Thank you for that kind introduction and the wonderful welcome, and it’s an honor to be here and it’s such an impressive sight to see this many people coming tonight, in their free time, to learn how we’re going together, as people movements in all the countries involved, how we’re going to stop the T.P.P.A., because it’s not our future. It cannot be our future!
Now, I burrowed myself out of the snowstorm in Washington and, as I was shoveling, my neighbors – knowing I was going to New Zealand, a lot of them work in Capitol Hill – they kept saying “When you go over there, can you try and find out why the New Zealand government is pushing the T.P.P.A.? Like what gives?”
I mean, the signing, the maybe thinking about sending implementing legislation to Parliament, the cabinet thinking about ratifying it, and a lot of people in D.C. are raising their eyebrows because Ambassador Groser is not telling everyone back home what clearly your embassy in Washington knows; Which there is not a majority of support in favor of the T.P.P.A. in the U.S. Congress! And this is a complication, because under our Constitution, it does not matter if the President of the United States – whoever he or she may be – signs a trade agreement in blood, in gold, or in ink. If the U.S. Congress does not approve it under our Constitution, it is nothing but a five-thousand-page doorstop.
The U.S. Constitution – Article 1.8, just in case anyone thinks I’m making this stuff up - says that the U.S. Congress exclusively has the right to implement a trade agreement in the United States, and the U.S. is not party to any agreement not approved by Congress. So what is key to know is, I think, a lot of governments in the T.P.P.A. countries are trying to psych us all out and make us feel like it’s a done deal and we should just roll over and give up. I mean, it is a pretty kick-ass fight, that has managed to stall their signing for four if it’s “done this year or else.” So we should all think about that. That was not how this was supposed to play out. This was a deal that was supposed to be done, they all said, four years ago. So it’s been people, in all of these countries, fighting back, that got to a point where, actually, there was enough accountability that the usual cozy-cozy didn’t happen very quickly. However, now we’ve got this thing on paper, and the thing is, I think the U.S. government is, at this point, trying to get a lot of other countries to sort of walk the plank – to make it feel more inevitable. To make, basically, it seem impossible to back out. But there’s just a little problem which is, they’re dozens of votes short of a majority in the U.S. House of Representatives, our lower chamber.
And, just to lay out the story here, everyone watched for years how the Obama Administration tried to get fast-track trade authority for the T.P.P. And they thought they were going to accomplish that in 2011, 2012, 2013, and then finally, after four and a half years of trying, they passed fast-track in the summer of last year by five votes out of 435. This is the kind of vote that everyone just holds their breath until the buzzer goes off, because it really was not clear how it was going to play out. And what ended up happening since then is some of the Republicans who voted for it have peeled off against T.P.P. A lot of them. Now, not for good reasons, as I’m going to explain, but for reasons that make it very hard to put back together a majority. So here’s the deal: Only 28 Democrats in the entire Congress voted for fast-track for T.P.P. They are not picking up more Democrats. They are losing Democrats.
Why? For some of the same issues that the agreement’s very dangerous here as well. So the Democrats are outraged about the final rules on medicines. Both the patents, but the extra; After 20 years of monopoly, of no competition, so prices can be high, this business of extra, of five to eight years of exclusivity. Even if there’s no patent, the big pharmaceutical companies with the biologic medicines – the cutting edge drugs for cancer treatment, for instance - can just decide to not market it or market it at a higher price. Monopoly in a “free-trade” agreement. That’s made the Democrats really mad. It rolls back the access-to-medicine rules that George Bush had in his trade agreements. So all of these Democrats are a little weasely and thought, well, I’m just going to draw a line – I’m going to say “This at least has to be as good as what Bush did, because then I can be for it.” And then it was worse than what Bush did for access to medicines. Oops! Same thing on the environment – rolls back the standards on the environment that’ve been in all the U.S. trade agreements Bush did in his second term. So a lot of Democrats are saying “Meh”.
And then there’s the investor-state issue. See, New Zealand’s like the U.S. in this way, which is, we haven’t lost any investor-state cases and President Obama keeps saying “Oh, that’s not a problem. Everyone stay calm, it’s a myth.” Just like you guys keep hearing: “Oh, you haven’t been challenged, don’t worry.” But there’s this little thing we have in common, and that is you have very few investor-state agreements at all. We have investor-state agreements with Rwanda, Guatemala, Costa Rica. Not a lot of external investors in Washington or any place else in their country, who are from those countries. The only place we’ve gotten challenged – and it’s happened 15 times – has been Canada in N.A.F.T.A. They challenge a lot, but guess what? If you guys get into the T.P.P.A., you get 1,608 new U.S. corporations: the most litigious in the planet, with newly I.S.D.S. – YOU – in addition to all those Canadians who’ve been going after us.
And the reason I mention this is in Congress, the Democrats have really started to get worried, because up until now, with all of the agreements we have with I.S.D.S. – 50 agreements – we’ve had hardly any challenges. Overnight, we’d double our liability: 9,500 new corporations. This includes the Japanese, and other companies that now you don’t have I.S.D.S. exposure to – that’d be a new threat. But I just want to say: 1,608 U.S. – they love to sue everyone, I’m from there, I’m a recovering attorney, I get the rap. This is brand new liability. So when your government says “We’ve never been sued”, I say “Hold on to your wallet, your tax dollars.” Because if T.P.P.A. happens, it is just a matter of time. Think of 50 years of I.S.D.S. and there were 50 lawsuits total, and now there are more than 50 a year. This is an enormous risk.
So with that as the background, that is why Democrats aren’t keen about it. And sort of the coup de grace on that one was just before Obama’s State of the Union Trans-Canada, the big company that’s trying to do that X.L. Keystone Pipeline to take the really dirty Canadian oil down through the U.S., they went after us in I.S.D.S. case for $15 billion because their pipeline was rejected. So, we’re not picking up a lot more Democrats.
So then what’s happening with the Republicans? Well, this is the part that’s really kinda disgusting. See, they all represent the big corporations, they’re used to getting 110% of what they demand. They’re among the 500 companies to actually get a seat at the table. So they were totally stunned that they didn’t get their usual 110% because for them, 98.7% of all the goodie-greedies that they wanted? Not sufficient. So this is what the Republicans are demanding: two of the things which are extremely relevant for New Zealand. And I’m talking Republicans like the leaders of the Republican Party who passed fast-track, who are essential to every trade agreement. Like the people who you can’t imagine – it would be like Dracula no longer liking blood – these are people who love trade agreements and they are not supporting it, and why? They are demanding that there be a longer period of exclusivity for the biologic medicines. So, you know the New Zealand government’s running around saying ‘Oh, it’s only five years.” Well what the real period is ambivalent. Could be five years, it could be eight years. The U.S. government says it’s eight years. Peru says it’s eight years! Different countries say different things. But what these guys are demanding is, in writing, a declaration it’s at least eight years and a renegotiation to go towards 12 after that. And they’re saying they will not support the agreement until they get that.
Number two: they are asking for the removal of the tobacco exception to investor-state – the only good thing in that entire agreement, if you ask me, having read a zillion trade agreements, it’s a real exclusion to investor-state. There’re tricks to it, there’re problems with it, but it’s a hell of a way down the road to what you’d really do, as compared to serve the world’s most lame “environment” exception that doesn’t work. The tobacco one works. So we’ve got a block of probably 20 House Republicans saying they will oppose the agreement if that thing is not gotten rid of. And how can they do that? They just send letters – each country does – saying we’ll never use that exception.
Now the reason I raise this here is your country has put off passing plain packaging laws ‘cause you’ve been waiting to see what happened to Australia when Philip Morris investor-state attacked. Now everyone saw, a couple weeks before Christmas, Philip Morris’ case gets dismissed. This is not a moment to exhale and look forward to having the plain packaging law because the identical case with a different tribunal where there’s a little bit less spotlight – Uruguay, a small country, a very small population, making less of a fuss than Australia – the exact same case was allowed to go forward. Same issues, same law - they’re all model laws based on the tobacco treaty - Uruguay is still facing the same Philip Morris case, Australia made a big enough political fuss, it got thrown out. So when you think about why we need the tobacco exception, among everything else that’s wrong with investor-state, and that’s why the things that these guys are demanding gets removed.
The Chamber of Commerce – the business roundtable and all the other corporate lobbies – only came out in favor of the T.P.P. right before the President’s State of the Union speech under pressure and they conditioned their support on these changed being implemented before there’s a vote. Now how could this happen? How it works is they will do side-letters with individual governments that would be a commitment to change the tax. They’re called self-executing amendments. So the letter will say “there’s the honor of the Government of New Zealand to share with the Government of the United States that we both agree that the following provision will be amended according to this blah-blah-blah in the letter, and it will be subject to dispute resolution.” That is how you do a binding change to an agreement without opening up the agreement and actually changing the text. And if this seems extremely far-fetched, because there’s this myth – “once this thing is signed next week, that’s the end. It’s cement.” – a technical term to describe this situation: total boloney.
The Korea Free Trade Agreement, negotiated by another second term president desperate to get another agreement in his legacy, that would be George Bush the younger, he signed an agreement with Korea in 2007 that everyone, from a distance, could tell was not going to get through Congress. It was just like a non-starter. Just like they had Democrats and Republicans saying what they’re saying about TPP, “If this, if not that, if not this, ixnay”, same thing with that agreement. He signed it anyway. He gets the Korean Parliament to pass it because he thinks he’s going to have a stampede and then the U.S. Congress will go “Ooh! It’ll be an embarrassing incident if we…” Two thousand ten rolls around, they can’t get a majority in Congress. Three years and all those parliamentarians are hanging out there, the various political parties are going “Oh my God, we have to stand two elections, this thing isn’t even implemented, we already had to vote on the record for it.” And ultimately Obama goes back and says “I can’t get this through Congress unless there’re more concessions.” And Korea, they extract more concessions from Korea after they’d voted on it, and they used the self-executing side letter that I just described, which then says “You know, the tariff schedule on this thing is rolled back, that thing is added, and we agree at the moment the agreement’s implemented, these amendments go into effect.” The agreement finally passes in 2011, not by a wide margin. The Korean politicians who got involved in that whole thing, many of them lost their seats. And that signed agreement is, theoretically, what is now in effect with that agreement.
Now with the T.P.P.A. there’s a Catch-22, though, because the things that pick up the Republican votes lose the Democratic votes. And they have no margin of error. Like, the proxy of the fast-track for the T.P.P. was a five-vote margin. And they’ve already publically lost two Republicans in a very, very, like “I will never vote for T.P.P.” kind of way. Not the “Unless you change this and make New Zealand and Australia give us longer exclusivity periods I will vote for it.” There are a bunch of people who have just said “Under no circumstances.” So on a very narrow margin, they’re stuck in this scenario.
So then where are we, bottom line, in the U.S.? The first thing to just say is T.P.P.A. is in big trouble politically and the number one indicator there’s the polls. So, at this point, there’s not a single presidential candidate, Democrat or Republican, who is polling over 5% in any state in the entire country, who is for T.P.P. Democrats and Republicans!
Now, can we as American citizens trust in the end if one of them is elected they will stay that way? Not unless we take a political two-by-four upside their head every day. However, it shows you politically where the Congress is, where the politics are, that if you want any chance of being elected president in our country, you have to be against this agreement or you just fall off the polls. So what ends up happening scenario-wise, and there’s also now a huge anti-, there’s a huge campaign on Congress to oppose the T.P.P.A. in the U.S. and it’s really inspiring. I mean, it has the broadest diversity of groups I’ve ever seen in 20 years of trade campaigning, and whole sectors are united and there’re all kinds of new sectors involved, and it’s a very inspiring campaign. It may not be as totally amazing as all of you guys here tonight if you do the math of proportionality but we’re trying to hold our own compared to the Kiwis – we’re trying to catch up.
So what is going to happen? There’s probably going to be a push to have a vote before July when Congress goes on holiday for the election. The problem is fast-track’s a one-use tool, so unless they can count the majority of votes, they won’t start the clock. Because otherwise they’ve used up their fast-track and that’s the end of it. Because it clearly won’t get through Congress on regular rules. If it’s not on the special procedure, it’s toast. So they’ll probably make some noise or try and show momentum and they’ll chicken out. Then, you’ve got a bunch of members of Congress who voted for fast-track who’re about to lose primaries, because there’s a lot of retribution out there right now. And so all the other members are going <sniff, sniff> “Oh God, that could be me if I vote for T.P.P.” So it’s a very tenuous time, I suspect that it’ll be after the election before there’s another potential window they could have a vote. The problem is, depending on who wins the presidential election, there may not be that special session after the election. It’s called the “lame duck” session – if a Republican wins, it’s not going to happen, and then we’re in 2017. We have a new president. If it is any of the ones who, right now, look like they could be president, the one who is most susceptible to ultimately being for this agreement is Hillary Clinton, and she has insisted that they have binding disciplines on currency cheating in the agreement, which is something that will make Malaysia, Vietnam, and probably, in all likelihood, also Japan walk away. So that’s a deal where she’s put herself way out on that. Some of the others, like Bernie Sanders, or Trump, or Cruz – those guys just don’t want any part of the agreement at all. For different reasons: for right-wingers it’s the sovereignty issues of I.S.D.S., for Bernie Sanders it’s the corporate power issues.
So now we’re in 2017 and there’s still no T.P.P. and the U.S. approved. Which gets back to why New Zealand has been such a cheerleader for the agreement. Because I was here maybe four years ago, and I remember - and I’d been following the press, like in the New Zealand Herald alerts and everything at home – I remember your trade negotiator saying “If we don’t get what we want in dairy, then what the hell would be the purpose of this agreement?”
And he, like, had a big hissy-fit about that. And you know, the news is in the U.S. the guys in the dairy sector are like “Ah, Jesus. Close call, but those New Zealanders didn’t get us! Phew!” And like they’re actually neutral. Like these are people who’ve been on the warpath saying they’re going to oppose the agreement if there’s like any actual new market access, and I hate to be the bearer of news, because who knows what your government’s saying but, from the U.S. receiving end, you’ve got a lot a relieved dairy farmers who are not having to worry about New Zealand powdered milk. But then that begs the question: okay, what are the other upsides given that seemed to be the big thing?
And then there was the big prohibition: I remember vividly Mr. Groser saying “If this agreement becomes about bullying on China, if this agreement’s about ring-fencing China, we’re having no part of this agreement. We’d leave!” Well I don’t know if anyone else took a little look at the President’s State of the Union speech two weeks ago, because you can’t sell the T.P.P.A. on jobs in the U.S. because the recent studies show actually it would be a pay-cut for 90% of Americans by increasing income inequality. You can’t show it’s a gain for economic growth, because the Obama Administration’s only report showed it would be a booming 0.00% gain in 20 years in our GNP, so that’s not going to work. So now they’ve started this business where he just flat-out said “If don’t do this agreement, China’s going to write the rules. This is our way to have strength against China!” And I was thinking, “Um, Mr. Groser, you’re probably actually in the chamber in the diplomatic corps, did you happen to hear that? Remember that thing you said, like <buzzer sound> on the dairy and <ejection motion> on the China? What gives? You guys are the ones pushing it.”
I mean, it is a very strange state of affairs. Jane’s going to talk about what the studies that have been done show, but it is kind of actually a true question, which I’d love to talk to folks after we are all done, because, I’ve been picking the brains of all my friends of “Why are you guys doing this thing that has very little upside for you, enormous downside for increasing the prices for Pharmac?” - we envy your healthcare system, we aspire to be like you – and interestingly, shockingly, today Donald Trump actually said he wants bulk purchasing in formularies. And does the man know the T.P.P.A. would actually, for the U.S., freeze us from ever doing that? Uh oh! So here you have very low upside, a lot of downside, yet your country’s been one of the ones that’s most enthusiastic. So I thought it was really important to dig out of the snow and come here and say “Guys, this is far from a done deal.” And your government may be like we’re trying to run you guys for a cliff…
Your government’s trying to run you guys towards a cliff, but truth be told, you know, stay strong. And, I mean, you guys did an amazing job during the negotiations pushing back against some of the disgusting things that our government was pushing on behalf of these companies. And now you should know that it’s in front of Congress and this is no done deal. This is likely to be an undone deal. So if you guys, in your Parliament, for instance, do the implementing legislation and you change your laws, you’ve now changed your laws to meet all this bullshit in the agreement – it’s an agreement that may never get signed and you will’ve screwed yourselves over by passing that law! For God sake’s…
So I would just say for God sake’s don’t go rushing into this because in all likelihood it ain’t gonna happen, thanks to people power pushing up against it. And I’m going to close where Joe Hawke started, which is to say what a beautiful sight this is. And so I did the math, and if we were in the U.S., given the percentage of this many people for your total population, in our national population to actually do what you guys are doing here – which is inspired and thank you for the protests that will come next week. We have them going in the U.S. too – we’d have to have 63,000 people in a soccer stadium. So go New Zealand! No T.P.P.A.!