No Smiley Faces: Jared Bernstein on the TPP Juggernaut

Economist Jared Bernstein recently sat down with Capital & Main to offer his perspective on a wide range of political and income-inequality topics. Formerly a top advisor to Vice President Joe Biden and, currently, a senior fellow at the Center on Budget and Policy Priorities, Bernstein spoke to us again this week, following the U.S. Senate vote to fast-track the Trans-Pacific Partnership. The interview has been edited for brevity and clarity.

Capital & Main: What was your first, red carpet reaction to the Senate’s fast-tracking of TPP? 

Jared Bernstein: I’m not that surprised but I’m not deeply disheartened or worried. What’s positive is that this time the text of the TPP will be in the public domain for two months before the ratification in Congress, and that will give lots of us a chance to take a closer look at it — although it is true that the vote will be without amendment or filibuster.

Is the secrecy that shrouds the ongoing TPP negotiations normal for trade agreements? 

It’s pretty typical. The rationale behind that is that it’s awfully hard to do complicated negotiations, especially with 11 other countries, when there’s a bunch of other stakeholders weighing in from the outside. The downside, of course, is that it very much lacks transparency and you find yourself in this strange role where all the advocates of the deal are assuring us that everything is fine, but many of us don’t take very much solace in those assertions.

Where do you think this will put the average American in 10 years? 

It won’t make as big a difference as the rhetoric on both sides would suggest. But we’re going to have to be vigilant to see how this plays out. The average person should be much more concerned about the broader trends in trade and globalization than about a dense and complicated 29-chapter agreement, which is really the rules of the road between the 12 signatories – [although] we have to be very vigilant about who those rules protect and who they leave out.

Is there a smiley face we can put on TPP or will the trade tribunals that could trump local laws be disastrous for American workers, and local labor and environmental laws? 

No, I don’t see any smiley faces, but I’m not terribly afraid of what’s in the TPP. In the investor-state dispute settlements, which a lot of us are reasonably nervous about, it’s by no means outlandish to have a mechanism for settling disputes in an agreement like this. The idea being that signatories don’t necessarily want to depend on each other’s judicial systems – maybe they don’t trust them. For a country like Vietnam and other emerging economies, that doesn’t sound too unreasonable.

What is it about free trade agreements that makes Democratic presidents go against their party’s base? 

For some reason presidents love trade deals, whether they are Ds or Rs. [Democrats or Republicans] Part of it is that they believe that more trade is a good thing — and they’re not wholly wrong about that. But globalization creates winners and losers, and the losers have gotten the short end of the policy stick for decades now.

Is there a logical endgame to these kind of megatreaties – will there be an endless procession of them? 

As long as we keep trading with emerging countries, such as African nations, one can imagine continuing having these sorts of treaties. We have to bang on the transparency point because there’s nothing wrong with having rules of the road, but progressives need to be at the table when they’re being drawn up.

Then TPP’s pretty much a done deal in Congress? 

Yes, but that doesn’t mean it has to pass with the exact language we’ll see when it’s unveiled. It’s important to make ourselves heard during the two months prior to ratification — we could make it very uncomfortable for legislators to vote for it. 

Photo courtesy of the Port of Long Beach