by Thomas G. Maher
The European Union and The United States of America have begun negotiations to implement the Transatlantic Trade & Investment Partnership (TTIP), which proposes to remove trade barriers between the US and the EU. These trade barriers exist in relation to a diverse range of areas such as; food safety regulations, customs tariffs on imports and exports, labour rights and environmental issues. Below is a brief outline of some of the potential affects TTIP could have in Europe and Ireland.
Food Safety Regulations
In the US the use of genetically modified organisms (GMOs) is widespread, with corporations not only modifying the genetic structure of food seeds, beans and grains they are also using patent law to ensure they have a complete monopoly on “their products”. Also in widespread use in the US is hormone injected beef and pork products and chlorine washed chicken which are currently banned in the EU. These practices are designed to accomplish one goal; to reduce production cost in order to maximize profits. This practice of mass production could also seriously affect the Irish food industry, as it would place multinational corporations in a position to under cut Irish producers. This is described as “food safety deregulation” which carries negative overtones for EU member states, since the EU food safety regulations are described as “of the highest level in the world”. These regulations and standards are described as “barriers to free trade”.
Energy
The energy industry in the EU is also a massive opportunity for US corporations to increase their own market share in oil, gas, fracking, wind and wave energy. Currently in the UK, one US Corporation has begun investing in the fracking industry, which has had major effects on the environment on both sides of the Atlantic. In New York State for example, fracking has been approved in the area of the Delaware water basin, which is the source of drinking water to over 15 million people. Concerns in the US regarding the pollution of the ground water during the fracking process are largely being ignored in the pursuit of profit.
Employment
The European Commission assessed that the European economy could grow at least 0.5% by 2027, if TTIP is ratified, a figure that has been described as “generous” by independent economists. This would affect levels of employment, labour conditions and the right to form unions and associations as it currently stands in the US. Using the ISDS legal instrument, corporations could effectively sue nation states if decisions made by national parliaments or the EU parliament, have an adverse effect on their revenue. Veolia is currently suing the government of Egypt, after it agreed to increase wages in line with inflation. Veolia’s is arguing that the increase in workers salaries will diminish the projected profits of the company and are therefore seeking compensation.
The effect on working conditions, wages and International Labour Organisation (ILO) standards could be very negative to EU citizens. ILO standards are not enforced in the US; this again is seen as a barrier to trade. Even the EU commission has stated that it would be likely that EU companies, restricted due to competition law, would be forced to source cheaper goods and services from the US displacing EU workers and increasing unemployment.
Parallels between TTIP and the North American Free Trade Agreement (NAFTA) are obvious. In 1994 NAFTA was ratified between the US and Canada with the resulting loss of about a million jobs through out the US and Canada.
Environmental
TTIP is expected to increase production, which will increase consumption and the necessary shipping and transportation will increase to support this consumption. An inevitable rise in CO2 emissions will violate the Kyoto protocol agreement, which the EU has complied with. The US has not ratified the Kyoto protocol agreement. TTIP would also have an effect on the use of certain chemicals, used in various methods of production. The EU’s existing REACH regulations are very strict compared to the US. In Europe companies are required to prove, before use, that a chemical is safe and not dangerous to workers or the environment. Where as in the US, this obligation is placed on the authorities and they must prove that the chemicals being used are not safe to workers or the environment.
For example in the US 16 chemicals are banned from use in cosmetics while the EU has banned at least 1,200 chemicals. Corporations again describe these as a “barrier to trade” and they could argue, under the ISDS corporate court system, that it would affect their revenue causing the member states to be held liable for this loss in profits.
Investor State Dispute Settlement (ISDS)
The apparatus of the ISDS system would be the most detrimental aspect of TTIP to the sovereignty of EU member states and the EU itself. It allows for the corporations, both EU and US, to establish a “corporate court system” were they would be able to bring legal proceedings against any state, if it is established that a state’s actions, would have negative effects on the revenue of a corporation. This could be in the form of regulation, increase in wages or salaries for workers or environmental restrictions to name but a few. It would “elevate the corporations to the level of sovereign states” and allow democratic decisions to be overridden or place liability on a country for loss in revenue to a corporation. This would be carried out in a private corporate court, staffed with corporate lawyers, bypassing our own court system and conducted in secret without any public scrutiny.
Currently three multi-national corporations are involved in high profile ISDS cases. Apart from Veolia in Egypt, the most controversial case is that of the Phillip Morris Tobacco Company, who are suing the Australian state because of the public health requirement, passed by the Australian parliament, to sell tobacco in plain packaging and without advertising.
Undemocratic
The negotiations surrounding TTIP have been described as “shrouded in secrecy and non-transparent”, with teams of negotiators from both sides of the Atlantic attending over 100 closed meetings since 2007. The meetings were part of the Transatlantic Economic Council, set up in 2007, with the goal of rushing TTIP in by 2015. The EU Commission has agreed to block all public access to the related documents and placed a 30-year restriction on access to these documents. The Commission has asked for all MEPs to support the confidentiality of the documents, and has restricted access to EU officials by use of special reading rooms and have tagged all documents making them easily traceable in case of leaks. This means that EU citizens are in the dark with regard to the demands that US corporations are placing in regards to compromising regulations and safety standards. This is the same on the US side, where Congress has been denied access to the demands that EU corporations are making. Although public representatives have been blocked from reviewing these documents, corporate business advisers have full access to all the documents relating to negotiations and the US has called for “business to be allowed to set regulatory standards”. EU and US negotiators have agreed to establish the Regulatory Co-operation Council in order to “police the implementation of deregulation”.
The impact TTIP could have on Irish society, as well as other member states, could influence national decision making before and after laws and regulations are implemented. This undermines national policy-making and the sovereignty of governments by placing corporations at a higher level than elected governments.
TTIP represents the attempt of a small number of representatives in the EU and the US to by-pass the public court system and remove necessary safety restrictions in areas such as food safety and use of chemicals. But it is more than that; ultimately it is an attack on workers, on democracy and a further attempt by the 1% to secure an even bigger slice of global wealth for their class. Serious resistance will have to take place on both sides of the Atlantic if we are to prevent this attempt to widen again the gap between rich and the rest of us.