TTIP: Top 5 Concerns and Criticism
Why should TTIP be stopped in its tracks? Fears over corporations holding sovereign governments to ransom, over the dissolution of public health services, over the flooding of genetically enhanced meat into Europe, are all part of a long list being drawn up by those who want nothing more than the breakdown of TTIP negotiations. Critics also point to a major gap between the interests of the consumer and the interest of corporations as a result of the secret lobbying of Brussels.
1) Investment Protection
Arguably the most concerning aspect of TTIP for many critics is the so-called Investor-State Dispute Settlement (ISDS) mechanism which is likley to be built into the agreement. This mechanism gives companies the capacity to take legal action against states which they perceive are hindering potential profits. The Corporate Europe Observatory states that this mechanism will
"Enable US companies investing in Europe to challenge EU governments directly at private international tribunals, whenever they find that changes in law in the area of public health, consumer, environmental or social protection interfere with their profits. EU companies investing abroad would have the same privilege in the US".
As a result of this measure, according to a report by the Seattle to Brussels Network (S2B), "it is possible that the simple threat of a costly legal dispute would be sufficient to prevent governments from enacting progressive legislation in the future: a serious drawback for any political system that wishes to appear democratic."
"The ISDS is a massive Trojan Horse," says MEP Yannick Jadot, the Greens' trade spokesperson in the European Parliament, "which can used by multinational corporations to whittle away EU standards and regulations across a range of policies".
2) Impact on National Life
The concern is that these powers would jeopardize well entrenched national laws and regulations. Frances O'Grady of the UK's Trade Union Congress (TUC) for example, is concerned that deregulation and corporate rights could mean the gradual privatization of the UK's National Health Service (NHS). "The clauses [of ISDS] could thwart attempts by a future government to bring our health service back towards public ownership".
In Germany there is a strong opposition to the potential influx of Genetically Modified Organisms (GMOs) in foodstuffs due to TTIP deregulation. Jonathan Benson of Natural News advises us that
"Of primary concern is the EU, where regulators have been busy fighting off aggressive biotechnology interests that are hell-bent on forcing public acceptance of GMOs. Under TTIP, so-called "regulatory barriers" that leaked drafts have dubbed "unnecessary" would be lifted in order to take advantage of "the untapped potential of a truly transatlantic market place." Among these alleged "barriers" are current EU restrictions on GMOs, which the European public has made very clear it does not want in its food supply."
According to the French minister of foreign trade, Nicole Bricq, France is "the country where the mobilization against what they call the ‘transatlantic treaty', is the strongest".
There is a major concern over the future of local French cheese and milk producing areas, as well as the ‘adjustment costs' on the major French industrial sectors of meat, sugar, bioethanol producers and transport.
There is also a large degree of concern as to the nature of the TTIP deliberations. Many take issue with the fact that they are being negotiated privately in Brussels by the EU Commission, the executive body of the EU which is not subject to any public scrutiny.
John Hilary from the War on Want organization contends that "everything is going through Brussels", so there are "no democratic levers over TTIP". As a consequence, as these secret meetings are held between business groups and the EU Commission, TTIP is being "driven by a corporate agenda", producing a "pro-corporate mandate" at the expense of consumers and public life.
"TTIP negotiations, and texts", writes Linda Kaucher in the International Business Times, "remain secret until after the negotiations are completed even though this deal will directly affect almost a billion people and many more, indirectly, in third world countries."
Those who criticize this lack of transparency not only point to the likelihood that TTIP is driven by a "corporate agenda", but also that it is in direct contradiction with democratic principles and public oversight. George Monbiot of the Guardian newspaper in the UK called it a "full-frontal assault on democracy".
"These companies (along with hundreds of others) are using the investor-state dispute rules embedded in trade treaties signed by the countries they are suing. The rules are enforced by panels which have none of the safeguards we expect in our own courts. The hearings are held in secret. The judges are corporate lawyers, many of whom work for companies of the kind whose cases they hear. Citizens and communities affected by their decisions have no legal standing. There is no right of appeal on the merits of the case. Yet they can overthrow the sovereignty of parliaments and the rulings of supreme courts."
4) Financial Regulation
Closely tied to the aforementioned concerns, is the question of financial regulation. Critics point to TTIP as dragging the financial sector away from much needed regulation following the 2008 economic crash. The Dodd-Frank Act, brought into US law to enforce greater regulation in the financial sector is, as some argue, at risk of dilution if financial services are included in a trade agreement like TTIP.
In report by the Allianz Centre for European Reform, the authors explain that critics fear that "a package deal could force concessions in regulatory standards at the expense of financial stability. Many in the US…fear that TTIP could lead to a rolling back of financial regulation agreed under the Dodd-Frank Act".
Moreover, the current gap between levels of financial regulation between the US and Europe is likely to bring about antagonism if this agreement were to go ahead. American "rules to enable trade data surveillance on the foreign affiliate trades of US [over-the-counter] dealer brokers have brought harsh criticism from foreign, particularly European, bankers and regulators", warn the Institute for Agriculture and Trade Policy, who are based in Washington DC.
5) Adverse Economic Impact
Finally, in contrast to the promises by the EU Commission that TTIP will create thousands of jobs, many in fact point to a high degree of uncertainty over job stability and economic growth in the EU and in the US.
The S2B network refers to the net loss of 879,280 following the implementation of NAFTA and the "economic restructuring that may even lead to job losses" which may be caused by the implementation of TTIP. Indeed, the commission expects, in its impact assessment report, "an initial shock in the most affected sectors [and] is expected to lead to restructuring of the sectors concerned…"
Economist Professor Clive George from the College of Europe in Bruges, who has studied Impact Assessments of trade negotiations, warns, "economic models, on which such estimates are based…have been described by some leading modelers as ‘highly speculative'".
The EU Commission's report estimates an increase in GDP of little more than 0.1%, meaning an increase in the GDP growth rate of 0.01% for the ten-year period. Professor George maintains that these estimates are "trivial, and the [EU Commission] knows it".
There is also uncertainty in some circles as to the impact TTIP will have on third party countries, especially Low Income Countries (LIC). A report by CARIS, University of Sussex for the Department for International Development, examining the effects of TTIP on "Selected Developing Countries", suggests
"A transatlantic agreement carries potential threats in some sectors. The reciprocal removal of the [most favored nation] tariffs in transatlantic trade could entail LIC lose market share to the TTIP partners as a result of the fall in tariffs and other barriers".
It is, therefore, this uncertainty about the future of jobs and trade and investment flows that greatly concern some skeptics.
What individuals and civil society are most concerned and most vocal about regarding TTIP are the rights that are likely to be afforded to corporations entering newly liberalized markets across the Atlantic. They fear a situation where large, powerful companies are able to coerce and manipulate sovereign governments into doing their bidding, ultimately undermining national laws on food safety, environment, health, etc. Proponents of TTIP must allay these fears or face a difficult task in implementing the agreement.
-See the other side of the argument here
- EU's Litmus Test in the Western Balkans
- It's the State of our Democracy, Stupid! Why Transatlantic Relations are in Trouble
- The Reverse Trump Effect: EU Populist Movements After Trump Took Office
- Smaller and Larger Nations: Concert of Big Powers or Fair Balance of Interests?
- The Trump-Merkel Summit: After the Storm, a Vital Trans-Atlantic Agenda