Trans-Pacific Partnership Agreement

The genesis of a bogus free trade agreement

This TPP agreement has its origins in and after World War II. The war realigned global power relationships and those new relationships persist into these times, seventy years later.

The war marked the end of the old European empires and the beginning of the American Empire. In rapid succession in our region the Philippines gained independence from the USA, Indonesia from the Dutch, Indochina from the French and India, the present Malaysian states and Singapore from the British. Africa decolonised.

British influence worldwide was much reduced and by the end of the war Britain was hugely in debt to the USA for loans it had used to fund its war effort. The debt wasn’t paid off until the time of Prime Minister Tony Blair. Britain was firmly locked into the American Empire while pretending to still be an independent world power.

In the Anglo-American world the USA, Britain, Canada, Australia and New Zealand entered into a number of parallel military and intelligence agreements signifying that the USA was now the undisputed leader of that world. These included the Signals Intelligence UKUSA Agreement now known as the Five Eyes Agreement, the ABCA which was a military standardisation agreement, and others.

The USA led in the Cold War against the USSR and China. That gave rise to other military agreements such as SEATO or the Manila Pact, signed in 1954 and designed to prevent the fall of domino states in Asia into the Communist sphere of influence. SEATO included the old colonial powers in the region, Britain and France. ANZUS, signed in 1951, was the US, Australian and New Zealand security pact. NATO signed much earlier in 1949 became the USA-led military relationship in Europe. The USA was the dominant partner in all of them.

Throughout the Cold War the USA was also trying to bring the former European colonies under its own umbrella. For instance with the rise of President Suharto and the Indonesian military after 1965 Indonesia fell into the American sphere of geopolitical, military and economic influence. Malaysia and Singapore remained aligned through Britain and their membership of the Commonwealth. The Philippines remained allied to the USA. India and Vietnam were two that got away.

US economic dominance went unchallenged, even by the behemoth that was the Russian Empire – the USSR. Japan became a major world economy within the ambit of US influence.  As other Asian economies such as South Korea and Taiwan developed they too aligned with the US. The US also embarked with mixed success on numerous covert operations in Central and South America to lock those countries into the new American Empire.

It was an undeclared American Empire and it effectively ruled the world until China adopted state capitalism and embarked on its rapid rise as an economic powerhouse. China now challenges the might of the Anglo / European / American economic bloc.

What has changed in recent times is the ability of the USA to project its military power across the globe. It still dominates the oceans, the air and space but it no longer has the ability to dominate on land, or indeed in the South China Sea. That started with the American defeat in Vietnam but was driven home by the recent defeats in the Middle East and Afghanistan. They are not acknowledged as military defeats but they are. The USA won some battles where it could concentrate and focus its military power but it has lost the wars it started.

America’s economy still dominates, for the moment.

From World War II onwards America’s corporate might has increased inexorably and in recent decades has spread its grasp over the whole globe; globalisation. In the 2008 Global Financial Crisis caused by corporates, the corporates were still the main beneficiaries of the recovery process through massive financial bailouts. Corporates have taken control of the US political process with the billionaire Koch brothers preparing to pour over a billion into the next elections. Both main political parties are beholden to their corporate donors.

Hollywood is trying to restore its dominance in entertainment through its political connections. Jeremy Malcolm writing at the Electronic Frontier Foundation has stated that in relation to the IP provisions in the TPPA the US Trade Representative is “utterly captured by Hollywood“. The drug companies are involved in negotiating the TPPA to their own benefit, as are many others. Corporates now go to war with the military, performing many logistic and even operational functions.

The USA has become a corporatist state in which corporations now have more power and influence than citizens (who are now called taxpayers) in both domestic and foreign affairs.

The rise of the corporatist state has been greatly assisted in recent times by judicial decisions in the United States, beginning over 100 years ago, in which corporations have been granted increasing corporate personhood and the ability to assume the rights of individual persons. This has been disputed, the argument against revolving around whether or not corporations qualify as “persons” under the Fourteenth Amendment to the Constitution. Even though the original decision extending corporate personhood was highly questionable (Santa Clara County v Southern Pacific Railroad Company, 118 U.S. 394 (1886)) the precedent was set, is now fait accompli, and corporations are making increasing use of their “personhood”.

That American notion of corporate personhood is embodied in the TPPA and is behind much of the agreement including one of its contentious elements allowing corporations to sue sovereign governments.

Having lost its total military dominance and become a corporatist state, and facing the possibility of China becoming the premier world economic and therefore military superpower, America has few options. Its last weapon in the geopolitical power struggle with China is its corporate power.

And that is what the TPPA is about. The projection of American power through corporate power and through building that corporate power in “free trade” agreements that have nothing to do with free trade.

The choice for New Zealand is not about how much NZ will benfit from “free trade”. The choice is geopolitical and about sovereignty. Should NZ remain within the American sphere of influence? And what should the terms of that relationship be? Should New Zealand allow itself to become subject to American corporate rule? And what should be NZs relationship with its present major trading and investment partner China.

New Zealand’s political and business elites have made choices for us in secrecy without any democratic debate, and disguised it within their free trade rhetoric.

Regardless of whether we should or should not be part of TTPA we should first debate its real purpose. It seems that democracy is only about the small stuff.

So why is the USA now making a few concessions on trade when for decades it has maintained high trade barriers against its allies, and why were the negotiations so hard fought? Because it needs to lock 40% of the global economy into its geopolitical strategy at the least cost to its own economy.

The primary consideration in all geopolitical relationships is, and has always been, self interest. Since the end of World War II the primary beneficiary of all partnership agreements with the USA has been the USA.

Now, if you doubt my hypothesis about the USA’s grand geopolitical strategy through the medium of trade agreements consider this:

  • the TPPA includes USA, Canada, Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam (40% of the global economy); plus
  • the USA has existing agreements mostly concluded in the 2000’s with Israel, Canada, Mexico, Jordan, Australia, Chile, Singapore, Bahrain, Morocco, Oman, Peru, Dominican Republic, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Columbia and South Korea;
  • the USA is negotiating agreements with the European Union, Indonesia, Ghana, Kenya, Kuwait, Mauritius, Mozambique, Taiwan, United Arab Emirates, South Africa, Botswana, Lesotho, Swaziland, Namibia, Ecuador and Qatar;
  • the agreement being negotiated between the USA and the European Union is the Transatlantic Trade and Investment Partnership (TTIP). It is the equivalent of the TTPA; and
  • the Trade in Services Agreement (TISA), still in negotiation and involving 50 countries, covers about 70% of the global services economy. Its aim is privatizing the worldwide trade of services such as banking, healthcare and transport.

The big BRIC economies (Brazil, Russia, India, China) are missing of course but are being counter-balanced if not surrounded by the USA “free trade” strategy. Of course the BRIC economies are also agressively pursuing their own “free trade” strategies with many if not all of the same countries as the USA.

It’s like the nuclear arms race of the Cold War only its now a “free trade” race that we might come to know as the Trade Cold War. Trade wars have long been the genesis of empires.

The European empires lasted from the 15th Century to the 20th Century and used chartered trading companies in the vanguard of the colonisation of the known world. There were scores of them including British East India Company, British East Africa Company, British North Borneo Company, British South Africa Company, New Zealand Company, South Australian Company, South Sea Company, French East India Company, Dutch East India Company and Dutch West India Company. Portuguese chartered companies included Companhia de Mozambique and Companhia de Niassa. The chartered companies controlled the global economy.

The nascent American Empire of the 21st Century  has simply borrowed and adapted an old idea to its own geopolitical strategy as it paves the way, through multiple bilateral and multilateral trade agreements, for its transnational corporations to control the global economy. This time around they are sovereign unto themselves.