WASHINGTON, D.C.: Elizabeth Warren, a Democratic senator and standard-bearer on the US left, opened a new broadside on Wednesday (Thursday in Manila) against the White House’s signature Pacific trade pact, calling it a dangerous corporate power grab.
Warren’s salvo came as President Barrack Obama trumpeted the 12-member Trans-Pacific Partnership during a trip to Asia, where he has reiterated plans to push US lawmakers to ratify the agreement in the dying days of his administration.
The treaty’s 12 parties signed the agreement in February but it awaits approval by potentially reticent lawmakers in member states.
The prospects for a US ratification before January, which could leave Obama a parting legacy by establishing the world’s largest free-trade region, appeared to grow dimmer on Wednesday (Thursday in Manila) as Warren unveiled a letter to US lawmakers from 220 economists and law professors calling on Congress to reject it.
They denounced a key treaty provision formalizing use of the so-called Investor-State Dispute Settlement mechanism to resolve corporate grievances, which they say allows foreign companies to counteract local laws and regulations.
Rather than appearing before a court, aggrieved investors could seek damages against the US and other treaty members by complaining to private arbitration panels comprising corporate attorneys. Such provisions are currently in place in the North American Free Trade Agreement between the United States, Mexico and Canada, and in a number of bilateral trade treaties.
“It’s about leverage, leverage for big companies to threaten and intimidate governments who might dare take actions that threaten their profits,” Warren told reporters during a conference call.
“The bottom line is that giving foreign corporations special rights to challenge laws outside of the legal system is a bad deal for everyone except those corporations.”
The use of ISDS would undermine US financial regulations, food safety laws and environmental safeguards, according to Warren, who noted that the Canadian oil company TransUnion this year sued the US under the provision because of the Obama administration’s rejection of the Keystone XL pipeline — seeking $15 billion in damages from US taxpayers.
The Chicago Council on Global Affairs published survey results on Wednesday (Thursday in Manila) showing that six in 10 Americans support the TPP. Public support for free-trade generally has waned in recent years, according to the Pew Research Center, and both presidential candidates, Democrat Hillary Clinton and Republican Donald Trump, have said they oppose the TPP.
Senator Mitch McConnell, the Republican who oversees the agenda in the upper chamber of the US legislature, said last month there would be no vote in 2016.
Speaking in Laos on Tuesday where he is attending a summit, Obama called the TPP “a core pillar of America’s rebalance to the Asia-Pacific” region and vowed to redouble efforts to get lawmakers “to approve TPP before I leave office.”
“I have said before and I will say again,” Obama said. “Failure to move ahead with TPP would not just have economic consequences, but would call into question America’s leadership in this vital region.”