Public Submissions to U.S. Government Reveal Corporate Wishlist for IPEF: More Power at Our Expense

By: Sarah Grace Spurgin

In October 2021, President Biden announced the “Indo-Pacific Economic Framework” or IPEF. There have been few details about what this IPEF will actually entail, but what we do know is that corporations are loathe to miss an opportunity to codify exploitative and short-sighted measures into “trade” agreements. 

U.S. Trade Representative (USTR) Katherine Tai has stated repeatedly that the Biden administration’s vision for trade will not repeat the past mistakes of prioritizing large business interests above all else, but will serve workers, consumers, and the environment. IPEF could be an opportunity to realize this new, lasting vision for trade. At the same time, the notion of an IPEF did not come from consumer advocacy organizations, environmental groups, or organized labor.

I spent a week combing through the public comments submitted by industry lobby groups to the official federal registry notice for IPEF, and barely scratched the surface. What I found should put us all on high alert.  Here are five things the corporations want from IPEF:

1. TPP 2.0

At a recent Senate Finance hearing, Senator Elizabeth Warren (D-Mass.) warned Ambassador Tai that:

Lobbyists for the giant corporations are celebrating IPEF as the second coming of the Trans-Pacific Partnership [TPP]. Now there’s a reason the original TPP was derailed. It would have offshored more jobs to countries that use child labor and prison labor and pay workers almost nothing. Let me be clear, the IPEF cannot be TPP 2.0.

The formal comment submissions from corporate interests to the administration justify Senator Warren’s concern. Despite the warranted unpopularity of TPP, more than a dozen Big Ag and Big Tech lobbyists took the federally mandated opportunity of public commentary to express their disappointment at the U.S. decision to abandon the pact, and urge the administration to resurrect the long-dead TPP.

For example, U.S. Chamber of Commerce suggested that “in the absence of a return to the TPP, important elements in the administration’s Indo-Pacific Strategy could be achieved through the IPEF.” They also claimed that, “U.S. trade policy history is littered with failed or partially realized ideas that might have yielded more economic and strategic benefits if officials had moved faster or if challenging political decisions had been made sooner.” This sure sounds like an attempt to have even more secrecy in the corporate-dominated negotiating process. Translation: ‘don’t waste time listening to stakeholders with smaller campaign donation budgets transparency is as unnecessary as it is wasteful.’ In reality, the TPP was so unpopular in Congress in part because civil society, the public, the press, and our elected officials were kept in the dark.

The Chamber went on to say, “Don’t reinvent the wheel… An attempt to completely reinvent U.S. trade policy tools or to reshape the entire global economic agenda to reflect the political forces in Washington is cumbersome, fraught with uncertainty, and far less likely to be successful.” What they mean by that is, ‘the status quo works for us even though it has decimated good jobs, reinforced systemic racism, and accelerated climate change and pandemics.’

The American Petroleum Institute called for the U.S. to join the CPTPP, the TPP’s successor, to “contain and coerce China.” And in its comment submission, the Coalition of Services Industries (CSI), referenced the words of Singapore Deputy Prime Minister Heng Swee Keat: “The U.S. cannot afford to be absent from the region’s evolving economic architecture… if not through the CPTPP, then it must have an equally substantial alternative.” If by “equally substantive,” he means ‘scrap the president’s interest in developing new, people-centered trade policies and agreements that advance worker rights, racial equity and consumer safeguards and revert to the TPP or CPTPP approach,’ then the Deputy PM has it backwards. That is exactly what we cannot afford.   

For those who need a reminder, as these corporate lobbyists clearly do, there are good reasons the TPP was so unpopular. The TPP was a controversial 12-nation, corporate-rigged “free trade” agreement that failed to obtain majority support in the U.S. Congress after a massive grassroots campaign against the deal. At the heart of the TPP were new rights for thousands of corporations to sue the U.S. government before a panel of three corporate lawyers that could award unlimited sums, including for loss of future expected profits, to be paid by American taxpayers when the corporations claim U.S. policies violate the new entitlements the TPP would provide them. The TPP also included extreme monopoly protections for pharmaceutical firms that blocked competition and ensured high medicine prices. The deal’s environmental standards were even weaker than those in the previous four agreements negotiated by George W. Bush. The labor standards replicated ones that had failed to stop egregious labor abuses in agreements with other countries, and the TPP included several nations notorious for labor abuses.

Not only was the TPP bad policy, but it was also bad politics. Politicians talk about trade in macro terms, but the cost of bad trade agreements can be felt on the micro level by American workers. For example, take Michigan, Wisconsin, and Pennsylvania, three states that played pivotal roles in delivering Trump to the White House in 2016 and Biden in 2020, and that have been directly hit by corporate-rigged trade agreements. According to the Department of Labor’s Trade Adjustment Assistance (TAA) database, since 1994 Michigan has lost 186,769 jobs to trade, compared to 89,030 jobs lost in Wisconsin and 207,832 jobs in Pennsylvania. TAA is a narrow program, only covering a subset of workers who lose jobs to trade, so the numbers are certainly an undercount. In the past two presidential elections, these states have been decided by margins smaller than the number of jobs lost to trade in those states.

These numbers are more than statistics. They’re families affected when a parent no longer has work. They’re members of communities, towns and cities that dried up when factories were closed, and jobs were sent overseas. They’re the actual lived reality of globalization and outsourcing run amok. That was the anger Trump was able to tap into during his 2016 run that painted Hillary Clinton as the champion of the trade status quo hurting the American worker thanks to her too-little-too-late rejection of the TPP and earlier support of NAFTA.

2. More Power Online, at the Expense of Our Privacy

Just like Senator Warren pointed out in a recent Senate Finance hearing, “[t]ech companies like Facebook and Amazon are a huge part of global trade – and they’re also involved in spreading misinformation, mistreating workers, and squashing competition.  They also hire hordes of lobbyists to protect their appalling way of doing business.” Consumer organizations including Consumer Action, Consumer Federation of America, National Association of Consumer Advocates, National Consumers League, Public Citizen, and more are warning the administration of harmful “Trojan Horse” provisions in so-called “digital trade” agreements the US is being encouraged to join. (Check out a letter from the organizations here). Nowhere are these efforts more evident than in the hundreds of corporate comments submitted on IPEF.

The so-called “digital trade” proposals corporate lobbyists are pushing throw out an obligatory vague phrase here or there alluding to the importance of cybersecurity and consumer privacy, but a closer reading of their proposals shows their desire to undermine domestic policy space on important issues like gig economy worker protections, discrimination and algorithm transparency, corporate liability, and consumer privacy.

• Binding rules to limit the ability of governments to regulate where Big Tech firms send and store our data

One of the most-covered topics in these comments was the quest to bar governments from regulating where and how data can be stored. When you use a service online for free, chances are you and your personal data is actually what’s for sale. The company operating the online site or service is making money by turning our personal data – including shopping history, location tracking, home address, and sensitive medical and financial information – into a new commodity to sell or to target advertising. [ICYMI, John Oliver had a great segment a few weeks ago on data brokers and what they’re doing with our personal data.] The biggest companies in the world are racing to control this valuable resource our personal data and they don’t want consumer safeguards that governments could enact to protect your privacy standing in their way.

Big Tech glorifies the so-called “free flow of data,” but what that really means is binding rules to limit the ability of governments to regulate where Big Tech firms send and store our data. That would mean high-tech giants like Amazon, Google and Facebook would be free to transfer our data to any other country and thus avoid privacy and other consumer protections that governments may require. These rules mean consumers have no guarantee that their data would be protected where the data were transferred even if domestic laws require such protections. Countries that have superior privacy laws could see their data protection rules undermined, while U.S. congressional efforts to enact privacy rules could be thwarted.

A number of lobbying groups including  Information Technology Industry Council, PhRMA, the U.S. Chamber of Commerce, and the American Chemistry Council called for a ban on data localization requirements, which would significantly undermine the ability of governments to secure their citizens’ data against unauthorized or unlawful exposure or processing, or against cybercrime, accidental loss, destruction or damage.

[Fun fact: Last year, the American Chemistry Council was revealed in this exposé from the New York Times & Greenpeace as the lobbyists urging U.S. trade negotiators to strongarm Kenya into reversing its limits on plastics — including a tough plastic-bag ban as the world moves away from fossil fuel energy sources.]

We’ve seen these digital trade terms prohibiting limits on data flows appear in trade negotiations from the TPP to the Digital Economic Partnership Agreement, to the WTO “e-commerce” talks and what is clear is that governments are signing up to these terms without understanding the implications for their domestic policymaking. Big Tech sees the IPEF as the latest opportunity to cement these rules.

• Rules that undermine investigation of discriminatory source code and algorithms, intrusive surveillance practices and violent incitement online via prohibitions on technology transfer requirements and “trade secrets” protections.

Everyday decisions made by artificial intelligence (AI) components of online platforms affect which individuals and communities can access public and private services. Critical components of economic and social stability like home loans, job postings, medical treatments, targeted ads, and much, much more are influenced and determined by AI algorithms, thereby enabling a sort of 21st century redlining. Governments are likewise increasingly turning to these algorithms developed by private corporations for aid with “predictive policing” and other surveillance functions. It’s clear that there is a huge need for a collaborative effort to address this growing crisis.

Instead, organizations like Biotechnology Innovation Organization, National Foreign Trade Council, the Business Software Alliance (BSA), he Association for Competitive Technology, and more are calling for a prohibition of what BSA considers the “improper digital policies or practices that undermine data security and economic opportunity in the United States and among like-minded allies, including:… forced technology transfer requirements (e.g., source code transfer mandates); source code and encryption key disclosure/access mandates; [among others].”

“Digital trade” terms that require governments to provide trade secrets protection for source code and algorithms would limit governments to accessing such information only to instances of known violations of law. Congressional committees, scholars and public investigators would be barred from reviewing code and related data to identify racist, sexist and other practices deserving of scrutiny and correction. To add insult to injury, some pacts with “digital trade” rules require governments to enact liability shields for online firms that allow them to evade responsibility for discriminatory conduct, online racial incitement, and other civil rights violations. More on that below.

Rather than shield these “trade secrets” from public scrutiny, continuous, independent oversight and transparency is key to ensuring human and civil rights are maintained in the digital age.

• Manipulating “trade” tools of “market access,” ”trade discrimination” and “conditions for business” to exploit workers in the gig economy

There is a false notion that workers providing services online or in the gig economy are somehow different from those in their brick-and-mortar counterparts, and so domestic policies that generally apply to protect the rights of workers do not apply to them. “Digital trade” rules can make illegal “trade barriers” out of requirements that large ride-sharing companies meet driver hours-of-service rules or contribute to drivers’ social security, for example. Corporations push U.S. trade officials to consider enforcement of domestic laws to be “discriminatory” if such laws affect them more than other businesses. But sometimes, certain businesses are more affected because they have monopolized that industry. Take, for example, an antitrust Korean law to end anti-competitive App Store practices. But Apple and Google are pushing U.S. trade officials to attack the law as “discriminatory” because, thanks to their monopoly practices, it would affect them more than other businesses. Similarly, some public interest policies are characterized as illegal limitations to “market access” if they’re shut down due to violations of or conditioned upon the following of local labor (or other) laws.

As I searched the IPEF public comments database for mentions of non-discrimination or market access, it took days just to get through the pages of results, let alone the comments themselves. While some of these discrimination and market access concerns may and can be legitimate business concerns, it’s a useful way to disguise attempts to avoid regulation altogether.  

Additionally, firms like Google and others want to bar governments from requiring a local representative or office as a condition for doing business, which could make enforcement of local labor laws that much more difficult. In issues of unsafe labor practices, say concerning drivers who work for a ride-sharing app, if there is no local representative, the authorities’ only option would be to enforce labor laws against the drivers themselves, not their employer. A local legal entity extremely useful for holding corporations accountable to their workers, consumers, and more.

• Codifying a still-debated tool to shirk liability for fraud and counterfeit sales

Another growing area of public debate is over the rules that govern the internet, particularly Section 230 of the 1996 Communications Decency Act. Section 230 says that no provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider. Online platforms use this law to claim they’re not liable for content posted by third parties, for example, fraudulent or defamatory posts on Facebook. Some experts say this is a core component of free speech online, while others say it mainly helps mega-corporations avoid liability for negligence. One thing’s for sure, overly broad corporate liability waivers like Section 230 have no business in a trade agreement.

There is vigorous opposition to and support for Section 230 by Democrats and Republicans. That’s why this is exactly the sort of policy that should not be locked in via a trade agreement, but should be decided in an open and democratic forum. Policymakers must have flexibility to address concerns with Section 230, not have the ever-expanding digital policy space preempted by international trade agreements, so we need to be vigilant as Big Tech attempts to include a corporate liability shield under the guise of “digital trade.”

But corporations and lobby groups like the Computer & Communications Industry Association, as well as the Entertainment Software Association (ESA) are doing just that. To use ESA’s language: “Video game companies maintain online platforms that host user generated content and are beneficiaries of the limitations on attendant liability afforded by Section 230 of the Communications Decency Act… ESA considers the inclusion of a provision on this issue an important objective in negotiating the Framework.”

3. Ever-Expanding Intellectual Property Demands, Consolidating Life-Saving Medicine and Tech for the Rich

Corporations such as Google are also demanding a ban on technology transfers and intellectual property disclosure, which have been a major debate in the COVID-19 vaccine equity crisis. The doubling-down on IP barriers is both increasingly concerning as well as exceedingly paternalistic. Take this comment from the U.S. Chamber of Commerce for example:

The COVID-19 pandemic has made clear that countries around the world, including many in the Indo-Pacific region, remain ill-equipped to participate effectively in the global ecosystem for intellectual property (IP) development and technology transfer... These structural shortcomings in their own systems have led such countries to inappropriately identify intellectual property rights and related trade commitments as a barrier to access to technology.

I went through thousands of pages of comments. None made me need to take a lap, scream into the void, and lay face-down on the floor all at once quite like this.

First of all, limiting life-saving technology for only the wealthy who can pay top dollar for a good, be it a vaccine, medical treatment, renewable energy, or otherwise, is both immoral and ultimately self-sabotaging, as we’re currently seeing with the ongoing global COVID-19 vaccine apartheid & ensuing variants. Secondly, more than 100 facilities across the world were identified as possible producers of COVID-19 vaccines, despite pharmaceutical lobbyists’ decidedly racist lies about developing nations remaining “ill-equipped” to produce them. Setting aside colonialist culprits that created the structures that reinforce asymmetries of power and participation in the global economy, the U.S. Chamber of Commerce goes so far as to suggest that countries are apparently too poor and dumb to even understand the vaccine crisis they face.

PhRMA, the lobby group representing the pharmaceutical industry (that enjoys spending millions and millions of dollars to keep prescription drug prices high) submitted comments on IP protection that are almost laughable if they weren’t so outright poisonous. “PhRMA therefore encourages Commerce to negotiate an IPEF agreement that is as comprehensive and ambitious as possible and that includes strong IP protections… [that] facilitate the manufacturing and distribution of lifesaving medicines and other IP-intensive products.”

I can’t think of an industry lobbying group more responsible for the lack of manufacturing and distribution of lifesaving medicines such as Paxlovid or COVID-19 vaccines than PhRMA and their ongoing campaign to block a waiver of WTO IP rules.

And it’s not just PhRMA and other Big Pharma companies. Industry groups like the Payments Leadership Council, representing multinational financial corporations, and tech companies all see a future cash cow in doubling-down on IP barriers at the expense of human rights.

Further entrenching extreme IP barriers sets an incredibly dangerous precedent. As we face increasing climate emergencies and pandemics, it could not be more critical that we ensure any and all economic agreements, frameworks, side-deals and declarations put people before profits.

4. Power to Sue Governments Over Laws They Don’t Like

No call for public comments on any sort of trade platform involving the US, no matter the scale or venue, is without the classic demands we are constantly battling. ISDS, the Investor State Dispute Settlement mechanism, is a classic hit. ISDS allows multinational corporations to sue governments before a panel of three corporate lawyers. These lawyers can award the corporations unlimited sums to be paid by taxpayers, including for the loss of expected future profits, on claims that a nation’s policy violates their rights. Their decisions cannot be appealed. ISDS has been used to stall and rollback climate progress, and   by foreign investors against states that took necessary steps to contain COVID-19. It’s an unforgivable abuse of power and has no place in democratic institutions, but for obvious reasons (money), corporations love it.

Take the commentary from the Information Technology Industry Council:

“With growing two-way ICT investments between U.S. and many IPEF economies there may be room to focus on strengthening investment protections: to protect investment abroad in countries where investor rights are not already protected through existing agreements (such as modern treaties of friendship, commerce, and navigation, or free trade agreements).”

The American Petroleum Institute similarly called for “clear investment protections.” ISDS is so unpopular on a bipartisan basis that President Biden campaigned on a pledge to not include it in any future agreements. It’s a politically toxic, undemocratic tool, so these corporate lobbyists have to tread lightly, but reading between the lines and based on their long-standing positions, “strengthening investor protections” is likely code for “We want ISDS, and we want more of it.”

5. Rolling Back Public Interest Safeguards to the Lowest Common Denominator

Similarly, “unified process” was a recurring phrase throughout the corporate comments. Again and again, corporations listed demands for a unified entry system, unified online payments, unified customs procedures, etc. The Payments Leadership Council, the National Foreign Trade Council, the U.S. Chamber of Commerce, and more organizations are calling for such uniform processes. Phrases like these should always give us pause, because any call for ‘regulatory practice uniformity’ could be trade speak for achieving lowest common denominator in consumer safety oversight.

Granted, cooperation among regulators is not inherently a bad idea. What IS very dangerous is for such cooperation to happen in the context of a traditional free trade agreement that prioritizes reducing costs for businesses over any protection of consumers or the environment. The biggest banks, agribusiness, chemicals and pharma corporations in the U.S. have made clear time and time again: it’s consumer and environmental protections they intend to undermine in the name of “regulatory cooperation.” Uniformity and high consumer, environmental, labor standards aren’t mutually exclusive, but should never be considered a tradeoff.

So now what?

That was a lot of prophet-of-doom-ing.

To be clear: this process is only just beginning to begin to start to form. This federal comment period for IPEF, meant to invite public input toward developing US negotiating objectives and positions, just ended on April 11, 2022.

USTR Tai is adamant that IPEF will be a new type of economic arrangement, one that “goes beyond what we've done traditionally with all of the traditional trappings and the traditional pitfalls.”

The global economic system that shattered when COVID-19 hit is one that we must not, and frankly cannot, return to, per USTR Tai’s insistence (and ours) (and those that have suffered from neoliberal, corporate-rigged hyperglobalization worldwide). This effort to build a new trade paradigm can reflect this administrations goals of a worker-centric, sustainable, equitable trading system – it’s exciting! But to avoid the mistakes of the past, we have to be cognizant of the demands corporations are pushing. They might have the money and the armies of lobbyists making grandiose demands in their side, but we have reality and justice on ours.

Current Status of the Campaign to Waive WTO IP Barriers to COVID-19 Medicines: Remarks From the People’s Summit to #EndCovidNow

The People’s Covid-19 Summit was a series of online days of action centered on the core idea that we know what we must do to fight COVID-19 and prevent the next variant -- the political will is all that’s missing. On the final day of the May 9-12 event, timed to coincide with Biden’s global COVID summit, Melinda St. Louis delivered the following remarks. 

By: Melinda St. Louis

Thanks so much for the opportunity to join our international partners and this fantastic panel tonight. My name is Melinda St. Louis, and I am the director of the Global Trade Watch division at Public Citizen, a U.S.-based consumer organization with half a million members and supporters that has advocated on behalf of the public interest for more than 50 years.

Global Trade Watch has led the fight against corporate-rigged “trade” agreements that provide special powers for Big Pharma to raise medicine prices, promote the outsourcing of jobs and undermine the food safety and other safeguards on which our families rely. 

We’ve been working to address global COVID vaccine inequality through a trade policy lens. Because, in addition to funding and sharing technology, part of the solution to vaccinating the world is getting rid of intellectual property barriers at the World Trade Organization through what is called the “TRIPS waiver.”

The reason we need this TRIPS waiver is, WTO rules require countries to guarantee pharmaceutical corporations’ monopoly control, which means a long wait for production of generics. In the COVID-19 context, these intellectual property barriers impede the global production of vaccines and contributed to the shameful reality that still only 15% of people in low income countries have received their first shot and will be ill-prepared to ramp up rapid production of newer generation vaccines targeting new variants, as well as lifesaving treatments and diagnostics.

Over a year ago, India and South Africa proposed a TRIPS Waiver to temporarily waive those intellectual property barriers so countries could produce their own COVID medical products -- and there are dozens of facilities around the world ready to do so, if only they were allowed. 

After a powerful campaign led by many of the people here at the People’s Summit, President Biden announced support for a TRIPS Waiver on vaccines. After the first Global Covid Summit, the White House included support for delivering aTRIPS waiver in its pillar of commitments to vaccinate the world. But a year later, we still don’t have a waiver.

What we have instead is a shocking counterproposal introduced at the WTO last week. This counterproposal is not a waiver. Instead, it is a clarification of existing options that countries already have at their disposal. And it would even add new barriers to countries trying to bypass intellectual property barriers. 

The only WTO member that has signed off on that counterproposal is the European Union, spurred on by pharma-friendly Germany. The EU and WTO leadership are hoping to force countries to agree to this terrible proposal so the WTO can claim to have done something to address the barriers that it created. Sadly, the WTO director general called this counterproposal a “workable solution” at the Covid Summit today, when in fact it would be a step backwards.

But we will not be fooled. Civil society and experts from around the world agree: this counterproposal should be rejected in favor of a real, comprehensive TRIPS waiver. 

In addition to notable individuals like Nobel Prize-Winning Economist Joseph Stiglitz and Former UN Secretary-General Ban Ki-moon, organizations that oppose this counterproposal include:

• Public health organizations, such as Doctors Without Borders, Oxfam, Partners in Health, and People’s Vaccine Alliance
• Human rights organizations, such as Human Rights Watch and Amnesty international
• Labor organizations, such as Public Services International
• And importantly, civil society and prominent academics in India and South Africa (the countries behind the original waiver proposal).

The need to address these important intellectual property barriers was noticeably absent from the agenda of today's Covid Summit, which is very shortsighted, as world leaders claim to recognize the need to prepare for future strains of the virus and future pandemics.South African President Cyril Ramaphosa used the opportunity to call for the TRIPSWaiver that would cover vaccines, tests and treatments, and Indian Prime Minister Narendra Modi also called out the need to remove WTO intellectual property barriers in their statements at the summit today. It was disappointing that the White House did not include this previous commitment in its remarks or fact sheet from today’s summit, as this would have been a critical moment to galvanize world leaders.

We have less than a month before the biggest WTO meeting in years. We have to increase pressure on the US to resist the terrible counterproposal and show leadership to get a real TRIPS waiver. 

And, President Biden needs to update the US position to support a waiver for tests and treatments in addition to vaccines. The lifesaving treatments now on the market for those who can get them, were not yet available last year when Biden announced his historic support for a vaccine waiver. At this stage in the pandemic, tests and treatments are essential tools.

We have an easy tool I can share with you so you write to the White House on this. I encourage you all to do so, and share with your friends and family. 

And speaking of the White House, I’d now like to share with you a video from international public health workers that Public Citizen, Be a Hero, and others projected to President Biden at the White House at a moving candlelight vigil ahead of this summit. We shared messages from public health advocates around the world, as well as a special video from Ady Barkan reminding Biden of his personal promise to Ady to share vaccine technology. 

Video: Full #EndCovidNow People's Summit Pannel: Final Night

Video: Summary of White House Vigil

Video: Be a Hero's Ady Barken to President Biden: Keep your promise

IPEF at the Crossroads

[Reposted from PC News]

By: Karolina Mackiewicz

U.S. Trade Representative (USTR) Katherine Tai has stated repeatedly that the Biden administration’s vision for trade will not repeat the past mistakes of prioritizing large business interests above all else, but will serve workers, consumers, and the environment. This is a welcome change after decades of U.S. trade policies that have offshored jobs to countries with exploitative labor conditions, encouraged polluting industries, and constrained domestic consumer policies.

In October 2021, President Biden introduced the “Indo-Pacific Economic Framework” or IPEF. Little is known about IPEF as of now, including which countries will be participating in the framework.

It could be an opportunity to realize a new, lasting vision for trade that deserves broad support. However, the notion of an IPEF did not come from consumer advocacy organizations, environmental groups, or organized labor. And one thing we do know about IPEF is that mega corporations are hoping to use it to solidify their power.

Big Tech’s “Digital Trade” Power Grab

At a recent Senate Finance hearing, Senator Elizabeth Warren (D-Mass.) warned Ambassador Tai that “lobbyists for the giant corporations are celebrating IPEF as the second coming of the [Trans-Pacific Partnership] TPP… Tech companies like Facebook and Amazon… are involved in spreading misinformation, mistreating workers, and squashing competition. They also hire hordes of lobbyists to protect their way of doing business.”

An initial review of public comments submitted by the Chamber of Commerce, PhRMA, and other corporate interests justifies Sen. Warren’s concern. Industry lobbyists are pushing for IPEF to emulate the TPP, a proposed pact that never earned majority support in Congress because it would have offshored jobs to countries that use forced and child labor, locked in high medicine prices, and threatened public interest safeguards.

In particular, the so-called “digital trade” proposals Big Tech is pushing are not focused on remedying actual problems related to the online sale of imported goods, such as tariff evasion and product safety. Instead, tech companies hope to use IPEF to lock in binding international rules that limit governments from regulating online platforms and from fighting corporate concentration and monopoly power. They seek to undermine domestic policy space on important issues like gig economy worker protections, discrimination and algorithm transparency, competition policy and anti-trust, corporate liability, and consumer privacy.

Trade for People and the Planet

In comments submitted to the USTR, Public Citizen described the vision needed for IPEF to succeed in terms of policy and politics. Key components include a transparent and participatory negotiating process; strong labor and environmental standards based on key international agreements; and digital rules that prioritize workers’ rights and privacy over corporate interests.

Whether this vision will be shared by all administration officials involved in IPEF remains to be seen. Ambassador Tai, who will lead one of IPEF’s four pillars, often speaks of a new type of trade policy that uplifts workers across borders and tackles climate change head-on. However, the other three pillars of IPEF will be led by Commerce Secretary Gina Raimondo, a former venture capitalist and “free trade” fanatic.

Sen. Warren and Sen. Bob Casey (D-Penn.) recently sent to each of the administration leads joint letters that reflect this internal division. Their letter to Ambassador Tai voiced support for her goal of “worker-centric” trade, while Secretary Raimondo’s was much more critical of her enthusiasm for “traditional free trade agreements have been terrible for workers, consumers, and the environment.”

More Information Coming Soon

On May 12, the United States will be hosting a meeting of the Association of Southeast Asian Nations (ASEAN), a political and economic union of ten countries in the region. This may be an opportunity for the administration to announce some or all of the countries that will be part of IPEF negotiations. The countries involved will give more information about the scope of the agreement and issues to be included.

Public Citizen will closely monitor the negotiations and ensure the public is apprised of how terms of a potential IPEF will affect people’s jobs, health and safety and the environment. We will fight fiercely to realize our new vision for trade, and to avoid IPEF replicating the past failed trade-pact models that have benefited large commercial interests to the detriment of most.

Hard-Won Workers’ Rights in New NAFTA

By Sally King

In the first week of February, a historic union election happened inside one of Mexico’s largest General Motors (GM) plants. Workers in the city of Silao in central Mexico voted overwhelmingly to affiliate with the National Independent Union for Workers in the Automotive Industry (SINTTIA). The union, which gained strength as an alternative to the corrupt, boss-friendly “protection unions” that have long plagued workplaces across Mexico, will now represent more than 6,000 employees at the plant.

This vote was not only a historic moment for the Mexican labor movement; it was a first test of the labor reforms written into the revised North American Free Trade Agreement (NAFTA), known as the United States-Mexico-Canada Agreement (USMCA). 

The USMCA and New Labor Rules

Public Citizen’s Global Trade Watch fought against the original NAFTA and has called for reform of that agreement since 1994. Our goal with the USMCA was to bring about real and enforceable changes, including mechanisms in the agreement itself and ensuring that Mexico committed to its labor reform laws within a four-year period. 

Many of the USMCA’s strongest rules were made possible through the pressure Democrats in the U.S. House of Representatives and groups like Public Citizen forced on former President Donald Trump to renegotiate his proposed revision of NAFTA. The result was improved labor provisions and a novel Rapid Response Mechanism (RRM). The RRM is a targeted, facility-specific enforcement mechanism unique to the USMCA devised to protect workers’ right to organize. For decades, Mexico’s laws and institutions have at best been permissive of — and in many instances even fostered — the collusion between corporations, employer-controlled unions and government officials to the detriment of the rights and interests of Mexican workers. The result is that 25 years after NAFTA, Mexican real manufacturing wages are lower than manufacturing wages in China. This corporate race-to-the-bottom system worked to keep wages down and helped big companies export over a million U.S. jobs to low-wage, exploited labor under the original NAFTA.

Instead of standing with workers, Mexico’s traditional protection unions, many tied to the long-ruling Institutional Revolutionary Party (PRI), have historically been closely allied with employers and politicians, keeping wages low and preventing workers from organizing to improve conditions within factories. These secretive “unions” often finalized contracts without workers’ knowledge and with even fewer benefits than was guaranteed under the law, undermining Mexican workers’ rights and interests.

The system has been stacked against workers for decades. Mexican workers have had little say in choosing the unions that represent them. Workers have been blocked from engaging with or even seeing their collective bargaining agreement. Workers who step out of line or attempt to organize have faced repression and violence from the companies they worked for and even from local authorities.

But the USMCA’s labor rules and the domestic reforms made by Mexico during the deal’s negotiation require a commitment to eradicate protection contracts and address deep corruption in the labor system. This includes improved enforcement rules to ensure fair union elections and requirements that workers be able to see union contracts in advance of voting on them.

What’s Happening Now

In April 2021, workers at the General Motors plant held a vote on whether to throw out their contract, but destroyed ballots were found in the offices of the existing protection union. Thanks to the new labor rules under the USMCA, workers were able to utilize the RRM. That then prompted the Biden administration to formally ask Mexico to review the case. The workers elected to throw out their old contract in August, leading to last month’s historic vote for an independent union that will negotiate a new contract.

This win to provide opportunities for workers with representation from an independent union at GM marks a possible new beginning for a shift to stronger labor standards with real enforcement in Mexican factories.

Everyone will be watching this and other RRM cases. We still have a way to go to realize improvements on working conditions, wages, and overall labor rights across North America under the USMCA.

WTO vs. Policy Space: New Report Shows Trade Organization Rarely Allows Countries to Use Exceptions

Melanie Foley 

Welcome everyone to today's event releasing the new report from Public Citizen's Global Trade Watch, titled WTO General Exceptions - Trade Laws Faulty Ivory Tower. My name is Melanie Foley, I'm the international campaigns director at Global Trade Watch, and I will be the moderator for today's event. This new analysis of World Trade Organization case decisions reveals that countries rarely succeed and attempts to use the WTO exceptions to safeguard policy spaces challenged as WTO violations. Even though the affirmative defenses ostensibly were designed to provide nations with policy space to pursue health, environmental and other goals. Absent changes to WTO rules, the global trade regimes viability and legitimacy will continue to fade as governments prioritize addressing the major challenges of our times from climate crisis and the harmful rise of digital mega corporations, to extreme inequality and the threat of an endless pandemic. And now it is my honor to introduce our speakers. Lori Wallach is the director of the Rethink Trade Program at American Economic Liberties Project. She is also a senior adviser to the Citizens Trade Campaign, the US National Trade Justice Coalition of unions and environmental consumer, faith family, farm and other groups. Lori is an internationally recognized expert on trade with experience advocating in Congress and foreign parliaments, trade negotiations courts, government agencies, in the media and in the streets. Lori has written extensively on trade and globalization issues, most notably two books: The Rise and Fall of Fast Track Trade Authority, and Whose Trade Organization a Comprehensive Guide to the WTO. In 1991, Lori began Public Citizen's Trade Program bounding its Global Trade Watch division in 1995, and directing it for 26 years. Daniel Rangel is the research director of the Rethink Trade Program at American Economic Liberties Project. And until recently, he had the same position at Global Trade Watch where he carried out most of the research for this paper. Daniel is a Colombian lawyer and political scientist and he holds a master's degree in international economic policy from Sciences Po Paris, and an LLM in international legal studies from Georgetown University Law Center. He specializes in international trade and investment law and policy and he carries out advocacy activities in trade and labor issues, particularly in the context of Mexico's commitments under the USMCA. Jane Kelsey is professor emeritus at the University of Auckland New Zealand, where she specialized in international economic law, focusing on trade and services investment and regulatory issues. In her long career, Dr. Kelsey has written many academic articles and technical reports, briefed to governments and affected sectors on legal developments advised delegations on bilateral mega regional and multilateral negotiations, and run training workshops on related matters for government officials, legislators, trade unions and civil society. Last but not least, Alvaro Santos is Professor of Law and faculty director of Corolla, the Center for the Advancement of the Rule of Law in the Americas at Georgetown Law. He teaches and writes in the areas of international trade, economic development, transnational labor, law and drug policy. In 2018, he served as deputy chief negotiator of the USMCA for the newly elected government of Mexico. Professor Santos is co-editor of the books World Trade and Investment Law Reimagined, a Progressive Agenda for an Inclusive Globalization, Law and the New Developmental States the Brazilian Experience in Latin America, and the New Law and Economic Development, a Critical Appraisal. He's also the author of numerous journal articles and book chapters. And now the authors of the reports will present the findings and then the commentators will make some additional remarks about the importance of ensuring that trade agreements adequately safeguard policy space to attain non-commercial goals. So Lori, could you please tell us why Public Citizen tracks the WTO exceptions record? And what is the importance of conducting this study?

Lori Wallach 

So the original impetus in this study, and really this work, the first version of this report was done in 2005, was when the scope of the trade agreements began to impact most directly be behind the borders domestic regulatory policy space. So at the time of the Uruguay negotiations that established the WTO. And NAFTA and other free trade agreements, scholars, advocates, members, policymakers, members of Congress started to worry, after that initial GATT case, before the WTO and the tuna dolphin case that increasingly trade agreements might undermine domestic health and environmental and other public interest policies. And the negotiators systematically around the world said don't worry, there are exceptions, these general exceptions preserve policy space, they ensure that there's a balance so we can get the benefits of expanded trade and also make sure we can have the policies that prioritize other goals. And pretty systematically, a lot of advocates and increasingly legal scholars said, "I'm not sure the balance is right, and actually do these exceptions work?" And what we have found over time is that unfortunately, the exceptions have not proved to function as the way they were promised. And in fact, in a pretty systematic way, the commercial goals and incentives have been prioritized in the implementation and in the rules of these trade agreements. So Public Citizen started tracking just to find out empirically, what was the score quantitatively, were these exceptions being used? Weren't they being used for tribunals or countries trying to use them countries not trying were tribunals accepting them? And that is the genesis of this study. And this is the fourth iteration of it. And I don't know if you want to ask a follow up question, if I should just keep going.

Melanie Foley 

Thank you, Lori. I was wondering if you could tell us a bit about the thresholds and give us some of the top headlines of the report.

Lori Wallach 

Yep. So what we found out was in this most recent version, which is now 26 years of the WTO's existence, there have only been two successful uses of the general exceptions, which are premised on GATT article XX. So two uses have been successful out of 48 attempts. And the lead author and investigator, who is Daniel, can explain a little about the methodology of what those 48 attempts are based on. But two out of 48 is the score. And in both instances, which is the US shrimp, and US tuna dolphin cases, the particular sub provision that was used was the accepted was the one that is related to the conservation of natural resources. And that gets to sort of the threshold of tasks that have to be met. Because the bad record, just on the surface, is sufficient to show that some rebalancing these rules is necessary. Part of that will certainly be fixing general exceptions, though that its own is not going to be sufficient. The underlying rules need to be balanced. Countries need to think more about whether they're going to cut out whole swaths of policy from being subjected to the rules or if the rule should be cut from covering whole sections of policy. So the rules themselves need work, but getting the exceptions right is of importance. And so part of what this study did is also break down on which prong of which test of these exceptions that attempted use of them failed. And so the first level of exception, and there's a great chart that goes through each of these prongs. The first level exception, the first level of the thresholds to use these exceptions is the subject matter, something that is covered. And so some things are in the GATT. There are a couple of things are covered in the GATS services that aren't covered in the exceptions for goods, and vice versa. But neither of those exceptions scope what kinds of policies are considered legitimate for an exception to otherwise violate the obligation. Neither of them cover a lot of subject areas that countries would have very legitimate purposes to regulate in the public interest. So the first question is, do you have a policy that's actually covered in the scope of any exception? Then the second question is the qualifier. So does it have to be does your measure the policy you're using doesn't need to be necessary to that goal if there's a legitimate goal? Or Is it good enough that it's related to interestingly, the two cases that were successful in using exception have the related thresholds which is easier to satisfy. The study breaks down each prong of the necessary tasks, which is very hard to use, so have to have the goal, then how does your measure relate to the goal, next test you have to satisfy. And then there's a there is an identical chapeau language on both the GATT and GATS set general exceptions and those that language is replicating a lot of FTA's as well. And that language is another set of three sort of sub tests, you have to get through the chapeau. But the chapeau itself has three tests. And that has to do with how the measure is applied, and is it in the manner that would constitute a means of arbitrary discrimination. That would constitute a means of unjustifiable discrimination between countries with same conditions prevail, and then now applied in the manner that would constitute disguise restriction on international trade. And so the getting through that whole gauntlet, only two measures have made it the whole way. And Daniel will speak to at which part of those tests the most difficulties arise, because that helps us think about the reforms, which will also describe that we propose and what needs to be addressed.

Melanie Foley 

Thank you, Lori. And now that we know a bit about all the thresholds that must be met. Daniel, could you please tell us some of the top findings of this report? And what policy recommendations you would suggest to fix the problem?

Daniel Rangel 

Thank you, Melanie. So we started off by trying to figure out which are the exceptions are most often involved in the dispute settlement system that WTO and as you can see on this slide, and both public health so GATT, article 20 B, and the natural resources exception GATT, article 20 G, are up during the list. But interestingly, that article 20 D also there, which is an exception that is a mouthful, but I'm going to read to you, and is those measures that are related and that are necessary to secure compliance with laws or regulations, which are not themselves inconsistent with the provisions of the GATT. And the way in which I will see this is that this is this is supposed to be like a joker exception. So whenever you have a law that is not tied to any of the policy objectives that are in the other sports, you should be able to use paragraph D. The problem is that when we go into the first threshold, we realize that in most cases, not in most cases, but in a disproportionate number of cases, whenever a respondent has tried to use the subparagraph D exception, it has lost on these first step. So six of the 17 cases when the super graph has been analyzed, and are cases where the respondent lost on the first threshold. And while article 20 D represents 35% of the exceptions raised now as an analyzed in the dispute settlement system, it represents 67% of the cases lost on the subject matter threshold. So there is clearly an inflexibility of WTO tribunals, with regards to these specific thresholds on the stem. And we found that this is particularly important when other international obligations are in play. And in our paper, we assume in the India solar cells case, which is a case in which India attempted to use this exception to justify some domestic contract requirements that are adopted for the sale of solar energy to the government. And India in that case, pointed out that these measures were necessary to comply with its international obligations to reduce carbon emissions. And these international obligations came from the UN Framework Convention on Climate Change and the Rio declaration and other instruments. And in a very formal least interpretation interview The appellate body and the panel determined that since these instruments weren't enshrined in India's domestic legal system, then they couldn't be considered laws or regulations within the meaning of article 20 D. And in our view that's in itself an evidence that there is a need for a wider scope of the exceptions that actually give room to these important policy objectives or over time, like fighting climate change. But moving forward to the next step of analysis, and is what Lori referred to the qualifier thresholds. So as we mentioned, here, responses have to prove either that the measure is necessary to fulfill those universal objective or is related to, and as you can see on the graph, it has been way harder for respondents to prove that the measure is necessary. So here, we're gonna go into something that people that are familiar with WTO law know very well, and it's evolution of the necessity standard, and particularly when it comes to the contribution of the measure, because on one of the first important WTO cases, on the exceptions, a Korea beef the appellate body step basically, that for a measure to be considered necessary. It had to be almost indispensable. And that received a lot of pushback. And in 2007, in a new case, Brazil Retreaded Tires the arbitrary said, no, no, it doesn't have to be indispensable. It just has to make a material contribution. And a lot of policy makers and scholars saw that decision as the appellate body moving forward to a more defense friendly approach to exceptions. But the thing is that when you look into the number of the cases that were decided before and after Brazil Retreaded Tires, it turns out that there was a greater proportion of cases involving the necessity test that passed this threshold before that case than after. So before 40% of exceptions relying on the necessity analysis pass the set the test, while after is only 35%. And we are aware that this is a small sample. But also if you look into all of these cases that failed the necessity test after Brazil Retreaded Tires in every one of them, the WTO adjudicating bodies question, the contribution of the measure. And these to the very least has to raise some questions about the extent to which the changes in the interpretation by these tribunals is actually generating changes in the outcomes of the cases and the degree of deference that is given to the states or trying to regulate in the public interest. And finally, going through the last threshold and I want to spend a lot of time on the cases in these because I want to get to our some of our recommendations. But as you can see, here are 48 cases where responds were trying to use GATT article 20 and GATS article 14, the general exception provisions of those agreements, only 14 reach to the chapeau threshold. And of those, only two were finally considered consistent with all of the requirements and justified under the general exceptions. And so how do we fix this system in order to actually give or recognize a country's policy spac? The first thing will be to widen the scope of coverage of exceptions. As we mentioned, there are a lot of different policies that have been trying to be defended through subparagraph D. That is the Joker exception that that have failed on the very first step. And that is in itself approved that we need further exceptions and we need exceptions that deal with human rights, where we indigenous rights, with tobacco control. Also the existence of paragraphs could be amended so that's paragraphs b and g which deal with health and exhaustible natural resources could be amended to include multilateral environmental agreements such as those that India was trying to invoke to justify its domestic control requirements in India solar cells, also subparagraph E to be expanded, which is the defense studies related to prison labor to include more international labor standards, particularly those related to the right to organize. And to be clear, this could be done either ideally reforming the WTO agreements, but also in a lot of different free trade agreements that have language that is very similar to the one establish very similar or identical to the one established in the in GATT, article 20. And another important fix and is one of the most important in our view is that the something has to be done with the necessity test. And we have three proposals in that regard. First is make the necessity element of the exception. So judging, and this has been done, for instance, in the recent agreement of RCEP, in the data provisions that this agreement has, and basically what it will entail is that whenever a country proves that the measure is designed to address the policy objective that is mentioned in this paragraph, then the measure is treated as necessary, because the country consider those is necessary. And if there is further discussion, it will be given in the support. But then there wouldn't be discussion about trade restrictiveness or something like that. Another option is actually removing the trade restrictiveness analysis from the exceptions, or even replacing in all of the subparagraphs, the necessity standard for a design and applied to threshold. And this actually has been done in a lot of international investment agreements that have borrowed the language from the GATT article 20. And the two other recommendations that we have are related with the Chapeau. The first one is that it's necessary to adjust the checkbook terms to the realities of domestic policymaking. And here we're drawing a lot from the work from Timothy Meyer, a super interesting article, in which he explains how policymaking has mixed motives and mixed motives are necessary to pass or enacting legislations many, many times. And that these realities do not find their way in the analysis in which the analysis that has been conducted by the appellate body and departments at the WTO. And a fix to reform this condition will be to include a predominant motive test into the Chapeau language, so that there is some room for the appellate body and to for panels to actually understand all of these problems. And the second recommendation related to the Chapeau will be to place the burden of proof on the complainant berry with regards to those conditions establishing the Chapeau. And this is very important, because in the very first case of the WTO use gasoline, there are a body without giving it a lot of thought or at least explanation plays the burden of proof of the Chapeau requirements on the respondent. And if you take a look at the response of the Chapeau requirements, these are negative conditions, and a general rule in international law is that whoever affirms boss positive proposition, then that party has to prove it. And for some reason that didn't happen on this case, and to this very day, it hasn't changed. And the respondent still has the burden of proof to say that the measure is not discriminatory or is not a disguised restriction on trade, which doesn't make sense. That should be the burden of the complainant theory. And if the complainant party makes a case in that regard, then the respondent could be able to refute it. So we think that these are important policy recommendations that could be adopted, and that they will go a long way into actually recognizing the domestic policy space of a stage for undertake the important measures that are necessary to deal with the different challenges of our lifetimes. And I think I will stop there and I will let yield the floor to Jane.

Melanie Foley 

Thank you, Daniel. Now Dr. Kelsey knows very well that for many years Public Citizen has tracked this WTO exceptions record. Jane, could you please tell us about the importance of this effort and what alternatives there might be to the general exceptions, given the evidence that shows that they are increasingly inadequate?

Jane Kelsey 

Well, thank you very much. Kia ora from New Zealand. It's a real pleasure to offer some reflections on this paper because for over many, many years, decades now, when governments have been confronted with concerns that WTO rules and then subsequently similar roles in free trade agreements have threatened policy space and created conditions for regulatory chill on the adoption of important public policies or compliance with international obligations that are not about traditional ideas of trade. The government's have routinely misrepresented these exceptions which we've seen are largely ineffective as providing full protection, and those who hear these reassurances really have not had access to counter information. And so the past iterations of Public Citizen's analyses, and I'm sure this latest update have been very important resources to be able to show people that not only are the exceptions, deeply problematic, but that government sales pitch, if you like, for the agreements, relies on an imbalanced perception of the role of commercial interests versus the importance of protecting policy space in the domestic and the international domain. And so I'm really delighted to see that public citizen has updated in such a comprehensive way, their earlier analysis. I have been tracking these developments since the Uruguay round in the late 1980s. And as someone who works in particular on areas of services, and regulatory constrains, what has become an extremely problematic is the extension of so-called trade rules behind the border to constrain what governments are able to do in what are considered to be legitimate domestic policy, regulatory and legislative forums. And that started with the WTO. It extended through various free trade agreements. And now we're seeing it back in the WTO, with the so called joint statement initiatives. And the GATT exceptions, which date back to 1947, have become increasingly problematic when we've been seeking to apply them to this expanding range of behind the border constraints. Yet, when these issues are raised, there is an inertia or more often positive resistance to revisiting them, because that would implicitly concede that there are limitations and faults in the rules and the agreements. And so what we see instead is that they're just routinely rolled over, which compounds the problems. And at the same time, as we've seen the rules becoming more expensive, the post-1990s neoliberal agenda, or the 1990s onwards, neoliberal agenda has, in fact, expanded the scope of the agreements, leaving the general exceptions to do even more work. So if we take the GATS, for example, the so called public services carve out, which was always inadequate because it only applied to non-commercial services provided through a state monopoly. How many services do we have now that non commercial state monopoly services? So that's so called public services carve out which is still routinely pointed to by governments is in applicable to almost anything that governments do. And because the carve out is even less applicable than it was in the 80s and 90s. When it was being designed, we have to rely more and more on the inadequate general exceptions whose three layer test leaves almost nothing to be protected as the Public Citizen analysis showed. An additional problem that we've been finding is that, of course, the categories set out in the GATT general exception, and in the GATS, general exceptions of the time, and so they reflect both the historical era and the power politics in which they were negotiated. And the report refers to the culture question in that context, but I work a lot on indigenous rights, which were nowhere near the negotiating agenda, even during the EU Dugway round with the GATS lit alone back during the GATT. And we had battles in this country during the Uruguay Round around the TRIPS, which, to which the general exceptions don't apply, and to the GATs, where there was as a minimalist limitation in New Zealand's schedule. Of course, after both the GATT and the GATSwere created, we had, for example, in the United Nations, the UN Declaration on the Rights of Indigenous Peoples, but that was only adopted in 2007. So we have a question about how those rights to be reflected when we're dealing with arguments in either the GATT or GATS TRIPS Agreement, or then in the general exceptions, and we had a tribunal case here recently, which involved one of the contemporary issues that we have on the agenda and the WTO and, in the FTAs, which is the e-commerce or digital trade agenda. And the issue for Maori was how to protect their data in light of those chapters, which effectively give big tech control over that data and the ability to hold it wherever they want in the world. And the government said they could rely on the general exceptions, as part of the defense the government raised, but of course, the general exceptions have no recognition of indigenous rights. And the government suggested or maybe they could be squeezed into the category of public morals, which is totally inappropriate for indigenous rights over data. And we argued successfully in the tribunal, that there's no way a panel or an appellate body, if one existed, would have enough understanding about indigenous rights over data, let alone that such matters would survive the three tier test. And so there was for us a really important contemporary example of the problems, which the tribunal recognized that you cannot rely on exceptions to address such fundamental tensions between the rules of the trade agreements, and other internationally recognized rights. And in the case of New Zealand, the Treaty of Waitangi, which provides protection for those rights, but not in formal domestic law or regulation. So that comes back to the importance of having carve outs right at the beginning of the rules, so we don't need to rely on the general exceptions at the end. But we're seeing now, even in the contemporary roles, such as e-commerce, those carve outs are very limited. And instead, there's a tendency still, firstly, to cross reference to the GATT and GATS exceptions to the extent that they are applicable. But that's uncertain and highly debatable before we even get to the problems that Public Citizen has identified. And then within the chapters on e-commerce or digital trade, and DJSI text. There are specific exceptions, such as those on movement and storage of data that import some of the wording from the general exceptions, such as the necessity or the chapeau language, but with variations on the wording that create even further uncertainties about how they would be interpreted. So in some, the various proposals that Public Citizen has put forward in the paper are a really important start to thinking about more effective public policy protections. But the only part of the picture. It's clear that governments can't just keep rolling over the same flawed exceptions in FTAs, and future WTO agreements. They can't expand the rules even further beyond what is the legitimate rubric of trade. They need more effective carve outs for public policy measures and international obligations. And they need to exclude matters from the jurisdiction of dispute bodies, but they also have to be prepared to revisit the ineffectual decades of WTO exceptions. Sadly, there is no political will that I can see on the part of trade negotiators. The WTO to do so. So hopefully those who are listening to today's launch of this report and then reading the report will help generate that political will. Thank you.

Melanie Foley 

Thank you, Jane. And now Alvaro, I'd like to ask you what lessons for the future? Can we learn from the findings of this new paper, and particularly from the perspective of developing countries and considering important issues like labor rights?

Alvaro Santos 

Thank you very much for the invitation to comment on the report. And so I will answer those questions, Melanie. And so first, let me say one thing about the report and its method, and then talk about labor development and conclude by saying a word about the lessons for other trade agreements. So first, on the method, congratulations on the report. It's a sobering analysis of how difficult it's been for countries to use the general exceptions. And I think it makes a really valuable contribution. And it's also sort of a call for reflection and action. As a scholar of international trade, I myself, have written about certain progress in the interpretation of general exceptions. And I think, you know, many other scholars have done that, too. And, and so there is a there was, at least for a while a sense that the panels on the appellate body were actually making these exceptions more capacious. So if one looks, for instance, at the difference between, you know, the tuna dolphin case in GATT, and how limited that interpretation was, but didn't allow a measure that was unilateral and had extraterritorial effects, a mentioned before was deemed to protect the environment, compared to high was dealt with shrimp turtle, in the end, there seems to be progress. And so I'm thinking also of the work, for example, of Rob House and John Alandra, about the use of the general exceptions, and particularly public morals, or the work of Andrew Lange, talking about world trade after neoliberalism. All of these and many more scholars sort of had a sense that there was there were some important changes, and that the more narrow neoliberal view, that predominated industrial establishment for a while, was given way, even in piecemeal fashion, to a much more integral and perhaps more pluralistic view of trade. And I think this report calls that into question or at least makes us reckon with the fact that if you look over sort of the arch of the, this 26 years, not much has been achieved, even if there has been some, you know, optimistic or hopeful decisions. And so, Daniel's reference to Brazil tires, which was one of those decisions that seemed to be even more deference to countries and particularly making an allusion to the capacity of developing countries when considering, you know, alternative measures. It's troubling, it's a call for thinking that despite what seemed like progress, there is, in fact, not much in the end, in terms of what we can basically point out to space for countries that try to use this exception. So in that regard, I think it's an incredibly valuable contribution, and one that will create a lot to talk about and a lot to analyze. I have one suggestion in terms of the method or that I think could be complimentary for further study in terms of what we have in the report. And that is that this provides a formal analysis of the way in which the cases have turned out in really good and detailed way. But I think there's also something more that can be done, which is to basically analyze what happened with those measures that countries tried to pass using the general exceptions, and how were they adjusted, right. So even if you think about the shrimp turtle case, you can think about that case, as a case of the US lost just one the last, you know, implementation panel. But there was a lot of sort of gaming to try to pass measure and then adjusted without over complying, sort of testing the limits of the exception, and I wonder whether some of these other measures that lost, these countries also adjust them in a way that then led them to let them have them, even if not in the original design. Even cases, for example, like us gambling, which is here counted as a loss, and rightly so, you know, there can be sort of partial losses and partial wins, right. So not all the measure was found in violation, there was like a specific aspect of the measure what happened with the rest. And also what happened with the one that was found in violation, we'll see that just know. These were, these are things that I think would be helpful to get perhaps more robust sense of how countries use the exceptions and in what way that affected them ultimately. Again, I think that this is a key work. And it's already very important, I think it can lead to this further analysis, to get a better picture of how this has worked for countries. But again, the census really puts it's basically focus on the problem of have exceptions have been so difficult to use, and so narrowly interpreted, despite their sense of progress. And that's why I think it's so insightful. Let me now move to the question of labor. And here the report recommends that, you know, the exception, the exception 20 E in GATT, he expanded beyond the illusion to prison labor to cover other core international labor standards. And I wholeheartedly agree with this proposal. But I also think that, you know, one, one really interesting aspect about the timing in which this report comes is that we're all thinking about the future of the international trade regime, both in the WTO and elsewhere. And so it's a really good moment for thinking about, you know, other potential changes. So expanding the exception, for sure, could be one, but since we're thinking about change, you know, I think we can take some sort of cues from the asbestos decision, particularly when it comes to questions like labor, as well, as dealt with health matters. But what was noted in the report was that, in the end, this was not decided, on the basis of an exception, but it was based on the analysis of non-discrimination and national treatment. And here think that it'd be useful to think about how concerns about labor violations could be incorporated in the rules of trade, rather than in the exceptions. So for example, can we think about how countries may be able to make distinctions between goods that have an able to discriminate if products are basically produced in violation of labor rights, and so here, just to use asbestos, again, the example is, asbestos products made in Canada, are different from asbestos lack from other products made in France, based on an analysis of likeness. So they were found not to be like, precisely because of the health effects, given the physical characteristics and consumer preferences. So something like that could be sort of attempted rather than deal with labor as an exception. And there are important differences here in whether you treat it as basically part of the discrimination analysis. That is that is valid, because they're not like products, or whether you're treated as a general exception. One is symbolic, because you're entitled to it, and you're not in violation. So you don't have to use an exception if you impose a barrier against a product that's in violation of labor standards. And the other is questions of evidence, and who has the burden of proof. And you know, this has been written about so it's not, it's not a new idea. Again, Rob House has written about this, but it's an important moment where this could be done. And we can even go much more boldly thinking about maybe a new agreement in the WTO free lateral agreement on labor, given that all the subsequent regional trade agreements have actually incorporated labor, with lots of problems, but in their texts. So maybe this is a time to actually create a multilateral norm that really gives justice to the concerns about labor. Let me now move to the development question. And so here, what I would say is that it'd be important to think about rights and also the use of general exceptions in a relational way. So, obviously, this is a familiar concept, the idea that REITs are relational. And so they often enter into conflict. In this case, one country's policy space is another country's trade barrier. And so here the idea is that just needs to be worked out and understood and accepted. That is that there will be a more capacious exception that would entail trade restrictions for these justifications. And here, my concern is how that affect or benefit developing countries, partly because some of the exceptions that are often invoked have to do with concerns of developed countries, but that that go, you know, government of developing countries or producers in developing countries, often called protectionist or worried about being protectionist. And so I think that, you know, they're obviously very good reasons to protect the environment and labor rights. And in my view, this will be beneficial to developing countries. But I think that we also need to analyze how these more capacious and expansive exceptions would be used and deployed. And it would be good to get from the report, also an idea of, you know, how the use of these exceptions, caught across developed and developing countries. And the idea that I want to propose here is that some of these general exceptions, could be useful to developing countries. But I think that if we're going to have sort of refocus the trade regime, in a way that doesn't obsess so much with market access, that is that it becomes more understanding of the societal values that countries have, and that we accept that, in fact, they could represent trade barriers for other countries, including developing countries, we also then need to think about ways in which development policies in poor countries need to be incorporated and allowed in the regime. So thinking about, for example, exceptions for industrial policy and in the industry development. So Daniel, I can mention India's solar cells case, well, there the use of a general exception, was trying to use the other laws and regulations provision, but maybe there is a case for creating an exception that explicitly regulates the possibility of experimenting with industrial policy. And that has all sorts of criteria to also create certain discipline so that it's not abused, and that it has a time exploration and so forth. We can think about also reinstalling, some of the exceptions to the provisions on subsidies that expired already. And were aimed to research and development and also to serve new technologies in green in the development of green technologies, and thinking here of their work, for example of Greg Shafer who has proposed some of these. But so all of this to say, yes, I'm all in favor of expanding the general exemptions. I also think we need to go beyond the existing ones and think about the needs for developing countries, particularly in this area, especially if we're going to accept that market access is going to be affected by the general exceptions for good reasons. And let me just conclude with some lessons for reform and other agreements. Part of it deals with, I mean, relates to what Jane was talking a minute ago, which is that, you know, I think one of the sobering aspects of this report is that it shows that what we thought or some of us thought could be understood as gradwell progress doesn't really provide much reassurance and so, as we are seeing or experiencing norm generation in other agreements, this practice of incorporating the general exceptions by reference to GATT or GATS should give us pause. And so it's basically it's a flag and a cautionary message to saying, don't negotiate new agreements or new provisions in agreements that you're uncomfortable with, because you think that the exceptions will basically give you the escape valve. And this is true for digital trade, but also many other areas. And I'll just finish by saying that I think this is a very good example of an area that was supposed to give countries policy space, and it didn't. But there are also other examples in the WTO, for example, safeguards that were supposed to give policy space to countries to deal with around domestic industries, problems and struggles. That has also been very limited. And so I think this can help us to think more holistically about the areas in which the trade regime has failed to do that, which have come to bite the regime and affected legitimacy. So, again, congratulations to the report, and I'm looking forward to seeing how some of these insights and conclusions could be further developed.

Melanie Foley 

Thank you all, and thank you to all our speakers. So for our last few minutes left, I'd like to turn to some audience questions, folks, you can click the q&a button down below and enter your questions. First off, we have Simon Lester, he says, I've raised the issue of overly stringent necessity and similar tests with people at USTR, the European Commission and the Canadian government. And none of them think there's a fundamental problem with the existing approach. Although they may support small tweaks in one direction or another. Part of the issue may be that for many lawyers, these types of scrutiny balancing proportionality tests are exactly what courts are supposed to do. And they can't see why trade courts wouldn't do the same thing. Thus, the challenge is to think about ways to shift these trade lawyers away from what they learned in school and feel comfortable with to a great extent, then the issue is not really free trade or even trade. Rather, it's about the appropriate function of courts and judicial review, efforts to fix the problem should take this into account. In my view, a big part of the focus should be this question: Why shouldn't trade courts use the same type of analysis as domestic courts do? Do I have any volunteers? From our speakers? Maybe, Daniel?

Daniel Rangel 

Yeah, I think that there's truth to the part of the comment that Simon made that lawyers feel comfortable with the things that they're comfortable with, and they're comfortable then replicating that in other scenarios. But that doesn't mean that the other scenarios are fit well with those practices that are most common and that fit better in the initial scenario that our domestic legal systems. And I think that I briefly discussed with Alvaro before this call, and is that trade courts are not administrative courts nor they are constitutional courts, they don't have the substistantial values of the different places where they are adjudicating cases for embedded in an instrument. Conversely, the rule exception framework has a rule that gives prevalence to commercial values. While the exception is something that only in exceptional cases, could trump that idea of the commercial value given problem that has to be given prevalence. And I think that that is the problem with pretended that a trade court could act as an administrative court in a domestic setting that could weigh and balance different sources tell objectives, when it's very clear that there is a bias and that there is a priority in the system. And that is why I found so appealing some of the comments Jane made about we need to think about this maybe in a different way about disclosures and carve outs, so that the system is actually in a way the system protects certain areas. And we only get into the cases that are actually agrevious trade discrimination. And the policy space of countries in specific areas is not decided by lawyers that are not considering all of these different values that the society is where the policies come from, are considering.

Melanie Foley 

Thanks, Daniel. Our next question is from Emmylou Walters. Clearly the exceptions only kick in when there's a breach of the GATT obligation. Do you think there's a role to play here and also reforming these obligations? Each likeness test that doesn't allow for differentiation on sustainability or animal welfare, which then pushes you into the exceptions for a policy with these objectives.

Jane Kelsey 

Well, if I can make a quick response, Melanie, and I've written an answer to that in in the Q&A. There have been some recent moves to do that, for example, in the TPP, CPTPP text for national treatment and MFN, the likeness test, there is a footnote. And the footnote basically says like circumstances includes whether the distinction is based on legitimate public welfare objectives. But that raises all sorts of ongoing problems as well, because it refers to public welfare, not public policy objectives, which is a new level of uncertainties. It doesn't have a necessity test, yet it's going to coexist with the general exceptions. And it's very unclear how the interrelationship of them will be interpreted, it also coexists with other agreements involving the same parties that do not have such a footnote. So before we even look at whether the trade bodies should in fact be passing judgment on what is a legitimate public welfare objective. We have these huge complexities in the attempt to fix the notion of likeness in a way that is really a kind of pragmatic expediency rather than a genuine fix.

Melanie Foley 

Thank you, Jane. And I think we have time for one more. Marcus Gustafson. Do you think that there may be a selection bias in your data? It seems members will most likely challenge the most egregious examples of protectionism. That's only the worst examples of protectionism deviating from the actual policy goals are likely to be challenged. Others are not challenged, or many are likely settled during consultations. And a secondary question of how do you regard pieces such as EC seals or China audio visuals where despite a loss under the WTO, the respective countries modify their regime to remove the protectionist element and continue to pursue their policy goals?

Lori Wallach 

Yep, I can certainly speak to the modifications, which is in the US context, in several instances. And this gets to the issue that was raised in the past, when the laws were modified to try and comply, they actually weakened the achievement of the underlying goal. And that has been an unfortunate consequence, both in the chilling when there's not full adjudication, but also in the actual compliance with some of these rulings. And this sort of gets the point that Alvaro is making, which is what you know, what actually happens practically, and in a variety of these use cases is a not been a good outcome, actually, in the compliance has actually undermined the goal, which then gets the selection bias, which is, I don't think there is a selection bias, if you look at the mix of cases, some of them are, you know, clearly not anything like your classic protectionism case. And some of the classic protectionism cases that we can all cite, have not been subjected to WTO dispute settlement. Typically, actually, there's like a unilateral threat over that, and or other nasty bargaining. And that's how that gets resolved on the side. So I don't think in the data, you have the bias that's being suggested on the front end, I do think it's worth just coming back to what I think a lot of this study reveals, which is as well as getting the exceptions to be effective, it's looking at the rules and the front ends and understanding that when you have rules that have such broad scope of what kinds of policies they're trying to cover. And you have a system that systematically puts commercial priorities first, which is the trade regime, it's not world government, where there's some set of values and you're balancing, you're going to have these structural problems. And you're not going to exception your way out of it, even though you need good exceptions. And so that does on the front end, talk about what kind of actual rules we want to meet what kind of goals we can get the benefits of trade expansion, while maximizing the policy space for other equally valid goals. So sort of closing historically on the the redoing of the study, and again, you know, thanking Daniel for doing that work. One of the points that having done this starting, you know, 10 years after the WTO was established and now many many years after was to make the underlying point, not just that the exceptions need to be be improved true, but that the actual system is really structured in a very lopsided way. And as the scope gets bigger and bigger and bigger, and now we have another round of that being threatened with the JSI, we need to think at the broadest sense of what rules are appropriate and what subject matters of should be have any rules made in the context of trade negotiations.

Melanie Foley 

Thank you, Lori. And since we are now at time I would like to thank our speakers again and all of you for attending. The new report is available on tradewatch.org. And a recording of this webinar will be posted there shortly. Thank you all again.

Rethinking Trade - Season 1 Episode 43: A New U.S. Approach to the WTO? MC12, Part 2

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Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

 

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. Welcome everyone to MC 12 Part Two. In part one, we discuss some of the big issues at stake at the World Trade Organization's 12th ministerial conference, or MC 12, which was scheduled to take place last week in Geneva. However, that meeting was postponed after travel restrictions related to the Omnicon variant of COVID-19. Ironically, many people would consider the number one issue for the WTO to deal with is temporarily suspending intellectual property barriers that are preventing the world from producing more vaccines, tests and treatments for COVID-19. Lori, with the ministerial cancelled, what's the status of the TRIPS waiver, the suspension of the intellectual property barriers, and maybe you could talk about the irony here of the ministerial being postponed for this reason.

Lori Wallach 

There's only one thing the WTO simply must do to help end the pandemic. And in fact, to not be part of the problem of having a permanent pandemic. And that is to get the hell out of the way. So the WTO's intellectual property rules require every country to provide monopoly control for certain pharmaceutical companies over how much COVID-19 vaccine, treatments, testing, diagnostic testing products can be made, where it can be sold, at what price. So this waiver of the agreement on trade related intellectual property or the TRIPS Agreement, some provisions of that is about getting these WTO obstacles to ending the pandemic removed temporarily. And so it's incredibly ironic that the WTO ministerial got shut down. Because for more than a year, the WTO chose obstacles to manufacturing sufficient amounts of vaccine and treatment and testing to be able to not have wildfire-infections across large parts of the world, which is precisely where mutations and variants get hatched. And so you know, if international organizations are subject to karma, then the WTO had this coming, because it's part of the reason why not only hundreds of 1000s of unnecessary deaths have occurred. But why we have cycle after cycle of varients, because, you know, here we are, almost two years in 7% of people in low income countries have gotten vaccinations, Three and a half percent of people in Kenya have gotten vaccinations. In the last couple of months, there have been more people in the United States who have gotten boosters than the total of 10 African countries combined, people have gotten any shots. And this lack of access, the shortage is the reason why variants will keep getting hatched. And there's a chance we don't know yet, there's a chance this particular variant could be the one everyone's scared about that gets around the vaccines, and then we have to start from scratch. So we need to have the waiver of TRIPS so that we can unlock these intellectual property barriers. And in numerous countries where there are qualified manufacturers in the Global South, they can start the process, which is going to take depending on whether they have full technology transfer, if the company's current vaccine monopolists are compelled to share, Madonna's former chief chemist says it's three to six months to get a vaccine line going. If they have to figure it out by reverse engineering some of it, it could be a year or more. But if we don't start now, by unlocking the IP, we're going to be in the same boat in a year from now with whatever the next wave or a variant is with millions more people dead. And it's scandalous. So the only thing that has to happen now, the WTO will figure out when it's going to have its next ministerial. Not relevant to this point, before the WTO decamped for its long Christmas break. They just need to have an online meeting. They don't need a ministerial to do the waiver. They need what's called a general counsel, and a general counsel can be done online as it had been done. During other months of the pandemic, and they just need to enact this waiver and get this show on the road.

Ryan 

And Lori as we got ready to record this episode, and while the rest of the world was waiting for an agreement on the TRIPS waiver, we got word that the WTO had just announced a brand new agreement to limit regulation in the services sector. Can you explain to us what this is about in its substance, but also, what it says about where the priorities are? Right now that this was done while the waiver sat untouched?

Lori Wallach 

Well, first of all, let's just explore why the waivers stuck. There are two big reasons there are 130 countries at the WTO that say they support a waiver, about 70 countries support the waiver, that is a tax, that's a specific written proposal that South African India put forward, the newest revision is from May. There are other countries, including the United States that say they support a waiver. The US so far, and the President reiterated this a week ago, said they support a waiver for vaccines, maybe not for the other medications. The President even said, because of the new variant, we need to do this now. However, the European Union, led by Germany, with the support of the United Kingdom and Switzerland have blocked any progress on a waiver, they are strictly on the side of Big Pharma, protecting these monopoly intellectual property barriers. And that's a serious problem. And there's only one way that is going to be overcome. And that is if the president of United States makes it his business to call up the new incoming Chancellor of Germany, and say, "This has got to end." This is looking terrible for Western democracies. We are seen here as somehow this institution, we say we support the WTO is seen worldwide as an obstacle to ending the pandemic and the European Union is seen as blocking it. And maybe the President wouldn't say this, but what is true is that the US not really leading, either pushing on their close allies, the European Union, the United Kingdom, Switzerland, to get the heck out of the way, or the US really leading the process because, you know, the US says it's for a waiver, but it hasn't gotten down to brass tacks. And for a waiver to be enacted, you got to have a piece of paper that says, "Here are the intellectual property provisions. We all agree we're waiving temporarily, here's how long we're gonna waive them duration wise. And here's what medical products we're gonna waive them with respect to." And so far, the US has really not bellied up to the bar. So there's been a lot of really nice rhetoric, "We support a waiver, we should do it now." But when the rubber hits the road, the US has not put down in any detail what is "the" waiver with support. So it's super stuck. We have 70 countries saying, "Here's a piece of paper we all support." You have the US not saying what they like or don't like about that paper or their suggestions to change it, and the EU basically want to light the paper on fire. And as a result, since May, we have seen no progress on substantive negotiations, or an actual text of a waiver to adopt. And that has to happen in the next couple of weeks. It's not rocket science, there is definitely a landing place. But the US has to step up the leadership and the EU needs to get out of the way. And that's only going to happen basically, if President Biden makes this a priority, and gets our allies shifted and take some leadership on trying to get this text together has to engage. Now, while all of that isn't getting done, somehow what the WTO had time to do was ink, announce and celebrate an agreement limiting environmental and consumer regulation in the service sector, the service sector being transportation, education, retail, everything you can't drop in your foot is basically a service, tourism, etc, banking, financial services. And so this agreement is sort of a very controversial one in that it doesn't involve all of the WTO countries. It's sort of a private little party a handful of countries had, there's a question about whether it's even quite kosher, it may not exactly be legal. And somehow there's been time to finish this agreement that the world's biggest banks and airlines and others have thought was lovely and excited about but there isn't time to actually prioritize and finish the waiver of barriers that are extending a pandemic that's killing millions of people and that is making the entire world suffer economically and health wise; it's pretty damn scandalous. And this sort of gets to what you know, we all have to do, which is that is not okay. That is not okay. That is not where the priority should be. And we basically need to all raise the volume with all of our governments about our demands to in the next couple of weeks before Christmas, just get the damn WTO waiver enacted. It's really doable, but it's gonna take more leadership from the Biden administration.

Ryan 

And you touched on this a little bit. But the TRIPS waiver, part of why it's being held up is because it needs to get a consensus decision. But then why was this agreement on the service sector regulation, why was that only a portion of WTO membership, not the entire organization? Is that the area where it where it may not be a kosher agreement?

Lori Wallach 

So the service sector agreement is being portrayed as a plurilateral agreement, which is to say an agreement that only covers the countries that have agreed to it. And the reason why it's probably not kosher is there is no mechanism to start a plurilateral agreement except by the consensus of all the countries, because even if you don't sign on an agreement that a bunch of other countries that you're in agreement with are in means it's going to change what your circumstances are with respect to some of those countries. So a bunch of countries have been trying to get this particular thing done. And it was not going very far. And a bunch of countries didn't want to do it. And so the countries that wanted to do it sort of used some residual authority from an agreement from 25 years ago, and they were just going to announce they were doing an agreement. In contrast, the waiver is under a particular article, if you want to look online, look up the Marrakesh agreement establishing the World Trade Organization, Article Nine Rowman IX is a waiver. These waivers happen pretty regularly in the General Counsel, by the way, not big WTO ministerios. And that waiver has a certain kind of process, and it's something the whole membership supposed to do. Now, here's the dirty little secret, you can vote on a waiver. It's like the nuclear option because everything gets done at the WTO by consensus so far. But if you pull up that agreement, that Marrakesh agreement establishing the WTO. And you can read the GATT, it basically lays out voting rules supermajority, so it's not simple majority supermajority voting rules for a variety of things, including these waivers. So I guess it's possible if the EU won't get out of the way at some point and the US doesn't engage. If enough other WTO member countries really get desperate and furious enough, I guess they could call a vote. But you know, there's a legal way to do that. And to do a waiver, whether that service sector agreement is one little bit kosher, that really remains to be seen. But whether it's legal or not, it's still damn outrageous as a matter of priority, that, you know, we're in the face of like the zombie apocalypse. And instead of like dealing with that, and in fact, instead of removing an obstacle to dealing with that, which is what the WTO is, instead, there's a discussion about something totally different, that really isn't in the public interest at all. Very infuriating.

Ryan 

There's obviously so much more we could talk about here. And much of that will of course discuss in future episodes, some of it we've discussed in prior episodes. But to wrap up for today, Lori, when will the next ministerial be held? Because it's just been postponed? Is it in discussion? And what will or could happen between now and then we've already mentioned that we don't need a ministerial to get the waiver. So what are the next opportunities for this to happen?

Lori Wallach 

So probably what could happen is that the sponsors of the waiver, South Africa and India at some point may just literally call for a special session of the WTO as general counsel and ask for countries to get together make this a priority and get the waiver done. And we would certainly support that happening. All the other stuff that was supposed to happen at the ministerial and some of it is contentious. That's all business that will or won't get done at the next ministerial or will or won't get done between the ministerials. There was an attempt to set the ministerial for a new date in March. The countries could not agree on that some countries had concerns that it wouldn't be clear enough yet whether it was safe to be together and what the travel situation would be. So there is no new ministerial date, which is why it makes it so important to get the waiver done before the WTO leaves for Christmas holiday. And that really is the number one priority, if you care about ending the pandemic, the waiver has to get done at the WTO which can be done by an online meeting before Christmas break.

Ryan 

Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Rethinking Trade - Season 1 Episode 42: MC12, Part 1: Danger and Opportunity at the 12th WTO Ministerial

 

LINKS:

MC12 Global Call to Action

3 Million TRIPS Petitions Delivered to President Biden

Senators Sanders, Warren, Baldwin and Brown call on Biden to Push for TRIPS Waiver at MC12

Reuters: Activists Urge Biden to Push for Intellectual Property Waiver for COVID-19 Vaccines

Big Tech’s “Digital Trade” Trojan Horse Strategy

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Music: Groove Grove by Kevin MacLeod.

 

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in house trade expert, Lori Wallach. Last week, we discussed US Trade Representative Katherine Tai's recent comments on the World Trade Organization and the need for some big changes to take place there. Well, the WTO is having its 12th ministerial at the end of the month in Geneva, Switzerland. And there will or will not be some big things on the agenda. Lori, why don't you tell us first what a WTO ministerial is what happens there and why you appreciate that this specific one is scheduled to start on November 30, of all dates.

Lori Wallach 

So the WTO, the World Trade Organization, that global commerce body that replaced the GATT, the General Agreement on Tariffs and Trade, has a governing structure that involves a typically every two years big confab of the trade ministers, the politically appointed people. So in the US, it's the United States trade representative who's currently Katherine Tai. The actual part of the government, not the career staff, the professional staff who go between governments but the political people come together at a WTO ministerial. And in what is called the Marrakesh agreement, which established the WTO in 1995. The governing rules are set such that this Ministerial Conference, because that's what's officially called the Ministerial Conference. And this is the 12th one. So shorthand will be MC 12 is when the forward agenda of the organization is determined for the next several years, where important decisions are made the really high-level political decisions are made. And it's auspicious that it happens to be on N30 November 30. Because the mother of all WTO ministerial was probably was the one in Seattle in 1999. And the call to action for what became a huge protest that shut down that ministerial and in partnership with a lot of developing country negotiators on the inside saying no-way no-how to WTO expansion ended up derailing. What was planned to be a huge increase in the WTO is corporate rigging and powers meddling behind borders and non-trade stuff. So the action alert that year that Public Citizen sent out the beginning of online organizing was mark the day N30.  Exclamation point. And N30 has become a really rallying cry for global justice, trade justice activist because that was a day activism really changed the world at the WTO.

Ryan 

And so this episode is our precursor to the 12th WTO ministerial. So we're going to talk about a few of the major items. The elephant in the room is of course, the trips waiver. And the fact that this ministerial is happening at a time when many countries in the Global South have yet to break out of single figure vaccination rates, due in part to monopolies on COVID drugs. Lori remind our listeners what the trips waiver is, and what's at stake for it at this ministerial. And then maybe what are some of the things to look out for in terms of the outcomes? .

Lori Wallach 

So TRIPS is trade related intellectual property, it's one of the agreements that got hatched with the WTO. Before this WTO took over from the GATT the trade agreement, the global trade agreement dealt with trade. Instead, with the WTO, a lot of different corporate interests rigged all kinds of rules that basically got them new rights and privileges, and that constrain governments from acting in the public interest. And probably exhibit number one of that is the agreement called TRIPS, which yes, in a Free Trade Agreement requires 20 year monopolies on patents and copyrights and industrial designs. And the pharmaceutical industry, pharmaceutical corporations were mainly behind doing this because what they ended up doing is imposing worldwide obligations and every government that's in the WTO that you had to have these big long monopolies. And a lot of developing countries didn't, the US didn't have that kind of monopoly intellectual property protection system. Until we were very much developed country, we were basically borrowing technology from Europe. And so this sort of imposition of one size fits all rules, the TRIPS agreements is seen as one of the most nefarious because, you know, covers medicine. It covers seeds. So it's like, are you going to live and die or you're going to eat. And the TRIPS Agreement waiver is a proposal put forward initially by South African India that now has almost 70 official written co-sponsors, 100 countries supporting a waiver of the WTO trips, agreement monopoly rules, because those rules guaranteeing pharmaceutical corporations have monopoly control over how much COVID vaccines are made, and where they can be sold, how much of the new treatments that are, couldn't save lives are going to be made how much of the tests in this kind of incredible global pandemic disaster. This is when you use what is called the waiver mechanism. So when the WTO was hatched, it has what's called the Article Nine, that's the Roman numbers, so IX, that's Article Nine of the agreement, establishing the WTO allows for waivers of any WTO rule. So South African India basically said, "We're facing this catastrophe, we have to make sure we can get enough vaccines and treatments and we have to do it right away. And there are a lot of qualified producers. Let's have a temporary waiver of these rules until we get the COVID pandemic under control." The US came out in support of it Joe Biden reverse Donald Trump in May, which is great live other countries saw the US do that there were very few that were against, but the ones that were mainly rich countries, join the US in support of a waiver. And at this moment, we're like a week before the start of the WTO ministerial, the European Union, on behest of Germany is blocking the whole rest of the world and saying,"Nope, we're gonna stand for the pharmaceutical corporations and keep these monopolies." So the TRIPS waiver is a big honkin deal. And it would be obscene. If there wasn't an agreement. After a year since it was introduced. It was first introduced in October of 2020. If there wasn't a deal at this big wig, WTO ministerial, how what would be the reason to have a WTO ministerial except to get the WTO out of the way of stopping the pandemic. And more than 100 countries agree though, way to do that is to waive these monopoly rights that are basically prolonging the pandemic. And making it such that qualified producers cannot be making these medicines to help save lives. Will it happen though? A lot of that's been independent, all the activism, the action, the pressure, the EU is going to have to break their allegiance with pharma enjoying the rest of the world. And the Biden administration is going to have to step up and basically lead to get the EU out of the way and to bring this over the finish line with South Africa and India. It really is the only thing the WTO should be doing this ministerial.

Ryan 

And if you look in the summary of this episode, you'll see some links for the global days of action and some other context in factsheets about the trips waiver campaign. So Lori, if TRIPS, you know if TRIPS is a good example of what Big Pharma can do when they get their hands on trade rules. Let's talk about something we also talked about in a recent episode, which is so called digital trade rules, and how big tech firms are pushing and utilizing trade rules to extend their own monopoly powers. Can you talk about the state of digital trade rules at the WTO and what the big tech firms are pushing for in terms of global trade rules?

Lori Wallach 

So in the department of learning from history, the notion that there would be a trips waiver at this ministerial after in that famous infamous one in 1999 in Seattle, there wasn't a waiver then for medicine for HIV AIDS. And millions of people in Africa died. Thanks the two year delay until finally some action was taken in 2001 at the WTO. Well, in that same horrible category of not learning. It turns out that what Big Pharma pulled off monopoly protections in the so called free trade agreements. Right now big tech is trying to take page right out of Big Pharma has handbook and as we've discussed on this podcast before, they have branded as quote unquote, digital trade, basically a set of handcuffs, policy-handcuffs, they want to put on governments not to regulate against big tech abuses. And they have a bunch of rules are sort of anti anti trust, which is to say pro monopoly rules. So all the things that big tech is doing to abuse us as consumers, our privacy, us as human beings, all the algorithm discrimination, online surveillance, as well all of the ways in which they are directly hurting people, sales of unfair products, abusive working conditions, or the outrageous gig economy abuses. All of that stuff, governments around the world, some much more advanced than the US in this work have been creating policies to try and break up those behemoths and to get them to behave. And the US Congress is stepping up right now to do the same. So these firms are desperately trying to use the WTO, to set down rules to make it impossible for that stuff to happen. And so what is happening at this ministerial? To date, the big tech firms have not been able to get an official launch of official WTO negotiations to set up global rules that they want. So they've started sort of a side gig. And that is called the joint statement initiative on e-commerce. Could it be more arcane, so you have no damn idea that you're basically being held up? People in Geneva, talk about an e-commerce JSI sounds totally boring. But what it means is basically letting big tech screw the world. And so these rules are not completed. But the mission that big tech house for this particular ministerial is to sort of get them made kosher, which is to say they want them to be brought into the process, they want them to be officially recognized. And given this is supposed to be a body where the only thing that happens is the thing that the members of the organization, the countries agreed to as sovereign nations, this should not be happening, as countries said no. Yep, the negotiations have gone forward. And there are 80 countries no rump group of 164 WTO countries who've been just on their own like, "Well, we'll just pretend we have the authority. Let's write some rules." And so the big issue is whether this ministerial will issue and kind of a statement that somehow invites out rump operation right into the WTO.

Ryan 

And so Lori, having gone through those two kind of big items, what are some of the other items that are going to be discussed at the WTO that US and other you know, folks in our network coalition partners, we'll be tracking? And then maybe you can just take us out for this episode, because we're gonna have a part two, after the ministerial where we'll be talking about what actually happened.

Lori Wallach 

So some big union federation's like Public Services International have called for this whole ministerial to be postponed. And their logic which makes a lot of sense is if there isn't guaranteed to be a deal waiving the TRIPS, intellectual property barriers, to getting vaccines and treatments against COVID around the world, then why the hell would you even be coming to Geneva at this point, to have a negotiation because all the other things that might be on the agenda are bad news for working people, for consumers, for the planet. And amongst those other bad news, things besides the digital trade, so-called digital trade negotiations, are negotiations around what is called, again, seems really benign, but it's not: domestic regulation of services. And what that is about is basically setting up strictures limits, and how the government's though the members of the WTO, almost all the governments in the world 164 countries are not allowed to regulate services. So what's a service? It's everything you can't drop in your foot. So it's education, its retail, its transportation, it is energy, it is a whole set of, you know, sort of office and insurance and banking, and you name it, basically, it's probably a service and was literally physically, it is a product. So limiting regulation on those things has huge implications for climate, for workers, for consumers, for our economy. And this is an effort by a lot of big multinational corporations united together, so big oil, plus Wall Street, plus, plus, plus, they've all gotten together to try and get agreement on those limits. Then there's an agreement on what's called investment facilitation. But that's kind of a sideways way to try and get new foreign investor protections into the WTO. Just at the point that around the world, the investor state dispute settlement system ISDS is in ill repute and countries are backing out of it. This is an effort by the mining and oil companies that multinationals that want these rights to try and sneak back ways into putting these rules back in order through the WTO. And then there are some negotiations that aren't happening, which is really outraged a lot of developing countries, including those on food security and development issues. So you understand why some of the big international organizations have said unless it's TRIPS waiver time, this dang thing shouldn't happen at all because nothing else but badness is on the agenda. And that is what we will leave off because in a short matter of two weeks we will be on the other side of this ministerial and we're going to know if the good things happened, if the bad things happened or if it got postponed.

Ryan 

Rethinking Trade is produced by Public Citizens Global Trade Watch. To learn more you can visit Rethinktrade.org. You can also visit Tradewatch.org. Stay tuned for more and thank you for listening.

Rethinking Trade - Season 1 Episode 42: A New U.S. Approach to the WTO?MC12, Part 1: Danger and Opportunity at the 12th WTO Ministerial

Will the WTO get out of the way of global production of COVID-19 vaccines and meds so we can end this pandemic? Whether Big Pharma or humankind will win is the biggest question as the WTO’s major biennial ministerial meeting starts the Tuesday after Thanksgiving.  But Big Tech also has a play…

More than 120 countries support waiving some of the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) rules that are limiting production of COVID-19 vaccines, treatments and diagnostic tests. But the European Union, UK and Switzerland are blocking. A waiver won't happen without more leadership from the Biden administration.

With all this as a backdrop, Big Tech corporations are also vying for influence at MC12, urging the body to push so-called “digital trade” proposal that would close domestic policy space on issues of great importance, including gig economy worker protections, discrimination and algorithm transparency, competition policy and anti-trust, corporate liability, and consumer privacy. Big Tech wants the WTO to formalize what have been rump talks in violation of its own rules.

The stakes could not be higher for the WTO or for the world: Failure to enact a waiver will prolong the pandemic, leading to more death, illness, economic hardship, and social and political disruption. And rushing through a “Trojan Horse” set of “digital trade” rules will only further erode democracy worldwide.

LINKS:

MC12 Global Call to Action

3 Million TRIPS Petitions Delivered to President Biden

Senators Sanders, Warren, Baldwin and Brown call on Biden to Push for TRIPS Waiver at MC12

Reuters: Activists Urge Biden to Push for Intellectual Property Waiver for COVID-19 Vaccines

Big Tech’s “Digital Trade” Trojan Horse Strategy

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Music: Groove Grove by Kevin MacLeod.

 

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in house trade expert, Lori Wallach. Last week, we discussed US Trade Representative Katherine Tai's recent comments on the World Trade Organization and the need for some big changes to take place there. Well, the WTO is having its 12th ministerial at the end of the month in Geneva, Switzerland. And there will or will not be some big things on the agenda. Lori, why don't you tell us first what a WTO ministerial is what happens there and why you appreciate that this specific one is scheduled to start on November 30, of all dates.

Lori Wallach 

So the WTO, the World Trade Organization, that global commerce body that replaced the GATT, the General Agreement on Tariffs and Trade, has a governing structure that involves a typically every two years big confab of the trade ministers, the politically appointed people. So in the US, it's the United States trade representative who's currently Katherine Tai. The actual part of the government, not the career staff, the professional staff who go between governments but the political people come together at a WTO ministerial. And in what is called the Marrakesh agreement, which established the WTO in 1995. The governing rules are set such that this Ministerial Conference, because that's what's officially called the Ministerial Conference. And this is the 12th one. So shorthand will be MC 12 is when the forward agenda of the organization is determined for the next several years, where important decisions are made the really high-level political decisions are made. And it's auspicious that it happens to be on N30 November 30. Because the mother of all WTO ministerial was probably was the one in Seattle in 1999. And the call to action for what became a huge protest that shut down that ministerial and in partnership with a lot of developing country negotiators on the inside saying no-way no-how to WTO expansion ended up derailing. What was planned to be a huge increase in the WTO is corporate rigging and powers meddling behind borders and non-trade stuff. So the action alert that year that Public Citizen sent out the beginning of online organizing was mark the day N30.  Exclamation point. And N30 has become a really rallying cry for global justice, trade justice activist because that was a day activism really changed the world at the WTO.

Ryan 

And so this episode is our precursor to the 12th WTO ministerial. So we're going to talk about a few of the major items. The elephant in the room is of course, the trips waiver. And the fact that this ministerial is happening at a time when many countries in the Global South have yet to break out of single figure vaccination rates, due in part to monopolies on COVID drugs. Lori remind our listeners what the trips waiver is, and what's at stake for it at this ministerial. And then maybe what are some of the things to look out for in terms of the outcomes? .

Lori Wallach 

So TRIPS is trade related intellectual property, it's one of the agreements that got hatched with the WTO. Before this WTO took over from the GATT the trade agreement, the global trade agreement dealt with trade. Instead, with the WTO, a lot of different corporate interests rigged all kinds of rules that basically got them new rights and privileges, and that constrain governments from acting in the public interest. And probably exhibit number one of that is the agreement called TRIPS, which yes, in a Free Trade Agreement requires 20 year monopolies on patents and copyrights and industrial designs. And the pharmaceutical industry, pharmaceutical corporations were mainly behind doing this because what they ended up doing is imposing worldwide obligations and every government that's in the WTO that you had to have these big long monopolies. And a lot of developing countries didn't, the US didn't have that kind of monopoly intellectual property protection system. Until we were very much developed country, we were basically borrowing technology from Europe. And so this sort of imposition of one size fits all rules, the TRIPS agreements is seen as one of the most nefarious because, you know, covers medicine. It covers seeds. So it's like, are you going to live and die or you're going to eat. And the TRIPS Agreement waiver is a proposal put forward initially by South African India that now has almost 70 official written co-sponsors, 100 countries supporting a waiver of the WTO trips, agreement monopoly rules, because those rules guaranteeing pharmaceutical corporations have monopoly control over how much COVID vaccines are made, and where they can be sold, how much of the new treatments that are, couldn't save lives are going to be made how much of the tests in this kind of incredible global pandemic disaster. This is when you use what is called the waiver mechanism. So when the WTO was hatched, it has what's called the Article Nine, that's the Roman numbers, so IX, that's Article Nine of the agreement, establishing the WTO allows for waivers of any WTO rule. So South African India basically said, "We're facing this catastrophe, we have to make sure we can get enough vaccines and treatments and we have to do it right away. And there are a lot of qualified producers. Let's have a temporary waiver of these rules until we get the COVID pandemic under control." The US came out in support of it Joe Biden reverse Donald Trump in May, which is great live other countries saw the US do that there were very few that were against, but the ones that were mainly rich countries, join the US in support of a waiver. And at this moment, we're like a week before the start of the WTO ministerial, the European Union, on behest of Germany is blocking the whole rest of the world and saying,"Nope, we're gonna stand for the pharmaceutical corporations and keep these monopolies." So the TRIPS waiver is a big honkin deal. And it would be obscene. If there wasn't an agreement. After a year since it was introduced. It was first introduced in October of 2020. If there wasn't a deal at this big wig, WTO ministerial, how what would be the reason to have a WTO ministerial except to get the WTO out of the way of stopping the pandemic. And more than 100 countries agree though, way to do that is to waive these monopoly rights that are basically prolonging the pandemic. And making it such that qualified producers cannot be making these medicines to help save lives. Will it happen though? A lot of that's been independent, all the activism, the action, the pressure, the EU is going to have to break their allegiance with pharma enjoying the rest of the world. And the Biden administration is going to have to step up and basically lead to get the EU out of the way and to bring this over the finish line with South Africa and India. It really is the only thing the WTO should be doing this ministerial.

Ryan 

And if you look in the summary of this episode, you'll see some links for the global days of action and some other context in factsheets about the trips waiver campaign. So Lori, if TRIPS, you know if TRIPS is a good example of what Big Pharma can do when they get their hands on trade rules. Let's talk about something we also talked about in a recent episode, which is so called digital trade rules, and how big tech firms are pushing and utilizing trade rules to extend their own monopoly powers. Can you talk about the state of digital trade rules at the WTO and what the big tech firms are pushing for in terms of global trade rules?

Lori Wallach 

So in the department of learning from history, the notion that there would be a trips waiver at this ministerial after in that famous infamous one in 1999 in Seattle, there wasn't a waiver then for medicine for HIV AIDS. And millions of people in Africa died. Thanks the two year delay until finally some action was taken in 2001 at the WTO. Well, in that same horrible category of not learning. It turns out that what Big Pharma pulled off monopoly protections in the so called free trade agreements. Right now big tech is trying to take page right out of Big Pharma has handbook and as we've discussed on this podcast before, they have branded as quote unquote, digital trade, basically a set of handcuffs, policy-handcuffs, they want to put on governments not to regulate against big tech abuses. And they have a bunch of rules are sort of anti anti trust, which is to say pro monopoly rules. So all the things that big tech is doing to abuse us as consumers, our privacy, us as human beings, all the algorithm discrimination, online surveillance, as well all of the ways in which they are directly hurting people, sales of unfair products, abusive working conditions, or the outrageous gig economy abuses. All of that stuff, governments around the world, some much more advanced than the US in this work have been creating policies to try and break up those behemoths and to get them to behave. And the US Congress is stepping up right now to do the same. So these firms are desperately trying to use the WTO, to set down rules to make it impossible for that stuff to happen. And so what is happening at this ministerial? To date, the big tech firms have not been able to get an official launch of official WTO negotiations to set up global rules that they want. So they've started sort of a side gig. And that is called the joint statement initiative on e-commerce. Could it be more arcane, so you have no damn idea that you're basically being held up? People in Geneva, talk about an e-commerce JSI sounds totally boring. But what it means is basically letting big tech screw the world. And so these rules are not completed. But the mission that big tech house for this particular ministerial is to sort of get them made kosher, which is to say they want them to be brought into the process, they want them to be officially recognized. And given this is supposed to be a body where the only thing that happens is the thing that the members of the organization, the countries agreed to as sovereign nations, this should not be happening, as countries said no. Yep, the negotiations have gone forward. And there are 80 countries no rump group of 164 WTO countries who've been just on their own like, "Well, we'll just pretend we have the authority. Let's write some rules." And so the big issue is whether this ministerial will issue and kind of a statement that somehow invites out rump operation right into the WTO.

Ryan 

And so Lori, having gone through those two kind of big items, what are some of the other items that are going to be discussed at the WTO that US and other you know, folks in our network coalition partners, we'll be tracking? And then maybe you can just take us out for this episode, because we're gonna have a part two, after the ministerial where we'll be talking about what actually happened.

Lori Wallach 

So some big union federation's like Public Services International have called for this whole ministerial to be postponed. And their logic which makes a lot of sense is if there isn't guaranteed to be a deal waiving the TRIPS, intellectual property barriers, to getting vaccines and treatments against COVID around the world, then why the hell would you even be coming to Geneva at this point, to have a negotiation because all the other things that might be on the agenda are bad news for working people, for consumers, for the planet. And amongst those other bad news, things besides the digital trade, so-called digital trade negotiations, are negotiations around what is called, again, seems really benign, but it's not: domestic regulation of services. And what that is about is basically setting up strictures limits, and how the government's though the members of the WTO, almost all the governments in the world 164 countries are not allowed to regulate services. So what's a service? It's everything you can't drop in your foot. So it's education, its retail, its transportation, it is energy, it is a whole set of, you know, sort of office and insurance and banking, and you name it, basically, it's probably a service and was literally physically, it is a product. So limiting regulation on those things has huge implications for climate, for workers, for consumers, for our economy. And this is an effort by a lot of big multinational corporations united together, so big oil, plus Wall Street, plus, plus, plus, they've all gotten together to try and get agreement on those limits. Then there's an agreement on what's called investment facilitation. But that's kind of a sideways way to try and get new foreign investor protections into the WTO. Just at the point that around the world, the investor state dispute settlement system ISDS is in ill repute and countries are backing out of it. This is an effort by the mining and oil companies that multinationals that want these rights to try and sneak back ways into putting these rules back in order through the WTO. And then there are some negotiations that aren't happening, which is really outraged a lot of developing countries, including those on food security and development issues. So you understand why some of the big international organizations have said unless it's TRIPS waiver time, this dang thing shouldn't happen at all because nothing else but badness is on the agenda. And that is what we will leave off because in a short matter of two weeks we will be on the other side of this ministerial and we're going to know if the good things happened, if the bad things happened or if it got postponed.

Ryan 

Rethinking Trade is produced by Public Citizens Global Trade Watch. To learn more you can visit Rethinktrade.org. You can also visit Tradewatch.org. Stay tuned for more and thank you for listening.

Apple and Google Want U.S. Trade Officials to Attack Anti-Monopoly Law

[Reposted from PC News]

By: Karolina Mackiewicz

Tech giants Google and Apple are urging U.S. government officials to attack a pro-consumer policy by South Korea as an “illegal trade barrier,” even as the U.S. Congress is poised to pass similar legislation to break up app store monopolies.

The new Korean law would require app stores to allow consumers to use diverse payment systems, not only those controlled by the app store’s home platform. And it forbids the platforms from the current practice of banning app developers from listing on multiple platforms’ app stores.

Google and Apple claim that this law, instead of an anti-monopoly initiative that the U.S. Congress is also considering, is somehow an illegal trade barrier and perhaps even a violation of a free trade agreement between the U.S. and Korea. As flimsy as this claim is, it is a preview of coming attractions of the newest and latest corporate sneak attack via trade agreement.

From the translation of the amendments obtained by Public Citizen, it is clear the requirements apply to all app stores, regardless of the “nationality” of the company. In a letter to U.S. Trade Representative Katherine Tai, Public Citizen experts conclude that the amendments are not discriminatory. Such measures are typical of antitrust laws and competition policies around the world. The fact that the Korean policy could particularly affect American businesses is due exclusively to those businesses’ dominant market position, not because Korea is discriminating against U.S. firms, much less violating trade obligations.

“If the U.S. starts this fight on a nondiscriminatory policy because some U.S. companies don’t like it, then when we have a regulation here that impacts some other country’s platform that is neutral, but it happens to impact them because they’re a big player in the U.S., then that country will come after us,” said Public Citizen's Global Trade Watch Director Lori Wallach in the latest episode of the Rethinking Trade podcast. “It creates a circular firing squad attacking consumer policies so the only winners are a handful of mega big tech platforms.”

Public Citizen urged U.S. trade officials to refrain from criticizing the Korean law and to beware of Big Tech’s larger strategy to avert digital governance.

Big Tech interests’ latest ploy is to hijack trade negotiating venues to lock in binding international rules that limit governments from regulating online platforms in the public interest and from fighting corporate concentration and monopoly power. These interests seek to quicky establish international agreements that quietly undermine regulatory efforts in Congress and U.S. agencies. To obscure this, they have misbranded their attack against the very notion of digital governance as “e-commerce” or “digital trade” policy initiatives.

This is a multi-front effort that includes what is formally called the World Trade Organization (WTO) “Joint Statement Initiative on E-Commerce” negotiations now underway in Geneva among 80-plus countries, a plurilateral Pacific Rim “Digital Economic Partnership Agreement” (DEPA) and various bilateral negotiations.

The Big Tech strategy replicates pharmaceutical firms’ 1990s maneuver of hijacking “free trade” agreements and inserting provisions that require signatory countries to provide the corporations extended monopoly protections and limit policies that lower drug prices.

“These corporate-rigged international agreements end up becoming Trojan horse platforms, where non-trade agendas that are not able to get through the sunshine of public debate and voting in legislative bodies end up getting implemented through the backdoor of a so-called trade deal,” said Wallach.

Rethinking Trade - Season 1 Episode 41: A New U.S. Approach to the WTO?

U.S. Trade Representative, Katherine Tai’s recent speech about the World Trade Organization was shocking. Why? Because she openly and frankly discussed the yawning gap between the WTO’s expansive rules and what is right and good for people and the planet. And she made clear that the rules of the global commerce agency need a major redo.

That sort of tough love may be the last chance for the WTO, which has suffered a deepening legitimacy crisis for decades. Today WTO intellectual property barriers empower a few pharmaceutical corporations to limit how much vaccine is made, prolonging the pandemic.

In this episode we unpack USTR Tai’s recent comments and what they mean for the future of the WTO.

Learn more: www.tradewatch.org

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Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

 

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. Today, we're going to be talking about a recent speech from United States Trade Representative Katherine Tai about US trade policy and the World Trade Organization. Lori before we get too far into the show, maybe you can just summarize for our listeners, what the WTO is, and a bit about the history of calls for significant changes to be made at the WTO.

Lori Wallach 

So the WTO is the World Trade Organization. And it is a body that replaced a thing called the General Agreement on Tariffs and Trade, which was the post World War II body that basically set the rules of border taxes, tariffs and quotas, how much stuff that come in. Unlike the old GATT, the general agreement, tariffs and trade the WTO broke all the boundaries of what has ever been in a trade agreement and imposed one size fits all on the whole world obligations that countries owe to corporations like extended monopoly protections for pharmaceutical corporations, which right now is making the WTO an obstacle to ending the pandemic, or requirements that you can't regulate service sector companies healthcare or transportation, or banks, for instance, how big they are, or whether they are protecting consumers. And it's set up rules that even set limits and how we can spend our tax dollars as governments. Really invasive and behind the borders policymaking. And the key requirements of the WTO is a provision that requires all signatory countries to, "ensure compliance of domestic laws, regulations, and administrative procedures," with all of the WTO is non-trade rules, so it basically sets a ceiling imposed by corporations and what our democratically elected governments can do on a whole bunch of stuff unrelated to trade. The WTO has been suffering from a crisis of legitimacy almost from when it was hatched because its very establishment was opposed by many of the developing countries that are members of it. And the US and European Union basically cooked a deal. And it came into effect in 1995, replacing the old GATT, and ever since there have been efforts by the corporate world and by some governments to expand its powers even more. And people famously remember the Battle in Seattle, the 1999 WTO ministerial in Seattle, where basically the developing countries stood up and said, " No. We are not expanding this further. We need to fix the existing rules." The WTO has never really recovered from its crisis of legitimacy. And then over the last 10 years or so it's dispute panels because it strongly enforces all these extreme rules. Its dispute panels started pushing out even further and further and kind of making up new laws given the negotiations were jammed, until ultimately, first the Obama administration then the Trump administration said this crap has to stop. And ultimately the Trump administration basically put that enforcement system out of business by not appointing new judges. And at this big speech on the WTO just recently, the new US Trade Representative Katherine Tai for the binding ministration basically said, yeah, big reforms are needed before we want this thing back in operation.

Ryan 

So I just wanted to play a quote from that speech, Lori from USTR Tai's, recent speech at the Graduate Institute, the Geneva trade platform, and then I was hoping to get your thoughts on it. Here's the quote.

USTR Kathrine Tai 

"For some time, there's been a growing sense that the conversations in places like Geneva are not grounded in the lived experiences of working people. For years, we have seen protests outside WTO ministerial conferences, about issues like workers' rights, job loss, environmental degradation, and climate change, as tensions around globalization have increased. We all know that trade is essential to a functioning global economy. But we must ask ourselves, how do we improve trade rules to protect our planet and address widening inequality and increasing economic insecurity? Today I want to discuss the United States vision for how we can work together to make the WTO relevant to the needs of regular people."

Ryan 

Lori, how significant is this quote coming from the United States Trade Representative? And what does it say about the potential future of US trade policy?

Lori Wallach 

It's a really big deal. And the reason it's so significant coming from the US is historically things like that might have been said from activists from scholars like Nobel Prize-winning economist Joe Stiglitz, from developing countries. But it's a really strong leadership development to have the US Trade Representative admitting that there are problems and in fact leading that there are problems, and then committing to try and do something about it. It's amazing.

Ryan 

I also I just want to play another quote as well. This one is maybe a little bit more in the weeds. Here's the quote:

USTR Kathrine Tai 

"Over the past quarter-century, WTO members have also discovered that they can get around the hard part of diplomacy and negotiation by securing new rules through litigation. Dispute Settlement was never intended to supplant negotiations. The reform of these two core WTO functions is intimately linked."

Ryan 

Can you speak a bit about this dispute settlement mess at the WTO? And what reforming it could look like?

Lori Wallach 

So this is the thing I was talking about, where because the agenda at negotiations is always more WTO power for corporations to set the rules on non-trade stuff, the negotiating agenda is just broken down. And so these tribunals who are the enforcement tribunals who can impose huge billion-dollar sanctions for countries to get nailed by trade sanctions unless and until they change their domestic laws to meet these WTO dictates. That system has been put out of business for three years because the US refused to appoint more appellate body judges. So they don't have a quorum, so they can't literally impose these sanctions. And what USTR Tai said, basically, was that because the way that the WTO enforcement system has played out a lot of countries instead of talking to each other at the WTO, or trying to negotiate settlements that are mutually agreeable, have started to basically try and use the litigation, the enforcement system to get their way. And that's not what it was supposed to be about. And that's actually something both sort of defenders of the current WTO rules will say, and those who think that they need to be majorly replaced. So the reform that she's talking about basically is linking both pieces, which is that the actual enforcement mechanism, the dispute settlement system needs major redo. But also she's making the exactly spot on right point, that the substantive rules also need to be updated, replaced, fixed, and that you're not going to end up with one without the other. No one wants to see strong enforcement of bad rules. If there isn't a way for countries to talk to each other and resolve their issues diplomatically, then you're not going to have successful negotiations to get the rules that deserve strong enforcement. So it is exactly the right way to be thinking about what the WTO fix agenda needs to be. And a lot of civil society groups have been taking sort of, I would say, you know, more robust, even wider position on that for some time. They talk about they don't want a new round of WTO expansion, but they want to turn around fixes to the existing rules. So again, it's super powerful that you have a US leading trade official, basically saying that both the process of enforcement and the underlying rules need to be reviewed. And I think she probably say fixed or reformed, civil society would say replaced, but at least everyone's heading the same direction, which has not been the case for the US. Typically US is going in one direction and civil society is going to another. So it's pretty hopeful and a lot of work to do but pretty hopeful that that's the perspective.

Ryan 

And Lori, what did USTR Tai say in this recent speech regarding the WTO TRIPS waiver, which our listeners are probably familiar with at this point, is there any movement on the waiver either at the WTO or from the USTR office?

Lori Wallach 

Well, this is kind of a catch-22. Because at this point, the whole world is looking at the WTO and is seeing it as an obstacle to ending the pandemic. The WTO is, again, not about trade, intellectual property rules are reaching behind borders requiring 164 WTO members to guarantee monopoly control by a handful of pharmaceutical companies over how much and where vaccines for COVID-19 treatments, diagnostic tests are made, and where they're sold. And that is obviously fueling the continuing outbreaks needless deaths, economic chaos, we're just no place close, we just have an absolute shortage in the supply. The current vaccine makers and their monopolies will not deliver what the world needs. And until these WTO rules get out of the way, the whole world that's looking at this is right, the WTO is an obstacle. It's not only not part of the solution of one of the biggest challenges facing humanity, it is basically at this moment, the biggest obstacle. So with that in mind, actually, the speech did not focus on, in a sort of pragmatic sense, how the WTO is intellectual property barriers are going to be gotten out of the way. But if they're not, that could be sort of the final nail on WTO his coffin. I mean, the organization is sort of hanging by thread. Its negotiating system has failed to work forever. The member countries are in deep disagreement about what the substance of the role should be. But clearly, they're extremely outdated and have become an obstacle not just to stopping the pandemic, but to surviving climate crisis, etc. And in the face of an existing near-fatal legitimacy crisis. If the WTO after a year, because it was October 2020, that countries proposed temporarily waiving these WTO corporate pharmaceutical monopoly rules. If the WTO can't even get out of the way of this huge pandemic counter fight, basically, its lash read of potential usefulness or legitimacy could just be totally trashed. So institutionally, the WTO needs to deliver a waiver. And USTR Tai's speech basically said, there needs to be more work, we need to have an outcome. But you know, it's not looking super auspicious. I mean, we were one month out of the WTO ministerial, which certainly isn't you don't have to go to a ministerial to do this waiver of the WTO, Trade Related Intellectual Property or TRIPS rules, you can do that at any meeting of the general basically body, which is called the General Council. But this ministerial was certainly was the far out deadline that the head of the WTO, the director-general set by which this ought to get done. And it's, you know, it's not getting done. It's in part, because the European Union on behalf of Germany is blocking it. But also the US has a very strong hand to play, that has not been played to lead forward, I think the EU would get out of the way. Because at this point, there are 130 countries that support a waiver. And you have a handful of countries that oppose: Germany, the UK, Switzerland, and they've got a couple that are just missing an action. So I think between now and the November 30, meeting of the WTO Ministerial Conference, part of the fate of the WTO is going to be sealed. And to the extent that the Biden administration is key in getting these changes done, I think we all need to be focused on how we can help make sure it happens. And part of that certainly is talking to members of Congress if you run into them, because I think a lot of them want to see this done and they can speak to the administration. But also, you know, it is talking to your friends and your family about why we don't have enough vaccines worldwide why the next variant can come kick our ass, and that is because of WTO rules, and it's fixable, but we're gonna need to organize to fix it.

Ryan 

Rethinking Trade is produced by Public Citizens Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Rethinking Trade - Season 1 Episode 40: Apple & Google Seek U.S. Trade Attack on Anti-Monopoly Law

Right now, Apple and Google are lobbying the U.S. government to attack South Korean anti-monopoly policies. They claim that a recently passed Korean law requiring app stores to allow consumers to use diverse payment systems violates the US-Korea trade deal. Big Tech corporations want to hijack trade pacts to outlaw as a “barrier to trade” anti-trust, labor, environmental or consumer protections that could cut into their profits. 

On today’s show, we discuss this case and Big Tech’s current attempts to quietly thwart domestic digital governance and pro-competition policymaking now underway in the U.S. Congress, in various U.S. agencies and in countries around the world by misbranding such policies as “barriers to digital trade.”

Learn more: www.tradewatch.org

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Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan, and I'm joined once again by our in-house trade expert, Lori Wallach. There's a good chance that you're hearing this podcast through an Apple or Google platform, and today we're going to talk about something both of these companies are doing to expand their monopolies. Under the guise of international trade rules. Apple and Google are urging US government officials to attack a recently passed South Korean law that would require app stores to allow consumers to use diverse payment systems, not only those controlled by the App Store, among other monopoly busting features. Lori, can you give us a summary of what this so-called dispute is all about?

Lori Wallach 

You bet. At issue here is a law that was passed by South Korea's Parliament that is attempting to break up what are now monopolies by Apple and Google with respect to consumers who want to buy apps, but also developers who have created apps. Under the current monopoly practices of these two, you, as a developer have to sign a deal that says you only sell through one or the other, and you won't go to any other platforms. But then also, you're required to use the Apple or Google payment system. And those big companies take a cut right out from under the developer. So the idea in this law is to say number one, you can use any payment system you want, if it's listed on Google or Apple. And number two, you can't be limited to where you will sell it. And ironically, there are bipartisan proposals that are identical in the US Congress. Now, what the companies are trying to do is pretend that instead of this being an anti-monopoly initiative, that the US Congress is replicating that somehow this is an illegal trade barrier, and perhaps even a violation of a free trade agreement between the US and Korea, which is, of course, total garbage. But it's a preview of coming attractions of the newest and latest attempt to have a corporate sneak attack via trade agreements.

Ryan 

And in addition to being a preview, this whole story also shines a light on the past. But first off, it reflects a broader big tech strategy to quietly thwart domestic digital governance and anti-monopoly actions by branding them as barriers to trade. But it's also part of a long history of companies arguing that basically anything in the way of their profits such as you know, labor, environmental or consumer protections, constitutes barriers to trade. Can you talk about that dynamic historically, and how big tech has sort of updated it and is utilizing it today?

Lori Wallach 

On this podcast, we often talk about how what is at the heart of today's so-called trade agreements often has nothing to do with trade. But rather these corporate-rigged international agreements end up becoming Trojan horse platforms, where non-trade agendas that are not able to get through the sunshine of public debate end up getting implemented through the backdoor of a so-called trade deal. And that's what we're seeing here. So as governments around the world and finally, even here in the US, are realizing the way that these mega-platforms are threatening our economy, our livelihoods, frankly, our democracy, there is action to try and incorporate some kind of basic consumer protections, gig economy worker protections, and generally established what is often called digital governance. So some rules to ensure these companies are operating in the public interest. And the companies hate this. And along a part of that alongside of those public interest protections is some anti-monopoly actions. So the companies realize that they have finally perhaps come to the end of the road of their wild abuses and lack of government oversight. And so their strategy is this effort to get negotiated in the trade context, what they are calling "digital trade rules," those are air quotes around them folks, digital trade because it's not about trade. And what they hope to do is effectively replay what Big Pharma did in the 80s where they got rules stuffed into free trade agreements that required every signatory country to guarantee the pharmaceutical corporations extended monopoly protections so straight up protectionism and free trade agreements, so that their medicines basically could have monopoly guarantees for higher prices and that governments would be handcuffed from using policies that could bring down medicine prices. And that garbage got stuck in trade agreements that doesn't have anything to do with trade. And basically, every signatory country has to meet it. That is what big tech is up to right now, they want to get the handcuffs on the Congress and Parliament's around the world, on government agencies trying to regulate them and break up their monopolies. And the way they sort of see it is they can do this in one fell swoop worldwide. And sort of, you know, excavate the policy space out from under governments around the world trying to get those big monopolist under control. And it is, you know, it is part of a theme, which is you, you know, have seen over and over non-trade policies that the corporations don't like labeled illegal trade barriers and forbidden. I mean, one of the rules in these so-called Digital trade agreements takes a page out of what the Wall Street firms got stuck into a WTO agreement, which is literally rules that say you can't regulate on the size of a firm, or how many services they offer. That's the law globally, for financial firms in many countries, because of WTO. And that's what big tech, for instance, is trying to get enacted, as well as rules that basically, you know, require governments to allow the free flow of information, your private data, which means privacy rules, basically would be very hard to establish, or that requires governments to protect and secrecy the algorithms and code of these platforms. So like racially discriminatory searches that mean different people only see certain jobs or loan opportunities or housing opportunities, incitement to violence, all of the different abuses and discriminations that can happen online. You could never do the research as an investigator or as a congressional committee, you'd have to know a crime was committed for the government to get any of this information. And similarly, liability protections so that you know, if it's sold online, and may burn down your house, that product, but you can't sue for that dangerous product. All of this garbage is part of this broader digital trade agenda and has nothing to do with trade. And so this is basically just the latest version of corporations hijacking trade agreements to do bad things that would be really hard to get past in public.

Ryan 

And what are these companies asking the US to do specifically, and what mechanisms exist through our existing free trade agreement with South Korea that they can utilize to challenge the South Korean government on this?

Lori Wallach 

The big tech companies are asking the US government to threaten to challenge the App Store anti-monopoly policies in Korea as violations of the US Korea Free Trade Agreement. And as well to threaten them with some kind of sanction or other kinds of economic pressure if these laws are allowed to stay on in the books. And number one, the US Congress is about to pass similar laws, there are bipartisan proposals just identical to the Korean law in both the House and the Senate. And number two, if those laws weren't here, and it wasn't a race to see who could pass them first, Korea did, then we shouldn't have laws like that, because we shouldn't have these kind of monopolies that are bad for consumers and bad for app developers that basically allow Apple and Google to harm both the consumer and the developer. And the notion that somehow it should be the US government's business to protect two mega-platforms, online monopolies is just obscene.

Ryan 

And you mentioned this just now. And you also mentioned it earlier with regards to the US. Are there other countries adopting similar measures, as I was in South Korea? And are there threats to those actions by big tech firms as well, I guess, in addition to the US that you mentioned?

Lori Wallach 

Yes, so part of the reason we suspect that Google and Apple are being so fierce piling on the Korean policy is it is one of the first one that has been enacted in such a big country that basically sends a signal to the rest of the world of, "Oh, well, if they're doing it. We wanted to do that. Let's join." I mean, certainly, the US plays that role if the European Union does that. A lot of developing countries can get beaten up by these companies and frankly, by you know, the US government, but when a country like Korea does it well then the big tech companies are really in a swivel about it, because and that's when they call in the US to the EU to beat up the other developed powerful country, because the tech platforms themselves don't have the ability to just single-handedly bully their way into say intimidating the entire Korean parliament.

Ryan 

So my last question Lori is about the US response. So far, the US Trade Representative has not taken up this case and has not come out to challenge the South Korean government at the behest of Apple and Google. Why is it important that they maintain this position and not elevate these attacks, and maybe you could just reflect on the US government's posture towards this?

Lori Wallach 

So this issue right now is in what's called an interagency process, that is to say a bunch of different US government agencies are weighing in and what the US position on this should be. And it is worthwhile, if you care about these issues, to leave comments in support of busting up the App Store monopolies with the USTR to mention it to members of Congress and tell them you support it because some other agencies like the Commerce Department, are basically flacking for the big tech corporations. The United States Trade Representative's office, his position has been basically, of course, they're not going to tolerate laws that discriminate literally are set up to go after US companies because they're US companies. But if there is a law that is neutral, ie just simply bans his behavior. And the reason that it impacts these monopolist is because while they're monopolist, they have an undue size, therefore, they're bigger, they're affected more. Those are the kinds of policies the US government should not go after. Those are antitrust policies. And we really urge the trade representative's office to stick to their principle of evaluating everything on the basis of what does it mean for working people? What does it mean, for consumers? It's been really refreshing to see a trade representative's office that isn't just like the Commerce Department still is thinking about what the big companies want. And so in this interagency process, because they're still talking it out, it really seems that the Trade Representative and that's Katherine Tai is the cabinet-level ambassador. USTR Katherine Tai it seems like she and her team have thought this through carefully and want the rule to be is there real discrimination or is this a legitimate policy? And there are some other agencies that would love to just go after this law because big tech wants it. And so you know, what we need to do is make sure that the good policy prevails because otherwise, you know, what are the implications? It's setting up a circular firing squad, because if we start this fight on a nondiscriminatory policy because some US companies don't like it, then you know, when we have a regulation here that impacts some other countries platform that is neutral, but it happens to impact them because they're a big player in the US, then it's going to come after us. And in the end, it's the consumers and the people who create apps. It's basically everyone but the handful of mega big tech platforms that end up losing under that scenario.

Ryan 

Rethinking Trade is produced by Public Citizens Global Trade Watch. To learn more, you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Biden’s COVID-19 Kumbaya Summit

By Daniel Rangel

In the beginning of August, some media outlets started reporting that the Biden administration was planning to convene a “first-of-its-kind, global leader-level summit” focused on ending the COVID-19 crisis and preparing for future pandemics. The summit was scheduled in parallel to United Nations General Assembly (UNGA) and was supposed to rally the international community to step up its efforts to increase vaccine production and enhance equitable global distribution as the Delta variant surges.

After nearly a full year of frustrated negotiations at the World Trade Organization (WTO) to try to enact a temporary, emergency COVID-19 waiver of certain rules of the Agreement on Trade Related Aspects of Intellectual Property (TRIPS), UNGA seemed an appealing multilateral venue to discuss the direly needed global actions required to bring an end to the pandemic. Hence, for several weeks, journalists, diplomats, academics and activists – but most of all, regular people in the Global South unable to access COVID-19 vaccines – pinned their hopes on the summit that the U.S. president was organizing.

A group of more than 50 civil society organizations – including Doctors Without Borders, Oxfam, Universities Allied for Essential Medicines, Public Citizen and Health GAP,  – sent  President Biden a letter urging him to lead action at UNGA to ensure equitable vaccine production and distribution. The letter described the actions needed so that the president’s announced goal, vaccinating 70% of the population of every country within the next year, might actually be fulfilled.

Our organizations outlined the four crucial steps that would truly make America the world’s “arsenal” of global vaccine access:

• work with allied countries on a final text to speedily enact a TRIPS waiver for COVID-19 health technologies including vaccines, diagnostics, and treatments;

• launch an ambitious global vaccine manufacturing program with other countries to help produce billions more highly effective doses within one year and support a dedicated financing line item in the Build Back Better Act committing billions of dollars to this effort;

• use U.S. government’s full authorities to require the few firms with monopolies over effective vaccines, diagnostics, and therapeutics to transfer technology and production know-how to manufacturers in the Global South; and

• set an example for other governments by reallocating excess doses available in the United States to countries in the Global South via COVAX or regional procurement mechanisms.

And then the day of Biden’s COVID Summit arrived. It is difficult to imagine how anyone could have felt anything other than disappointment and ire after watching the four-hour long recording of the event. The “summit” was more a recollection of self-celebratory speeches and pre-recorded statements than a high-level debate between world leaders. And it certainly was not designed to launch a global partnership to end the pandemic with specific solutions and verifiable commitments.

The event was divided into four sessions that were supposed to address the urgent need to vaccinate the world to end the COVID-19 pandemic; the dire shortages of oxygen, testing kits, therapeutics and personal protective equipment (PPE) that are ravaging the developing world; and plans to be better prepared for the next pandemic.

Although the targets and commitments related to testing, therapeutics and PPE are woefully inadequate as well, this piece will focus on the problems with the portion of the summit that dealt with vaccine production, distribution and access.

From the outset, it is important to clarify that the Biden administration’s new 500 million vaccine dose donation is commendable. Similarly, the fact that with this new commitment to purchase and donate more doses to a total of 1.1 billion shots makes clear that the U.S. administration is willing to make financial efforts to get shorts in arms not just on American soil, but all over the world.

Yet, it is also true that this action will not end this pandemic or lay the foundations for a global public health framework that delivers for everyone, regardless of their country of birth. And it will transfer hundreds of millions more U.S. taxpayer dollars into the coffers of Pfizer, a company that has reaped windfall profits from the pandemic while blocking the ability of qualified producers in developing countries to make enough doses to cover the world.

At this point, no one thinks that we can “donate” our way to safety. Pledges to redistribute doses from high-income countries with relatively high vaccination rates to low-income and lower-middle income countries are only the first and most basic step needed to stop the global vaccine apartheid we are witnessing.

Why? Because this approach retains control by a few powerful donor countries and the existing monopolist vaccine firms. So, if and when shots get to arms is decided not by the governments needing doses but by those with other priorities and interests. For starters, that means most of the promised doses only are scheduled to be delivered in 2022. Of the 1.1 billion doses that the United States plans to reallocate, 800 million are not expected to ship until next year. And, to date, less than 15% of the vaccine donations that high-income countries have pledged have actually materialized.

Those realities make Biden’s COVID-19 summit not that different from the May Global Health Summit in Rome. There, many European countries pledged to redistributed doses as the main tool to address vaccine inequity, but four months later have failed to live up to the commitments. As a result, people from the Global South are still waiting for these vaccines to arrive. To make things grimmer, Biden’s call for other countries to join the United States in donating more doses only was answered by just four countries. And, the pledges made by Spain, Italy, Japan and Australia, combined, do not surpass 100 million doses.

This is an unacceptable outcome for an event that was billed as the place where world leaders would unite to agree on a plan to end the pandemic. Fortunately, South African president Cyril Ramaphosa, during his intervention at the summit, did spotlight what is necessary to reach the 70% vaccination goal: We need a global plan for developing countries to be able to manufacture their own vaccines and procure them directly.

In the same vein, UN Secretary-General António Guterres recalled his appeals for a global vaccination plan to solve the problems of intellectual property, technical support and finance to quickly ramp up vaccine manufacturing in different regions of the world.

The U.S. government also has backed the idea of expanding regional production of mRNA, viral vector, and/or protein subunit COVID-19 vaccines for low- and lower-middle income countries. However, until now, the United States has left untapped the myriad policy instruments and resources it could harness to translate this aspiration into reality.

Instead of committing to throw his weight behind the TRIPS waiver or announcing that he will use U.S. government’s contractual rights or statutory authorities to mandate the sharing of vaccine production knowledge, during the summit President Biden focused on the scattered actions that his government has carried out to support final-stage vaccine fill and finish operations in some developing countries.

Particularly, President Biden referenced the Quad partnership to finance the production of one billion doses in India and the recent deal to manufacture 500 million doses of Pfizer-BioNTech’s vaccine in South Africa. Both of these deals do not represent transformative solutions that reduce Big Pharma’s control over supply, distribution and pricing of life-saving medicines neither for the COVID-19 pandemic nor for future health crises.

The Quad partnership underpins vaccine production of Johnson & Johnson’s (J&J) shots by Indian producer Biological E. However, for the time being, Biological E is poised to carry out only the final formulation stage, being dependent on J&J for the supply of drug substance. Similarly, the deal between Pfizer-BioNTech and South Africa’s Biovac is just for fill and finish operations. These contractual arrangements do not represent autonomous manufacturing in the developing world and do not entail significant technology transfer or knowledge sharing.

The vaccine apartheid will not end and developing countries will not have autonomous capacity to protect their citizens until there are regional production hubs around the world churning out significant volumes of vaccine doses from start to finish. And, the U.S. government could contribute a great deal towards this goal if it uses its political clout and innumerable resources and levers to get a TRIPS waiver enacted and create the conditions for broad technology and knowledge transfer.

However, President Biden failed to mention the TRIPS waiver during the summit even if the White House factsheet released after the event did reference the waiver, the only truly global initiative to end the pandemic.

At the 76^th Session of UNGA, the U.S. administration lost an unbeatable chance to engage with world leaders and deliver a TRIPS waiver for which it announced its support since May. Dread that this foreshadows a similar failure at the imminent November WTO Ministerial Conference.

As for the plans to be better prepared for the next pandemic, Vice president Harris unveiled a proposal to create a new financing mechanism for epidemic surveillance, vaccine development and vaccine delivery. This Financial Intermediary Fund for Pandemic Preparedness is to be hosted by the World Bank.

The U.S. will contribute $250 million, and the objective is to raise $10 billion. The final destination for these huge sums of money is, as of now, unclear. But, unless something changes radically, the only certainty is that the fund will keep nurturing the bottom line of the same pharmaceutical companies that today deny vaccine access to those that need them the most.

The lack of U.S. leadership and the fact that the COVID-19 summit did not yield any meaningful commitment resulted in an UNGA where progress on a global vaccination plan was noticeably absent, despite the calls from African heads of state for support for the TRIPS waiver.  Instead of the promised first-of-its-kind, global leader-level summit to end the COVID-19 pandemic, the summit was a peak of missed opportunity.

Rethinking Trade - Season 1 Episode 39: President Biden Could End the COVID Pandemic at This Week’s UN Summit - Will He?

Getting the world vaccinated and ending the pandemic is a political choice: World leaders have the medical, technical and financial capacity. To produce enough vaccines involves three clear steps: getting intellectual property monopoly barriers out of the way through a temporary WTO TRIPS waiver, technology transfer through sharing the recipes, and funding global production so the world is not reliant on a few monopoly sources.

With this year’s United Nations General Assembly now underway and President Biden’s upcoming COVID Summit around the corner, the U.S. has a powerful opportunity to end the pandemic. Unfortunately, the targets for Biden’s COVID summit exclude making a final deal on the TRIPS waiver or any others steps to share vaccine recipes with the world so more shots can be produced.

To discuss all of this, we are joined by longtime HIV and social justice activist Matthew Rose, who leads U.S. policy and advocacy work at Health GAP and has been deeply involved in the fight for the TRIPS waiver.

Click here to sign the petition.

Click here to learn more about Health GAP.

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Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 
Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. Today, Lori and I are joined by our friend and coalition partner Matthew Rose. Matthew is the director of US policy and advocacy at health Global Access Project or Health GAP, which we'll talk a bit more about later in the episode. As we speak, world leaders are gathering for a largely virtual United Nations General Assembly. As a side event to the Assembly on Wednesday, President Biden is hosting a global COVID-19 summit to quote, identify concrete actions, and set "ambitious targets to end the pandemic." Lori, could you frame the UN meeting for us in the context of the fight to get the world vaccinated, and then we can talk a bit about what to expect from this COVID summit.

Lori Wallach 
So ideally, this UN summit, where heads of state from around the world get together every year should be the place where finally the world comes together, to agree on a concrete plan to end the pandemic. At this moment, there is no plan. And as a political choice. We have the technological the medical, the financial means to end the pandemic. Now, these world leaders need to choose to do so. And unfortunately, the way it looks like the agenda is prepared, which is a lot of speechifying, and the way that Biden's so-called COVID summit has an agenda and targets that largely ignore the core issues undermining global access to vaccines, which is the key step to trying to end the pandemic. I can't say that's a very auspicious prospect, that what should be the meeting to end the pandemic is actually going to deliver the Biden summit is all about sharing existing doses and donating doses. But adding a billion more doses to the pledge of rich countries giving poor countries doses does not fix the 10 billion dose-gap in the supply or distribution that now has less than 2% of people in poor countries, getting vaccines and allows the COVID variants to be brewing around the world wiping out unvaccinated people destroying people's lives and livelihoods. And the agenda, the targets for the Biden summit, in no way take on the corporate monopoly control by Big Pharma entities that is causing vaccine apartheid worldwide. So Matt rose, you are a person who has been a leader in these global access to medicine fights for a very long time. How do you see it?

Matthew Rose 
It's interesting the way you framed it, Lori because I think that what popped out of me first about the summit is there's nothing new here. There is nothing being said or done to get us further along the path. The targets that they put out are not that different from what the WHO has already identified as targets. We've done the pledging thing when we had our meeting, back in June when the G7 got together, and of those 500 million doses that the President was going to donate them, that promise to donate, they have yet to be materialized. And they're at the back of the queue when it comes to doses coming out of the COVAX system. So all we've seen, since the big announcement that we were going to say let's break pharma control. Let's make sure that doses are available back in May, when we said the trips waiver should go forward is a lot of just hoo-ha in action. In a world where millions of people are still suffering from the effects of COVID where we're watching variants continue to rise around the world and continue to wreak havoc, reigniting some of the places where we thought we were doing good. And it leads you to question are we going to actually end this pandemic? Because we've had these meetings before. Why is this different? And so far, what's been put on the table looks like more of the same, which has fundamentally not gotten us to a place of ending a pandemic.

Ryan 
Let's talk specifically about one of those big demands to end the pandemic. That is a solid proposal, one being made by governments and civil society organizations throughout the world, which is the TRIPS waiver. Lori, could you give listeners a quick reminder about what the TRIPS waiver is and where it stands currently. And then Matthew, maybe you could talk a bit about the work being done. Now, to make the waiver a reality.

Lori Wallach 
You bet. I want to also just share with people COVAX, that's the agency that's supposed to take donations and dole them out. And what Matt Rose is pointing out is if you've got a shortage of doses, that kind of an agency, which is way short of even the modest goal of getting 20% of people in developing countries vaccinated just doesn't have the shots because they're just not available. So how do you change that dynamic? So more vaccines, treatments, diagnostic tests for COVID are being made worldwide. So that instead of having very high vaccination rates in a handful of rich countries and the rest of the world screwed, you actually get the whole world vaccinated, you get the whole world tested, you get everyone treated, you save lives, and you end the pandemic. How do you do that? And the thing that 150 countries want and have wanted since a year ago, October 2 of 2020, is a waiver of the WTO rules that require all the WTO countries to guarantee pharmaceutical corporations monopoly controls for many, many years of things like the COVID vaccines. So right now, under these WTO rules in the agreement on trade-related aspects of intellectual property, it's called TRIPS. every country around the world is supposed to let these handful of companies which use enormous billions of government money to create these vaccines control if and when they're made, where they're sold. As a result, shocker, the most effective vaccines, Pfizer, Moderna, are being only largely sold in the rich countries. And most people around the world have nothing. So this waiver of these WTO TRIPS monopoly requirements was proposed a year ago. In May, the Biden administration said they would support it, they have not exerted leadership to get it done. So here we are four months later, it's a total deadlock. And this is what's so disgusting. It's blocked by literally three countries, Germany, the United Kingdom, and Switzerland, with Germany leading the crew. If Germany stopped blocking with 150 other countries around the world have stood up and said, this is necessary to deal with this incredible inequity, we must take away the former monopoly so more can be made by everyone so everyone can get it and we're jammed right now. We've got two months before a big WTO summit that starts around Thanksgiving to actually get a final deal done. And it's only going to happen if the US President Biden stands up. But Biden's agenda for this US summit isn't to land the waiver deal or to otherwise force these monopolist Big Pharma companies to transfer the technology needed to make more doses. In fact, the big highlight is announcing they're going to give more us taxpayer money to monopolist Pfizer to buy hundreds of millions of more doses to donate. So instead of actually distributing production and control to people around the world, to control their own destiny, and make sure that for this pandemic, and for the next they have the ability to survive. Instead, we're gonna have taxpayer money going to have the monopolists have more profits to make some doses not enough and ship them around his charity.

Matthew Rose 
One of the most important things in a public health crisis is time, we have squandered over almost a year now, in not giving people what they want. And what they've asked for. This would not cost the United States any new money. This would not hurt the first-world countries who've used 70% of the doses that have been allocated to the world. what it would do is give everybody a fair shake to be able to make their own vaccines, make their own diagnostic tools, make their own treatments available in their countries. And we know that this is what's needed in this kind of emergency time. And we continue to, instead of moving something forward that 150 countries have asked for. We let just three countries, three countries who are well vaccinated, who have good control of the epidemic in their countries who don't have the economic wherewithal to weather lockdowns decide that the rest of the world who is feeling the crashing effects of this delta wave have no choice, no options here. And it's really a question of do we want to have as the United States, the moral authority to say, for the good of the world, we will do the right thing. And in May, it sounded like we were going to get there. But over months of negotiations, what have we gotten? We've gotten the Europeans floating a nonproposal, which essentially exists only to slow down the process, as again, their entire populations get vaccinated, while the people on the other side have to see the horrific things of what's happening in the US x100. Because they have no access to vaccines, there's no protection for them. And we continually sit in this spot of staring down each other when people needlessly die and suffer, because we don't want to exert the authority required to push the waiver through. We know that the US leadership is key on these issues. We know the US has rallied the world before and rallied with the world to fight large global health challenges. Every president in American history, since the Carter administration has had to deal with a global health crisis. We've always taken a central role and we've helped Marshal resources and done it in a productive way. For the most part. I have some quids and asterisk there, but we can get into that later. But we know that what leadership looks like from the US, it looks like our diplomats in Geneva using every trick in their playbook offering things carrots and sticks aligned to get people to move on these questions. And we're just not seeing that this time. And it's almost gobsmacking to see how we got stuck here.

Ryan 
And Matthew, speaking of time, Health GAP grew out of the fight to ensure that all people living with HIV, especially those in the poorest parts of the world have access to life-saving medicines. That was back in the late '90s. Can you talk a bit about what that fight looked like then how it played out over the years and how it ties into the current fight for the trips waiver and getting the word vaccinated against COVID-19?

Matthew Rose 

Absolutely. Health GAP history is born from that fight when we watched triple combination therapy, be accessible to the rich countries and not getting it to our colleagues around the world knowing that the suffering we were seeing here and the transformation that we got from those drugs could also be transformed there. And it's eerily similar in very disturbing ways about what's going on. One of the interesting things in the HIV fight in the 90s in the early aughts is that we got to people who you would never think to be on our side, to come across on our side on this issue. That being George W. Bush and Dick Cheney. I know, I know, you're shocked, too. But this proves that going through the WTO can work. Why because we got Cheney and Bush to rally the world together to have the Doha Declaration, which relax IP rights on antiretrovirals so that we could push them out around the world and has generic manufacturers be able to move into the market. And you saw a massive change in the lives saved from this meaningful work and engagement. And these were staunch, staunch neoconservative Republicans who love free trade above all else. But even they were willing to recognize that trade-related barriers, had a ceiling that had a threshold that they shouldn't cross. And if that if they did cross that something, government had to step up and act. And it's wild to think that we worked with Cheney and Bush to get this done to unlock the blockages and allow this flow. Now was this flowing perfectly everything we wanted? No. But you know, that's what you get when you play with Republicans sometimes. However, it did unblock a number of things that allow us to truly set up an infrastructure that continues to allow new products coming from developed markets into the rest of the world. So you can see, you know, now we're still paying crazy drug prices in the United States because we pay crazy these drug prices in the United States. But you can have the generic version of the exact same drug available in a much more affordable manner to people in developing countries who need that drug. And this was a game-changer because it really allowed us to get treatment where it needed to be. Now, one of the places that pharma got to benefit was that it meant that there was a conference supply of people who needed drugs and had drugs paid for, and we had to create a mechanism to pay for that drug. And, you know, the generic companies at least got to have some of that cash. So pharma still gets to benefit and even in the world now, if the waivers are removed, they still get a little bit of money. It's not a whole free for all sale. But it does change the balance of power. And it allows people to make their own drug in-country and sell it to themselves at rates that they can actually afford, rather than what the United States might pay or you know, say Germany can afford to pay. Furthermore, as we watch this kind of global vaccine hunt happen, we can see that things that we've done in the HIV fight, have taught us that how to make these things work and happen. But it's a matter of do we have the political will to get there? And that's where we've been stuck is can we rally the will of the people to do what we did to do what the republicans did, it's still so strange to say, back in the early 2000s and realizing that you can indeed help people to save themselves. And that I think, was empowering, we basically created a generic market scheme by allowing this to go through. And this spurred innovation and spurred development in India, making them kind of the biological place of the world. So you can see what countries are able to do. Bangladesh is able to do places that can really do something once these barriers are removed, and that the investments that they make in those can have spillover effects for other things and other options. But you've got to get through the big block, that is the waiver and getting people on board with understanding that we can go big because we've done it before. And all your arguments about collapsing the pharmaceutical system are all empirically denied, because there's still a thriving pharmaceutical system in the world, even though people with HIV can now get medication.

Ryan 
I think we'll end it on the note of rallying the world like you just mentioned, Matthew, Lori, maybe you could talk about what listeners can do right now to help when the TRIPS waiver and then the pandemic and then Matthew, maybe you could just tell folks listening how they can support the work Health GAP is doing both in regards to the waiver and the other important areas that you focus on.

Lori Wallach 
The most important thing is to build pressure on the White House to take action to end the pandemic. This is not a technical problem. This is a power problem. We need to elevate our demands for a TRIPS waiver for technology transfer and for funding for global production to get everyone the vaccines they need to end the pandemic. There are two easy things everyone can do right now, go to tradewatch.org, top left corner, you will see a box about this crisis, click, you will see an action alert, sign the petition and then pass it on to your friends and family. Number two, it really matters to call your members of Congress at 202-224-3121. You can call the US Capitol. You just give me your zip code, they will send you to your House member have your house member transferred to your senators, ask your House representative and your two senators to talk to the White House, particularly Jeff Zeints and get a letter written back to you about what they say about what they're going to do to deliver the TRIPS waiver

Matthew Rose 
Ditto all the things Lori said it's super important that we raise the pressure and we make this White House realize that the American voters realize what is being done in their name and decide what we're willing to stand for. We can demand that our government actually shift power and create an equitable way to distribute and help support vaccines getting around the world. We can actually think about how to end this pandemic. The plans are out there. The data is out there. The information is out there. It is a matter of political will. And the best way to rally will is to talk to your friends, your family, your co-workers. Share, share, share share. There will be so much information about the waiver for the next couple of weeks and about what we're doing follow Global Trade Watch, follow Health GAP on Twitter. Go to our website to healthgap.org. We are working hard to continuously pump out new materials and resources that help explain what's going on and what's happening in the fight. But this coming summit will help set the stage for what the world does going forward. We can either decide to let a mediocre, lukewarm, boring agenda continue to drive things where we sit and stare at each other across the room and twiddle our thumbs. Or we can act with the urgency and the swiftness that is required to end a pandemic that has encased our lives for over a year and a half to actually provide and support with the rest of the world, 150 countries has asked of us and to truly transform society in ways that recognize justice, dignity and equity. This is our moment. This is a moment in a world where you might not thought it was gonna come. But here now you can make it happen. Fight to support the waiver, fight for vaccine equity and fight to end the Covid-19 pandemic.

Ryan 
Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Delta Variant Shows, Unless Biden Administration Starts Leading Global COVID Vaccine Effort, Pandemic Will Never End

[Reposted from PC News]

By Mike Keeley

The delta variant-fueled COVID-19 wave that is slamming communities nationwide and flooding ICUs is a glimpse of the endless pandemic to come unless the Biden administration secures a waiver to significantly boost production of vaccines, tests, and treatments; requires firms to share vaccine recipes; and helps to fund a major increase in COVID-19 medicine production worldwide.

A recent report by Public Citizen’s Global Trade Watch (GTW) debunked Big Pharma claims that drug corporations’ current vaccine production plan would quickly satisfy global demand. Nine months into 2021, current vaccine producers have delivered only five billion doses of the 12 billion they promised to make this year, while 14-15 billion doses were needed before rich countries started booster shots.

Less than 3% of people in low-income countries have had at least one dose, according to the World Health Organization (WHO), and those countries may wait until 2024 for mass immunization, if it happens at all, according to the Economist Intelligence Unit.

This scarcity is not only unjust and guarantees needless deaths and economic pain, but increases the chances of vaccine-resistant variants emerging that put the whole world back to square one on immunization.

The global shortage of vaccines can be traced to monopolies that empower a few vaccine makers to control if, how much, and where vaccine doses are produced. The World Trade Organization (WTO) requires 159 countries to enforce patent and other so-called intellectual property barriers to greater medicine production.

Regular Public Citizen News readers will recall that the Biden administration made history in May when it reversed the Trump administration’s position and supported temporarily waiving the WTO pharmaceutical monopoly terms to save lives amidst the COVID-19 crisis. American support for the “TRIPS Waiver” greatly elevated the issue and influenced some allies to follow suit.

However, since then little progress has been made thanks to a handful of wealthy countries opposing the waiver, especially Germany and the European Union on its behalf.

Following the U.S. announcement of support, GTW joined with a coalition of U.S. and international civil society organizations to pressure German Chancellor Angela Merkel to stop blocking the more than 130 countries that want the waiver. As Merkel traveled to Washington, D.C., in July for her final White House visit, she was met with dozens of protests organized by Public Citizen, Citizens Trade Campaign (CTC), and allied organizations focused on more than a dozen German consulates nationwide.

Protesters arranged body bags outside the White House during a protest calling on German Chancellor Angela Merkel to stop blocking an emergency waiver of intellectual property rules needed to increase global production of COVID-19 vaccines and treatments that would help save millions of lives Thursday, July 15, 2021 in Washington. The action in support of the “TRIPS waiver” was one of more than a dozen demonstrations in the U.S. capitol and at German consulates across the nation timed with Merkel’s visit to the United States this Thursday. While President Biden and a majority of the world’s governments support a TRIPS waiver, Germany continues to obstruct it. (Eric Kayne/AP Images for Citizen Trade Campaign)

The Chancellor was directly challenged by GTW protestors—including one inside a large Merkel puppet—as she arrived for an honorary degree at Johns Hopkins that students petitioned against, given her opposition to the waiver. CTC, GTW, and allies mobilized a huge banner on helium balloons depicting the White House in the background. Body bags were also laid outside the White House the day of the Biden-Merkel meeting, generating more press. Heads of major U.S. organizations wrote to Biden and spoke at a press conference organized by GTW to publicly urge him to exert U.S. leadership at the summit and resolve the German opposition.

Public pressure put the TRIPS waiver on the agenda for the summit, but Biden apparently did not expend the political capital necessary to convince the Chancellor to move. Nor has the administration exhibited the leadership at the WTO. 

Waiver proponents had called for progress by the end of July, but with none in sight, the WTO disbanded for a six-week vacation against the WTO Director-General’s guidance. “The WTO is showing itself to not just be useless in the fight against COVID, but an actual hindrance,” said GTW Director Lori Wallach. “The WTO’s shameful inaction on the COVID waiver could be the final undoing of an organization that already was suffering a major legitimacy crisis and on its last legs.”

According to Oxford University, more than 3.3 million people worldwide have died from COVID-19 since India and South Africa first proposed the WTO waiver in October 2020. Meanwhile, White House coronavirus czar Jeff Zients appears to have no plan to end the pandemic. GTW and almost 30 partner organizations – including Be A Hero, Amnesty International USA, and Avaaz – are joining forces in a petition to Zients demanding that he:

• Actively cooperate with waiver proponent-nations to produce a draft WTO TRIPS waiver text and use all means to press the European Union and others to end their opposition;
• Leverage the U.S. government’s past public investments and all legal authorities to make vaccine firms transfer technology; and
• Launch and fund a global manufacturing plan to increase and democratize vaccine production in hubs worldwide.

Biden is reportedly planning a COVID-19 summit in conjunction with the United Nations General Assembly in September. According to Wallach, “President Biden’s global COVID summit will only be a success if he uses it to exert global leadership to get the WTO TRIPS waiver done and secure commitments from other countries to help fund the necessary scale-up in developing countries’ production of COVID vaccines to end the pandemic.” More than 130 countries support the WTO waiver, and opponents are facing increasing political pressure and moral outrage. Chancellor Merkel’s upcoming retirement creates opportunities for our German allies to end their country’s obstruction of the waiver and thus end the EU’s opposition. But while there is hope, there is also peril. All eyes are now on the Nov. 30 WTO ministerial, a date far beyond when a waiver should have been enacted. And Big Pharma and other interests are pushing to transform a meaningful waiver into a meaningless WTO political declaration.

Public Citizen will keep up the pressure to force the Biden administration to show leadership and secure a comprehensive waiver as fast as possible to end the pandemic.

Tuesday Press Conference: MoCs, Civil Society and Labor Leaders Urge Biden To Launch Global Plan to End Pandemic at Next Week’s UN Summit

For Immediate Release: Sept. 9, 2021
Contact: Derrick Robinson, [email protected]

MEDIA ADVISORY

 South African Government Official Will Provide Update on WTO Vaccine Waiver as Delta Variant Devastation Foreshadows Devastation of Endless Pandemic 

WHAT: Ahead of the U.N. General Assembly (UNGA) heads of state summit, Member of the U.S. Congress and heads of labor, faith and health organizations will spotlight in a Public Citizen Zoom press conference why President Joe Biden’s leadership is essential to ending the pandemic.

In the months since Biden’s historic support for a waiver of World Trade Organization (WTO) monopoly barriers to greater COVID vaccine production, little progress has been made. And White House COVID Czar Jeffrey Zients has yet to unveil a global plan as the Delta variant detected in India where vaccines are scarce is now raging worldwide. UNGA and Biden’s  global COVID-19 summit will be successful if the president uses them to get the WTO waiver done, require vaccine recipes be shared via  broad tech transfer to speed expansion of COVID medicine supplies, and move funding for much expanded global production.

WHO: U.S. Rep. Jan Schakowsky (D-Ill.) 

U.S. Rep. Rosa DeLauro (D-Conn.)

Zane Dangor, Republic of South Africa, Special Advisor to the Foreign Minister           

Dr. Joia Mukherjee MD, MPH, Partners In Health, Chief Medical Officer

Father Charles Chilufya SJ, Jesuit Representative for Africa and Madagascar

Sara Nelson, AFA-CWA, President

Moderated by Lori Wallach, Public Citizen’s Global Trade Watch

WHEN: Tuesday, Sept^. 14 at 9:30 am EST [GMT-4]

HOW: Press can register here.

BACKGROUND: On May 5, people around the globe cheered when President Biden announced the U.S. would support a temporary waiver of WTO intellectual property barriers to boost production of the COVID-19 vaccines needed to save lives and end the pandemic. But months later, Big Pharma monopolies remain, now exacerbated by even higher vaccine prices. Current production capacity cannot supply enough COVID-19 vaccines for the world. The poorest countries may wait until 2024 for mass immunization, if it happens at all, per the Economist Intelligence Unit. To date, 75% of vaccines have been administered in just 10 countries, and only 1% of people in low-income countries have received at least one dose, according to World Health Organization statistics.

The U.N. Global Assembly of world leaders comes at a time when the critical shortfall of vaccines, diagnostics and treatments in low- and middle-income nations is enabling more deadly and possibly vaccine-resistant variants to develop and spread domestically and abroad. The delta variant first detected overseas is burning through the U.S., and scientists warn of even deadlier variants as the pandemic drags on. Unless the UNGA results in significant breakthroughs to the WTO waiver, tech transfer and global production funding that ensure that people worldwide can access vaccines and treatments, there can be no end to the public health or economic crises anywhere.

###

Rethinking Trade - Season 1 Episode 38: Labor Day Special: An Historic Vote in a Mexican Auto Plant

On August 19th, workers at the massive General Motors plant in Silao, Mexico participated in an historic vote that ousted the corrupt and undemocratic protection union that had long controlled labor relations there. The effort to win such a vote was made possible by the labor rules and Rapid Response enforcement mechanism of the USMCA trade deal.

In this Labor Day special, we sit down with Public Citizen’s Global Trade Watch Research Director Daniel Rangel and long-time labor organizer Jeff Hermanson, who has been supporting the General Motors campaign through the AFL-CIO’s Solidarity Center. We discuss the situation at Silao, its significance in the context of trade policy and what it says about the prospect for workers to utilize the USMCA to fight for labor rights in North America.

Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 
Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. It's Labor Day we're doing a Labor Day special episode about a quite historic union vote at a General Motors plant in Silao, Mexico. Joining Lori and I is Public Citizen's Global Trade Watch Research Director Daniel Rangel. As well as Jeff Hermanson, former Mexico director of the Solidarity Center and a longtime labor organizer. Jeff has been pretty involved in supporting the efforts at the General Motors plant in Silao. Jeff, why don't you just start by telling us what just happened at the Silao plant. And then we're going to talk about how significant this is for the Mexican labor movement but also for the prospects of the revised NAFTA, the USMCA's labor protections, and enforcement mechanisms.

Jeff Hermanson 
The General Motors plant employs 6,400 workers. They have a collective bargaining agreement that's known as a protection contract with the CTM (Confederation of Mexican Workers), the largest union in Mexico. And under the labor law reform in Mexico and the USMCA, every contract has to be legitimated by a secret ballot vote of the workers for the first time. And the workers voted it down. And that's a big deal.

Lori Wallach 
There was a really exciting development, one that involves a lot of different streams of organizing and policy change. One, I think the key thing was the Rapid Response Mechanism (RRM) of the revised North American Free Trade Agreement, which is officially called the US Mexico Canada agreement, the USMCA. That agreement going into place required the labor law changes, Jeff, that you mentioned in Mexico and also created this mechanism, Rapid Response Mechanism that for the first time allows company-specific cases to be filed to directly enforce against an individual company, the new labor rights that were required, basic core ones right to organize rights in the revised NAFTA. And there's a lot riding on whether or not that mechanism can work. It definitely is an important new tool. And at the same time, it's, you know, first trial runs. So the US government under US Trade Representative Katherine Tai self-filed one of these rapid response cases against GM, with respect to the outrageous basically malfeasance that occurred during the first effort to have a vote on this contract. I'm wondering, Jeff, if you could explain to us a little bit of the context of this, because, you know, folks are probably not that familiar with the idea of a protection contract. And also, the obligation under the new NAFTA is that every one of these old contracts, a lot of them, which were really, you know, protecting the boss, not protecting labor rights have to be revoted. And so this came to a head in the context of that process. And I'm gonna ask you, Jeff, to take it away and give us some context of how we got to this and why this is so important.

Jeff Hermanson 
So in Mexico, there are very few non-union workplaces. But 90% of the contracts are considered protection contracts, that means that they're put in place by the employer and an union before workers are hired in many cases, without worker knowledge in many cases. But even if there is some worker knowledge as there is in the General Motors situation for the purpose is to protect the employer from any legitimate union representation. And in this case, for example, for the 12 years that this union held this contract, there was not a single assembly, not a single vote on leadership, not a single ratification of contracts, and very little help from the union on any individual grievances. So because every one of these contracts is now going to have to be voted by the first of May, 2023. Because of the importance of the plant the size of the plant. The eyes of the Mexican government and the US government were on this vote. And in April when the first vote was held, it was a two-day vote. The first day of the vote went forward, the ballots boxes were put in the union office for safekeeping, supposedly, but when they came the next day to start the second day of voting, they found that the ballot boxes had been broken into, and ballots destroyed. And they had done a count of the vote up to the end of the first day. And the vote was leaning towards rejecting the contract, 45 to 55. A surprise to everyone. The workers and the secret ballot had voted this contract down, however, because of the irregularities, as they're called the Secretary of Labor suspended the second day of voting did an investigation, and issued a finding that yes, serious irregularities had occurred. The same day that finding came out, the US Trade Representative filed a complaint under the terms of the labor chapter of the USMCA calling upon the Mexican government to take steps to remedy the situation. Labor Secretary in Mexico ordered a second vote, which was supposed to take place within 30 days of her order, the 30 days came and went, the CTM just didn't run the election. And so then an agreement was reached between the US Trade Representative and the Mexican Secretary of Labor, that a rerun election had to be held by August 20. And if it wasn't held, the contract would be invalidated. So that puts some real sanctions into the agreement. And it also required observers. And the bottom line is when they voted again, they voted the same way: 45% Yes / 55% No. And they rejected the contract.

Daniel Rangel 
Thank you, Jeff, for chairing this. I think that what our listeners are wondering now is what will come next? What's the process for workers to get through in your representation at GM- Silao.

Jeff Hermanson 
So now we're in a situation where this contract will be invalidated. I mean, there's a period in which the CTM can object to the election. And throughout that period, the contract stays in effect, we hope that that 20 day period will result in the contract being eliminated. And the workers then have the opportunity to form their own union, they've already applied for the registration and gotten registration of an independent union. And now they're campaigning to get enough support to apply to negotiate a contract.

Lori Wallach 
So what do you think was the relevance of the Rapid Response complaint for the outcome because this is like a pretty stunning outcome after decades of workers getting screwed by protection unions in Mexico was a brave thing to vote the way they did the fact that the vote actually got redone in a fair way, as you know, knockdown, drag-out stunning, given the context. Does the USMCA and the USTR self-initiated case had anything to do with that? Or is it all about internal organizing, which I know we want to hear about the amazing work that the workers did also to represent themselves? But was the RRM part of the story?

Jeff Hermanson 
Absolutely, this second vote probably never would have occurred without that complaint, because as I said, the Secretary of Labor ordered to election rerun in 30 days, and the union just didn't do it. They said, "No, we don't have to do it, we have until the first of May of 2023 to do it." Without that complaint, the second rerun probably wouldn't have occurred.

Lori Wallach 
You figured they were thinking about the sanctions and the RRM, that we're going to hit the company and the government was going to look bad, and they were all seeing that chewing on their ankles?

Jeff Hermanson 
The government in Mexico really does not want sanctions to be applied. They do not want, you know, investors to see that sanctions could be applied to them. So basically, they were ready to do just about anything that the USTR asked to get past this complaint. And what they did was order a rerun election under conditions in which the workers could vote freely, secretly, without coercion, and vote their conscience. And that's what they did. You know, and it really is an amazing testimony to the courage of these workers. Because in the past, this never would have happened in the past the CTM would have brought in, you know, 100 thugs to intimidate the workers. I mean, we've seen this so many times, there would have been no secret ballot, you know, it would have been an open vote in front of everybody. And, you know, I never would have happened. So this is a turning point in the history of the Mexican labor movement, in my opinion.

Daniel Rangel 
This case appeared on the radar of many people with these outrageous episodes of the representatives destroying to ballots of the workers that were voting no against the contract. But this fight and struggle of many workers started many years ago, right? Could you give us a little bit of the background of what was going on in that plant? And what were the main drivers for workers at the GM-Silao plant to both know for this contract?

Jeff Hermanson 
I think you know that it's true that there has been dissent within this company for years, but dissent that was repressed, the dissent that resulted in workers being fired dissent that really, you know, could not come into the open without retaliation from the company. And so as a result, the main voice of the workers was a group of fired workers, eight fired workers formed a group called Generando Movimiento (generating movement) using the initials GM, you know, they were a presence on social media, they were a presence with their personal connections to folks in the plant. And it's quite obvious that they had some real impact because we've seen other legitimation votes recently in auto plants that were one-sided in favor of the Union. Because there was no such movement in the plant because workers were intimidated. In this case, we saw the CTM, holding captive audience meetings with the help of the company, before the first vote, in which they were telling workers that if they voted the contract down, they'd lose their benefits, which is a lie. We saw threats and intimidation of workers, we saw the idea floated that if the yes vote won, that they would raffle off 10 brand-new GM vehicles, of course, workers know in Mexico that a lot of promises are made in election campaigns that are never fulfilled, and this is one of them. But you know, it was a situation in which the workers themselves had built enough of a support network in that plant that people felt safe to vote their conscience. And that's really an amazing thing.

Daniel Rangel 
Before you finish. Let me ask you this, how was this news and this historic vote received? And how is this gonna change the landscape for the relationships between employers and workers in Mexico?

Jeff Hermanson 
I expect this sends a message to employers and unions, you know, it received tremendous press coverage in Mexico. This was one of the top stories for a few days after the vote. And there are employers right now thinking, "What am I going to do when my contract is up for a vote?" In many of these cases, the workers don't even know there's a contract. So we think that a lot of these contracts will fade into history, when the deadline, first of May 2023 rolls around, most of these contracts will not have been legitimated and they will no longer be in force. Those that are voted on, we're going to see, we're going to see more defeats of protection contracts.

Daniel Rangel 
And why are you so certain that workers are going to vote down these contracts?

Jeff Hermanson 
You know, these contracts are protection contracts for a reason. And the reason is to keep wages low. And wages in the General Motors plant are half what the wages are in the Volkswagen plant in Pueblo where they have had an independent union, negotiating real wage increases for the past 25 years. And you know, the differences are very obvious. There are three independent unions in the assembly plants in Mexico, one in Volkswagen, one in Nissan, and one in Audi. And all three of them have at least 1/3 higher wages than in the GM plant. And some of them have double the wages. That's a big deal. It's a big difference. People can see that. Workers are fed up. They were fed up with the CTM in this plant, they're fed up with protection contracts in many plants throughout Mexico.

Lori Wallach 
Well, that begs the next and sort of final question, which is what needs to happen now for actually the workers at the Silau plant to get an independent union? They still have to get a new union. And GM has to recognize that new union and then they need a new collective bargaining agreement. So are there challenges between saying no to the old and getting the new that could actually change worker's lives? What are the prospects there?

Jeff Hermanson 
There definitely are challenges. Other protection unions are circling around the GM plant and talking about how they're going to represent these workers. But the workers themselves have formed an independent union, national independent union of workers of the auto industry. They have received their registration papers from the federal authorities and they are seeking right now to sign up, you know, they have to sign up 30% of the workers in order to demand collective bargaining, we expect there will be real competition for support. I mean, we can't forget that the CTM did get 45% of the vote, we expect that they will try to negotiate a new contract. If the independent union gets a 30% signup, there'll be an election between any union that can provide a 30% showing of interest, essentially, they'll be on the ballot. So we might see a competitive election between an independent union and the CTM union or another protection union.

Lori Wallach 
And the very fact they have the opportunity to have that vote and have an independent union challenging the corrupt CTM protection union is a pretty amazing development. Dear listeners, to put this in perspective, this is historic. And I think the thing thinking forward about these challenges and all is for all of us to think about what work we need to do as activists, as organizers, as policymakers listening to this interview to actually translate this opportunity, these instruments into the reality that workers throughout North America have been fighting for together since the NAFTA itself was hatched in the early 90s, to actually have a mechanism for workers to improve their lot and the transnational companies have been playing workers off of each other, taking their high wage union jobs in the US to Mexico to pay people $2-3 an hour, making sure there are no real unions. How do we translate this opportunity, this moment through action through the RRM cases through solidarity into real change? And that is what is before us. And Jeff, I don't know if you have some specific ideas about that?

Jeff Hermanson 
You know, the recommendation of the Independent Mexico Labor Experts Board has been for massive funding of US and Mexican union binational organizing efforts. I'm very much in favor of such a program. I mean, this is what needs to happen. We need to train a generation of professional trade union organizers. We need to help them create industrial unions that are independent of government and employers that are democratic, and that actually represent the interests of workers. And that can be done with the cooperation of US, Canadian and Mexican unions, this is possible now for the first time in my career. I see this as a real possibility.

Ryan 
Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Rethinking Trade - Season 1 Episode 37: Hyperglobalization, COVID and Failed Supply Chains: Now What?

In our very first episode, we looked at how corporate-led globalization has fueled shortages in our medical supply-chains and limited our ability to fight COVID-19 Today, we catch everyone up on the latest, discussing two Biden-Harris Administration initiatives aimed at addressing this mess -- a targeted supply chain-review and an executive order on Buy American procurement rules. We also make sense of the latest U.S. trade data, which suggests a record trade deficit in 2021. Yup, that's probably another COVID symptom…

Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan 

Welcome back to rethinking trade where we don't just talk about trade policy, we fight to change it. I'm Ryan, and I'm joined once again by our in-house trade expert, Lori Wallach. Lori, and one of our very first episodes, we talked about how decades of hyperglobalisation have undermined our resilience against the COVID-19 crisis, and how the government has to actively intervene in the economy to rebuild a domestic manufacturing base. Today, we wanted to update listeners on what has been and hasn't been happening since that time. Let's start with an overview of the big picture. What does the pandemic look like today from a trade policy perspective?

Lori Wallach 
So, on the one hand, the expected shift towards more domestic supply chains in response to what proved from COVID, to be enormous vulnerabilities in this country, but around the world created by hyperglobalisation. And these very thin, brittle globalized supply chains. This has not happened as quickly as one might hope and expect. In part, the corporations, the big multinationals, the Amazons and other mega retailers, who've made a lot of money on that race to the bottom hyperglobalized system of sweat labor, supply chains, and just-in-time production, are very keen to maintain that system, which prioritizes their profits, and what they will consider efficiencies, no redundancy, over reliance, reliability of supply and deliverability of critical goods. And so they're pushing back. And also, we've had that system being pushed for the last 25 years of the World Trade Organization, the NAFTA Free Trade Agreement model. So it's a steamline are heading in the wrong direction, it takes a long time to turn. The evidence of that is that we have seen increased imports from China into the US, of the medical supplies we've needed from personal protective equipment, PPE to different kinds of medicines that we've needed to deal with the COVID crisis. We have seen a lot of spending domestically, as people are stuck at home and not spending more on restaurants and travel on kitchen goods, you know, fancy ovens and other things, a bunch of which are imported. So our trade deficit has gone up. Interestingly, the WTO has reported that's contrary to the cheerleaders of the corporate globalization model, there haven't been a lot of enduring trade barriers. So countries didn't use emergency tools to shut down trade and force domestic sourcing. The WTO just issued a report that many of the trade restrictions that emergency restrictions that have been put in place during the height of COVID, have been lifted. And that actually, if anything, there's been more removal of trade barriers and attempt to get the important goods that the production of which is over-concentrated in a few locations. And on the other hand, there have been some very inspiring moves by the Biden administration, which include a supply chain review in some key sectors and also a Buy American executive order. Now, we also saw during the Trump administration, some similar announcements and executive orders. And the proof is always in the pudding. The Trump administration didn't follow through, they had a lot of power and opportunities to do things just unilaterally without Congress. They didn't take them. The bind administration has taken some specific steps, and we're gonna have to watch carefully to see if they actually follow through on all of it.

Ryan 
Those specific steps are what my questions are based on the first big item I wanted to tackle you just mentioned, which is the supply chain review being conducted by the administration. What does this review entail? Like what is it what's its purpose? And what is the status of it?

Lori Wallach 
In the spring, the body Harris administration announced they would do 100 Day Review to figure out the weaknesses in and plans to strengthen certain critical supply chains. And they pick three sectors. And they pick three important sectors: critical medicines, critical minerals, the production and processing of, so for instance, the minerals used in making cell phones and the communications equipment, and then also semiconductors, and then also the supply chain for batteries, electric batteries, which is to say, the sort of advanced batteries that are used for electric cars. And then June 8, they published a report, it was perhaps the first time since Alexander Hamilton, that the US laid out a detailed industrial policy in writing. And I'm only slightly exaggerating, the report itself was incredibly inspiring. It's laid bare, the deep flaws in the current system, in a way that I would say, as someone who's observed these issues for 30 years, one could hardly have ever predicted would come out of the US government, and was quite smart in laying out the ways in which the old regime failed. And I know that wasn't easy, because some of the agencies and for that matter, even President Biden had supported the past policies that led to these problems. So in that regard, it was incredibly impressive and helpful because the only way you get a different outcome is when you start to admit that the status quo didn't work. And it takes you know, it takes bravery if you were part of hoping those old policies would work and pushing them. And some of the proposed changes of how to fix the problem, were also really inspiring and were spot on. And were things you would never expect to come out of any US administration. And by the way, weren't the kind of things that the Trump administration dug into not neither in detail of thinking it through and figuring out the solutions as compared to a bunch of superficial rhetoric that also are not compatible with the status quo big business model. So now the proof is going to be in the pudding about whether those kind of changes actually get made. And if they were changes proposed across the board, using existing authorities, things that the executive branch could do in their own capacity with respect to strengthening the Buy America policies, and Buy American policies, which has to do with the government using government procurement resources to shape the market. It included changes in the tax code, it included uses of the defense production act, for the government to create demand and incentives for changes. And it's really if implemented, could make some big differences. And now we need to see if it gets implemented.

Ryan
Another big item and you just mentioned this is the modifications the administration is made to Buy American rules. We've covered this at length in previous episodes. So listeners can go back and get even deeper into this topic. But maybe you could give us a quick introduction to what these policies are, and then talk more about what is being done and what hasn't yet been done in relation to the Buy American rules in the context of the pandemic especially.

Lori Wallach 
So again, here, the good news is the administration's executive order on Buy American and Buy America was quite broad. It covered all the programs, it covered a lot of the needed territory, and proposes to increase the domestic content rule for what qualifies is Buy American, which right now is just 55% of the value of a good needs to be American made, which is pretty pathetic. But unfortunately, it didn't really close the biggest loophole. And that is even that 55% rule is waived entirely with respect to any government procurement over a certain threshold value. That's about $180,000, which for the federal government means most of the contracts, most of them are bigger than $180,000. Because under our trade agreements Buy American is waived for 60 countries that have trade agreement, procurement agreements that basically guarantee that these foreign countries, companies and products get treated as if they were made in the US for Buy American is called the Trade Agreements Act waiver. And it is the exception that eats the rule. And the way that works is not only to goods from Hong Kong, which now is China and from Mexico and Japan and Korea in all of Europe, not only are those treated, Taiwan, treated as if they were from the US, and the government gives equal credit, equal purchasing priority to those goods, but almost worse, any good over that threshold, the domestic content rule is waived whether or not that country has a trade agreement. So that means that all that has to happen is the last step in processing has to happen in America. And there are companies have gotten that so skilled in doing this, that they basically like can construct the better part of a whole building, with all of its walls poured the plumbing in there, the electrical in there, different pieces of you know, built-in furniture in there, they ship those on barges. And then as long as like the whole building is put together all that content, all that value, that is considered meeting the Buy American rule for all of those goods that are in that building or with respect to Buy America. That is the final assembly is happening here now Buy America is stricter than Buy American. So I don't want to simplify this. I want everyone who wants to know the details to go to a website at tradewatch.org and go to the procurement section, and we have a memo that lays out all of these issues and where the gaps and flaws are. But the thing to know is that the executive order like Trump's executive order, I'm Buy American doesn't close this huge loophole. And that's a problem. The President did say that they would as a candidate, that they would be closing these loopholes. And in some of his initial statements, they said that they would and now the executive order doesn't. What the executive order does do is ask for a bunch of data. And there's a hearing this very week about what the flaws are and the current data keeping, because it's so sloppy, we don't really know what is really domestic versus what is just assembled here without domestic content versus what is from one of the 60 countries versus what is domestic content and assembled here. So it's really hard to know what's really going on. And as a result, the data makes it look like there's less of a problem than we know that there is. So with respect to the Buy American and Buy America rules, that executive order is one big piece. The other big piece is the infrastructure bill. So the house infrastructure bill explicitly didn't prioritize that trade agreement waiver, but the Senate version does. And now there's a lot of pressure to just use the Senate version, because the vote was so narrow there, and it almost didn't pass at all, the Senate version does expand Buy America. That's the construction money, and it has it go to a lot more programs and my going down to the states. And that's great. And it strengthens the rules with respect to us made iron and steel. And that's great. But it doesn't really fix the Buy America problem. And it doesn't fix the waiver there. So there's a lot more work to be done there. And there is, you know, enormous opportunity in the existing statute where the President just like President Biden can do this. Now President Trump could have and didn't, can use existing authority to simply waive that trade agreement exception, the President can just take that away. And that would certainly be something that would be smart. And if you again, go to our website, tradewatch.org, you can see letters from very senior members of the House and Senate urging him to do that very thing, President Biden.

Ryan
So my final question also involves reports and data and things you can find on the Public Citizen website, which is the fact that, so a lot of these measures that we've been discussing haven't been fully enacted yet. And so the trade data, the deficit report still shows a rising US trade deficit in manufactured goods. So the reason analysis on the website on the Public Citizen website, suggested 2021, could actually be a record high. Can you talk about the Census Bureau's trade data report? And some of the things you found those meaningful in it what's in the analysis that we published?

Lori Wallach 
Here's the thing for folks to know, it looks like the 2021 annual trade deficit could top $1 trillion for the first time in US history. And that's just horrific and astonishing. However, that says something different than what you'd normally expect, which is to say what that says most and this is where our analysis points out, is that the US has had an economic recovery from the COVID recession that is faster and broader than most other countries. So we're actually our consumers have started to buy stuff, our demand has increased. At the same time, Ryan, as you just pointed out, these initiatives by the Biden administration, which is you know, been in office for seven months now have not had an opportunity to go into effect. So to the extent that the US has had an economic recovery and people want to buy stuff, the supply chains still are largely those old ones. So there aren't, you know, yet great opportunities. If the supply chain review brings those names supply chains home, if the Buy American and Buy America improvements actually happened with a waiver closed, and as a result, there's more domestic government demand for goods. And as a result, there's more investment. And as a result, there more opportunities for folks to be able to buy American made everything, then that change hasn't happened yet, even though the demand is picked up. So as a result, what we see is our imports are way up, because we want to buy stuff, but we don't have it domestically made yet. And you know, please at the Biden administration falls through so that in a couple of years, that data doesn't look like that. At the same time in the rest of the world, there still is much more of a recession going on. So our exports stayed down, there isn't demand for our stuff. And because we have demand here, our imports go up. And so we have a pretty whopping trade deficit. The COVID phenomenon, and the economic implications of it really are overshadowing what otherwise we could see in the trade data. Because for instance, there's another indicator about manufacturing, it's a study that is done that, you know, every month looks at sort of the projections for supply chain and manufacturing. And that and domestically, and that is that that number is up that's that's doing fairly well. So normally, you wouldn't see that number go up in the trade deficit go up at the same time. But that is that is the COVID effect. I think we're all incredibly impatient to see the horrors of the COVID lessons about hyperglobalisation quickly translate into more domestic investment, more domestic manufacturing, more resilience, more reliability. For all of us more good manufacturing jobs, the proof is going to be in the pudding over time, and the Biden administration is going to have a fight in its hands with all these corporations that want to do the same old, same old, you know, "China's too expensive, let's make it in Vietnam," kind of agenda of manufacturing. And I think they're going to stick to their guns only if we really all are pushing to make that happen. Because the counter push is going to be enormous. And there is a lot of inertia of this old system. But I think what we see in what the Biden administration's supply chain reviews and what they Buy America order is showing, is there a lot of people in there now, unlike any pastime, high level Biden administration officials, who deeply understand the problem, and really do you want to change and as frustrating as it may be, that's not going as fast as we want, are there parts of it that aren't done. It behooves us all to basically make common cause with those allies, and really push hard to try and help those folks in the inside who want to make these changes because it's a unique opportunity. It's the first time in 30 years of my doing this work that that possibility even exists, and so we need to make it work for us.

Ryan 
You can check the description of this podcast for links to both of the reports that we discussed in the episode. Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

Rethinking Trade - Season 1 Episode 36: U.S. Inaction is Enabling COVID-19 Variants to Spread

The world celebrated when President Biden announced the U.S. would support a temporary waiver of World Trade Organization “TRIPS” intellectual property barriers to boost global production of COVID-19 vaccines. But months later, Big Pharma’s monopolies remain. 

The administration has failed to deliver on the waiver or to get vaccine makers to share their recipes. That means dire shortages of vaccines continue and with the vast majority of people worldwide exposed, COVID is on a murderous, variant-spawning rampage.

Now the delta variant first detected overseas is burning through the U.S. Public health experts are warning that lockdowns and perhaps other measures, like postponing in-person learning, may be necessary. The U.S. must act now to end the pandemic. Every moment of further inaction enables COVID-19 variants to develop and spread.

Take Action: rethinktrade.org.

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Music: Groove Grove by Kevin MacLeod.

Link: https://incompetech.filmmusic.io/song/3831-groove-grove.

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

Ryan
Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. Lori, on May 5, the Biden administration announced its support for waiving TRIPS intellectual property barriers for COVID-19 vaccines at the World Trade Organization. As we've detailed in previous episodes, a waiver proposed by South Africa and India would help facilitate more production of COVID-19 vaccines, tests and treatments around the world. By reversing the Trump administration's block against the waiver, the administration created momentum for it to be adopted at the WTO. But today, three months later, the deal is not done. And with the Delta variant spreading rapidly, pressure is mounting on the administration to do more to make the waiver a reality. What is the current situation with the TRIPS waiver? And why are groups urging more to be done,

Lori Wallach
Just to remind folks TRIPS stands for the agreement and trade-related aspects of intellectual property. It's an agreement enforced by the WTO that all of the WTO is members, 160 countries are obliged to give Big Pharmaceutical companies monopoly control. So for instance, right now, a handful of companies are deciding if and when vaccines are made, there's a dire shortage as a result, a few companies have the powers over how many tests are made and treatments that are critical to saving the lives of people with COVID. So this waiver is urgent, and not a dang thing has happened. And that is where it is. So two things are going very wrong. One, on the one hand, the binder administration on May 5 did a historic thing and switching sides, having the US be on the right side of history and joined 130 other countries calling for this temporary waiver of these intellectual property barriers in the face of this unprecedented 100 years health crisis to try and save lives, it was exactly the right thing to do. But since then, the US has not really shown the kind of leadership that in the past has been shown at the WTO or other international negotiations, when there really is the US on a mission to get it done. Now, it's tricky, because the WTO is a place where if big developed countries too heavy-handed, it can backfire. But there is sort of a Goldilocks position not too hard, not too soft, just right. And we're not there yet with the US is leadership to try and get the deal done. On the other hand, the European Union has come in like gangbusters to mess the damn thing up. So Germany is leading has pushed the European Union, which operates the WTO is a block to oppose a waiver. And they have been strategically obstructionist. They have been merciless, they have been impossible. And instead of the US basically meeting fire with fire, the US has been fairly passive. And so the situation now is more or less Germany with the UK and Switzerland kind of hiding behind the German government, which has ginned up the whole European Union is blocking 130 plus countries that see this urgent waiver as necessary, not sufficient, there's more, but necessary to start to scale up the needed production of vaccines, tests and treatments. So what's happening now is basically Germany needs to get the hell out of the way, at this point, it is becoming a Germany versus humanity problem. This is not good history, this is not good luck. They just need to get out of the way. And then you've got the US, which needs to step up and help lead with some of the countries like South Africa and India that have this initiative in the first instance, towards getting a deal because three months of so-called negotiations have led to nowhere since the US switch sides and the US showed amazing leadership and getting some of the other small but powerful bloc of countries to stop blocking. So Japan came inside and Mexico and Canada, they're a bunch of countries that were doing the wrong thing and the US got that fixed, but they still have not been able to deliver the deal. And President Biden and USTR Tai were spot-on. The number one priority needs to be to save lives. And right now it's not just lives overseas, as important as it is that tens of millions of people could die needlessly. To put this in perspective, of the 4 billion and change vaccines that have been produced and used 85% of them have been used by just 10 countries. So if you're in the US and you're hearing this, you're getting scared about Delta, but you've had some months of having a sense of security of having some sense of the vision of what could be normal. There are dozens of countries that haven't a single shot available, and most of Africa's below 10% immunized is not supposed to be getting a full set of shots under the current production capacity until maybe 2024. Which, you know, just to be very narrow-minded. What do you think the Delta variant in any other variant is going to be coming from but from where the Coronavirus is raging? It is killing people and it is cooking up at some point a vaccine-resistant variants. So when people say no one's safe until everyone's safe, they just a slug. So we just need to get the TRIPS waiver done like two months ago as the critical first steps that we can get more vaccines, tests and treatments made around the world and end the damn pandemic,

Ryan
You were just talking about the Delta variant. We've talked about the threat of variants in the past. And that's been one of the things we've been saying about the TRIPS waiver that it would help prevent them from emerging and spreading in the first place. Now we're seeing the reality. The Delta variant is obviously threatening to bring about a new round of mask mandates and lockdowns in the US and elsewhere. Can you talk a bit more about the issue of variants and the TRIPS waiver?

Lori Wallach
So here's the deal. Variants emerge naturally out of viruses, but they need a place to be created. So the virus has to be replicating, that's when you get variants. That's where you get mutations. And if there are vast numbers of people who are infected, if there are raging outbreaks, it doesn't just kill tens of millions of people who do not need to be losing their lives at this point, because there is a vaccine, even if the vaccine, like with the Delta variant can't stop an infection, it's proving to keep people from being hospitalized or from dying. Most of the world is now in the face of huge third-wave, raging outbreaks, and just not being covered here. So the horrors that we saw in India, that's right now in Indonesia, that has been in Peru and Nepal and Pakistan, it is all over Africa. People are dying, and they have no vaccine, they have no treatments, and they're totally unprotected. And in the midst of all of that, death, destruction, economic wreckage, new variants are also breeding. And the reason why is the virus is trying to make itself better, stronger, more likely to spread and continue on. So these Greek letters, now we've heard about lambda, they are four significant variants that have basically been developed because there have been outbreaks where the virus can mutate. And then the new version can spread. And as we saw with Delta, if it's much more infectious, it just takes over. And so we practically greedily thinking just about that handful of countries have vaccines, we the privileged to have vaccines have equal interests as the person who doesn't have them in the entire world getting vaccinated. Because as long as there are raging outbreaks anywhere, there are going to be variants until there's a variant that literally gets all the way around the vaccine makes you really ill, kills people at the same numbers, and then we're going to be on global lockdown again and back to scratch. So whether you're motivated by the self-interest of not getting back to that situation, or you are horrified by the prospect of all these needless deaths, or it's a combination, it is in everyone's interests in the battle of vaccines versus variance, to get enough vaccines to wipe out the hot spots where massive new variants will develop and spread worldwide.

Ryan
And I haven't met many people who are not upset when they hear about this stuff, what needs to happen now, you know, what can get us out of this mess?

Lori Wallach
So at this point, I think the only thing that is going to change the circumstances is if people in the developed countries who've been privileged to have the vaccines and who now are the seat of Europe blocking the waiver, and the US not leading strongly enough to get the waiver. People in the rich countries need to reactivate the campaigning that, for instance, in the United States led to this amazing outcome of having the US for the first time in history, put people's health and global health ahead of Big Pharma. People did that. The President obviously has a strong moral compass in his Catholic social justice, faith-based value of caring for people's lives around the world. That is for sure with the president. But amongst many different things that were clamoring for attention, many crises, it was public attention and demand that helped make this wave or something, then in May, with all the other things demanding a president's time the President supported, and we're just gonna have to gear up another campaign at the same level, because a lot of other things are sucking up a lot of the oxygen in the room. And people in the White House, people across the country need to basically have this rise back up. And then sadly, I think the Delta variant is part of how that's going to happen anyway. But you know, as we're thinking about what can make a difference, the answer is not, "Oh, we all should get a booster." The answer is we need to get that third shot that we will be taking unless you're super immune-compromised super all there's some real reason you need it, that needs to go into an arm and someone in one of those countries where there no vaccines, and then we need to make a ton more vaccines. That's the bottom line. There are three ways this can happen. This is not rocket science. This is a question of people power. Step one. on leash the intellectual property, get the barriers out of the way. That is the waiver of the WTO rules. Simply get rid of these barriers temporarily so that it is allowed around the world to make more of the vaccines, treatments and tests. Number two technology transfer. What does that mean? It means the difference between someone giving me the piece of paper and saying legally, okay, here's the IP waiver. Here's a list of ingredients and you have the right now to take my information that previously was under monopoly control, and you can do it too. But he was cooked anything with the recipe knows listening gradients isn't sufficient you need the how you do it, what is the order of it, what you stir with what where does the egg beater come in? And so the technology transfer is that part of the recipe, where it says here is how you make, for instance, these mRNA vaccines, which actually are the easiest to scale up, because they don't require the enormous specialized like vats that you need to brew certain kinds of virus-based viral injections. units in your chemistry, you need clean manufacturing could be in a computer chip factory, it could be in another pharmaceutical factory, but you need the technology. So that's a matter of being able to do that as Moderna's chief scientists said is getting lines up in three to four months, not taking a year to reverse engineer how the hell you put the ingredients together. So number one TRIPS waiver, liberate the intellectual property. Number two, to speed up the production technology transfer. And by the way, the US government paid a lot of money to Moderna to Pfizer, to J&J. And there is, particularly with Moderna, even government patents in the vaccine. So there is leverage the Biden administration needs to exercise it is basically to say, guys, we'll even compensate you for some of this, but you just have to share the know-how. And then number three is just a good old cash money to basically scale up the manufacturing. And what is clear is this has to happen in hubs around the world, we don't have the capacity and make it out here and ship it there. Besides the fact, we all know how that will go. As soon as there is a real scare here, no one is going to be willing to send the stuff made here or there. So yeah, we need to increase production here both for more capacity for our own use. And then we can make some more and send some more. But there needs to be production capacity around the world. And the good news is and every part of the world there are companies that could do it. Some people say at this moment, there are 2 billion doses not being made were the IP liberated and the technology transferred, that could be online in the matter of months. But even more production needs to be set up. And so for instance, Public Citizen did a study, and for $25 billion, 8 billion more doses could be constructed by either retrofitting existing facilities, or adding new lines to existing clean manufacturing facilities, which again, that's all you need for mRNA. You don't need the huge vats, etc. and that work is going to take cash both for the construction, but actually the thing that's the most expensive is just the inputs. So as Professor Joe Stiglitz, the Nobel Prize winning economist says if you can get the IP barriers out of the way, the market can solve for a lot of this. So if you need more inputs to make mRNA vaccines, you need more lipids, you need more glass vials, as soon as you liberate the IP and get the technology transferred so actually, there is a demand for all that stuff. The market will solve for making more but but it's going to take money. So wave the IP transfer, the technology, manufacturing that is funded and distributed around the world. That is how we get the hell out of this disaster. That is the only way we're going to stop this pandemic. And the way to make that happen is only going to be people power. Pharma has no interest in this. The pharmaceutical companies are right now have a monopoly on these vaccines. They're not just thinking about their greedy boosters for $150 a shot, which Pfizer's literally said that's what they're going to do; not the 20 bucks a shot, that they're now charging for pandemic pricing vaccines. It's not just the vaccines where they hope to make the $150 booster shot, which is what Pfizer is on the record said they're going to do and replace $150 shot with for the $20 pandemic pricing original vaccine. It's also because these handful of companies want to corner the market, have a monopoly on this platform of mRNA with respect to cancer cures and AIDS cures and, and malaria, and the greed of thinking about these future profits over the prospect of tens of millions of people dying and never getting out of this cycle, this vicious cycle, which is profitable for Pharma to have a new variant that needs new boots so that they can then sell to the rich people. But that that is like that has no future for our world. So the one-two-three stops, people power is going to make it happen. And the very first thing I recommend is join all these organizations nationwide, that have sort of hit that basta point where it's like enough already, the Biden administration needs to step it up. And in the US there's a big petition drive and their visits with members of Congress has a lot of activity going on. And in Europe, led by the Germans same things going on basta, we've had it! The EU needs to get the hell out of the way starting with Germany and that transatlantic people power given the leadership's already come from the developing countries and their governments. That's how we're going to get this done.

Ryan
And if you check the summary of this podcast, there are links to some of the actions that Lori just described. Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.

XL Pipeline Absurd $15 Billion NAFTA ISDS Claim

By Noa Levin, Daniel Rangel

TransCanada Energy (TC Energy) announced on July 2, 2021 that it would be filing a legacy North American Free Trade Agreement (NAFTA) claim under the Investor State Dispute Settlement (ISDS) system, seeking US$15 billion in compensation for the Biden administration’s revocation of the Keystone XL pipeline permit. While the United States-Mexico-Canada Agreement (USMCA), which replaced NAFTA, gutted ISDS between the United States and Canada, the parties agreed to allow a three-year post-termination period for “legacy” claims arising from investments that predate the entry into force of the USMCA. This is the basis for TC Energy’s claim.

A review of TC Energy’s annual fiscal reports reveals that $15 billion is an arbitrarily large damage claim, completely unrelated to the value of investments made or the actual hit that the company is assuming from the project’s cancellation.

TC Energy claimed in their 2020 Annual report that the carrying value of the Keystone XL plant, property, and equipment was US$2.2 billion, and the carrying value of associated projects was US$0.2 billion (a combined carrying value of US$2.4 billion).[1] This carrying value, which represents the asset’s worth (measured by taking its cost and factoring in any depreciation), underscores that the Keystone project was valued at only US$2.4 billion prior to its cancellation. In 2016, when TC Energy launched its first ISDS case against the United States, the corporation  claimed that it had spent US$3.1 billion on the project. It is apparent then that the company did not undertake any substantial further investment after then-President Trump issued a new permit in 2017.

Now, this does not mean that the actual “damage” caused to the Canadian firm ascends to US$2.4 billion. The project might have been cancelled, but TC Energy could sell or repurpose many of the assets initially devoted to the pipeline to reduce the financial burden. As a matter of fact, it seems that this is what has been happening since. In its First Quarterly report of 2021, TC Energy reported that the cancellation of the Keystone XL pipeline led to an after-tax asset impairment of US$1.8 billion.[2] In other words, the cancellation of the project resulted in a financial hit of US$1.8 billion for investors.

This is considerably smaller than the $15 billion demanded through ISDS. Yet, this number must be reduced further because TC Energy did not finance the pipeline alone; a significant amount of funds came from outside investors, most notably the Government of Alberta, which invested approximately US$1 billion in the project.[3] Excluding these external investments, TC Energy reported a personal financial exposure (loss) of US$0.8 billion.[4]

So, while it is demanding $15 billion in compensation from U.S. taxpayers, TC Energy actually took a financial hit of US$0.8 billion from the cancellation of the Keystone XL pipeline.

In a nutshell, TC Energy expects to get 15 times more money, coming from taxpayers’ pockets, than the asset losses it experienced from the revocation of a permit, that was already denied twice. Rather, the $15 billion reflects what the corporation in some way gauges to be its expected future profits. Or, to put it another way, $15 billion is the corporation’s projected return on an investment that generated widespread opposition across potentially impacted communities in the United States.

Are more reasons needed to swiftly and definitively end ISDS? 

 

[1] In Canadian dollars, these values are $2.8 billion, $0.2 billion, and $3 billion respectively, using the December 31, 2020 exchange rate of 0.7875 USD for 1 Canadian dollar.

[2] Or 2.2 billion Canadian dollars, using the March 31, 2021 exchange rate of 0.79601 USD for 1 Canadian dollar.

[3] $1.3 billion Canadian dollars, using the March 31, 2021 exchange rate.

[4] $1.0 billion Canadian dollars, using the March 31, 2021 exchange rate.

Rethinking Trade - Season 1 Episode 35: NAFTA Keystone XL Pipeline $15B ISDS Attack

Within hours of taking office, President Biden revoked the permit for the controversial Keystone XL pipeline. The project, which would worsen the climate crisis, also posed major health and safety risks to indigenous people whose land it crossed. Now the Canadian corporation that wanted to build the pipeline is using a NAFTA Investor-State Dispute System (ISDS) tribunal to demand $15 billion from U.S. taxpayers.

ISDS allows multinational corporations to sue governments before a panel of three corporate lawyers, who can award unlimited sums to be paid by taxpayers, including for the loss of expected future profits. A years-long civil society and labor campaign got the original ISDS rules whacked out of the revised NAFTA. But that fix is phased-in over three years. This means legacy cases like TC Energy’s can be launched until 2023.

In this episode, we look at the Keystone XL NAFTA ISDS case, the new rules governing investor rights in North America, and the future of the ISDS regime.

Learn more at rethinktrade.org.

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Music: Groove Grove by Kevin MacLeod. 

Link: https://incompetech.filmmusic.io/song/3831-groove-grove. 

License: http://creativecommons.org/licenses/by/4.0/

Transcribed by Sally King

 

Ryan 

Welcome back to Rethinking Trade where we don't just talk about trade policy, we fight to change it. I'm Ryan and I'm joined once again by our in-house trade expert, Lori Wallach. Lori, earlier this month, a Canadian company called TC Energy filed a claim for $15 billion in compensation from the US government for allegedly violating the terms of the North American Free Trade Agreement's Investor State Dispute Settlement system by revoking the permits for the infamous Keystone XL pipeline. Now in our last episode, we looked at the revised NAFTA, now the USMCA, one year after it went into effect. One of the big victories in the fight around the USMCA was the gutting of ISDS. But before we get deeper into what ISDS is, how it works and how a case is being launched, even after the USMC went into effect, can you just tell us about what this case looks like and what it could mean for the US and for US taxpayers.

Lori Wallach 

So as you said, this corporation is demanding $15 billion with a "b" in US taxpayers money to compensate them for the denial of their special rights as foreign investors under NAFTA, because they are claiming that the future expected profits that would accrue from this XL pipeline had it gone forward, with some up to $15 billion, and that they have a right as a foreign investor to be able to complete this project. And if any US government action stops it, we taxpayers have to compensate them. That is the infamous Investor State Dispute Settlement system, which grants rights to foreign corporations to sue the US Mexican or Canadian government. Before a panel of three corporate lawyers. The lawyers can award the corporations on limited songs to be paid by American taxpayers or Canadian taxpayers or Mexican taxpayers, including for the loss of their expected future profits. And he's from corporations only need to convince the lawyers that a law or a safety regulation or in this case, a permit for a dangerous pipeline violates their NAFTA rights. The decisions are not subject to appeal, and the amount awarded has no limit. And this part of NAFTA was largely eliminated with respect to Canada, it was simply ended. And with respect to Mexico, the worst features were eliminated. However, those new rules phased in over three years. So this is what is called a legacy case, we are one year into the new phase and two more years to go. So this case can still go forward.

Ryan 

And for the listeners, we covered a lot about ISDS. In our 10th episode of the podcast, when there were lawsuits being threatened to keep factories open during the early days of the pandemic, I would encourage you to go back and listen to that episode. But Lori, let's get a little deeper into the ISDS system. And then also let's talk about how it was gutted from the old NAFTA, we can talk a bit about the campaign. And then you already introduced us to the legacy cases. But maybe you could explain a little bit more about what a legacy case is and what the phasing looks like.

Lori Wallach 

So legacy case just means that a corporation still has a certain number of years as the investor state Dispute Settlement system phases out of NAFTA, to be able to still bring cases and it's three years one year down. So legacy cases, basically using the old NAFTA provisions before they phase out. And the process basically, as a corporation gives notice from an intent to file what is officially in arbitration. Only the corporations can start these cases governments can't sue the corporations for bad behavior. The rights are only for investors to attack governments and their regulations. And once an investor starts a case, if it's within the three-year phase-out, even after ISDS phases out the case goes forward. So it is a very pernicious facet of NAFTA. And it's a from our perspective, too long of a transition and getting rid of those terms. There are questions about the standing for this case and there will be legal fights about whether or not particular rights were denied. The problem is the decisions get made. by three ad hoc, appointed just for the case billing by the hour corporate lawyers, and these mainly men make their money by serving on these tribunals. And only the corporations can start the cases. So there's a deep financial incentive to rule for the corporations because the corporation's get to pick one of the judges, the three of them, the corporation picks one, the government picks one, and then those two have a third. So it's a club where you're likely get picked by the corporation and the corporation's one that starts the cases if you rule for corporations. So very few of the people, the corporate lawyers who specialize in these kinds of cases, and by the way, they built like $800 an hour. So even if they're going to eventually dismiss a case, it's in their interest for it to go for a long time, which is why on average, even in the cases, they're dismissed, governments pay between five and $8 million in legal fees, that's when they win. So it's a real scam. And it can't go away fast enough.

Ryan 

For many countries. I mean, for the US, the US can afford to enter the legal process around this lawsuit. But for many countries, much poorer countries, even the threat of one of these cases, might as well be one of the cases, right, like companies can often get what they want, simply by suggesting that they could launch a case.

Lori Wallach 

ISDS works as a threat because historically, so many of the tribunals and the corporate lawyers rule in favor of the governments. And for a lot of particularly developing countries, if they figure they're going to have to pay any way. They don't want to spend the extra millions fighting the case along the way. They'd just rather try and settle it pay off the corporation roll back the long question. And it's now developing countries that do that there's an infamous case where Canada reversed an environmental regulation banning a toxic substance. So that us Corporation, the Ethyl Corporation would end their lawsuits and part of the settlement was that Canada had to publish in newspapers around the world that this chemical is perfectly safe, and as well as long to be sold again in Canada. So it's a rough form of corporate bargaining, where the sword of Damocles is basically hung of the prospect of not just a lot of money and damages to have to be paid off by taxpayers, but years of litigation and millions of dollars in legal fees. It is, you know, a really outrageous and pernicious system.

Ryan 

And so there's two big things at play regarding ISDS in North America, specifically in the USMCA and the first of those legacy cases, which you described earlier. The second is the carve-out in the USMCA that maintains ISDS rules for a narrow but fairly important sector of industries. Can you talk about this carve out and what we need to be on the lookout for.

Lori Wallach 

So the carve out is an exclusion to the termination of the old NAFTA investor state. And it applies the old ISDS rules to contracts that currently seven us oil and gas companies have it's 13 contracts that were made under the old NAFTA that are specifically with one particular Mexican government agency that has to do with oil and gas exploration. And the rule is, as long as Mexico keeps Investor State Dispute Settlement, the old times with other countries whose firms have those kinds of contracts, then this carve out allows the US companies to have access to the same extreme corporate rights that their competitor other foreign investors in Mexico's oil and gas sector have. And it was, you know, that one of the, you know, really disappointing things that ended up marring what would have otherwise been incredible victory and ISDS. So when activists look at this rollback of ISDS, which NAFTA was the first agreement into which ISDS first trade agreement into which ISDS was inserted. So to have the United States which has been a great proponent, shoving ISDS in other countries and being a big benefactor and defendor have it, to have the United States say we're ending it with this country, and we're cutting it back enormously with this other country, symbolically around the world and powers a lot of other countries who are trying to exit this outrageous regime. But the sour aftertaste was that this carve-out meant with respect to those contracts and those companies indefinitely until Mexico actually decides to get out of ISDS which would be a very smart thing, then these us firms keep the legacy of the old NAFTA,

Ryan 

Sort of, as you were just alluding to Lori, there was a lot of hope when the USMCA was passed regarding the future of ISDS, not just within the context of the USMCA, but throughout the world. Obviously, NAFTA was not the only deal. It was the first, but not the only to have ISDS rules. What are some of the big fights ahead and confronting and continuing to dismantle ISDS globally?

Lori Wallach 

So a lot of very important developing countries have shown leadership and getting out of ISDS. South Africa started the trend. And then Indonesia joined in, Brazil has never had ISDS agreements. Bolivia and Ecuador both got out heartbreakingly now the right-wing government Ecuador is trying to get back in a lot of countries looked to those countries in the renegotiated its agreements to get rid of most of the pernicious elements. So when the US joined in as a main proponent, benefactor and defender of ISDS, and also a developed country, it was a super important impact worldwide where lots of countries want to get out of their investor agreements and/or if not get out of them altogether to roll them back to something more like the Mexico model. That is in the USMCA which, you know, like the India revised model requires a corporation to use up all of its domestic enforcement options before I can even contemplate going to a panel and then only allows direct exposure creation compensation as compared to all the fancy, silly made up rights, the corporation is jammed into deals like NAFTA and others. And so I think that with the Trump administration, which is you know, basically Donald Trump, a wholly owned corporate subsidiary, with right-wing tendencies, in addition, to make clear that even they thought ISDS was a bridge too far made it such that with a democrat Biden saying his trade agreements wouldn't have ISDS it's now become really the US position, that that old regime is no longer acceptable, tolerable, and that's good for us, that's good for the countries with whom the US would have trade agreements, but also opens up space for the many countries around the world that are smaller countries or developing countries to basically take the cover of the US taking that action with NAFTA.

Ryan 

Rethinking Trade is produced by Public Citizen's Global Trade Watch. To learn more you can visit rethinktrade.org. You can also visit tradewatch.org. Stay tuned for more and thank you for listening.