The Disastrous Effects Of The Transatlantic Treaty (TTIP)
An amalgamation of acronyms are appearing to describe the same thing. And it is not without reason. The opacity by which this new free trade agreement between the United States and the European Union, induces a lack of consensus among media actors. Even so, the English acronym, made available by the supranational institutions, of TTIP (Transatlantic Trade and Investment Partnership)(1) has been generally accepted in the press.
However, the alphabet soup does not end with TTIP. CETA (Comprehensive Economic and Trade Agreement) and the SPA (Strategic Partnership Agreement) are agreements of a commercial and political nature between the countries of the Union and Canada. This will serve as a bridge to implement the TTIP. On September 26, 2014, the negotiations between the two actors have ended pending the ratification of the treaty in the European Council and Parliament (competent entity) and in the respective parliaments of the community states (if their constitution requires it).
It seems understood that this treaty supposes, in a general way, organize the largest free trade market in the world, which would bring together more than 800 million consumers and more than half of the world’s GDP (54%) allowing, likewise, doping the European economies by €120,000 M and the American economies by €95,000 M (data prepared by the Center for Economic Policy Research)(2). With this economic perspective, a European citizen would not doubt its implementation, but… then why so much secrecy?
The TTIP far surpasses “simple” free trade agreements, since it pursues three very important objectives that need to be clarified. The first would consist of the elimination of the last customs duties (tariff barriers), which are already very low(3). The second, for its part, aims to “harmonize” non-tariff barriers (norms) between the countries involved(4). Finally, it consists of guaranteeing legal mechanisms, called ISDS (Investor-State Dispute Settlement), so that investors do not encounter regulatory or legislative obstacles in the markets they intend to enter, and if they do, they can avoid them. In other words, the TTIP (or also the CETA) aims to prioritize the interests of large companies over the States with the obvious loss of sovereignty that this would entail.(5)+(6)
In fact, the negotiations have been instigated by numerous American(7) and European(8) lobbies, but officially it is the officials of the respective governments who are dealing with it(9). The negotiations will theoretically end next year, but will be preceded by a long ratification process in the Council and the European Parliament as well as in countries whose legislation requires it. This process will not be an easy task in this period of economic, social and political crisis in Europe (especially in the South). From this context, plus the uncertainty about the possible consequences of the TTIP, the impermeability of the institutions is deduced(10).
The advantages or disadvantages towards European or American societies are different depending on each case, and depending on the ideological prism from which it is viewed. According to the report prepared by the banking lobby CEPR for the European Commission (who also claims that it is an economic prediction and obviously inevitably lacks certainty), the advantages are linked to economic growth (0.5% increase in GDP from the EU and 0.4% from the USA) especially in certain sectors: especially the automobile sector (40% increase in exports), the metallurgical sector (+12%), processed food (+9 %), chemical products (+9%)… Regarding employment, the study commissioned for the Commission predicts a transfer of jobs between sectors (in relation to 7 jobs out of every 1000 in 10 years) and not really the creation of the same . This is important! Politicians always play the card of job creation to justify the free trade agreement (or other interests of dubious legitimacy) when they really do not adhere to the data from the official studies of the institutions which they represent.
Furthermore, the disadvantages materialize at multiple other levels, which are not mentioned in the CEPR study (of too economical analysis): the treaty risks the social, economic, health, cultural, environmental, political and even geopolitical level. … For example, the eight fundamental rights proposed by the International Labor Organization (ILO) are adopted by the member countries of the EU. In contrast, only two of them are ratified by the United States government. The experience of free trade agreements suggests that the “harmonization” of standards is established based on the lowest common denominator, which would lead to a loss of fundamental rights on the part of European workers, a section specifically mentioned by the CEPR. who affirms, in fact, the need for the deregulation of employment.
Another example that we propose, due to its social sensitivity, are threats to the environment. A free-trade market will increase merchandise traffic as well as energy expenditure and, with it, pollution. On the other hand, the free entry and use of certain polluting technologies such as the extraction of shale gas (fracking), allowing the use of agro-industrial chemicals (do you like chicken bathed in chlorine and beef with hormones? ? sic.) or opening the doors to GMOs (although in Spain the practice of transgenics is very deep-rooted(11))… would be some of these effects to consider.
To finish this point, we will mention the most worrying one: the loss of democracy Constantly, politicians and citizens categorically affirm that we live in a democracy. But democracy does not exist or ceases to exist, but rather it exists more or less depending on the productive structure and the dialogue of the competent actors within the system (where society is the legitimate actor in a democracy). The lack of transparency of the European Union regarding an inherently undemocratic TTIP, denounced by the Court of Justice of the European Union (CURIA), is symptomatic of the loss of democratic quality that the treaties will cause. The economy is displacing politics and definitively subjecting society to the laws of the market.
A Europe submissive to the dictates of the large transnationals will entail a transformation of the productive system, and therefore of the social system, as well as a setback in the sovereignty of the States (the little that remains after signing the transfer of sovereignty in the Lisbon Treaties). A release of the capacity for action of large companies, which will increase competition (hyper-competition), leads to a scenario where small producers can be severely punished if they are not able to adapt to these new circumstances (adaptation to e- commerce would be basic), causing conflicts at all levels of society.
Monopolies, oligopolies… will have the opportunity to increase their capacity to act against the States, who would be devoid of legal tools to do so (remember the ISDS state-company arbitration mechanisms). Structural reforms, experienced in an extreme way in Spain, are the basis for free movement to be established. The latter, if it materializes, will be a new step towards economic globalization, with the United States starting with a certain advantage. All this thanks to the influence of its Internet giants: Google, Amazon, Facebook, Microsoft… This deregulation of markets would also aggravate the possibility of crisis. First, the result of productive specialization in a given territorial area, which would tend to intensify against productive diversity, whose resistance to the secular economic crises of capitalism is more effective. Second, the States, as mediators of social forces and employers’ forces, would lack the powers to prevent the fall of the productive system. The loss of democracy in favor of control of the economy is the final price.
(2) The CEPR is an organization (lobby) financed by different private banks.
(3) According to the World Trade Organization, tariff barriers in Europe vary depending on the products but the average is 5.8%. The products that contain a higher tariff burden are agricultural products with an average of 13.24%. On the other hand, customs duties imposed on industrial products are much lower, 4.2%.
(4) According to a study carried out by the Fondation Res Publica, on September 16, 2013, the “harmonization” of the standards will be done from “below.” That is, national or supranational regulations will be adopted whose restrictions are less “harmful” to capital flows.
(5) The fine of almost €9,000 million imposed on the French banking group BNP Paribas by the United States Government for an alleged investment in countries under US embargo (Cuba, Iran and Sudan) predicts that the economic law American will prevail over the others. It seems paradoxical that when a transatlantic treaty is being developed where the interests of multinationals defended by future international courts will prevail, the American government can impose its law (given its control over the dollar) on European companies.
(6) It seems important to us to clarify that the main American interest is imperialist in nature and, therefore, geopolitical (or geostrategic). The reason is conditioned by the new protectionist stance of the Chinese government, especially with regard to the protection of its own high-tech brands for national consumption. Likewise, its monetary ambitions seek to rival the dollar little by little (although this is far away). Furthermore, the USA wants to rebalance its trade deficit in recent years so as to guarantee hegemony over the legislation of industrial products. This would induce the adaptive need of third states to the productive rules of the Transatlantic treaty. While European interests, for their part, remain simple mercantilist issues (without any political ambition to counteract American dominance), the USA seeks to maintain its hegemony at all costs, which will entail the attempt to marginalize China and Russia. The process is not easy, since the latter are looking for allies to counteract American hegemony. The clearest example is found with the BRICS meeting in Brazil coinciding with the Soccer World Cup; as well as Vladimir Putin’s tour in Latin America. Remarkable is their agreement to create a common investment bank between the BRICS and the gas pipeline that will link China and Russia.
(7) Of which, the agri-food industry, the cultural industry or, even more so, the new computer technology industry would be the most interested sectors. According to Corporate Europe Observatory,
(8) German industrial groups, especially vehicle producers, are the most interested in this process and see an opportunity to partially relocate their industry to American territory. The latter is strongly modernizing its industrial technology and contains more lax legislation in the field of labor.
(9) From July 14 to 18, the sixth round of negotiations between the United States and the European Union took place in Brussels. Between October 29 and 3, the seventh round of negotiations will take place in Maryland (USA).
(10) Likewise, the opacity of the negotiations has facilitated the election of the “ultra liberal” Jean-Claude Junquer to replace José Manuel Durao Barroso in the European Commission. The latter began transatlantic negotiations with the United States in 2013.
