The (Australian) ABC radio reported on the Trans Pacific Partnership (TPP) on Friday evening. Professor Joseph Stiglitz (Columbia University), spoke from London to Mark Colvin (host of ABC PM). The Nobel Prize-winning economist and author of “The Great Divide: Unequal Societies and What We Can Do About Them,” urges caution on the TPP.
Well – if this Janet Yellen supporter, and former chief economist of the World Bank is waving the red flag, then we are really in trouble.
Colvin asked Stiglitz about the secrecy surrounding the TPP. These are extracts from the radio interview (audio here)
STIGLITZ: Well fortunately we know quite a bit about it because of Wikileaks. The US government not only has not revealed the negotiating position, actually has classified it. So we can’t even use Freedom of Information Act to find out about it. This is really, in my mind, an outrage…. (And he has probably just read the leaked bits.)
…we’re setting the rules of the game for the 21st century; rules about regulation, rules about drugs. These are really critical aspects for the running of our society, affecting our health, our environment.
Just to give you one example, about 30 years ago we passed in the United States something, a law called the Hatch-Waxman Act, which represented an attempt to reach a compromise, a balance between big pharma, the patent drugs and generics. …we know that the US is negotiating for a position that would make it much more difficult to get access to generic medicines, that would drive up drug prices. They’re asking for something that even the president of the United States has opposed.
COLVIN: So how would this affect, say, Australia’s PBS, the pharmaceutical benefits scheme, and the PBAC which stands behind it which negotiates with international drug companies and sets the prices the patients end up paying?
STIGLITZ: Effectively they’re trying to undermine your ability to have that…
COLVIN: And how would they do that? …
STIGLITZ: Well just outlaw it…
…a second separate part that have gotten Americans across the board, both on the left and the right, really, really angry. And that is, they’re trying to create a new judicial system as it were, a private one.
You know, we used to think that one of the basic functions of government is dispute adjudication, resolution of disputes, and they’re creating this very, very expensive system of dispute resolution only available to corporations. Not available to civil society if there is a violation in the agreement, only to corporations.
COLVIN: Australia has negotiated a number of regional free trade agreements and is enthusiastic about the TPP. The Australian Government says that it will be an enormous boost for our economy. Will it?
STIGLITZ: Almost surely not…
COLVIN: Who does benefit then from a TPP like that?
STIGLITZ: Our drug companies… big pharma. The generic drug companies in the United States are actually opposing this.
The tobacco industry will like it because it will make it easier for them to sue any country in the region who signs up, if they try to regulate tobacco, even mild regulations about package labelling…
COLVIN: But won’t there be a net increase in exchanges of goods, services and even labour?
STIGLITZ: There will be some, and this is where I said the impact will differ from country to country. Countries like the United States that export mostly capital intensive goods, like airplanes, they’ll find net almost surely the job destroying effects of imports greater than the job creating effects of exports. (my emphasis)
It is clear, to even mainstream economists that the TPP is a corporate take-over.