that you'd have arsenic in baby milk.

Brockley Nick said...

Free trade isn't a Thatcherite mantra, it's one of those rare principles on which keynesians and monetarists agree.


It is not a false comparison, it is exactly the same principle. It doesn't matter how many houses you have, if someone decides to knock one down, you're entitled to sue.

Headhunter said...

Nick, bringing in the TTIP which appears to protect corporates' ability to make a profit though is far from pure free trade, it's enshrining in law that, despite changing market conditions and public interest, corporates are nonetheless permitted to sue our elected representatives for our money to protect their shareholders' revenue.


If a corporate enters into a contract with a public body such as the NHS to provide a service for a specific number of years and the NHS breaks this contract then there is already a route in law for the corporate to take the NHS to court and sue.


If someone decided to knock Tamsin's house down, she already has recourse in law to go to court before this occurs. This is a silly analogy. In any case it's unlikely that it would happen without some kind of compulsory purchase order which would compensate her financially and if she didn't agree with the price offered she can go to court. The framework is already in place


As far as I can see. the TTIP is a law that will allow a corporate's to ensure profits continue above and beyond contractual agreements following changing market conditions or public need. This is not desirable. This, despite the fact that workers and "grunts" are facing and increasingly shifting and unstable working environment in which they are hit more and more by the winds of free trade. If workers are permitted less and less protection, why should corporates have a multilateral agreement protecting their revenues?

PeoplesAssemblySEL said...

As it has now turned out, it appears you've jinxed things.

PeoplesAssemblySEL said...

A lot of comments here. There appears to be an appetite to talk about TTIP!

A point to make clear, the idea that because of the groups sponsoring and supporting the event, that an evening of propaganda is going to ensue is wrong.

The organisers have put much thought into creating a format that stimulates a broad and balanced discussion, fair to all involved, panel members and audience. If you question, things about ISDS or harmonisation that you want answered, the event will be a good place to get it answered

The event is akin to a hustings.

The Guardian newspaper recently had a members event event on TTIP http://www.theguardian.com/membership/2015/feb/18/guardian-live-what-is-ttip-and-how-does-it-affect-us It cost £15.

This one is free, local, and there'll be refreshments (where the sponsorship went) and entertainment, there'll be a choir too at the end. (2 songs)

Do come along, on Tuesday, it should be a stimulating evening.

PeoplesAssemblySEL said...

Update: Tonight, TTIP Explained- Pros - Cons, BIS (Business Innovation & Skills) couldn't send anyone as advertised however, Emanuel Adam, from British American Business inc http://www.babinc.org/aboutus/professionalstaff will be there to put the Pro case for TTIP.
7.15pm -9.00pm. Lewisham Civic Suite.


An important aside, tomorrow at the same location, there will be a lobby against the 1/3rd of budget cuts coming to the borough, this starts at 6.00pm.

Tamsin said...

Good meeting. Civilised and informative. Even those one feared might rant on the whole didn't. Thank you to the organisers - and to you, Nick, for providing this wider publicity and a forum for pre-discussion.

PeoplesAssemblySEL said...

News: On Wednesday night Lewisham Council passed an TTIP motion.

There's been hard campaigning by a range of Lewisham community and political groups, to raise awareness about the threats TTIP poses towards democratic decision-making, such as how council to buy services, with particular concern as how this applies to NHS. This was important to offer balance to the establishment view of this trade agreement.

Read more here from Telegraph Hill, Cllr Paul Bell, who proposed the motion http://www.paulbell.org/blog/lewisham-council-passes-motion-against-ttip
Lewisham is now joined by Edinburgh who also this week passed an motion regarding concerns about TTIP, about 20 councils have similar votes.

TL:DR? In short Lewisham is a TTIP free zone.

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