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Labour rights to be TTIPed out?

Labour rights to be TTIPed out?

Political Context

Elections for the European Parliament saw strong gains for Eurosceptics here and on the continent arguing that membership of the EU has meant a loss of sovereignty of national parliaments.  Yet while we were going to the polling station, secret negotiations (we only know about them because of leaked documents) are taking place between the EU and USA that would result in an even greater transfer of power away from national governments to corporations. When the chips are down those doughty Eurosceptic defenders of sovereignty kept quiet - their ideological belief in the primacy of the market appears to trump the primacy of national parliaments.  

Under the cloak of ‘free trade agreements’ a myriad of bilateral, and regional investment agreements have given transnational capital new powers to directly challenge the democratic right of governments to regulate, legislate and take back privatisations into public ownership.

What is TTIP?

TTIP stands for 'Transatlantic Trade and Investment Partnership.' It has been described as a ‘free trade deal’ and is currently being negotiated – in secret – between the EU the USA. Unlike previous deals designed to lower trading tariffs between partners, tariffs are already low between the US and EU. According to War on Want, “officials from both sides acknowledge that the main goal of TTIP is to remove regulatory ‘barriers’ which restrict the potential profits to be made by transnational corporations on both sides of the Atlantic.”

TTIP is about increasing the power of multinational investors, generally big business and hedge funds, and reducing regulation on these organisations. 

TTIP would cover regions accounting for 60% of global GDP, 33% of world trade in goods and 42% of world trade in services. Its impact would be felt, not only on the EU and the USA, but the rest of the world. 

TTIP would establish in law the right of multinational corporations to sue nation states in a special court – the Investor-State Dispute Settlement (ISDS) – if the nation’s regulatory framework were deemed a ‘barrier’ to free trade.

As the Guardian’s George Monbiot wrote in a recent article; ‘While corporations can sue states there are no corresponding right for citizens.  ISDS is a privatised justice system for global corporations”.

What it isn’t

One thing we can be pretty certain about: TTIP is not a progressive agreement protecting the rights of ordinary workers.  It is inconceivable that this current government would sign up to enforceable International Labour Organisation (ILO) conventions which protect workers' rights.  As it is, our labour laws are outside of these conventions.

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On labour rights, out of 190 ILO conventions, the US has only ratified 14 and only 2 of the 8 core conventions dealing with forced labour, child labour, freedom of association and discrimination.  So anyone who thinks that a US backed trade agreement might give them a European style social model is whistling in the wind.

TTIP without ISDS

Negotiators have focussed on trying to remove the quasi-judicial process of the ISDS because of its undemocratic nature. Removal of ISDS would be welcome but it is unlikely that this would somehow neutralise TTIP leaving only economic benefits. 

Proponents of TTIP argue that there will be economic winners on both sides of the Atlantic. The US lead negotiator, Michael Froman, argued that TTIP would generate annually an extra €120 billion, or an extra €545 a year in disposable income for an average European family. 

Political scientist Dr Gabriel Siles-Brügge, University of Manchester and Dr Ferdi De Ville from Ghent University in Belgium argue that these figures are too optimistic:

“All this rhetoric means that Governments continue to place emphasis on liberalisation of the economy. Indeed, you could reasonably argue that similar free-market policies in the financial sector are partly to blame for the economic crisis in the first place- so an entirely different approach of ambitious social and ecologically sustainable policies is required – not more of the same”.

TTIP without ISDS may be slightly more transparent, companies would still be able to sue national governments but they would have to go through the courts rather than secretive tribunals. Nevertheless it would not stop corporations having the ability to override regulation or legislation of a sovereign state.

What next

We need trade and trade needs rules, but not rules that threaten our democracy and take away our rights. Andy Burnham, Labour’s Shadow Health Secretary made a very early commitment that a future Labour government would repeal the Health and Social Care Act, and take private interests out of the NHS.  The coalition government’s dogma driven rush to sell off as much of the NHS as they can means that TTIP could well scupper any plans to take it back.  

Organised opposition have defeated mega trade treaties in the past.  In a preface to a pamphlet, produced by American unions representing workers in  food, agriculture, catering and the hotel trade - ‘Trade Deals That Threaten Democracy’ - Ron Oswald, IUF General Secretary, argues that instead of expanded powers for transnational capital global rules should be established to effectively enforce respect for human rights over the private claims of investors.

The consequences of TTIP

  • Around 70% of all processed foods sold in US supermarkets now contain genetically modified ingredients. Here in Europe we have resisted GM foods. Hardly any GM food is on sale and where it is it must be clearly labelled.  US biotech companies are using TTIP to launch an assault on EU regulations for GM foods.
  • US food producers have identified the EU’s system of controls (the EU enshrine the precautionary principle to control pesticides) as one of the prime set of standards to be downgraded under TTIP. 
  • Over 90% of US beef is produced with the use of bovine growth hormones that have been linked to cancers in humans, and EU restrictions on the import of such beef have been in place since 1988. The US government has already challenged these restrictions at the WTO, and business groups are calling for their removal in the TTIP agreement as ‘unnecessary’ barriers to trade’.
  • US producers of chicken and turkey regularly treat bird carcasses with chlorine before selling them on to consumers – a process that has been banned in the EU since 1997.  The US government has  challenged the ban through the WTO, and US companies are now calling for TTIP negotiations to put an end to it.
  • In the same way as North American Free Trade Agreement (NAFTA) rules are being used to sue the Canadian government over the moratorium on fracking in Quebec, TTIP would allow US companies to challenge bans on fracking in Europe.
  • The US government has confirmed that it will use TTIP to prise open the service markets of Europe for the benefit of US capital, and specifically that it will “address the operation of any designated monopolies” in the area of public utilities.

For more information and references for these examples:

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