Two Dozen US Senators Demand Labor Rights in the TPP

December 3, 2012

Sens. Franken, Snowe Urge President to Protect American Jobs

in Negotiations Over New Pacific Free Trade Agreement

Sens. Say Pact Should Maximize American Job Creation,

Open New Markets, Target Other Nations’ Unfair Trade Practices

WASHINGTON, DC [12/03/12] – Today, U.S. Sens. Al Franken (D-Minn.) and Olympia Snowe (R-Maine) urged President Obama to ensure that a new Pacific free trade agreement now being negotiated will not only open new markets for U.S. exports, but also create and protect American jobs, and target other nations’ unfair trade practices.

“As the economy continues to recover, a major priority of the American people and of your Administration has been preventing the outsourcing of good American jobs,” the senators wrote in a bipartisan letter to President Obama. “[The Trans-Pacific Partnership] should be crafted to maximize good job creation and market expansion while minimizing the incentives for further off-shoring of middle class jobs.”

Among the priorities Sens. Franken and Snowe asked President Obama to undertake in the negotiations were efforts to prevent unfair currency manipulation, to ensure that countries that are not a part of an agreement couldn’t take advantage of it to get their goods into the U.S. market, and to make certain that other countries in the negotiations protect fundamental labor rights.

They also urged that other countries’ State-owned enterprises be required to play on a level playing field and that incentives to send U.S. jobs and manufacturing overseas be eliminated.

The free trade agreement, known as the Trans-Pacific Partnership, currently includes eleven nations – Australia, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, Brunei, and the United States — and may include more in the future.

Sens. Franken and Snowe’s bipartisan letter to President Obama, which can be read below, was signed by 22 of their Senate colleagues, including: Sherrod Brown (D-Ohio), Tom Harkin (D-Iowa), Barbara Boxer (D-Calif.), Ron Wyden (D-Ore.), Kirsten Gillibrand (D-N.Y.), Sheldon Whitehouse (D-R.I.), Jeff Merkley (D-Ore.), Richard Blumenthal (D-Conn.), Robert Casey (D-Penn.), Joe Manchin (D-W.Va.), Barbara Mikulski (D-Md.), Tom Udall (D-N.M.), Jon Tester (D-Mont.), Debbie Stabenow (D-Mich.), Patrick Leahy (D-Vt.), Bernie Sanders (I-Vt.), Amy Klobuchar (D-Minn.), Jay Rockefeller (D-W.Va.), Chris Coons (D-Del.), Frank Lautenberg (D-N.J.), and Bill Nelson (D-Fla.).

Dear Mr. President:

            As the economy continues to recover, a major priority of the American people and of your Administration has been preventing the outsourcing of good American jobs.  In the context of trade policy, we believe, like you, that trade when done right should create and preserve good American jobs instead of outsourcing them. As your Administration has stated, a balanced trade agenda means opening markets for U.S. exporters and keeping faith with workers here at home.

            Pursuing such a balanced trade agenda requires that your Administration and Congress work together.  Nowhere is such cooperation on trade more urgent than in the ongoing negotiations on the Trans-Pacific Partnership (TPP), a vast, multi-country free trade agreement that will have a significant effect on global trade and investment.  It should be crafted to maximize good job creation and market expansion while minimizing the incentives for further off-shoring of middle class jobs.

            With that objective in mind, as you and your United States Trade Representative continue negotiations on a TPP, we respectfully urge you to:

•           Maintain “Buy American” government procurement requirements. The American people, through their elected officials, should not be prohibited from establishing government procurement policies that prioritize job creation in the United States.  We hope that you will direct USTR negotiators to ensure that any TPP not restrict “Buy American” and “Buy Local” government procurement policies at the federal or sub-federal level.

•           Require strong Rules of Origin. The Rules of Origin in the TPP should ensure that only signatories to the TPP will benefit from its increased market access and other provisions so that employment opportunities in the U.S. may be expanded.  Non-TPP members must not be allowed to use weak rules of origin as a backdoor way to enter the U.S. market and further depress U.S. job prospects.

•           Ensure that State-Owned and State-Supported Commercial Enterprises (SOEs) operate on a level playing field.  Given that SOEs are more common in the other TPP countries than in the U.S., the TPP should require that SOEs competing with private U.S. enterprises operate and make decisions on a commercial basis. The agreement should also incorporate a reporting requirement so that countries have to provide information on the operation of their SOEs in other TPP countries on a regular basis.

•           Safeguard against investment and service sector rules that provide incentives for the off-shoring of both good manufacturing and service sector jobs.  These rules should not grant corporations extreme protections that help them relocate investment and jobs overseas.

•           Include an enforceable obligation to protect fundamental labor rights. A country that denies these rights to workers is providing a hidden subsidy that keeps wages artificially lower than they otherwise would be if workers were free to organize and bargain—a subsidy that makes U.S.-based producers less cost-competitive. The free exercise of fundamental labor rights is key to improving the standards of living and expanding export markets while labor suppression merely ensures that middle classes—and export markets—will be smaller than they otherwise would be.

•           Safeguard against currency manipulation. To prevent the artificial suppression of job-creating American experts, the TPP should explicitly allow countries to respond to and offset currency manipulation.

            If your Administration pursues these basic negotiating objectives and collaborates with Congress during the negotiations—ahead of the ratification debate—we are confident that the TPP can become a tool for job creation that helps rebuild a national consensus on international trade policy.  We look forward to working with you and the USTR to ensure that the TPP meets the crucial goals of opening markets to American exports and keeping faith with American workers.  Should you have any questions, please do not hesitate to contact any of us.