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  • How Trade Agreements Can Promote U.S. Constitutional Values

    The United States is currently engaged in a trade negotiation known as the Trans Pacific Partnership (TPP) with eight other Pacific Rim countries. Public Citizen recently posted a leaked draft of the agreement’s proposed language on international investment. If the information they posted is accurate, it’s good news for those who support U.S. constitutional values.

    Among the proposed TPP guidelines for international investment:

    • Governments should treat foreign investors no differently than domestic investors,
    • Governments should treat investors from each TPP trading partner equally,
    • Governments should not force companies to use a certain percent of domestic content if they prefer to use less-expensive imported inputs or require companies to export the goods they produce,
    • Governments should not expropriate (steal) a covered investment except through the due process of law while providing compensation.

    This type of language can be found in most U.S. trade and investment agreements. However, its origin actually traces back to our country’s founding.

    For example, the Fifth Amendment to the Bill of Rights states: “nor shall any person…be deprived of…property, without due process of law; nor shall private property be taken for public use, without just compensation.” These words appear almost verbatim in the TPP draft.

    Our Constitution’s Commerce Clause makes it difficult for the state of California to discriminate against investors who live in Ohio, just as the TPP would make it difficult for TPP member countries to discriminate against investors based on which country they live in.

    Trade agreements don’t just need good rules. They need a good way to enforce the rules. The proposed TPP dispute-resolution process would let U.S. companies appeal to an international panel if they believe their property rights have been violated by another government. Foreign companies investing in the U.S. would have the same opportunity. That’s much more effective than forcing investors to depend on the court system of the same government that just allegedly nationalized their property or otherwise broke the rules.

    There is a principle at stake here, and that principle has universal value. The Constitution protects us from the possibility that property will be seized by the government without compensation. It also protects Americans from state and local politicians who, in the absence of the Commerce Clause, would be free to disrupt the flow of trade and investment within our 50-state free-trade area. If done correctly, trade agreements like the TPP should expand the application of this principle to our economic relationships with billions of people around the globe.

    Posted in Featured [slideshow_deploy]

    2 Responses to How Trade Agreements Can Promote U.S. Constitutional Values

    1. sounds wonderful says:

      yeah…blocking websites without due process eliminating the possibility of parralel exports giving corporations there own court system…

      all wonderful things….

    2. Carol, AZ says:

      US trade and Constitutional Values?
      Mexico hasn't been ignored by the USA or by other countries. What has been ignored;
      MX is in anarchy. The MX killing fields as reported; at least 55,000 MX people slaughtered, thousands more are reported missing. The export is drugs.
      Quietly, Bo has led the way to have an open triad border in North America, from MX to Canada.
      Do you have any idea how many American based companies have invested in MX for the purpose of cheap labor and to bi-pass our environmental laws. Recently, one drug cartel just burned down the entire Coca-Cola , American own complex located in MX. America, financed and developed MX's oil fields starting in the 1950's.
      It's understandable why Japan is a major international competitor; we taught them after WW II how to do business, and financed their economy, they listened. They are NOTa Banana Republic.

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