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Nobel Prize-winning economist Joseph Stiglitz rejects the Trans-Pacific Partnership

Nobel Prize-winning economist Joseph Stiglitz says that the investor-state dispute settlement (ISDS) provision is the “worst part” of the Trans-Pacific Partnership (TPP), that the deal would prevent Canada from moving toward a low-carbon economy, and that the whole agreement should be renegotiated.

The Trans-Pacific Partnership is a ‘free trade’ agreement that covers 40 per cent of the global economy. The TPP includes G7 ‘major advanced economies’ (the United States, Canada and Japan), G20 ‘major economies’ (Australia and Mexico), relatively smaller economies (New Zealand and Singapore) and ‘developing economies’ (Brunei, Chile, Malaysia, Peru and Vietnam).

With respect to the ‘investment protection’ provisions in the TPP, Stiglitz says, “It used to be the basic principle was polluter pay. If you damaged the environment, then you have to pay. Now if you pass a regulation that restricts ability to pollute or does something about climate change, you could be sued and could pay billions of dollars.”

In an opinion piece published in the Guardian this past January, Stiglitz wrote, “While the language is complex – inviting costly lawsuits pitting powerful corporations against poorly financed governments – even regulations protecting the planet from greenhouse gas emissions are vulnerable. The only regulations that appear safe are those involving cigarettes (lawsuits filed against Uruguay and Australia for requiring modest labeling about health hazards had drawn too much negative attention). But there remain a host of questions about the possibility of lawsuits in myriad other areas.”

He says those other areas could include ‘investment protection’ being used to prevent an increase in the minimum wage and to stop rules against predatory lending practices.

Stiglitz also says the deal’s rules of origin provisions would mean job losses in Canada.  A recent study by Tufts University found that the TPP would cost Canada 58,000 jobs and increase income inequality. The Huffington Post reports, “In all, the study estimates that the 12 countries involved in the proposed free trade deal would lose a net total of 771,000 jobs in the 10 years after the deal comes into force.”

And Stiglitz says, “I think what Canada should do is use its influence to begin a renegotiation of TPP to make it an agreement that advances the interests of Canadian citizens and not just the large corporations.” Given presidential front-runners Donald Trump, Hillary Clinton and Bernie Sanders all oppose the TPP, and that there is serious opposition within the U.S. Congress, Stiglitz adds, “I’m a little surprised that Canada would seriously consider going through the political fight that is associated with getting this agreement ratified until the U.S. adopts it.”

But when asked last week about the TPP, Prime Minister Justin Trudeau said, “In our conversations with Canadians, with industries which are ongoing, there are a lot of people in favour of it and there are a few who have real concerns and we’re looking at understanding and allaying certain fears and building on some of the opportunities.”

And earlier this year, trade minister Chrystia Freeland bluntly stated, “The negotiations are finished and for Canadians it’s important to understand that it’s a decision of yes or no.”

Last week, U.S. Trade Representative Michael Froman took a slightly different view when he said, “TPP isn’t something that can be renegotiated – [but] that doesn’t mean that we can’t address some of the issues stakeholders have raised through other mechanisms, including in the implementation process, in the enforcement process, in the context of the broader trade agenda.”

The House of Commons standing committee on international trade is expected to study the TPP for the next nine months (to about January 2017). The Canadian Press reports, “After that, [Freeland] has promised that only a vote in Parliament would ratify the deal.” The Hill Times adds, “It’s unlikely the TPP deal will be put before the House for debate and a Commons vote until next fall or winter [meaning late 2017]…” In November 2015, the leaders of the TPP signatory countries put a two year limit on the ratification of the TPP (meaning the deal would need to be ratified by the Trudeau majority government by November 2017).”

The Council of Canadians is demanding – through this action alert – proper public consultations in Canada. We are also encouraging our supporters to participate in the recently announced House of Commons standing committee hearings in Vancouver (April 18), Calgary (April 19), Saskatoon (April 20) and Winnipeg (April 21). If you don’t live near those cities, the committee is also accepting written submissions (of no more than 1,500 words in length) before April 30. You can email your comments to them at ciit-tpp-ptp@parl.gc.ca You should also email a copy of those comments to the government at TPP-PTP.consultations@international.gc.ca

We would also encourage you to attend one of our public forums featuring Dr. Shiv Chopra speaking on the TPP and food safety in Courtenay (April 7), Nanaimo (April 8), Duncan (April 9), Victoria (April 10), Ladner (April 12), Langley (April 13), Chilliwack (April 14), Vancouver (April 16), Guelph (April 27), Windsor (May 14), and London (May 31). You can find more details about that tour here.

For extensive commentary on the TPP, please see our campaign web-page here. To listen to a 13-minute interview with Stiglitz on CBC Radio’s The House, click here.