The US Withdrew From TPP—Not TISA
US President Donald Trump withdrew his country from the Trans-Pacific Partnership (TPP) on his first full day in office, fulfilling one of his longstanding campaign promises.
However, TPP isn’t dead—many of its most dangerous provisions live on through the Trade In Services Agreement (TISA).
You probably haven’t heard of TISA.
And yet TISA’s been here for a while.
In fact, it’s been through 21 rounds of negotiations since April 2013.
Basically, it was designed to serve as a back-door for economic globalism in case TPP (which bore the brunt of public ire) failed, as it has—it was a fail-safe.
What is the Trade In Services Agreement (TISA)?
The participating countries include the US, the European Union (the EU is negotiating on behalf of the member nations, who don’t have direct input on the agreement), Canada, Mexico, Australia, New Zealand, Japan, South Korea, Taiwan, Chile, Columbia, Peru, Norway, Switzerland, Pakistan, and Turkey.
As you can see, TISA’s actually larger in scope than the TPP, as it includes Europe, and a number of other large economies, like Pakistan and Turkey.
As for what it does, documents released by WikiLeaks, and published by Bilaterals.org give us an idea.
1. TISA Erodes National Sovereignty By Deregulating International Banks & Investment Firms
Article 9 of TISA’s draft legislation contains language which would eliminate extra regulations for foreign financial firms: essentially, it ensures that countries cannot make separate rules for foreign-owned banks.
This has a number of adverse impacts.
For example, in the US, states draw artificial boundaries to protect local financial firms (particularly insurance companies).
Now, we can debate whether or not that’s a good thing to begin with, but what’s not up for debate is the fact that TISA would benefit foreign firms, by exempting them from these artificial boundaries.
This means that small insurance companies in, for example, Vermont (which are currently protected from competitors in New York), would potentially be put into competition with foreign-owned giants like Britain’s HSBC or Barclay’s.
TISA makes it open-season on small domestic financial firms.
Also, according to the Public Citizen‘s analysis, financial derivatives, including those yet to be invented, would necessarily be sold within all participating country’s territories—individual countries lose the ability to restrict the type of financial products sold there.
This is a recipe for spreading financial contagion—if TISA goes through, you better believe the next financial meltdown will be even worse (hard to believe, I know).
2. TISA Undermines Internet Privacy
Article 10 of TISA bans restrictions on the transfer of information in “electronic or other form” of any “financial service supplier”.
This is a major issue because financial service suppliers doesn’t just include firms like banks, but also internet suppliers and data firms, like Facebook or Google (they sell advertising services etc.).
This means that companies like Facebook or Twitter have free reign over the data they collect—it would contravene international law for an individual country to make regulations stopping foreign companies from extracting data and processing it elsewhere.
For example, if America wanted to pass an internet privacy law, which stopped Pakistani firms from collecting data on their customers due to fear of espionage or terrorism (yes, I know this is a ridiculous example, but you get the point), we couldn’t.
Not only would TISA void existing laws (of which there are many, especially in Europe), but it would make any new law ultra vires (void) before it was even enacted.
TISA serves the interests of major internet companies, not the people.
Furthermore, it’s an assault on internet privacy, since it enshrines border-less data.
3. TISA Redefines “Services” To Include Manufacturing—Secretly Empowers The Law
TISA was originally pitched as making it easier to hire international accounting or engineering firms, ie. it was supposed to facilitate the free flow of services.
But, in effect, the “services” category has been expanded to include certain secondary industries, like manufacturing.
This means that TISA is basically just a shadowy version of TPP.
Deborah James of the Center for Economic and Policy Research laid out TISA’s scope as such:
Corporations no longer consider setting up a plant and producing goods to be simply ‘manufactured goods.’
a shoe or watch that measures steps or sleep could be a fitness monitoring service, not a good. A driver-less car could be a transport service, not an automobile. Google and Facebook could be information services and communication services, respectively.”
Basically, anything and everything can be interpreted as a service under TISA.
That’s TPP, in a nutshell.
Free trade doesn’t always work—but they’re force-feeding it to us come hell or high-water.
Thankfully, TISA talks have stalled since Donald Trump’s election, although his administration has yet to mention TISA—the media has also been frightfully silent on the topic.
There you have it, TISA’s not going any time soon.
Not unless Americans get angry, like they did at TPP.
Via the National Economics Editorial.