The TTIP has - due to its expected negative impact on democracy, civil society achievements in the areas of health, environment protection, and political and social fairness of the last decades, as well as for all entrepreneurial activities not taking place in the framework of big multinational companies - to be firmly rejected.
The information found on this page shall help understand the basics of the complex situation regarding the TTIP and is updated and where needed extended regularly.
For keynotes, presentations and more detailed information about the TTIP please get in contact with us here!
The complexity and difficulty of the issue "TTIP" becomes already evident when trying to define it: The originally used term TAFTA (Transatlantic Free Trade Area / Agreement) has been changed to TTIP, the main reason very likely being that a connection to the similarly named NAFTA (please find below at "TTIP as job generator") - which definitely was not a success - was not welcome.
However, another reason could be the definition problem of the terms "Free Trade Agreement" and "Free Trade Area": For a Free Trade AGREEMENT, the most favored nation clause of §1 GATT has to be applied, i.e. all the results of the negotiations have to be applied to ALL GATT (and thus WTO)members, the negotiated preferences are not to be kept among the negotiating partners only.
Only in a Free Trade AREA pursuant to § 24 GATT exklusive exceptions of the most favored nation clause are applied and the preferences are kept among the negotiating partners. BUT: In a Free Trade AREA "substantially all the trade" has to be liberalized (what has up to now been interpreted as 85% of the trade).
This leads us to the question: What shall the TTIP become? A mere Free Trade AGREEMENT that would not imply any advantages over all other WTO members (and would thus be completely useless), or a Free Trade AREA with the prerequisite of 85% trade liberalization, when even the PRO-TTIP-Studies only calculate with a 25% decrease in non-tariff trade barriers (see below)?
The TTIP has many "siblings" such as the CETA (Comprehensive Economic and Trade Agreement: EU - Canada), TPP (Transpacifc Partnership), TiSA (Trade in Services Agreement) and agreements with China. The new "partnership" would be the biggest one worldwide with 800 million people and 1/3 of the global trade in goods and services!
This free trade agreement is a decades-old elite-project, whose "ideological antecessor" (re investment) MAI (Multilateral Agreement on Investment, negotiated in the OECD) failed in 1998 after massive protests of the civil society. This failure has obviously caused a learning process: The TTIP negotiations are secret.
In February 2013, US-President Obama and the European Council announced the start of official negotiations (after some sort of preparations or pre-negotiations).
From a legal point of view, trade agreements are international treaties normally signed by countries. In the Lisbon-treaty (effective as of 2009), the EU member states gave the EU the exclusive right to negotiate all trade related issues (including investment) on behalf of them. Negotiator for the EU is ONLY THE EU COMMISSION, chief negotiator is EU Trade Commissioner Cecilia Malmström (following Karel de Gucht). 93% of the "stakeholder meetings" in the pre-negotiations were held with 600 consultants of multinational companies and lobby groups; parliaments and the public were de facto not involved.
There have not been any big changes lately: New data from July 2013 - February 2014 are showing that still between 74 % and 85 % of the stakeholder meetings were held with industry representatives.
The European Council is involved in a permanent information and consultation process, the European Parliament is only informed (since July 2015 - despite the "transparency initiative" of the EU Commission - only in a reading room in Brussels) but not allowed to pass on any information.
The goal is the facilitation and augmentation of transatlantic trade. The main issue is the reduction of non-tariff trade barriers (i.e. all measures hindering trade) such as consumer protection, environment protection and social standards. Tariff trade barriers such as tolls and quotas have become rare these days anyway and are marginal regarding the TTIP. Trade is not only the stereotype we have in mind, i.e. a ship crossing the Atlantic Ocean loaded with stuff like liquid gas, but also involves food and chemicals labeling, services, movement of capital, investments, public procurement and service providers, patents, security standards, culture and entertainment products (radio,..) etc.
One objective is the compatibility of regulations (regulatory convergence) between the EU and the US, i.e. their assimilation and in fact reduction. Standstill clauses ensure that the liberalized markets stay open - "progress" is only possible in one direction: Towards further deregulation. The term "regulatory cooperation" stands for the institution of "consultation processes" before new legislative initiatives, i.e. multinationals are involved in legislative procedures at a very early stage (please find more info below at "living agreement").
Investment protection and the multinationals´ right to file an action against a country are planned, which means:
According to an UNCTAD (United Nations Conference on Trade and Development, available for download below) study from April 2014 there have been 568 known cases until end 2013, 274 of which have already been decided. 43 % of these 274 cases were decided in favor of the countries, 31% in favor of the investors and around 26% of the cases were settled. These numbers are actually horrible: Given the abstruseness of the cases filed, on the one hand a higher percentage in favor of the countries would have to be expected, and on the other hand in the settled cases it has to be suspected that the countries have surrendered (as below in the Hamburg-Moorburg case) - there is no point in giving up for investors, they can only win!
Now already 75% of the plaintiffs come from the EU or the US; with TTIP, 75.000 companies would have the right to sue EU member states or the US! A very intimidating case: Vattenfall has sued Germany because of the environmental standards for the new coal power station Hamburg-Moorburg, and Germany has given up and lowered the standards! Detailed information about the 127 (!) ISDS cases filed against EU member states in the past 20 years is provided in a study by Friends of the Earth Europe (FOE) from December 2014 (available for download below).
Main potential effects on environment and consumer protection:
Main potential effects on labour law and social standards:
Main potential effects on developing and emerging countries:
Statements such as "The European standards will of course not be lowered" are lead ad absurdum when checking how the studies are coming to the - even though tiny - positive effects on both sides of the Atlantic: A graphic on page 117 of the IFO study (available for download below) shows that (apart from reducing the tariff barriers in agriculture) it is apparently expected that the EU standards for meat and milk productsare reduced - or how else can increases in exports by 4000 (!) % (meat products) and 1000 (!) % (milk products) from the US to Germany be explained, if 20% of the milk and 90% of the beef in the US are produced with growth hormones?
And what are we risking our democracy for? A legitimate question!
The official answer: To increase the economic growth and to generate jobs - in fact, once more the thought-terminating cliché "job generator" is used to protect the interests of the small group of people really profiting from the TTIP, i.e. the multinationals / their major shareholders. But what is the truth about the statements regarding jobs and growth?
The NAFTA (North American Free Trade Agreement) has proven the contrary, the positive effects regarding employment and alleviation of poverty predicted by the ex-ante studies (that are by the way also based on the CGE models now used for most of the PRO-TTIP studies) are marginal, and especially for Mexico there are even ex-post studies showing negative effects. The details are covered in the OEFSE study below (please scroll all the way down) under “Critical assessment of the PRO-TTIP studies”.
In general, only the older economic models (based on the Ricardo theorem which neither deals with distribution issues nor with investment liberalization or the mobility of capital) see free trade definitely resulting in welfare gains, the newer models also see gains caused by regulation in various situations.
And TTIP? The most popular PRO- TTIP studies are the study at the CEPR (Centre for Economic Policy Research) ordered by the EU, which is partly based on data of the ECORYS study, the CEPII study, the study by Prof. Felbermayr for the IFO, the study by Prof. Felbermayr for Bertelsmann, and the Bertelsmann “50 States” study.
All studies are based on questionable assumptions and scenarios that need to be critically questioned. The used models are complex and cannot predict the expected scenarios precisely, and the studies are at times very laboriously to read - which is why nobody seems to have read them, as I noticed frequently during the past few months. A thorough analysis of the PRO-TTIP studies can be found in a study of the Austrian Foundation for Development Research (OEFSE) from March 2014 that covers issues regarding both the content and the used methodologies. All studies can be downloaded below at "sources, links and studies".
But the really shocking fact is, that these studies - even though they are questionable themselves - are far from providing any convincing data! No entrepreneur would (based on such studies) even start negotiations!
A study of the Friedrich Ebert Foundation from October 2014 (please download below) also comes to the conclusion that the expected effects on growth and employment are - even in the most optimistic scenario - TINY.
The often mentioned increase in GDP by 0.5% (compared to the scenario without TTIP) refers to a timeframe of 14 years (until 2027). After this point in time the GDP stays at the reached level and there are no indications of further growth. The same applies to jobs: For instance, the IFO writes on its website that "Real wages in Germany would increase by around 1.6% and unemployment would fall slightly". And that is the promised economic miracle?
The following video shows the reaction of chief negotiator Karel de Gucht when being confronted with the study he ordered (but obviously has not even seen before). It also shows that the author of the two most famous studies, Prof. Felbermayr, describes the effects on employment even in the most optimistic scenario as SMALL!
A study from TUFTS University in Boston (available for download below) uses - instead of a CGE (Computable Global Equilibrium) model - the GPM (Global Policy Model) from the UNO, and thus gets completely different results: Massive losses in jobs ad welfare! In the EU, 600.000 Jobs are lost, the GDP decreases by 0.5% in North Europe, 0.48 % in France and 0.29% in Germany.
Again, for clarification: The PRO-TTIP-Studies do - in spite of suboptimal models and unrealistic assumptions and scenarios - NOT show any appreciable positive effects on welfare and employment, another study even shows NEGATIVE effects - so why is the TTIP being negotiated at all?
LOSERS: ALL OF US! Consumers on both sides of the Atlantic, developing countries, nature, small and medium sized companies,..
WINNERS: NEITHER "the economy" NOR the US, the EU or any other countries, but just a few multinationals and their major shareholders! Currently already more than 50% of the yearly worldwide capital gain go to only 0.01% of the world population (the other 50% go to 8-9%) - TTIP would make this gap even bigger! Jeronim Capaldo, author of the above mentioned TUFTS study, states that TTIP will cause a transfer from labor income to capital income.
A living agreement could mean that EU and US are first only agreeing on standards that do not need long negotiations as they are similar anyway. But as a consequence of the agreement, any new legislative initiative would have to be examined beforehand for its potential "considerable impact on transatlantic trade". A Regulatory Cooperation Councilwould be created for this purpose. This would result in more lobbying as multinationals on both continents would constantly have to be involved regardless of the issue - be it environment, consumer protection, labour law or other issues. In NAFTA a "chilling" effect on Canadian legislation (caused by fear of lawsuits by US multinationals) could be observed. A study from Heinrich Boell Foundation shows the details of the planned regulatory cooperation (available for download below).
In other words: The EU and US could agree on "inconspicious" formal procedures, which would pave the way for future agreements (that could then be negotiated step by step in secret). Such procedures would be much less obvious and attackable than chlorinated chicken, hormones in meat, ISDS, etc.
Conclusion: Even if - and that seems possible at the moment - chlorinated chicken, GMOs and ISDS can be stopped, we still have to stay vigilant: the TTIP itself is a threat.
As any subsequent contract modifications would need the OK of all signatory countries (provided that - what we should hope for - the EU is not allowed to decide alone), it is basically impossible to change or cancel the treaty once it has been ratified. Democratic control mechanisms, public protest and political campaigns would be useless, as the TTIP as international law would overrule EU law!
Knowledge is power, and the more people know about the TTIP, the harder it will be for the TTIP supporters to decide about our future behind closed doors! Also contact politicians you know!
Interesting videos about TTIP and TISA you can find here!
The initiative has been registered in July 2014 and should have started in September 2014 - but the EU Commission has rejected the application for registration of the ECI against TTIP and CETA. The ECI is the first EU-wide tool for participative democracy, the rejection on fallacious grounds is one more attack on democracy, legal action against the EU ruling has already been initiated.
BUT: WE WILL NOT GIVE UP! Please sign the self-organized ECI that has reached almost 3.2 million signatures (March 2016) and is still running until October 2015 - let´s show the EU commission how many concerned citizens we are!
Ask your representation of interests about their official position regarding TTIP! Some might not even have positions (yet), others will have very positive positions that might not have been properly discussed beforehand. In many cases negative effects for those companies and organizations that are being represented are to be expected!
For example, TTIP would be a catastrophy for a big part of "the economy" (for a definition of the term please click here), many small and medium companies would suffer from even more pressure from multinationals, subventions for socially and ecologically fair and responsibly acting companies would be endangered!
Opposing the TTIP does NOT mean opposing trade in general - it just has to be made clear that this kind of trade agreement is out of the question! Criticizing the TTIP and the approaches of the EU does not mean the principal rejection of the EU.
Become a member of the initiative KMU against TTIP!
"Back to the Stone Age", back to a system without global rules is also NOT a sustainable alternative!
Transnational rules are absolutely necessary - but they have to be completely different from what the TTIP is about. We need fair house rules for "spaceship earth", secured by internationally recognized laws and regulations, paving the path into a sustainable, fair world for all!
THE GOOD NEWS:
Alternatives are already being developed! The Alliance for an ATM (Alternative Trade Mandate) - currently consisting of around 50 organizations from EU countries - is working on the Alternative Trade Mandate that starts from a different point of view: Principles and values are set to be realised; the needs of the people(s) and the challenges of the 21st century are focused on - and then the role of trade within this framework is analysed. Therefore the principles of a democratically controlled trade and investment policy that serves the people and saves the natural resources is the main idea of the project.
Responsible for the content: Ridehere-Ridenow, Association for Conscious Living in the Here and Now, ZVR: 437983246