The White House has been curiously quiet on the Trans-Pacific Partnership front, following its earlier fanfare about the agreement when it was signed in February. Yesterday with the release of the U.S. International Trade Commission (USITC)’s almost 800-page report on the TPP’s Likely Impact on the U.S. Economy and on Specific Industry Sectors [PDF], we can expect the rhetoric to be ramped up again, in attempt to sell the agreement to an increasingly skeptical Congress and public.

However, the USITC report doesn’t actually give the administration much to go on. It estimates that by 2032 the TPP would expand U.S. real income by a measly $57.3 billion (0.23 percent). Real GDP growth would be even smaller at $42.7 billion (0.15 percent), and employment would be a negligible 0.07 percent higher. Belying the touted “Made in America” rhetoric of the United States Trade Representative (USTR), foreign imports would actually grow more than U.S. exports (by $48.9 billion, as against $27.2 billion).

Although the likely overall economic impact of the TPP is useful to know, EFF’s particular interest is in the effects of the digital provisions such as the tough new copyright and trade secret rules, and the e-commerce provisions. The latter include a weak guarantee that businesses can transfer their data across borders (but with no similar protection for users), restrictions on mandating the disclosure of software source code (even for the purpose of enhancing security), and mostly meaningless provisions on net neutrality and cryptography standards.

Agreement Would Likely Benefit Industry

On intellectual property, the USITC offers only the most general statement that these provisions “would likely benefit U.S. industries that rely on trademarks, patents, copyrights, trade secrets, and other IPRs by reducing their losses from infringement and increasing exports and foreign sales opportunities for their products and services”. Submissions from industry lobbyists are cited in support of this proposition, but none from TPP critics. Even if taken at face value, the USITC report tells us nothing that we didn’t already know, and more importantly it fails to address the countervailing costs of the provisions to users, other industry sectors, and public institutions.

Similarly on the e-commerce topics, which the USITC labels “Digital Trade and Computer Services”, it offers no economic data at all. It claims in the report and in its accompanying press release that “Many stakeholders consider two new electronic commerce provisions that protect cross-border data flows and prohibit data localization requirements to be crucial to the development of cross-border trade in services, and vital to optimizing the global operations of large and small U.S. companies in all sectors.” Yet it presents no evidence that what these stakeholders consider to be the case, actually has any credible basis.

Misleadingly, the report cites a Public Citizen and CIPPIC paper [PDF] on the TPP in support of the proposition that rules prohibiting forced localization will boost the competitive advantage currently enjoyed by U.S. cloud-based services. In fact the relevant passage of the cited paper merely notes that the USTR has made that claim, and gives no independent assessment of its veracity. Public Citizen have also said [PDF] that the TPP would “undermine access to knowledge, creativity, and autonomy over digital devices and content”; yet criticisms such as this are nowhere to be found in the USITC report. On the other hand criticisms from industry that the TPP doesn’t go far enough are included—notably criticisms that the financial services sector should have been covered by the data localization ban.

Costs to the Public Ignored

We shouldn’t have expected anything more, but this report is a whitewash. It fails to acknowledge, let alone to challenge, criticisms of the agreement made by public interest advocates such as EFF, relying instead only on the say-so of industry stakeholders that the TPP will benefit their sector. Even if those industry statements are taken completely at face value, they discount the real costs of the TPP’s rules to many other affected communities, including but not limited to startups, students, journalists, libraries, artists, and fans.

The minuscule benefits projected in the USITC’s report do nothing to justify the very real costs of the TPP that will be borne here and around the world. No monetary value is or can be placed on the loss of sovereignty that results from us locking in our current broken copyright system, so that we no longer have the flexibility to adopt better rules. None can be placed on the lost opportunity to include users in developing more meaningful global standards on net neutrality, or on other digital issues. No measure is placed on the value of works lost from the public domain for a further 20 years.

In light of these omissions, how can the USITC report be taken seriously? If anything, it reconfirms that the TPP is a bad deal, and that our Congressional representatives ought not to hesitate to reject it. Call on them to do exactly this by taking action now.


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