Given that the economy is one of the big issues in the campaign, it is surprising that most candidates shy away from discussing the Trans-Pacific Partnership agreement (TPP). The TPP is a proposed regional free trade agreement (FTA) that “aims to liberalize trade in nearly all goods and services and include rules-based commitments beyond those currently established in the World Trade Organization.” (The Trans-Pacific Partnership (TPP) Negotiations and Issues for Congress 3/20/2015) Given the large scope and the large number of participants, the economic and legal implications are quite high.
The immediate impact of the TPP, if passed by all member nations, would be a reduction of trade barriers and standardization of several rules and practices, including areas of intellectual property rights, access to advanced medicine, and even labor rights. In theory, this would open up large markets for US companies to sell goods and services at lower transaction costs, which would create more job opportunities within the US. Whether this proposed FTA would actually facilitate job growth in the US in the short term is up for debate, given the US labor participation rate is relatively low (Bureau of Labor Statistics - Accessed 4/30/2015).
The campaign debate on the TPP is likely to be isolated within the Democratic Party, given the party’s strong support from traditional labor unions. Nevertheless, the public debate on the TPP, if there ever will be one, would be difficult given the complexity and broad scope that this FTA is attempting to achieve. Even the concise and informative report on the TTP “The Trans-Pacific Partnership (TPP) Negotiations and Issues for Congress” is a dense 56 page report that is unlikely be read by an average citizen. At best, the TPP debate would be comprised of nitpicking several dispersed points throughout the agreement.
The TTP will probably be the legislation that might have a greater economic impact than the Affordable Health Care Act in the long term, yet the public discourse on the agreement has disappointingly been lagging. Elected leaders from all parties need to review this FTA closely once introduced and determine via public dialog whether the TTP serves the greater American interest. Because neither “new tax policy” nor “reforming Obama Care” would even have the closest economic impact than the TTP will ever have.
If we are going to have a real discussion on economy, it ought to include the TTP.
Further Readings
The Trans-Pacific partnership and Asia-Pacific integration: a quantitative assessment – It is a very good academic paper that looks at potential difficulties of the TTP negotiation. Also, the paper believes the annual economic welfare of having (only) the TTP in the region would be $104 billion by 2025.
