What Came First in TPP: the Trade or the Cronyism

Tyler CowenOne interesting thing about the Trans-Pacific Partnership (TPP) is that libertarians are on both sides of it. There are what I would consider the stupid libertarians, who are in favor of the deal because they are for anything that seems like it will make the rich richer. These are the kinds of libertarians who are against unions and for the liberty-destroying “right to work” laws. If we exclude the people who are libertarians simply because it is a presentable form of neo-confederacy (and that is most of them), the majority of libertarians are of this kind: people who just think the rich are super-keen and need to be ever rewarded. This group includes Tyler Cowen — hero of subgeniuses everywhere!

Timothy B. LeeBut there is a small fraction of the libertarian movement that is actually in favor of individual liberty. This group will generally be against the TPP. They understand that this treaty is not much about trade. What it is primarily about is providing handouts to powerful economic interests. So I was pleased to see that, as I had previously noted, Timothy B Lee is one of the better kinds of libertarians. He’s still wrong about exactly what libertarianism would bring, but he is at least trying to create a better world for all, not just for those who are already doing well.

Over the weekend, Lee wrote, Why Killing Obama’s Trade Deal Could Be Good for Free Trade. Cowen had claimed that if the TPP gets shot down, future trade deals could be worse as a result. Why that would be isn’t clear. His followups seemed to be a lot of magic thinking: he believes it because he’s already decided that the TPP must be good. Lee, in refreshing contrast, was clear as could be: it’s the cronyism, stupid!

The US has been using trade deals to push counterproductive copyright and patent policies on the rest of the world since the 1990s. Each time a deal comes up for a vote, supporters play up the trade provisions and downplay the corporate giveaways. If the TPP is approved, we can expect the same kind of terms in the next trade bill the US negotiates.

And conversely, if the failure of the TPP is seen to be due to all of the corporate giveaways in the deal, then future deals would be seen as DOA if they included them. As Lee put it, “When special interest groups started lobbying for another round of goodies, US trade negotiators would be able to say, ‘We’d love to help but we can’t risk having the deal rejected.'” The only question is whether future trade negotiators would see it that way.

But on that issue, Lee is also right: none of the major players arguing against this treaty are doing so out of a sense of protectionism. The number one thing that I hear people talking about is that it strengthens intellectual property rights, which will increase costs everywhere. The second thing I hear most often is the threat that the TPP could cause to democratic governance through the strengthening of investor-state dispute settlement — the unaccountable international legal system that could force countries to pay companies for laws that the court claims are hurting companies’ profits.

On the other hand, so what if future trade negotiators don’t take that lesson away from the defeat of the TPP? Surely after the defeat of the Transatlantic Trade and Investment Partnership (TTIP) for similar reasons, they would learn. And if not for that one, maybe the next. Whatever it takes. Although I have to say: I don’t see us getting more of these treaties if there aren’t major businesses able to get special treatment. The barriers to trade are already low. The TTP (and TTIP) didn’t come about because governments were itching for them. Now, the point of these deals seems to be very little besides the cronyism. I think they start with the cronyism and then come up with other things that will allow them to be sold.

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About Frank Moraes

Frank Moraes is a freelance writer and editor online and in print. He is educated as a scientist with a PhD in Atmospheric Physics. He has worked in climate science, remote sensing, throughout the computer industry, and as a college physics instructor. Find out more at About Frank Moraes.

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