GIVE AND TAKE
Europeans Fight U.S. Trade Deal With Fear of McHospitals, Fracking Under Eiffel Tower
The Transatlantic Trade and Investment Partnership is prompting paranoia about Corporate America’s takeover of the Continent.
BRUSSELS — It will afflict Europe with American abominations on an almost Biblical scale: cheap and dirty food, toxic waste, mind-numbing movies and television, gas-guzzling cars, all while scrapping healthcare and erasing labour rights.
That, at least, is how angry European activists are painting a planned trade deal between the European Union and the United States. A legion of horrors has been evoked about an agreement known as the Transatlantic Trade and Investment Partnership, or TTIP, which is currently under negotiation.
Dozens of groups have sprung up to oppose the planned pact, like Stop TTIP (whose website describes the deal as “a corporate coup that will put power and money into the hands of corporations and away from the elected government.”) and No TTIP (“TTIP would lock in the privatization of our public services, erode government protection for people and the environment and threaten a new round of unjust economic reforms forced on the poor”).
U.S. and E.U. officials are currently in New York this week for their ninth round of talks to hammer out the details of deal. But on Sunday, tens of thousands of protesters marched through the streets of Berlin, Brussels, Vienna, Madrid, Helsinki, Warsaw, Prague and other cities in simultaneous colorful demonstrations against TTIP.
Europe’s anti-TTIP campaigners characterize the plans as a diabolical plot to allow the likes of McDonalds to take over hospitals, Exxon to frack under the Eiffel Tower, and Google to take over parliaments. “It’s the most contested acronym in Europe,” admits Cecilia Malmström, the E.U. trade commissioner, who is in charge of the European side of the negotiations.
How did this trade deal become so hated?
TTIP was billed as a tonic for all, a rising tide to lift all boats: Americans want more and more of what Europeans are good at making, and vice versa. It is also presented as a way to reinforce the social and environmental values and standards that its opponents say are under threat.
When the TTIP negotiations were formally launched in 2013, U.S. president Barack Obama laid out its promise in simple terms: “Two million extra jobs, more choice and lower prices in our shops,” he said. German chancellor Angela Merkel has said TTIP “would provide important impetus for the development of the world economy as a whole.” British prime minister David Cameron has called it a "once-in-a-generation prize", while former E.U. trade commissioner, Karel De Gucht, has described it as "the cheapest stimulus package you can imagine".
The leaders have pointed to economic research suggesting that by binding the world’s two biggest economies closer in a market of 820 million consumers, TTIP could add as much as 0.5 percentage points of growth or more than $100 billion a year to the combined GDP of the E.U. and U.S..
The E.U. and the U.S. already enjoy the world’s biggest trade relationship, worth more than $1 trillion, with tariffs averaging a meager 4 percent. Most of these would be scrapped under the agreement. But the real effect would come from cutting the red tape of non-tariff barriers, the rules and regulations that companies have to comply with before they can access each other’s market. These are the expensive testing requirements needed to prove that cars, medicine, foods, cosmetics and other products are safe. The deal would mean Europe’s tests would be accepted as meeting American standards, and vice versa.
But TTIP’s opponents say this will do away with Europe’s important rules protecting consumers, social rights, health, the environment and data protection, which are usually stricter than in the U.S.. There are even suggestions that it could force European governments to privatize its public sectors, for example by allowing U.S. health companies to run the UK’s cherished National Health Service.
Some have raised the specter of unfettered imports of genetically modified foods or chlorine-cleaned chicken as a consequence of the deal. Others say TTIP threatens privacy by encouraging surveillance of personal data. Natalie Bennett, the leader of the UK’s Green Party, describes TTIP as “a huge threat to our democracy and our sovereignty,” adding that, “Chicken carcasses washed in bleach, hormone-stuffed beef and open season on pollution are not things we want to import from the U.S.."
Frances G. Burwell, vice president of the Atlantic Council insists that most of the fears raised by protesters are based on misunderstandings. “There is a perception that TTIP is only for big corporations,” she says. “But the Unilevers and Shells of this world have the lawyers to deal with bureaucracy. It is rather the smaller and medium-sized ones who really need the removal of the rules, and need a simplified regulatory structure.”
The most incendiary part of TTIP concerns the proposed investment tribunals that allow companies to sue governments whose policies treat them unfairly. Known as investor-state dispute settlement (ISDS), it has been included in trade deals since the 1960s as a way to protect investors against threats such as nationalization. But now opponents say it undermines democracy, deterring elected governments from enacting popular health or environmental policies out of fear of legal action from a foreign investor.
Officials insist there is no risk of government subjugation by big business, yet Malmström now says the ISDS provisions should be reworked so governments maintain a "right to regulate" free from challenges, exempting areas of general public benefit like health and the environment.
All this makes TTIP very different from other trade agreements, according to Monique Goyens, director general of the European consumer federation BE.U.C, who says the regulations, far from being useless red tape, are there to protect public interest. “As a consequence of TTIP, and especially the toxic cocktail of regulatory cooperation and ISDS, consumer protection in the E.U. will be at risk of being watered down.”
The negotiations come at an uncertain moment for Europe. The attacks on TTIP have tapped into public anger about the economic downturn and the increasingly anti-establishment mood. “There is anger at globalization, and TTIP is a convenient target,” says Jacob Funk Kirkegaard, a senior fellow at the Washington-based Peterson Institute for International Economics (PIIE).
Kirkegaard also points to the changing nature of politics and protest. “In the internet age, activists are much quicker and more powerful. Scare tactics are a great megaphone. The Internet, the democratization of information, is a struggle for traditional institutions and dull bureaucrats, whose ineptness has created a vacuum that nimble and dynamic forces can fill.”
There is perhaps a contrariness with protesters using the very tools of globalization – the Internet, cheap travel and communications, global campaigning – to attack it. But if so, the irony may be lost in the noisy debates over TTIP, as campaigners – mainly online – drown out officials in Brussels and Washington.
Work on TTIP will continue for the moment. Planned for over a decade before its formal launch in 2013, the negotiations are expected to last at least another two years. But the real test will come when the ratification process begins in European and American legislatures – some 898 amendments have so far been proposed in the European Parliament’s TTIP wish list. If anger continues to swell, it could dilute TTIP or derail it completely. If that happens, TTIP’s many opponents would celebrate. Whether their interests would be served by the trade pact’s demise is another matter. But even TTIP’s supporters accept that in its current form, the agreement has become a lightning rod for almost every European discontent.