Peterson Institute Claims Boost From TPP Outweighs Adjustment Costs

Peterson Institute Claims Boost From TPP Outweighs Adjustment Costs

The latest pro-TPP Peterson report, which estimates between 238,000 and 1,690,000 jobs lost in the first ten years, can be found at this link.

Quotes from Inside US Trade, March 15, 2016 

In preparation for the upcoming public debate in May when the US International Trade Commission releases its analysis of the economic impacts of the TransPacific Partnership, we expect to see many reports claiming that the TPP won’t cost jobs or increase wealth inequality. The Pete Peterson Institute, a conservative think tank created by the founder of BlackRock Mutual Fund, released a new report arguing that:

“the economic benefits of the Trans-Pacific Partnership (TPP) vastly outweigh adjustment costs associated with the deal over a 13-year period and that economic gains will be spread evenly throughout the economy, and actually reduces income inequality.”

Inside US Trade writes:

Households with incomes in the lowest 20 percent — or the fifth quintile — will see a 0.528 percent gain in factor income or about $2 billion total by 2030. The fourth quintile would see a 0.53 percent gain in factor income amounting to a $6 billion increase. The third quintile is predicted to have a 0.529 percent increase in factor income which translates to an additional $13 billion while the second quintile is projected to gain 0.531 percent in terms of factor income which produces a $21 billion windfall.

The first quintile, households making up the highest 20 percent of incomes, sees the smallest percent gain in terms of factor income as a result of TPP with a 0.521 percent boost but the largest gain in terms of actual dollars brought in from the agreement with a $48 billion gain.”

They conclude that:

“the TPP will improve the consumption possibilities of poorer relative to wealthier households. Claims that the TPP would worsen income inequality in the United States are thus not borne out.”

Of course, experience over the past more than twenty years has shown that trade agreements such as the TPP cause greater trade deficits and job loss, drive a race to the bottom in worker rights and wages and benefit large corporations while hurting small and medium-sized businesses and farms.

There has been little discussion of the impacts on our government spending and economy from suits that are brought before the international trade tribunal by large corporations. Australia spent $50 million defending itself from a suit by Phillip Morris. TransCanada is currently suing the US for $15 billion over the cancellation of the Keystone XL Pipeline.

And there has been no discussion of external costs that are created when large corporations are allowed to exploit workers or poison the environment. We only need to look to areas like Flint and Cleveland to see what happens when factories close or to Cancer Alley in the South to see what happens when industries are placed in residential areas.

This is why we must continue to stop the TPP and demand a new model of trade that lifts up workers around the world and protects the health of our communities and the planets.