National DEC Americas Outreach Initiative

NDEC Americas Outreach Initiative

National District Export Council launches the “Americas Outreach Initiative” program. This program is designed to counter the wave of protectionism regarding existing and proposed Free Trade Agreements, particularly for the Americas region. Main objective of this initiative is to build support for our trade policies and trade agreements specifically within our Hispanic community country-wide. NDEC considers the following actions as part of the Americas Outreach Initiative roadmap:

– Communication of the good news of how our SME exporters and their Latin American partners have benefited from these Free Trade Agreements, and

– Communication of our many trade agreement successes to the public and our large exporting community, but with the addition of new partners to develop export sales in these markets.

In order to pursue these goals, NDEC plans to organize and promote the organization through the DECs seminars, webinars and meetings focusing on TTP, success of exporters in utilization of the existing FTAs in Americas, as well as export opportunities in Latin America for the U.S. exporters. Key partners of the National DEC in this initiative will include the following organizations:

– U.S. Export Assistance Centers (USEAC),

– U.S. Hispanic Chamber of Commerce (USHCC),

– American Association Chambers of Commerce in Latin America and the Caribbean (AACCLA), and

– American Chambers of Commerce (AmCham).

For further information, please see the charter at NDEC_AmericasInitiative_7_1_16, or contact NDEC Steering Committee members Tom Norwalk ( and Ozkan Erdem (

How did the U.S. Free Trade Agreements Fare? A Comparative Study

US Free Trade Agreements

By Dr. Andreas Udbye

University of Puget Sound, Seattle, WA

Washington State DEC

As of 2015, the United States has Free Trade Agreements (“FTA’s”) with twenty partner countries. The main purpose of these agreements is to promote bilateral trade in the form of exports and imports. Their success can be gauged by measuring whether the FTA’s boosted trade at a higher rate than that with comparable non-FTA countries. This paper investigates whether the exports and imports between the U.S. and the twenty partner countries showed higher growth rates after the implementation of the FTA’s, and whether the growth rates were individually and collectively higher than compared to a control group consisting of 82 non-FTA trading partners. The measuring tool is Compound Annual Growth Rates (CAGR). Simpler than an econometric model based on gravity theory, and more accurate than comparing average growth rates, the CAGR is a suitable comparison measure. Older studies investigating international FTA’s have used versions of the gravity model to show significant increases in bilateral trade following the agreements. Unlike this report, none of those studies focused solely on the FTA’s that the U.S. has entered into over the past twenty years.

Compared to the control group, our analysis shows a positive effect of the FTA’s on U.S. exports, but a slightly negative effect on imports. Some of the FTA’s are only a few years old, and a complex global macroeconomic scene over the past ten years makes it harder to generalize. Each country has a different economic story to tell. However, from a trade policy standpoint it may appear that the FTA’s have the intended, incrementally positive effect on U.S. exports. While FTA’s may have significant positive or negative effects on specific sectors and industries, they do not appear to cause dramatic improvements in bilateral trade. In the conclusion of the paper we offer some possible reasons for the FTA’s lackluster performance.

Free Trade Agreement paper

Top Nine Myths About Trade Promotion Authority And The Trans-Pacific Partnership

By: Scott Lincicome, CATO Institute

The current debate over Trade Promotion Authority proves, once again, that the classic description of the anti-globalization movement—as “largely the well-intentioned but ill-informed being led around by the ill-intentioned and well informed”—still holds true. Despite the tireless efforts of trade policy experts to explain why TPA and the U.S. trade agreements it’s intended to facilitate are, while imperfect, not a secret corporatist plot to usurp the U.S. Constitution and install global government, myths and half-truths continue to infect traditional and social media outlets.
Because these myths—originating with the same old anti-trade bedfellows that have been with us for decades—have duped a lot of good folks who are otherwise predisposed to support liberty and free markets (including some(link is external) in Congress(link is external)), and because the House of Representatives is poised to vote on TPA in the coming days, here is one last debunking of the top nine myths about TPA, the Trans-Pacific Partnership (TPP), and U.S. free-trade agreements (FTAs) more broadly.
To save some time, you can skip to your favorite myth by clicking on the links below.

Myth 1: TPA and U.S. FTAs are unconstitutional and undemocratic!

Totally false. Cato’s Bill Watson and I explained(link is external) this at length in The Federalist last year, but here’s former Attorney General Ed Meese to reinforce(link is external) our conclusions:

Constitutional law professor John O. McGinnis also recently reviewed TPA(link is external) and concluded that TPA “simply permits Congress under its ordinary procedures to commit to a future majority vote of Congress to vote up or down on an agreement that the President has negotiated. Representative democracy is thus served by the later vote on an agreement whose text is known.” And then there’s the U.S. Supreme Court in the 1890 case of Field v. Clark(link is external) approving the constitutionality of an analogous law—the McKinley Tariff Act of 1890, which granted the president even more authority than TPA. It was no big deal.
Finally, it’s important to reiterate that, contrary to some claims, FTAs are not treaties(link is external) (which are typically “self-executing,” require two-thirds approval by the Senate, and have the force of law upon ratification). They are “congressional-executive agreements” that, even after being signed by the president, have absolutely no legal force until they are converted into implementing legislation (which would amend current law), passed by Congress, and signed into law by the president. Such agreements have for decades been used by the United States for many different issues, including trade liberalization, and U.S. courts have repeatedly rejected(link is external) constitutional challenges thereto. In short, a constitutional argument against TPA requires you to reject over a century of precedent, the repeated rulings of U.S. courts, and the opinions of even the strictest of constitutional scholars.

Myth 2: TPA grants the president new and unlimited powers!

Totally false. As already noted above (and reiterated here(link is external) by Cato’s Dan Ikenson andhere(link is external) by the Congressional Research Service), Congress under TPA retains total control over the international trade authority granted to it by Article I, Section 8 of the U.S. Constitution. Any trade agreement negotiated by the president (which he has constitutional authority to do under Article II) still must be approved by Congress.
As noted(link is external) by the CRS, “TPA reflects decades of debate, cooperation, and compromise between Congress and the executive branch in finding a pragmatic accommodation to the exercise of each branch’s respective authorities over trade policy.” It represents a “gentleman’s agreement” between the legislative branch and the executive branch—with the former promising the latter “fast track” rules for the requisite congressional approval of an FTA, if, and only if, the latter (i) agrees to follow a detailed set of congressional “negotiating objectives” for the agreement’s content; and (ii) engages in a series of consultations with Congress on that content. As discussed more fully below, each branch of government retains its constitutional authority to abandon this gentleman’s agreement, but doing so will essentially kill any hope of signing and implementing new FTAs. So, with limited exceptions, Congress and the executive toe the line.
Because neither branch gets expansive new powers or short-changed, Congress has granted every U.S. president since FDR some form of trade negotiating authority (source(link is external)):

Pretty boring when you think about it, huh?

Myth 3: TPA sets legally binding congressional rules for USTR and U.S. trade negotiations!

Mostly false. As already noted, TPA sets congressional negotiating objectives on a range of issues (some more palatable than others), but, contrary to the statements of TPA antagonists and even some supporters, these objectives are not legally binding on the executive branch. Instead, the president retains his authority to negotiate with foreign governments, and, as Meese notes(link is external), that’s a good thing: “under well-established constitutional rulings, it would raise serious constitutional concerns for Congress to try to mandate the President’s negotiating positions.”
The president and his U.S. trade representative thus technically have discretion to ignore these objectives, but doing so would obviously jeopardize any final congressional vote. As the CRS explains(link is external):

To take the fullest advantage of these benefits, Congress, drawing on its constitutional authority and historical precedent, defined the objectives that the President is to pursue in trade negotiations. Although the executive branch has some discretion over implementing these goals, they are definitive statements of U.S. trade policy that the Administration is expected to honor, if it expects trade agreement implementing legislation to be considered under expedited rules [i.e., ‘fast track’].

The negotiating objectives constitute one part of the gentleman’s agreement between Congress and the president: “follow our wishes when you negotiate, and we’ll limit our meddling when a final deal is struck.” If the president doesn’t follow them, then the deal is off.
Which brings us to…

Myth 4: Once TPA is approved, Congress will be powerless to stop TPP or other FTAs!

Totally false. Not only does the latest version of TPA include new language expressly stating that the House or Senate can dismantle the “fast-track” rules(link is external) for various “disapproval” reasons, but—even more importantly—Congress has always retained this power because it has plenary authority over its rules of procedure, including “fast track.”
The new TPA, like previous versions before it, acknowledges this fact in Sec. 106(c)(link is external), which states that the fast-track rules are enacted as “as an exercise of the rulemaking power of the House of Representatives and the Senate,” but “with the full recognition of the constitutional right of either House to change the rules (so far as relating to the procedures of that House) at any time, in the same manner, and to the same extent as any other rule of that House.” The CRS summary(link is external) of TPA reiterates this fact: “Congress reserves its constitutional right to withdraw or override the expedited procedures for trade implementing bills, which can take effect with a vote by either House of Congress.”
Such power is not merely theoretical. It is precisely what then-Speaker Nancy Pelosi did(link is external) to the Colombia FTA in 2008 after President Bush submitted its implementing legislation. Her move effectively dismantled the “fast track” procedures and thus delayed congressional consideration of the agreement indefinitely.
In short, Congress retains total control over the FTA implementation process under TPA and can only be bound by the “fast track” rules if it wants to be bound.
Sensing a theme here yet?

Myth 5: TPP is being negotiated via a dangerous and unprecedented level of secrecy!

Totally false. Probably the most-repeated myth right now isn’t even related to TPA but instead to the TPP, which is still being negotiated. According to the anti-TPA script, the TPP is so secret that nobody knows what’s in it, and—much like Obamacare legislation—nobody, not even Congress, will know what’s in it until the agreement is passed into law. Once again, however, nothing could be further from the truth:

  • First, Obama’s USTR and Congress have been consulting on the TPP since December 14, 2009, when then-USTR Kirk notified(link is external) Congress that President Obama intended to enter into TPP negotiations. USTR then held initial consultations with Congress in 2010(link is external) and, according to a January 2015 fact-sheet(link is external), has since held almost 1,700 congressional briefings on TPP alone. USTR also previewed various TPP proposals with key congressional committees before taking them to our trading partners. (Odd that the TPP talks have been going on for six years, but the vast majority of these “secrecy” complaints have only emerged in the last few months, huh?)
  • Second, USTR has provided(link is external) “access to the full negotiating texts for any Member of Congress, including for Members to view at their convenience in the Capitol, accompanied by staff members with appropriate security clearance.” This access began in 2012, and several House members and senators—both supportive of TPA (like Mike Lee(link is external)) and opposed (like Sens. Jeff Sessions and Elizabeth Warren(link is external), as well as Rep. Rosa DeLauro)—have reviewed the draft negotiating texts. Moreover, the level of security surrounding these TPP texts isn’t part of some scary Obama administration plot; it’s set by Congress (which, as you’ll recall, is controlled by Republicans these days). A U.S. government official confirmed to me that “the Senate and House security offices determine the procedures for viewing classified material in the Capitol reading room where the TPP text is kept for Members—not the administration… some people claim that it’s more difficult to view military or intelligence information, but it’s all subject to the same rules that are set and enforced by Capitol security.”
  • Third, USTR has engaged the public on the TPP via published reports and “stakeholder meetings(link is external)” with groups like labor unions, consumer groups, and, of course, corporations and trade associations. Some of these stakeholders have evenreviewed(link is external) the negotiating texts and US proposals. Admittedly, the official texts aren’t available to the general public, but this is common practice for all FTAs (as a quick Google search reveals(link is external)) and for good reason: just like other high-value negotiations among private parties or governments, revealing draft proposals before a deal is struck emboldens the opposition, undermines the parties’ negotiating positions, and exposes negotiators to public scrutiny over provisions that might not even be in a final deal. Publishing draft FTA texts would make completing a deal difficult, if not impossible, and it’s thus no coincidence the most vocal advocates for “full transparency” in free trade negotiations are actually those most opposed to free trade(link is external).It’s also important to understand just how unoriginal this “secrecy” canard is:

Yes, protectionists have been using the same “secrecy” lines for over 20 years. In fact, if you replaced “NAFTA” with “TPP” in those old Ross Perot commercials, they’d be almost indistinguishable from the ones on our TVs today.

  • Finally, unlike the oft-analogized Obamacare legislation, the actual text of any final TPP deal will be required by law to be publicly available (online) for months—yes, months—before Congress votes on it. As you can see from the table below (source(link is external)), under TPA the president must make the entire text of any trade agreement, including TPP, available to the public for 60 days before he can even sign it.Once it’s signed, Congress will have weeks, maybe months, to scour the deal, hold “mock markups” in various committees, and suggest changes to the agreement before the president sends Congress legislation implementing the FTA for a final vote. Also, within 105 days of the FTA’s signing, the U.S. International Trade Commission must issue a report on the deal’s economic impact—again prior those bills being submitted to Congress. And once the bills finally are submitted, Congress will then have up to 90 legislative days (which is like five months in normal human days) to review the bills and hold final votes.

Bottom line: when or if TPA is passed, the general public will have months—and if the presidential elections interfere, maybe years—to review the TPP before Congress acts on it. Think that’s crazy? Well, it’s precisely what happened to U.S. FTAs with Colombia, Panama and South Korea, which were signed by President Bush but sat around (online) for years(link is external) before they were submitted to, and passed by, Congress in 2011.


Myth 6: FTAs, completed via TPA, undermine U.S. sovereignty!

Totally false, as Watson and I explained(link is external) last year:

FTAs embody unenforceable promises governments make to each other. Domestic governments—here, Congress—retain the sole authority to ignore those promises and violate international commitments, and they (unfortunately) do so frequently(link is external). Foreign governments cannot force their trading partners to comply with the terms of an FTA—the only extra-national consequence of a violation is that other parties to the agreement may abrogate their commitments in a commensurate amount (e.g., by raising tariffs on imports from the United States from levels that were lowered in the FTA). Moreover, every U.S. trade agreement permits the parties to act outside the agreed disciplines in the name of, among other things, national security, public health and safety, or environmental protection. Thus, the idea that TPA and FTAs violate U.S. sovereignty or regulatory autonomy is patently false(link is external).

These principles hold true for the TPP, including its dispute settlement and controversial “investor-state” provisions. Despite what Warren (and some media outlets(link is external)) would like you to believe, there is nothing—absolutely nothing—that can force the United States to comply with an adverse dispute settlement ruling issued under the TPP or any other U.S. trade agreement. Period.
But, hey, if you don’t believe me, here’s Attorney General Meese again(link is external):

Future trade deals would not be unconstitutional, nor would they undermine U.S. sovereignty, if they contained an agreement to submit some disputes to an international tribunal for an initial determination. The United States will always have the ultimate say over what its domestic laws provide. No future agreement could grant an international organization the power to change U.S. laws.

A ruling by an international tribunal that calls a U.S. law into question would have no domestic effect unless Congress changes the law to comply with the ruling. If Congress rejects a ruling or fails to act, other countries might impose a trade sanction or tariff, but they are more likely to impose high tariffs now without any agreement. The fact remains that no international body or foreign government may change any American law. Moreover, Congress may override an entire agreement at any time by a simple statute. Nations also may withdraw from international agreements by executive action alone. That is one reason why such agreements do not interfere with the underlying sovereignty of each nation to chart its own course in the world. In short, the U.S. Constitution and any laws and treaties we enact in accordance thereto are the only supreme law of our land.

If that’s not clear enough for you, then I don’t know what is.

Myth 7: TPP is a secret backdoor for a parade of horribles (and TPA lets that happen)!

Totally false. Various politicians and pundits have sought to arouse suspicions by claiming, among other things, that TPA will permit President Obama to bypass Congress and use the TPP as a backdoor to, among other things, lawlessly expand immigration, curtail gun rights, or restrict Internet freedom. At this point, however, I hope you can see just how ridiculous these claims are. Regardless of the issue, the fact will always remain that nothing can be implemented via the TPP unless Congress agrees to implement it via a formal vote.
This would include things like new work visas (something that U.S. FTAs haven’t actually done for years now) or Internet regulations or gun rules or minimum wages or whatever: it all has to become law before it has any legal force, and the only people making law are Congress (and, again, according to their own procedural rules). So, if in the TPP the president committed the United States to toss every AR-15 into the Atlantic Ocean, those guns aren’t going anywhere unless Congress formally agrees, subject to all of the constitutional, procedural, and transparency rules already discussed.
And, really, do you think this Congress is going to do anything of the sort? Really? (For more specific debunking of these crazy ideas, go here(link is external)here(link is external)here(link is external) and here(link is external).)
We still don’t know precisely what’s in the TPP, and final judgment—by Congress and the public—should therefore be withheld until we do. But the idea that TPP, empowered by TPA, will grant President Obama any new legal authority to ignore or change U.S. immigration or gun or whatever laws without Congress is simply ludicrous.

Myth 8: FTAs (and free trade generally) benefit large corporations at the expense of working people!

Mostly false. There is little doubt that FTAs benefit some U.S. corporations and workers, while harming others—that’s kinda free-market competition’s thing.
In general, however, the corporate winners (who tend to be in growing, innovative industries) from U.S. FTAs outnumber the losers (who tend to be in archaic, uncompetitive ones). And every legitimate economic analysis of the TPP confirms(link is external) this general rule. FTAs also contain rules and exceptions for well-connected stakeholders. As I’ve repeatedly discussed, this is a big reason why FTAs are “third best” option(link is external) for U.S. trade policy.}
Nevertheless, there is also little doubt that (i) FTAs are pretty much the only trade liberalization game in town these days; (ii) while unpalatable, the cronyist exceptions in U.S. FTAs, are relatively minor compared to the overall liberalization; and (iii) the biggest winners from such liberalization aren’t corporations or the mega-rich, butconsumers, particularly poor ones.
(More here(link is external).) These gains wouldn’t be possible without FTAs (as much as we free traders wish they would be).
Thus, the idea that FTAs like the TPP, or any other reduction in global trade barriers, benefit the 1 percent at the expense of working class is just not true. Indeed, as we at the Cato Institute are constantly pointing out(link is external), the real cronyism in trade policy takes place on the anti-trade side of the ledger: corporations and unions lobbying government to shield them from free-market forces, always at consumers’ expense. It’s precisely for this reason that many of the U.S. lobbying dollars(link is external) spent on TPP aren’t from pro-export mercantilists (although there are plenty of those, too) but from those anti-competitive industries (autos, steel, textiles, sugar, etc.) and unions that are seeking to scuttle the deal or secure their own special exemptions.

Myth 9: TPA doesn’t matter!

Mostly false. Look, in an ideal world, all of these trade deals would be totally unnecessary: every government in the world would lower its trade barriers, kill its subsidies, and trade freely across borders, thereby enriching us all in the process. But that’s not our world. And even though some pro-TPA rhetoric is exaggerated, the legislation still has value for at least one big reason: U.S. trading partners take it seriously and won’t sign off on a final deal with the United States until TPA’s in place.
Indeed, over the last few months, officials from Japan(link is external)Canada(link is external), and Chile(link is external) (among others) have each made clear that their governments won’t finalize TPP until Congress passes TPA. And, again, it’s precisely for this reason that U.S. protectionists are spending major dollars to stop TPA: they don’t really think it’s going to destroy constitutional democracy and install a world government ruled by Emperor Obama; they just oppose free trade or the TPP. And they’re more than happy to prey on conservative insecurities to achieve their goal.
Since the 1940s, the United States, whether governed by Democrats or Republicans, has been the world’s leader on global trade policy. This leadership, due in part to President Obama’s mismanagement and disinterest, has waned in recent years. A defeat for TPA—and any resulting death of the TPP—would accelerate this decline.
There are legitimate (although not horrifying!) concerns about the contents of the final TPP deal, but it’s certainly not a harbinger of an economic or constitutional apocalypse. The American public should scrutinize the final agreement closely, but that won’t happen until TPA becomes law. For supporters of free markets, there’s no legitimate reason why it shouldn’t.

Scott Lincicome is an international trade attorney, adjunct scholar at the Cato Institute and Visiting Lecturer at Duke University. The views expressed herein are Scott Lincicome’s alone and do not necessarily represent the views of his employer.

Trans-Pacific Partnership Is about More than Lower Tariffs

By: Simon Lester, CATO Institute
Date: Sunday, October 18, 2015
On October 5, 2015, after an intense few days of negotiations, government officials from the United States and 11 other Pacific region countries announced the conclusion of the Trans-Pacific Partnership (TPP), a trade deal involving countries making up almost 40 percent of the world’s gross domestic product. Specific details of the agreement are still lacking, but by any measure this deal will be one of the largest in history. However, the work is not done yet.
The next step will be an intense political debate here in the U.S. as well as the other TPP countries. In preparation, it is useful to understand what’s in the TPP to sort out the wide-ranging impact it will have. Trade agreements are not just about lower tariffs — they are broad exercises in global governance.
The core feature of trade liberalization is still present, of course. In this regard, the key questions for evaluating the deal are, how much liberalization will occur through the TPP, and how quickly?
On various sensitive products, the early reports are underwhelming. We have heard that U.S. tariffs on cars and trucks will be reduced slowly (30 years for trucks); and U.S. restrictions on sugar will fall only slightly. Japan will liberalize agricultural markets only a little, and Canada will do the same on dairy imports. For those who favor trade liberalization, the specific details of “market access” provided for these and other products will matter a lot when assessing the merits of the deal.
Also important is liberalization of trade in services, a rapidly expanding part of the global economy. The provision of many services has moved online, and international trade is now possible in areas not previously envisioned, such as education and medicine. Ideally, the TPP will liberalize trade in these and other service sectors.
The upcoming public debate on the Trans-Pacific Partnership is sure to be contentious.
Beyond these traditional trade issues, there is an expanding governance aspect of today’s trade agreements. The Obama administration has touted the TPP as “the most progressive” trade agreement in history. It will apparently push labor protections further than ever before, and also include new environmental protections.
Another element that is designed to appeal to liberals is a “carve out” of certain tobacco regulations from rules that apply to foreign investment. For anti-tobacco groups, convincing the Obama administration to take this unprecedented step was a big victory.
These governance items may be short-term victories for groups on the left, but they could cause problems for congressional consideration of the TPP. Republicans in Congress are generally wary of excessive labor and environmental regulation, and members of Congress from tobacco producing states (including Senate majority leader Mitch McConnell) are strongly opposed to singling out tobacco for unfavorable treatment. It remains to be seen whether the Obama administration’s attempts to appeal to progressives will hurt the agreement’s chances to gain support from conservatives.
At the same time, the Obama administration has pushed for extensive intellectual property protection as part of the TPP. This appeals to business groups, but is extremely aggravating to many on the left. In the end, the compromise that was achieved has left some leading Republicans in Congress upset.
Trying to keep all of the different interest groups happy, by constructing a balanced package that gives everyone something they want, is a difficult endeavor. Everything you give to one group has the potential to irritate another group. The growing complexity of trade agreements has made the trade debate, and generating support for trade agreements, much more complex and difficult.
Inevitably, the TPP’s prospects for congressional passage will now be caught up with presidential politics. “Populist” candidates such as Bernie Sanders and Donald Trump will weigh in with criticisms. And as much as she might want to avoid it, Hillary Clinton will have to take a position as well. All of this may make congressional consideration difficult. It is hard to see a window of time in which Congress can sign off on the deal in this political climate.
The upcoming public debate on the TPP is sure to be contentious. With any luck, it will also be enlightening. There have been trade deals signed in recent years, but they have often been small, involving just one country or countries making up a very limited part of the world economy.
The TPP is not radically different from these recent agreements, but its scope will draw out critics to a greater degree than previously seen. This provides an opportunity to have a good debate on just what trade agreements should be doing.
Clearly, there should be liberalization in there, or else the whole exercise is pointless. But have we liberalized enough in the TPP? As noted, the extent of liberalization for some sensitive products is unclear at this point, and some traditional trade liberalization issues, such as farm subsidies, have been left out of the agreement entirely.
And on the governance issues, this is a chance to think deeply about the role of international law in shaping domestic policy-making, and whether trade agreements have expanded too much into this area.
It is too early to make predictions about the TPP’s prospects in Congress, and no doubt this process will be a learning experience for everyone involved.
Next up after the TPP is a similar agreement being worked out with the Europeans, the Transatlantic Trade and Investment Partnership (TTIP). The TPP and TTIP are jointly referred to as the new “mega-regional” trade agreements.
If they do come into force, they will reshape the trading system in ways that will last for decades. For that reason, once the TPP texts are released, members of Congress need to scrutinize them carefully and understand their full impact.
This article appeared in the San Francisco Daily Journal.

How to Think about the TPP

By: Simon Lester, CATO Institute
November 9. 2015
The full text of the Trans Pacific Partnership agreement was released last Thursday.  At over 6,000 pages (by most estimates – I haven’t counted them myself!), it’s quite a challenge to digest.  It’s easy to pick out obscure technical issues and discuss them with trade experts; it’s harder to talk about the big picture significance for a mass audience.
Economist Jeffrey Sachs tried to do this in an op-ed in the Boston Globe, and I think he offered a good starting point:
The agreement, with its 30 chapters, is really four complex deals in one. The first is a free-trade deal among the signatories. That part could be signed today. Tariff rates would come down to zero; quotas would drop; trade would expand; and protectionism would be held at bay. The second is a set of regulatory standards for trade. Most of these are useful, requiring that regulations that limit trade should be based on evidence, not on political whims or hidden protectionism. The third is a set of regulations governing investor rights, intellectual property, and regulations in key service sectors, including financial services, telecommunications, e-commerce, and pharmaceuticals. These chapters are a mix of the good, the bad, and the ugly. Their common denominator is that they enshrine the power of corporate capital above all other parts of society, including labor and even governments. The fourth is a set of standards on labor and environment that purport to advance the cause of social fairness and environmental sustainability. But the agreements are thin, unenforceable, and generally unimaginative. For example, climate change is not even mentioned, much less addressed boldly and creatively.
I would say he gets this about half right.  Some clarifications are in order.
He’s right about the free trade part. We should do the tariff/quota reduction part today (or better yet, years ago!).
He’s also right about his third category of regulations, on investor rights, intellectual property, and services.  As with most regulations, some are good, some are useless, and some are downright harmful.  The TPP regulations are no different.
As for the second category, however, when you talk about international rules that require evidence-based regulation, or prohibit hidden protectionism, that’s already taken care of at the WTO.  The WTO has a great track record of handling these cases.  It’s not clear how the TPP would add much here.
Finally, he wants stronger labor and environmental rules in the TPP, but it’s not clear to me why those subjects are suited for trade agreements.  Whatever you think about climate change, for example, if you are going to address that in a treaty, it seems appropriate to do so in a climate change treaty, not a trade treaty.  Regardless, these regulations are really just part of the general category of regulations, along with investor rights, intellectual property, and services.
Summing this up, and narrowing his four categories to two, the TPP has two major aspects to think about: the trade liberalizing part, which is good; and the regulatory part, which is pretty mixed.  The best way to evaluate the TPP over the next year – which many people are saying is how long we have until a Congressional vote – is to figure out how much liberalization is in there, and just how good/bad/ugly the regulatory aspects are, and weigh and balance the two.

TTIP and the SME Sector

BRUSSELS (September 11, 2014)
Parliamentarians, advisors and stakeholders throughout the trans-Atlantic community delved into the potential impact of a Transatlantic Trade and Investment Partnership (TTIP) on small- and medium-sized businesses at a gathering at the European Parliament (EP). The event, “Business of All Shapes and Sizes”, was hosted by the Bertelsmann Foundation and the US mission to the EU.
Business Europe’s Luisa Santos and National District Export Council’s Daniel Ogden speak of export opportunities for small businesses at a panel discussion in the European Parliament.
Speakers were US and European experts on the small- and medium-sized enterprise (SME) sector. National District Export Council Chairman Emeritus Daniel Ogden, Kentucky Department of Agriculture Export Advisor Jonathan Van Balen and US diplomat Tom Roett gave the American point of view. BusinessEurope Director of International Affairs Luisa Santos and European Association of Craft, Small and Medium Sized Enterprises Director of External Relations Luc Hendrickx provided the European perspective. MEP Andreas Schwab from the committee on internal markets and consumer protection opened the discussion. Henning vom Stein, head of the Foundation’s Brussels office, moderated the discussion.
The event spotlighted an important sector ― approximately 90 percent of US and European businesses are categorized as small- and medium-sized ― that stands to be significantly impacted by any TTIP agreement. The focus of the conversation was the need to balance eliminating red tape and unnecessary regulation that discourages exports with maintaining high health and safety standards.
Ms Santos illustrated the challenge by speaking about a small European business interested in exporting T-shirts to the US. Different requirements for labeling washing instructions, however, frustrated those plans. Other panelists noted that if mutual recognition of aircraft-safety standards could be agreed, surely the same was possible for directions for washing T-shirts.
The event also focused on criticism of TTIP and the negotiations for an agreement. Lack of transparency, market access for genetically modified organisms and the proper mechanism for resolving investor-state disputes were widely discussed.
This panel was part of an ongoing “Washington 101” series of events aimed at improving understanding of current trans-Atlantic issues and cultivating closer US-EU ties.

Unilateral Disarmament in Trade?

The Hill
By Myron Brilliant
Published: April 24, 2014
Two years ago this spring, large bipartisan majorities in Congress approved legislation reauthorizing the Export-Import Bank of the United States (Ex-Im), which is hosting its annual conference beginning today. But time flies, and Ex-Im’s charter will expire in just over five months.
While some critics are seeking to re-open the debate over the bank, the facts show Ex-Im continues to play a critical role helping American companies compete in global markets.
Last year, Ex-Im supported export sales that sustained more than 200,000 American jobs at 3,400 companies. Ex-Im is especially important to small- and medium-sized businesses, which account for more than 85 percent of the bank’s transactions. Tens of thousands of smaller companies that supply goods and services to large exporters also benefit from Ex-Im’s activities.
Unilateral disarmament is rarely a good idea, but this is precisely what these critics are seeking in their effort to eliminate Ex-Im.
Take a quick survey of trade finance around the globe. Ex-Im is one of at least 60 official export credit agencies (ECAs) worldwide. The Organization for Economic Cooperation and Development (OECD) reports that these ECAs have extended more than $1 trillion in trade finance in recent years.
With world trade at record levels, foreign ECAs are busier than ever. In 2012, German and French ECAs extended roughly two and a half times as much export finance — measured as a share of GDP — as Ex-Im did; Chinese and Indian ECAs provided almost three times and Korea’s ECA ten times as much as Ex-Im.
For the United States to “exit Ex-Im” would serve only to put American companies at a unique disadvantage in global markets. The notion that the United States can convince other countries to close the 59 ECAs they support — by example or negotiations — is a fantasy: Governments from Canada to China have shown zero interest in shuttering their ECAs.
And make no mistake: Ex-Im matters. Listen to Judy Zakreski of Chindex Medical Limited, located in Bethesda, Maryland: “If we lose access to Ex-Im loan guarantees, we cannot hope to compete with the vast financing available from European and Israeli ECAs, and hospitals will purchase equipment from those countries instead of medical devices made in America.”
Moreover, American taxpayers can cheer the fact that Ex-Im regularly helps reduce the federal deficit by hundreds of millions of dollars. Far from being a subsidy for corporations, Ex-Im charges fees for its services that returned $1.1 billion to the U.S. Treasury after covering all its expenses in fiscal years 2012 and 2013.
Ex-Im loans expose the U.S. taxpayer to little risk because they are backed by the collateral of the goods being exported. Borrowers have defaulted on less than 2 percent of all loans backed by Ex-Im over the past eight decades, a default rate lower than commercial banks.
At a time when polls show the economy, growth, and jobs remain top priorities, efforts to hobble Ex-Im will quickly hit the headlines as export deals are lost to third-country competitors.
We can’t let that happen. For the sake of American exporters small and large, it’s time for Congress to reauthorize Ex-Im.
Brilliant is executive vice president and head of International Affairs at the U.S. Chamber of Commerce