Executive
director of London-based human rights and anti-poverty
organization War on
Want John Hilary discusses the proposed Transatlantic Trade
and Investment Partnership (TTIP), which is currently being
negotiated in secret between the European Union and the United
States, and the potential adverse impacts of this agreement on the
economy, employment, corporate regulation and the environment.
Michael
Nevradakis: Could you share with us a brief introduction as to what
the proposed Transatlantic Trade and Investment Partnership is all
about?
John
Hilary: It's
a major trade and investment treaty, which is being negotiated
between the EU on the one hand, and the US government on the other
hand. And so for those of us who live in Europe, the European
Commission is representing all of us in the negotiations. Each of the
individual countries has no independent trade policies, so everything
has gone through Europe. The negotiations began in 2013; they were
trying to rush them through to a conclusion by the end of 2015, so
they didn't bump into the US presidential election.
The
idea is that these negotiations will lead to a treaty [that] would
somehow boost the economies of Europe and the USA to get them out of
recession. Also, the plan was that it would re-strengthen the
transatlantic alliance and it would help isolate countries like
Russia, Brazil, India and China, so it's quite a defensive move on
the geo-strategic level. The other side of it is, it was sold to the
people of Europe that it would bring growth and extra jobs, and
that's part of the problem, because now we realize that there will be
no extra jobs. In fact, at least 1 million people will lose their
jobs as a direct result of TTIP.
This
is not the first time that such an agreement has been proposed, and
there have been efforts, in fact, to get something like this done
since the 1990s.
That's
absolutely correct. In 1995, a group was formed called the
Transatlantic Business Dialogue, and it was composed of major
companies from Europe and the USA that got together to try to create
a customs union where they could trade and invest without any
restriction on their profits. They tried first through the OECD
[Organization for Economic Cooperation and Development], in the
context of the Multilateral Agreement on Investment. But there was a
massive worldwide mobilization against it, and we saw the MAI
collapse in 1998. They then tried again through the World Trade
Organization, and once again, the WTO crashed in 2004 and all of
these new powers had to be taken off the table. So we've already
fought back against TTIP in its previous forms, and we have won both
times. That's why we're confident we can win again.
One
of the characteristics of this agreement is the secrecy that is
surrounding it. Apparently, members of the European Parliament who
have followed the negotiations for TTIP have been essentially forced
to sign confidentiality agreements. Is this correct?
That's
absolutely correct, and the level of secrecy surrounding these
negotiations means that ordinary people across Europe and most of the
national members of parliament have no idea what's going on. The
European Commission placed a 30-year ban on all public access to the
key documents behind TTIP right at the beginning of the negotiations.
Any members of the European Parliament who are given access to the
special reading rooms where they can see some of the documents - they
have to sign documents promising that they will not share any of what
they've seen outside that room. Really, it's like a scene from the
Stalinist Soviet past, where you have individual documents marked
with secret markings, so that they can trace the source of any leaks
when the documents do go out into the public domain. It's profoundly
non-transparent and anti-democratic, and it's destroying any
credibility within the European Commission itself.
One
of the main areas of contention surrounding TTIP are the so-called
"investor-state dispute settlements," which would allow
multinational corporations to sue sovereign governments over policies
that they do not agree with, in special courts. Could you share with
us some examples of what these settlement courts are like and what
this would mean as far as oversight of these corporations?
You're
right to say that this is one of the most controversial areas of
TTIP, this idea that corporations could be elevated to the status of
nation-states, and they would be given the right to sue sovereign
governments in special courts. I think it's important to say that
this is not using the normal, domestic judicial system; it's a
parallel system of justice [that] is available only to those
corporations. So for the first time, a US corporation could have
access to these corporate courts to be able to sue our governments if
they felt that their profits in the future were going to be
undermined.
The
examples we have are extraordinary. For example, in Canada, they
introduced a ban on the poisonous fuel additive MMT, and they were
immediately sued by a US corporation called Ethyl, which produced
exactly that fuel additive. The Canadian government was told that it
had no right to block this suit, and in the end they backed down,
they paid out compensation to the company, and they had to drop the
ban, even at the same time that a similar ban was being introduced in
all other countries around the world.
"Do we not have the right, as democratic
countries, to decide our future policies without having to pay off
every corporation that wants to take action against us?"
There
are lots of other extraordinary examples. One example is when
Slovakia reversed a health privatization, which had been brought in
earlier by a previous government and which had been very unpopular.
The new government reversed the health privatization, and was
immediately sued by a Dutch company [that] was benefiting from the
privatization. The corporate court found in favour of the Dutch
company and awarded it 22 million euros in damages. Similarly, a
French company, Veolia, is suing the government of Egypt for raising
the minimum wage. Philip Morris is suing the government of Australia
for plain packaging requirements on all cigarettes, and Vattenfall,
the Swedish company, is suing the government of Germany for deciding
to phase out nuclear power.
This
is a fundamental challenge to our national sovereign democracies. Do
we not have the right, as democratic countries, to decide our future
policies without having to pay off every corporation [that] wants to
take action against us? I think people in Europe are absolutely
outraged when they hear what this ISDS clause means, and that's why
it's become so toxic in the TTIP negotiations.
The
real concern we have is that when countries concede there is the
prospect of being sued in these corporate courts, they will become
more unwilling to introduce regulations in the future. That's what we
call a regulatory chill because the chilling effect of seeing other
countries being sued and having to pay out huge sums if they're found
that they have infringed legitimate expectations of investors, that's
enough to stop countries from taking out the regulations in the first
place.
It's a profound threat to our national democracies, and that's
why when the European Commission held a consultation on these powers
in 2014, they received a record 150,000 responses from across Europe,
even though it was a very obscure, complicated resolution [that] they
were asking about. Over 98 percent of them said, "No, we don't
want these new powers."
The
problem is the European Commission is saying, "We don't take
orders from you; it's not really you we're listening to; we're only
keen for what the member-states of Europe tell us," and that's
the governments. So there's a profound gap between the official
government line and what the people of Europe are calling for.
Let's
run down the possible impact of the Transatlantic Trade and
Investment Partnership on some key issues, beginning with issues such
as food and genetically modified organisms and the environment. How
might TTIP and so-called regulatory harmonization impact policy on
food safety and issues such as climate change?
The
first thing to recognize is that TTIP is not your traditional trade
agreement. In the past, trade negotiations were about border tariffs
to goods, which are exported from one country and imported to
another country. But already, the level of tariff barriers between
the EU and the US is very low, so this time, it'll be more about
non-tariff barriers, and particularly getting rid of the regulatory
barriers, as they call them, to trade. That means any regulations
[that] will prevent corporations from being able to maximize their
profits when they trade and invest across the Atlantic.
The
harmonization agenda intends to reduce the standards so that they
will provide less of an obstacle to the maximization of profit. We're
very concerned because clearly there are very great differences
between the regulatory regimes in Europe and the USA. In the USA, in
many areas such as food standards, the environment, pesticides,
endocrine disruptor's [and] labour standards, there are far weaker
rules, and so we're worried that in Europe, we might see a dilution
of the standards which we have fought very hard to keep. Seventy
percent of all food in US supermarkets contains genetically modified
ingredients.
Well,
in Europe, we simply don't want those ingredients, and yet now, the
US Secretary of Agriculture is saying "you can't have that
choice." Under TTIP, you don't get to choose what you can and
can't eat. You have to accept these imports, or else it becomes a
barrier to trade.
The
proposed TTIP agreement may also have adverse impacts on education,
as well as health and public services. What might be some of the
impacts we might see in these areas?
One
of the key areas [that] we're very concerned about is the impact of
TTIP on health, education and public services. We've seen the leaked
offer made by the EU to the US and all of the sectors it's prepared
to put on the table in TTIP. That includes health services, education
at all levels, water, sewage, rail transport and postal services. If
you've already seen these services privatized under your own
government regulations, then it will be almost impossible to get them
back into public hands. And the other way around, it's important to
see this isn't just the US corporations trying to break into European
markets.
The EU is also trying to force open the government
procurement markets in the United States. That means, for example,
getting rid of all of the local, "buy American" or "buy
local" provisions that exist in certain states, which allow
small, family firms to be able to survive and protects local jobs.
The EU is saying, "This is a $650-billion market and we're
prevented from being able to enter it; we want TTIP to see an end to
those protections."
That
brings us to the next big threat about TTIP - that it is forecast to
cost the direct loss of 1 million jobs between the US and EU
combined. Six hundred and eighty thousand of those jobs are set to go
in the EU and 325,000 jobs in the USA, and those are minimum figures,
even if they don't have the sort of ambitious TTIP they're looking
for. That's the sort of social disaster [that] we can't afford in
Europe. If you think of the youth unemployment levels in Europe, in
countries like Spain, Greece, but also elsewhere, they're at record
levels.
Could
you go into detail about how this agreement will cost both the EU and
the United States these jobs, and also, what the experience has been
like in other similar treaties such as NAFTA, in terms of job
creation or job loss?
The
first thing to say is that this is a very common result from free
trade agreements, that you see the "displacement" of
labour. Lots of people end up losing their jobs and being forced out
of the markets, which they are already working in. That was exactly
the experience under NAFTA, when the US trade unions had been
promised hundreds of thousands of new jobs as a result of NAFTA, and
instead, the record showed that after 10 years, almost a million US
workers had lost their jobs as a direct result of NAFTA.
Now
this time, TTIP is predicted, under the official estimates, not our
estimates, to lead to the direct loss of at least 1 million jobs
through this process of dislocation, as small firms are brought into
direct competition with bigger competitors. That means that TTIP is
likely to bring the sort of dislocation we've seen in trade
agreements like NAFTA, and it's worth saying that although the
original estimates for job losses were made by the official
studies, which the European Commission got done at the beginning of
the negotiations, new studies using the UN's preferred model for
estimating these types of gains and losses have come up [with]
exactly the same results. At the end of 2014, a new study was
published [that] also said that we can expect 600,000 jobs in the EU
as a result of TTIP.
While
these discussions are taking place on TTIP, there are also
discussions ongoing between the United States and countries in the
Pacific Rim for the so-called Trans-Pacific Partnership (TPP). Are we
talking about essentially the same sort of agreement for the Pacific
region?
It's
a very similar sort of negotiations. The USA is looking west towards
the Pacific countries, and that includes countries of Latin America
and also Asia and the Pacific, through the Trans-Pacific Partnership,
and its looking east towards Europe with the Transatlantic Trade and
Investment Partnership. The basic premise behind both of those sets
of negotiations is the same. It's about prioritizing the needs of
capital over the needs of society, working people and the
environment.I
think it's worth saying both of these agreements will lead to
significant increases in greenhouse gas emissions and in climate
change.
We've
already had a study from the European Commission, which admits that
existing levels of climate change gases will go up, we will see a
loss of biodiversity, and what the EU is hoping most, it will see a
massive increase in fracking, which is the very controversial
practice of trying to extract shale gas from underneath the soil and
underneath, often, people's homes. So the environmental impact of
TTIP and the TPP will be catastrophic, at a time where we're meant to
be trying to reduce our impact on the environment and reduce climate
change.
Ultimately,
what is needed for TTIP to be agreed upon and ratified?
Firstly,
once the negotiations have come to their end, the final text of TTIP
would be presented to the Council of Ministers; that's the 28
member-states of the EU. The heads of all of those member-states
would have to vote in favour of TTIP for it to go through, and we've
already had a very nice commitment from the new government in Greece,
the Syriza government, that they would vote against TTIP. So we are
hoping the people of Greece will be our saviours in this respect.
"The basic premise behind both sets of
negotiations is the same. It's about prioritizing the needs of
capital over the needs of society, working people and the
environment."
If
the Council of Ministers agrees to TTIP, then it also goes to the
European Parliament, and they have to ratify it. Unfortunately, at
the moment, there is a majority in favour of TTIP amongst the
European Parliament because the Social Democrats as well as all of
the right-wing parties have decided that they would prefer to see
this go through. But we're working very hard to sway opinion there.
Then, TTIP would have to go for ratification at the national
parliament level, to each of the 28 member-states. But unfortunately,
the European Commission is very well versed in wriggling through
those procedural niceties, and often you can find that even if there
is opposition in member-states, the passage of the bills happens
anyway.
For
us, the most important thing is to raise a massive wall of opposition
to TTIP throughout the whole of Europe, and stop it before it can get
to that stage of ratification. We have also a current negotiation,
which is being completed between the EU and Canada, the Comprehensive
Economic and Trade Agreement (CETA).
The negotiations on that
finished in September and the text is now being prepared for
ratification through a process which is called "legal
scrubbing," and that is now going to come before the European
Parliament, we believe early or halfway through 2016. That will be a
key test case as to whether or not we can stop that type of deal,
because CETA also includes the same investor-state dispute settlement
powers, which allow corporations to sue national governments in their
own parallel judicial system.
If we allow CETA to go through, we know
that the vast majority of US corporations already have Canadian
subsidiaries, and they could use ISDS in the Canadian agreement to
sue our governments anyway. So we're fighting not just against TTIP,
but also against CETA.
War
on Want has been leading an awareness campaign against TTIP, and in
addition, you have presented an alternative solution, the Alternative
Trade Mandate. Tell us about your efforts and about this alternative
proposal.
One
of the problems we've had in fighting against the European
Commission's trade policy over the past 15 years is that every time
we resist and every time we defeat a new proposal, it just comes back
again in another guise. So we defeated the MAI in 1998, we defeated
the WTO in 2004, and yet still, we're fighting the same battles here
in 2015. So we wanted to try to create a new model of how trade could
look, how trade and investment policy within the EU could be
completely reformed so it wouldn't just lead to interests of
transnational capital, but it would meet the interests of society, of
working people, and it would end up protecting the environment rather
than destroying it.
And
so, together with a group of other civil society organizations across
Europe, we worked on this Alternative Trade Mandate. It's only a
start; what it tries to do is, it says if you start with different
principles, more progressive principles than just the maximization of
profit, then you could come to different solutions. And that's really
our concern about TTIP and all the EU's free-trade deals. They only
address the interests of capital. They don't address any of the
interests [that] exist outside that transnational capital class, and
that's what the Alternative Trade Mandate tries to do. If you start
with different principles, negotiate it a different way, you will
come to different conclusions.
Michael
Nevradakis is a Ph.D. student in media studies at the University of
Texas at Austin and a US Fulbright Scholar presently based in Athens,
Greece. Michael is also the host of Dialogos Radio, a weekly radio
program featuring interviews and coverage of current events in
Greece.
