Sleeping Monster: The Trade in Services Agreement (TiSA) and the Supply Chain

By Lambert Strether and cross-posted from Naked Capitalism

Trade[1] activists may regard the defeat of TPP — its (no doubt feigned) rejection by Democrat candidate Clinton, and its deep-sixing by President Trump on his third day in office — as a victory, and they’re not wrong. But it’s a mistake to regard the defeat of a deal as the defeat of the deal-makers: The forces and drivers behind the deal, which, if unchecked, will simply emerge with a [cough] new deal serving the same objectives. In this post I want to look briefly at the the state of play in “trade,” and then begin to look at the Trade in Services Agreement (TiSA) — that lowercase “i” gets me every time; I suppose it’s meant to make the acronym seem friendlier — because, unlike the regional TPP, TiSA is a global agreement, because it’s far less undead than TPP, and because it provides great insight into the future world our globalist elites would like us to live in[2].

I’m going to take the supply chain as my starting point for future posts on TiSA, because it’s about “stuff,” and as readers know I like stuff: Shipping containers, boats, trucks, trains, planes, the UPS guy with the package, and so on. My interest in TiSA was renewed by this report: TiSA: Foul Play (PDF)[3], authored by Professor Jane Kelsey of the University of Auckland, a trade activist, and I’m going to be relying on that report for some key points in this and future posts. (There is the a text of TiSA at WikiLeaks, thankfully; in future I’ll try to get more into detail.)

The State of Play for Trade

First, TPP. Trump having pulled out, the other other 11 TPP nations, led by Japan, are discussing reviving it. Next, the text of the TPP is being broken up for spare parts and incorporated into other deals. The National Interest:

While the rhetoric of ‘high standards’ owed much more to political salesmanship than rigorous analysis, there are parts of the agreement that can facilitate economic progress…. The existing text needs creative adaptation rather than simple adoption. Any successor agreement should be between those members who wish to exploit the gains of well-managed globalisation for innovative, inclusive and sustainable growth. The TPP can be a valuable organ donor.

In particular, TPP may be an organ donor for NAFTA. The Electronic Frontier Foundation on e-commerce:

Preliminary steps towards the renegotiation of NAFTA, the North American Free Trade Agreement,have already begun, and Alan Davidson, former director of digital economy issues at the Commerce Department, has flagged the problematic e-commerce provisions of the TPP as suitable for transplanting into the renegotiated agreement. “TPP is a terrific starting point,” he is reported as saying.

TPP’s objectives are also being stitched, Frankenstein-style, into NAFTA:

On July 17 the Trump administration released a 20-page list (pdf) of its objectives for the NAFTA renegotiation, which could begin as early as August. Many bear a striking resemblance to provisions agreed by TPP negotiators, experts and Trump opponents have pointed out. “The administration is planning to come to the table with watered down versions of TPP proposals,” said US senator Ron Wyden, a Democrat from Oregon.

And the same goes for TPP’s ISDS language, also being transplanted into other deals. Politico’s “Morning Trade” as cited at NC:

Leading small and medium-size companies are issuing a united call for the Trump administration to abandon in an updated NAFTA dispute settlement clauses that they say “grant greater rights to foreign corporations than to domestic businesses” and pose a challenge to local, state and federal policies” [Politico]. “The 100 businesses, included the co-founders of Ben & Jerry’s ice cream and eco-friendly clothing maker Silk Oak, are asking Trump in a letter today to eliminate investor-state dispute settlement clauses from all current trade deals — ‘beginning with the NAFTA renegotiation’ — while also removing the U.S. from any negotiations that would expand the clauses. It named the Bilateral Investment Treaty with China and the Transatlantic Trade and Investment Partnership with the European Union as two such negotiations that would expand ISDS.

As far as who is doing the stitching and surgery: We might call the lawyers, lobbyists, industry representatives, standards body wonks, legislators and diplomats — Flexians all — “The Trade Blob,” and clearly The Trade Blob has its own class interests in keeping the trade “conversation” going, beyond the passage of any one deal. But there are other class more dominant class interests at stake, made refreshingly clear by listing the key supporters of TiSA, the “Really Good Friends of Services” — I’m really not kidding about the name — and “Team TiSA”

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