US Foreign Policy: The Trans-Pacific Partnership more than a trade agreement

November 4, 2016

US Foreign Policy: The Trans-Pacific Partnership more than a trade agreement

If the TPP fails, does US leadership in our region fail with it?

by Claude Barfield


Image result for obama's trans pacific partnership

TPP after Obama–What’s Next?

The economic consequences of failing to secure the benefits of regional integration through the Trans-Pacific Partnership will be costly for the US and its partners, Claude Barfield writes.

US Secretary of Defense Ashton Carter has called the Trans-Pacific Partnership (TPP) the equivalent of a “second aircraft carrier.” And Secretary of State John Kerry has warned: “We cannot withdraw from TPP and still be viewed as a central player in the Pacific Rim and an undisputed force for peace and prosperity across the globe.” The remarks of these Obama Administration officials were seconded by Republican Senator John McCain (AZ) who said: “If TPP fails, American leadership in the Asia-Pacific may very well fail with it.”

These statements underscore the reality of trade policy stance at the intersection of a nation’s diplomatic and security strategies and its broad economic goals. With the exception of multilateral negotiations in the World Trade Organization—which deal exclusively with trade issues—bilateral, subregional, and regional trade agreements inevitably are influenced and guided by collateral, competing national priorities. A review of the history of US decision-making from the 1980s, when it first embarked on bilateral and regional trade projects, demonstrates this geopolitical overlay to trade policy.

Famously, it was Secretary of State James Baker, in response to a Japanese plan to create an exclusive Asian trade architecture, who proclaimed that the US would oppose any “plan that drew a line down the middle of the Pacific” with the US on one side and the nations of Asia on the other. Baker stated later that while there were no immediate challenges to US hegemony, he wanted to put down a marker tying US economic interests closely to US political and security goals. Similarly, the Clinton administration, in defending the North American Free Trade Agreement and a proposed regional trade pact with Latin America, strongly linked the trade initiatives with the political goal of advancing democratic norms and institutions in Central and South America.

Under President George W Bush the US negotiated trade agreements with 17 nations and the administration publicly set forth the criteria for US trading partners. In a number of speeches and congressional hearings US Trade Representative, Robert Zoellick, bluntly affirmed that in choosing free trade agreement partners, the US would expect “cooperation—or better—on foreign and security policy.” (And the US placed Australia at the front of the line in return for supporting the Iraq invasion).

Trade Policy and US Diplomacy and Security

Though President Barack Obama publicly eschewed many of the foreign policy tenets of the Bush administration, he ultimately accepted the inextricable entwining of US international trade policy with US diplomatic and security policy. Indeed, his decision to back TPP negotiations in late 2009 was rooted both in the sage advice of his economic advisers and in urgent pleas by his State and Defense departments for a US response to the deteriorating situation in Asia—China’s reversal of its ‘peaceful rise’ mantra and the increasingly erratic and dangerous provocations by North Korea under Kim Jong-un.

Image result for obama's trans pacific partnership

Obama failed to counterbalance China’s commercial success in ASEAN–so what is he laughing about?

With great fanfare, Obama and Secretary of State Hillary Clinton announced the US “pivot” (later “rebalance”) to Asia. In a number of speeches and statements in Asian fora, the president repeatedly reaffirmed that: “The United States is a Pacific power and we are here to stay.” From the outset, the nations of East Asia and observers around the world have identified the TPP as the central symbol of current and future US leadership in the region.

TPP negotiations are now concluded and the intricate and voluminous terms of the agreement are in the public arena. While not perfect, the results are generally quite positive—certainly from the perspective of US priorities and goals. Yet anti-globalist and anti-trade voices in the US have mounted a sustained and vitriolic campaign against the TPP. Its fate in Congress is highly uncertain, and possibly dire.

Image result for trump and hillary on tpp

Image result for trump and hillary on tpp

Meanwhile, the diplomatic and security environment in East Asia is becoming increasingly fraught. North Korea seems to be moving inexorably toward greater nuclear arms power and acquiring the means to deliver its weapons. At the same time, Chinese obduracy and belligerency over the South and East China Seas grows ever more challenging under President Xi Jinping. Further, The Chinese are far along in constructing an economic architecture that excludes the US: in trade, the Regional Comprehensive Economic Partnership; and in development, the Asian Infrastructure Investment Bank.

Over the long-term there can be no doubt that the economic consequences of failing to secure the benefits of regional integration in the world’s fastest growing region will be costly for the US—and its 11 TPP partners.  But even more costly for the US will be the failure to pass the TPP and fulfil President Obama’s vow that: “In the Asia Pacific in the 21st century, the United States of America is all in.” As Singaporean Prime Minister Hsien Loong has warned: “If you don’t finish TPP, you are giving the game away [to China].”

Image result for trump and hillary on tpp

One can only hope that the observation allegedly made by Winston Churchill that, “You can always count on the Americans to do the right thing, after they have exhausted all other possibilities”, comes true.

Much of this essay is taken from themes developed in a recent paper: “The Trans-Pacific Partnership and America’s Strategic Role in Asia,” in Peter C.Y. Chow (ed.), The Trans-Pacific Partnership and the Path to Free Trade in the Asia Pacific (Edward Elgar, Cheltenham, England, 2016).

4 thoughts on “US Foreign Policy: The Trans-Pacific Partnership more than a trade agreement

  1. During his presidential campaign, Obama talked about how he would be responsive to Main Street rather than Wall Street. Like all presidents before him, he eventually kowtowed to Wall Street.

    Both the TTP and TTIP are being created with the sole purpose of establishing US control over international financial flows, which would allow the Wall Street to get its hands on one half of all trade in the world. The dominant role of the US in these two associations may allow Washington to maintain its dominance over the world, especially if the free trade agreement between and the EU is to be signed, allowing it to establish a staggering level of control over 80% of all international trade, creating an alternative to WTO, where the US will dictate the rules of the game.

    But the problem is these two agreements are unlikely to be finalized any time soon, if ever. Therefore, Wall Street is pushing forward yet another agreement on the table — the Trade in Service Agreement (TISA). There is hardly any information available to the general public about this deal, since Washington is trying not to repeat the mistakes it has made with the TTP and TTIP, preventing the international community from raising the alarm before the deal is finalized. It has been reported that the Office of the United States Trade announced TISA would make the US much richer, producing three quarters of the American GDP.

  2. katasayang:
    Sometimes I bump into Feinstein at some party in San Francisco. She still lives in The City, as we call San Francisco affectionately. But she is always so busy you can hardly get to talk to her. Write to her? I am sure it will be thrown into the round file, like a basketball. Politicians only listen to the WIIFM radio — what’s in it for me. I am not a lobbyist. Don’t be so naive that politicians really listen to the voice of the people, unless there is an angry mob in the street.

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