Wednesday, February 5, 2014

How Democracy Works In The Global Economy

This article provides critical information about the ongoing effort to develop a regional trade agreement called the Transpacific Partnership.  The process, which involves a large number of nations, is necessarily complex but it also suffers from a lack of transparency.  Many members of Congress, including supporters of "free trade", do not believe that they have well informed about the negotiations.  The media, with few exceptions, have done little to keep the public informed about the negotiations.  Senator Warren was told that if the public knew what was being negotiated they would be opposed to the negotiations.  That describes the problem in a nutshell.  The trade negotiators are effectively setting industrial policy for the region.  Congress is not deeply involved in the process and the public is kept in the dark.  The underlying assumption is that everyone benefits from "free trade" and that representatives from multinational corporations are best suited to develop the trade agreement.  In a global economy the purpose of the nation state is to enable multinational corporations to determine industrial policy.  This is a new form of democracy that is best done without public participation.

The 16 Industry Trade Advisory Committee is the most important committee in the negotiations.  There are no labor or environmental members on the committee.  It is composed of executives from the 16 industries.  This committee will determine the critical details of the trade agreement.  Each industrial group has an incentive to limit competition in the industry and to strengthen intellectual property rights which has the effect of discouraging innovation and limiting competition.  They will seek to extend the duration of copyright and patent protection and also enable patent protection for new things like medical procedures which have not been subject to patent protection.

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