"This isn't a deal we should support." Thus spake Paul Krugman this morning on TPP, just hours after the White House's brow-wiping victory in the Senate. Krugman suspects the administration of deliberate obscurantism and not a touch of skulduggery in promoting the deal and belittling its critics, and perhaps he's right. Peddling an international trade deal is as much about spin as clawing one's way through domestic politics: both are subject to the eccentricities of borderline personality disorder, especially the tendency to black-and-white dogmatism.
On the terms of the trade deal as trade, I'd be reluctant to gainsay Krugman, seeing how his Nobel career is rooted in just that: international trade. But indeed what Krugman has to say about trade in this trade deal is what makes his argument so fascinating. For what he argues has the potential of undermining the chief argument of the deal's progressive opponents. That is, he dismisses trade itself as a major concern, arguing that "A series of past trade agreements, going back almost 70 years, has brought tariffs and other barriers to trade very low to the point where any effect they may have on U.S. trade is swamped by other factors, like changes in currency values…. [T]he Pacific trade deal isn’t really about trade."
Rather, contends Krugman, "the main thrust of the proposed deal involves strengthening intellectual property rights … and changing the way companies and countries settle disputes." It is here that Krugman worries. Our sovereignty could be at stake and some critical reforms jeopardized. "[A] leaked draft chapter shows that the deal would create a system under which multinational corporations could sue governments over alleged violations of the agreement," he writes, "and have the cases judged by partially privatized tribunals. Critics like Senator Elizabeth Warren warn that this could compromise the independence of U.S. domestic policy — that these tribunals could, for example, be used to attack and undermine financial reform."
The administration responds that this is black-helicopter thinking, and I'm strongly inclined to agree with the White House. As President Obama has protested with disbelieving harrumphs, why in God's name would he have struggled so mightily to pass Dodd-Frank only to turn around and unravel it through the TPP?
But let's put that aside, since the TPP's opponents have themselves subordinated it to their much larger and penetratingly populist argument that the trade deal will kill more American manufacturing jobs. With little exaggeration, I'm a bit unclear on which manufacturing jobs are left to kill, since, as Sen. Debbie Stabenow has so poignantly noted, how does one compete against $1.57 an hour in some Pacific Rim sweatshop? Trotsky may have had the answer, but his solution will be a long time coming.
Still, it's the Job Killing! cry that Sherrod Brown, Bernie Sanders and other TPP opponents have cried the loudest. The TPP is just another NAFTA (the grim interpretation of it, anyway), and with it, they say, America will soon be shipping jobs to Ho Chi Minh City by the boatloads. Free trade is an American job-killer; always has been, always will be, insists Brown-ally Harry Reid.
Then comes Paul Krugman, international trade specialist, and declares it all humbug. "The Pacific trade deal isn't really about trade" — and therefore jobs. So Krugman, while kneecapping it, joins the TPP opposition. It's a fascinating twist to the debate.