tv Key Capitol Hill Hearings CSPAN October 12, 2015 10:00am-12:01pm EDT
that have survived, sort of time after time were people look for deliverables for some bilateral and you just couldn't move on these. i think that's what we saw with agenda setting right from the start when you said audiovisual with friends. the u.s. what do you do on financial regulation? as you come it was a great idea but the remaining issues are really tough. ..
>> i think the reason why some of these have stuck around all the time, as you've said, they're really politically intractable. but in some sense there's a reason for that, and maybe it's not necessarily a bad thing. i mean, the other option is to have absolutely no regulation, right, at the extreme so that there's no conflict over what that regulation and anything goes. and if that's not what we're trying to set up, a sort of super-regulatory council that can sort of whack-a-mole and bat down anything that is not the least trade restrictive model,
that's where you're getting political pushback be. and that's the idea that, you know, citizens want to be able to have some say in what their economy looks like. and in some senses, you know, some citizens want greater government intervention in the economy. cato would say less government intervention in the economy. but these are really, really important questions. and it really gets to, again, i think, marjorie's question when she said raise your hand if you already think ttip is a good thing and you're for it. and i sort of went halfway up. we're in the sort of could-be camp, and this again gets back to the question of power that we often don't want to talk about in trade negotiations. if you're already for it and you don't have any idea how it's going to come out, that means you're pretty confident it's going to come out in a way that benefits your interests. and i think for working people, we're theoretically for it because we haven't yet seen one that really comes out that takes the proposals that we put in,
and they get put into place. so it's a really critical, critical question about how confident you are that your influence and your power is going to determine the outcomes. >> thank you. marjorie? sorry. >> yeah. so you asked the question about some of the more intractable issues. i can tell you that, like cato, the chamber actually sides with the europeans on a number of these issues. we do think that financial services should be included in the regulatory portion of the conversation. we do think that there is government procurement liberalization to to be had, although to i think it's actually a u.s.-offensive interest as well. we do support the notion of lifting the battle on crude oil exports which is, obviously, one of the drivers for including in energy and raw materials chapter from the european perspective. so i think we are, like you are,
interested to see liberalization occur not just in europe, but there are things that have to happen here as well. i just have to say very quickly i don't think celeste was saying this is what we're doing, which is to say advocating for the elimination of all regulation, because that's not what business is advocating for. what business is advocating for is a structure that allows for dialogue among regulators to identify ways to, where possible and it isn't going to be possible in every instance but where possible, to reduce the costs associated with regulation. no one in this country is any more interested in reducing protections for workers or consumers and the environment than they are in europe. we have the same level of concerns in this country. so the notion -- i don't think you were saying this, but i just want to make it very clear that business is not saying that in
the context of this negotiation we want to use this key element of regulatory cooperation as a way to simply eliminate or have a race to the bottom on regulation. >> bill, frederick? >> very quickly because -- [inaudible] celeste made this point citizens want to have a say. what i would note on many of these issues, the chicago council's public opinion surveys you get strikingly strong numbers in terms of public support for trade even when you ask specifically about tpp or ttip. so i think when we look at some of these obstacles, this may not be representing sort of the citizens on the street who want to have a say, it is much more interest group politics. >> just to follow on that last point be, i think that's perfectly true, and i don't think anyone should be afraid of having a big, broad discussion on trade. when you actually look at the political economy of trade
liberalization, you're not going to find many examples in history where external negotiation has pushed through an enormous amount of deregulation. what you will find is that external negotiations in the who, they've managed to lock in existing patents of openness to trade domestically. every now and then perhaps, you know, pushed countries a little bit to open up more. but trade agreements, they are broadly defined by the biggest sort of trend of political economy inside each country. and right now and for the past years we're simply not on a big deregulatory track. we're on a trend where regulations at some point are increasing, but i think more importantly for trade negotiations are becoming ever more complex, ambiguous by design. that regulators have been afraid of doing regulations, simple,
transparent and readily understandable for each and everyone simply because they don't want to face up to the consequences of the full effects regulations when it's applied. the good story on the economy the other week where they were sort of making the point about how the slew of financial regulations that have emerged in the post-crisis era has created a lot of uncertainty in the entire financial sector. and i'm quoting one financial regulators who was explaining sort of the compliance philosophy behind financial regulation was, basically, we call all the banks in, we line them up, and then we shoot one of them so that the others are going to get the the message. >> ouch. [laughter] >> yeah. right. >> that is not a cato-endorsed policy. [laughter] super, do you -- susan, do you -- >> i want to make three points. point one -- [inaudible]
but i don't think that in the future labor will be happy with trade agreements because i don't think they're meant to really address the problems of workers which is both unfortunate. and i think what we've done over time is try to come up with some fixes. so in the work that -- we participated in something for the ilo, and we came up with some new ideas, but they're all at the margins. they're not even really, in the end, going to change the situation, yet i think the situation must be changed. we need to find ways to empower workers in the global economy. second point, what i love about ttip and tpp is that they, while i agree with you the public seems more and more supportive of trade, it's also been revealed that our legislators are ever more -- i don't want to use the word protectionist because i don't know what word to use, but skeptical. because of all this interest group pressure.
yet i'm really hopeful as i see trade agreements evolve over time because i do think we need to find common ground on spillovers that affect people's privacy and the equality of work and the environment, etc. and so as the process becomes, i think, more transparent, i think i see more people engaged in the debate. and i think that is a good thing. i hope that more people will learn about the economics of the global economy, economics of inequality. i think having these debates helps to get people thinking about it. that doesn't mean that pundit class isn't -- of which i'm probably one -- isn't involved in skewing the debate in some ways. but i still think we have more opportunities to modernize trade policy making, to make it more accountable, and that's a good thing. the more you have that feedback be loop between government and
the governed, that's a good thing. and what the united states does affects the europeans and vice versa. just as what china does affects south korea. >> and by the way, susan, you brought a very thoughtful essay in our cato online forum about how to address labor concerns. so i urge you to go read those. we're just about out of time, and i don't want to be accused of having dominated the questioning, so i'm going to ask if anybody has a question from the audience. feel prix to raise your hand -- feel free to raise your hand and ask it. okay. yep, this woman right here in the middle. please identify yourself and address your question and headache it a question, please. >> thank you. my name's -- [inaudible] thank you for your presentation. i was wondering in terms of capitalism, and we are talking about free market.
[inaudible] we have big business, you represent small business. usa had the big corporation and have a small people. and usa didn't really represent all people -- [inaudible] represent all of people in the global situation, economy. and if we can say regulation in the global trade, but we cannot even have a good regulation, a good law in the united states, they can implement a good law to protect all the people. so how are we going to handle this global situation in this global trade agreements? >> thank you. we -- i think she was addressing you, marjorie. >> yeah. so, hmm. so the u.s. chamber of commerce doesn't represent everyone. the u.s. chamber of commerce is
an advocacy organization that works on behalf of business. it happens that among our members we have businesses of all sizes and across all sectors. we have u.s.-based, u.s.-headquartered companies among our members, we have european companies among our members. so i'm not entirely sure that i understood the point that you were making about the chamber. the point that you were making about regulation and how can we propose to promote better regulatory practices in an agreement like ttip if we don't ourselves have entirely effective or adequately representative approaches to regulation in this country, i think, is frankly the subject for a much, much longer conversation. i think it's a fair question, but i don't know that we have the opportunity to answer it
here. >> no, i don't think we do. i must say we are out of time. there's -- i got through about half of the questions that i wanted to ask, so i've got to do a better job of timing things in the future. we're going to go to a coffee break now, and i think we're going to reconvene here at 10:30. please help me in thanking the panel. [applause] check people out on twitter and read what they've been writing, and that might answer some of the questions that you didn't ask. [inaudible conversations]
[inaudible conversations] >> this forum on transatlantic trade will continue after a brief break, should be about 15 minutes or so. up next it'll be a hook at negotiating the transatlantic trade deal. later, panelists will examine trade and domestic policies and security in the transatlantic trade deal. so, again, 15 minutes, we'll start again at 10:30. live coverage here on c-span2. a look at the presidential race now and its intersection with the supreme court. it was a part of this morning's washington journal program, and we will show you as much of this as we can until this trade forum continues here at cato.
>> guest: good morning. >> host: on that supreme court that we want to tart with, particularly as to how it might influence the presidential campaign. what are your thoughts on how much of a topic the court itself good becomes as part of the campaign? >> guest: i think it will become an increasingly important topic. we've already seen the candidates talking a little bit more about it x it's starting to heat up because the next be president has the potential, as you noted, to appoint up to four justices on the court. and that would dramatically shift the ideology of the court in one direction or the other depending on who the next president is. >> host: and so part of that is the people that might get chosen to the court from the next president, what are the candidates specifically saying about the court? is it more about cases before the court or who they would like to appoint? >> guest: right now they're focused on topics, on issues, you know? we've seen former secretary of state hillary clinton bring up the issue of same-sex marriage, that the ruling, the landmark
ruling last year that legalized it across the country could somehow be in jeopardy if more keys are appointed to the court -- conservatives are appointed to the court. many of the big blockbuster cases are tied at 5-4, they're very close decisions. and she's also brought up the issue of gun control saying she thought the court's rulings on the second amendment were wrong and they should allow for more gun control measures especially in light of some of the recent mass shootings that have happened. so right now it's more topical, and, you know, bernie sanders saying that he would want somebody who would vow to overturn the citizens united ruling which allowed for unlimited corporate funding in presidential campaigns. so it's starting to heat up, but it will be a major issue for the next president. >> host: how much of those topics will include decisions on same-sex marriage and on the president's health care law? >> guest: a lot, a lot. especially as we see this term. there's yet another challenge to the health care law that's making its way to the court. the court's likely to take up
about substances for religious nonprofits. so as much as that is in the news, that will definitely be an issue that candidates are likely going to take on on the trail. >> host: to the topic of the actual choice of justices. if you go back in history from the various presidents, at best maybe chosen one or two justices during the time. in this case you're going to have when the next president comes into the power, you're going to have several in the upper 70s, early 80s. so talk a little bit about that and what faces this president when it actually comes to choices he or she has to make. >> guest: right. there are four justices who as one of my sources said actuarially -- [laughter] a gentle way to put it, could be likely to retire or leave the court in the next administration. and two are appointed by democrats, two are appointed by republicans and one is, what we would call the swing voter, anthony kennedy, who is usually
the decider in many of these really close 5-4 decisions. so if a republican, for example, a republican president replaces the two democratically-appointed justices, that would create a dramatic shift. it would no longer be this 5-4 teetering balance, it would be a solidly conservative court, and the same way the other way around. if a democrat appoints, replaces two of the more conservative-leaning justices. so that could really change the way decisions are handed down if you looked at this 5-4, you know, split we've had for most of the last decade. >> host: again, our topic turning to the idea of the supreme court and its role as the presidential campaign in 206 or a topic in the presidential campaign. 202-748-8001 for republicans, 202-748-8000 for democrats and 8002 for independents. if you want to post on twitter, you can do so @c-span wj, post
on our facebook page as well, our guest is kimberly atkins of the boss to have herald. -- boston herald. john roberts, especially amongst republicans after the decision on same-sex marriage and the affordable health care act, talk a little bit about how people are responding, candidates are responding specifically to him. do you think he becomes a specific topic of discussion in the next campaign? >> guest: i think he does, and he already has. we saw at the republican debate that john roberts became a subject of, and often a subject of derision among some of the candidates who don't think he's conservative enough or he has ruled conservative enough. his rulings, his multiple rulings as the decide canner in the affordable care act challenges, upholding the law, were very disappointing to a lot of republicans who were hoping that he would help cut that law down. and he was appointed by george w. bush, so it puts jeb bush in
a particular lidell candidate position to have to criticize his brother,. >> he has. he stated that, you know, basically the chief justice didn't have a long enough record of conservative rulings, which is debatable, but that he would try to find someone with a longer record to try to appoint. so it's interesting that this, you know, republican-appointed chief justice, someone who seemed at the time was heralded as one of the greatest achievements for george w. bush during his term is now the subject of criticism from republicans. i think we'll see that escalate, if anything. >> host: one of those sharpest critics at that debate was senator ted cruz, asked about john roberts specifically. we'll play a little bit of what he said and get your response. >> do you like what you just heard, senator cruz? >> i've known john roberts for 20 years. he's an amazingly talented lawyer. he's a good enough lawyer that he knows in these obamacare cases he changed the statute, he changed the law in order to
force that failed law on millions of americans for a political outcome. and, you know, we're frustrated as conservatives. we keep winning elections, and then we don't get the outcome we wanted. let me focus on two moments in time. number one, in 1990 in one room was david souter, another was edith jones, the conservative on the fifth circuit court of appeals. george herbert walker bush appointed david souter, and then in 2005 in one room was john roberts, in another was my former or boss, the rock-ribbed conservative on the fourth court of appeals. george bush appointed john roberts, and let me give you the consequences of that. if, instead, president bush had appointed edith jones and mike ludig, obamacare would have been struck down three years ago, and the marriage laws of all 50 states would be on the books. these matter, and i've fought to defend the constitution my whole life -- >> governor bush, i want -- >> host: anything to add to that? >> guest: you know, it's really
interesting. it's not always when a president appoints a supreme court justice there's sometimes -- they're sometimes surprised at some of the rulings that they've made. look, i think by any measure you can't say that the chief justice has been a liberal-leaning justice in any way. but sometimes there have been justices that have come out in a way that's different than anticipated, for example, retired justice souter, the republican appointee. he aligned so closely with the liberal block of the court that he waited until after president obama was elected to retire to insure that a democrat would replace him. sometimes supreme court justices are surprises. i think with the exception of the affordable care act rulings, chief justice roberts has been a reliably conservative voice. maybe not conservative enough for ted cruz, but -- [laughter] >> host: kimberly atkins of thee boston herald". first call comes from john.
>> caller: hi, how are you? >> host: fine, thanks. go ahead. >> caller: i have a question and a comment, and the comment is about something you spoke about a moment ago about gun control. first of all, i am very worried about the presidential election as it relates to supreme court nominations, and i think it's -- that's one of the reasons it's critical that the democrats hold the presidency. however, you mentioned how in light of recent events various decisions should have gone a different way or should go a different way. that's one of things that scares me though the most. when they do, when they come up with their decisions, current events and politics are not supposed to, are not supposed to be a factor. let me explain quickly what i mean by that. it's true that when things get up to the supreme court, they can be -- they're usually so complex because there's competing constitutional rights involved and other things involved in precedent and other
cases. and in technology changes, so when they wrote the constitution or various amendments, certain things had not yet been considered. we have to go back and take a look at what the constitution says. but what you can't do and what sometimes they do do and is very dangerous is to take a look at things currently going on and instead of trying to change the constitution or coming up with a constitutional amendment to base your decision not on constitutional arguments, but on things happening right now. it should be decides differently now than 50 years ago. that is, it's extremely dangerous and, frankly, it's, it's inappropriate and could be considered an illegal way of doing business. >> host: john, let's let our guest step in and comment to what you brought to the table. >> guest: yeah. i think that you're right in terms of what the justices should consider when making a ruling on constitutional issues or any issues. it shouldn't be based on the news headlines. the point that i was making is that in light of recent events,
the presidential candidates are likely going to be discussing gun control and gun rights more. and we've already seen former secretary of state clinton bring that up specifically in talking to the supreme court saying that making appointments to the court and the decisions that the court will make involving the second amendment will be crucial in terms of that. the justices themselves, of course, they look at the constitution and of course they interpret the constitution very differently. some of the justices would disagree with you that, you know, things change and over the course of -- with the changing technology and the evolution of society that constitutional considerations change. some don't believe that that's the case. the more conservative justices don't. and others, more liberal justices, do believe in the so-called living constitution that does change with the times. but you're absolutely right in the way that the court should consider issues. but presidential candidates
aren't limited to those same parameters. >> host: judy from idaho, good morning. >> caller: good morning. i would like to comment that the flood of money in this current election and the last couple of elections since citizens united may have caused justice kennedy to change his mind. in his concurring opinion, he said he didn't believe it would create the appearance of corruption and, obviously from the polls, it has created a general belief that money is corrupting the electoral system. so that's all i had to say. >> guest: yeah. you know, we'll have to see on that. there will definitely be more challenges in the area of campaign finance reform, and i don't know what justice kennedy is thinking, but we have seen justices in other cases, in other issues change their mind over time on issues. i mean, if you look at retired justice john paul stevens made a
dramatic change in his views on the death penalty, for example, where he voted to uphold its constitutionality and toward the end of his term and after he retired he's been one of the most vocal opponent toes of it, saying that he believes it's unconstitutional. so, yes, justices can change their mind over time, especially as they see the impact of their rulings, and so we'll have to wait to see on that. >> host: 8001 for republicans, 8000 for democrats and 8002 for independents. gallup did a poll asking people questions about the supreme court in september. this said that 37% of those responsibilities said the court was too liberal, 20% said the court was too conservative, 40% said it's about right, 3% said no opinion. does that trend to things or at least what you hear about the political makeup of the court or at least the ideological make beup of the court? >> i think it's true. i think a lot of people view the ideology of the court through
their own political lens. whether it is too conservative or too liberal for that individual. and so you get differing opinions. and it's also a situation where, you know, a certain percentage of people are really tuned in to what the supreme court does, and others pay more attention when these big cases and big decisions come down. so it depends on when you catch people in these polls. it depends on their general feelings about government in general. but i think you're going to have different opinions on the court no matter who's appointed and especially right now. it's such an even split when you think about who they were appointed by republicans or democrats. so evenly split right now that you are going to get very widely-differing opinions. >> host: do the justices themselves ever express how the public looks at them as whether too liberal, too conservative, whatever? >> guest: no, no. and the court is supposed to be an apolitical body. that's why the justices are appointed for life.
it's supposed to be independent and not beholden to anyone when they're making these sort of rulings. but what you will see sometimes is the court recognizing changes in society when they're considering certain issues. for example, the same-sex ruling. one of the factors was the changing societal view about same-sex marriage, and they had to take that into consideration when making that ruling. so they're not impervious to what's going on in the world around them, but they try to stay as apolitical as possible. from new york, this is rob. hi there. >> caller: thank you for c-span. good morning. you know, i look at the citizens united decision as just one of the greatest blunders in the history of this supreme court. you know, i mean to put it another way, too smart, they're not. such geniuses that we put on the highest court in the land, and this is what they come up with. but, you know, i was going to
really -- what i called to ask was do you believe that we'll see anyone resign within the balance of the term of president obama, and do you believe that if ruth ginsburg does resign, is it going to be seen as this, you know, politically-charged decision on her part? i guess that's my question. thank you for c-span. >> guest: yeah, sure. i mean, a lot of people, a lot of liberal activists and even several newspaper editorial boards have actually called on justice ruth bader ginsburg to step down during president obama's administration to allow him the chance to at least replace a democrat on the, on the court in the event that a republican wins in the next term and could get the chance to make
that replacement. she has been very adamant that she has no plans to retire. she points to justice john paul stevens who was on the court until his 90s, and after he did retire he expressed a little bit of regret saying maybe he did it a little too soon, that he missed the job, and she didn't want to be in that position. so i think that the likelihood of a voluntary resignation in the final year of president obama's term is small. it could happen, you know? sometimes justices have retired for unforeseen health reasons or unforeseen health reasons of a family member in the case of retired justice sandra day o'connor. so, you know, we have to see. but i think unless there is some other circumstance, i really highly doubt that anyone will step down. >> host: for kim atkins, bonnie in michigan. hi. bonnie in lancing, michigan? >> caller: oh, yes.
i was on hold, sorry. >> host: go ahead. >> caller: i have a comment about the prisons letting all the mentally ill out. in 1991 governor engler -- hello, yes. >> host: sorry, bonnie, i think you're calling about our last segment. we're trying to stick to the topic of the supreme court this time around. barbara from new york, hi there. >> caller: good morning, pedro, good morning, ms. atkins. ms. atkins, if a supreme court justice became mentally impaired but refused to acknowledge that, would chief justice roberts be able to force that person off the court, and how, do you know how they would go about doing that? thank you so much. >> guest: that's a pretty good question. because justices are appointed for life, the only way that they can be removed from the court is
through the impeachment process. so, no, the chief justice couldn't force someone off the bench, and over the course of history there have been some justices who stayed on the bench for a long period of time and, you know, it was a open question -- >> during the session i'll be watching it, and if you send your comments and questions to the hashtag catottip, and some of us on twitter. so follow us and send us comments. please check us online. so what's this panel about? well, the u.s. and the e.u. make up one-third of total goods and services trade totaling $2.7 billion a day. this amounts to nearly half of global economic output, and this is, essentially, the world's largest economic relationship. it is no wonder then when president obama announced in his 2013 state of the union address that he was launching the ttip
negotiation that this was met with incredible fanfare. the benefits are large. that is without doubt. but stakes are also high, and the issues we need to resolve in order to get to a deal are incredibly diverse. and giving that two years have passed without a clear idea of where the end point of the negotiations may lie, we need to sort of ask that first tank of gas is completely empty, where do we go from here? so this panel will address whether we can -- [inaudible] rounds of ttip negotiations, how we're going to complete them, highlighting the key challenges along the way. we're first going to start with a specific high-stake issue in the area of substantial benefit to both parties. gary of the peterson institute will begin the discussion with an overview of the challenges. this issue highlights a key challenge that e.u. negotiators have been wary of which is the role of the united states'
individual states in the negotiating process which could put a wrinkle in the deal. michelle' began will then focus our attention on regulatory cooperation. this is not the first time you're going to hear about this today, and you'll hear about it again and again. some have cited the removal of regulatory trade barriers to amount to 2.5-3 percent of an increase in gdp if we can get rid of all of them. michelle's going to set the efforts into the context of other ftas that are diegoing with regulatory chapters and what we could learn about the scope and scale of the negotiations begin what we've already seen. and throughout the discussion, john gilliam from from harvard university who has a fort coming book coming out -- when is it, john? >> [inaudible] >> in may. so check that out. john is going to focus us in on a really important issue that i think sometimes we take for granted which is domestic politics. all politics really is local,
and the ttip certainly is not. and particularly his focus will be on the e.u. side of the domestic political issues. so the commission has been forcefully trying to push through this deal, and john will give us a little of taste of what this means for the completion of the ttip. so the common thread among these presentations really lies in the fact that they all pinpoint specific challenges to completing this deal as well as opportunities to its full completion. and in the end, they're going to offer some insight into what we should expect in the coming rounds, and the round coming next week, i think this is quite timely. so with that, i'm going to turn the podium over to gary and -- [inaudible] [inaudible conversations] >> well, thanks very much. i want to thank the cato institute for inviting me and particularly i want to thank dan
ikenson because he knows i think he's wrong on ex-im bank and isds and probably six other subjects. but nevertheless, he invited me to come. it just shows he's an open-minded guy. so i would like to start with just a but comments, a broad overview type on the ttip and then move into the government procurement issue. the good thing, i think, about ttip by contrast with tpp in terms of finally achieving t, ip is that it's not -- ttip is that it's not an ideological debate. i think despite what celeste drake said, it'll be hard for the opponents to mobilize the same emotional energy against ttip that they have gathered against tpp, but there will be these very strong sectoral opponents dealing with isds,
regulatory coherence, the vw episode will be, we heard many times, service liberalization, cyber issues and so forth. so those sectoral disputes will occupy a lot of energy. in my view, this will not be achieved as a single kind of mega-agreement. that's, in fact, i think a mistake. i think it's going to be thought of as a decade-long project, and it ought to be broken into parts. and though it was said nothing is easy, there are actually some parts which are easier than others and that the negotiators ought to work out some kind of snapback if we don't go on to the harder issues after we've dealt with the easier ones. so that would be my second point. i think it's very hard education in to the sectoral -- hard in addition to the sectoral interests when you have two very
slow-growing economies, the u.s. doing better than europe now but who knows in 2017 how the growth numbers will look and even for 2016, the most recent projections are just 2.5% growth in the u.s. which is not really great. and i regard this as an enormous failure of our macroeconomic leaders. the achievement of tpp, ttip and so forth mainly on the supply side. and when you're underperforming on the demand side of the economy right across the board, it's hard to get much enthusiasm for increasing the supply limits. now, in the final point, final overviewpoint i'd make is on regarding something said in the last panel. it was pointed out that the faa agrees with its european partners on, you know, air bus
and boeing. but the point is that the faa determines flight safety civil aviation for the whole world. there's one regulator, and it's the faa, and everybody else is quite secondary and says me too. that's not the case for baby rattles. it's not the case for autos. and the turf interests of regulators in not being put out of business is extremely strong. so that make as the regulatory coherence one of these kind of wished-for things that i think should be regarded as a very long-term enterprise. now turning to government procurement, i'm delighted -- as were members of the previous panel -- that government procurement is an insisted item by the europeans. it's about 10-15% of gdp, government procurement across
north america and europe. that's a big share. it has not much been liberalized, and government procurement represents this unholy alliance which i assume cato denounces between government officials and local suppliers. it's as simple as that. and, you know, this is the way you give the money to your supporters on the business side in your jurisdiction. you procure from them. and right here in d.c. we have some of the deaths examples that you'll find -- best examples that you'll find in the whole united states, but they're certainly not isolated. so it really needs to be opened up for really benefit of taxpayers and consumers everywhere. now, in the government procurement agreement in the wto we have very high thresholds for anything to do with construction. a lot of government procurement
has something to do with construction. it's about $5 million before foreign firms can bid. for other products it's much lower, about 130,000. special drawing rights in the wto. in korea, with the korea/u.s. agreement, we got it down to 100,000 for everything else but not construction. so that was a step forward. the u.s. formula for dealing with government procurement which was pledged by ambassador froman early on in the negotiations in the tpp and was respected, so i'm told, in the fine text of the tpp is we're not going to ask the sub-federal units -- that's the states and the big cities -- to do anything. you don't have to do anything.
and so that has been the u.s. negotiating approach for some time now, since nafta. the states can volunteer, can volunteer. and in nafta about 20 of them did put on different schedules, different lists. in subsequent agreements many fewer have actually subscribed. and an awful lot of procurement is done at the subfederal level. so it's basically insulated from the, from the, from these liberalizing effect of these agreements which is a great shame. but, hopefully, the e.u. will pull up our socks on this one. now, the u.s. trade representative has long offered what i regard as a bogus legal explanation for this. they say we can't do it. but all you have to do is read article i, section eight of the u.s. constitution, and you know they can do it. and if you know anything about, you know, the federal government's power over,
congressional power over interstate commerce, it's just absolutely clear. the real reason, of course, is the political pushback from the states. but if they would talk about the real reason, then we might actually begin to make some real progress. so as canada and europe did in the cta agreement -- and it's amazing what has been done. canada, all the provinces have signed up and most of the big municipalities are signed up to open procurement. so that's -- there will be some very interesting econometrics coming out after a few years of implementation to see the reduction many costs. but begin this political rationale for the ustr failing, we make a couple of suggestions in our paper which is online. we were told that procurement is next up, february 2016
supposedly they'll start discussion. so what we would see as one possible solution is that some states should band together where they have a common interest versus europe and put forward that common interest through the ustr in exchange for opening their procurement. in other words, the states participate in the negotiation. that probably would be a horrible thought to the ustr, but that would be one way to make some forward progress. another way, which is more top-down and is eminently feasible because we do it all the time, is that when the federal government provides a substantial amount of funds for state or municipal projects, that there ought to be a tracing mechanism, and that procurement should then be open to european
competition and the ttip as part of the bargain. and a final suggestion i've offered for a couple of years now -- it hasn't gotten much traction, possibly never will -- but that europeans could say, and we could reciprocally say to them, the europeans could say, okay, a u.s. firm which wants to bid on a european project, it's free to bid provided that a majority of its workers are employed in states which subscribed to, put up a meaningful schedule to the procurement agreement. and so you would mobilize then the big firms which dominate trade to lobby then in state governments where they have a tremendous amount of power to sign on. thank you very much. [applause]
>> it's worthwhile today looking at what we're actually dealing with here, and i'm delighted to be at cato because the title of panel is finding the path to ttip's success. and i think the first panel showed us that within countries, trade is an ever more polarizing issue. the expectations for trade are higher due to austerity as a possible off-budget source of growth, even a promise for structural reform which was obviously important for japan and korea. we're expecting trade to do more. while we know a lot about the literature from the domestic politics of trade, we tended to focus -- and we heard a little bit this morning -- on the interest and preferences of economic actors and lobbying strategies to reach a trade agreement. but i think we also need to
think about the crucial trade-offs between legitimacy, efficiency and political pragmatism. and that trade-off, squaring those three corners of the triangle, is going to be very difficult. the trade environment is also more complex which came up this morning due to the complexity of overlapping trade regimes. we're dealing with the u.s. and the e.u. and others in plural lateral, multilateral and other regional environments. and so there's sort of a broader network, not just sort of ttip going on here of which the u.s. and e.u. are part of and are not part of. and so first comment that -- the first comment that i want to raise is also the other developments that sort of take place against the context and background of ttip. the first one is the changing terms of international trade. it's no longer about reciprocity, it's about regulatory trade policy. and that's very distinctive because it brings up the
politics of precaution. in the u.s. and the e.u., you can't be subject to the same reciprocity or trade-offs. you can't negotiate in the same way as tariffs. that's a my first point. the second point is that subsidies are public, and they can be negotiated by trade negotiators, but many rules and standards are private. and these different regulatory rules can impact the trading system. they're set by a range of private trade associations, professional bodies or international forums. aftm, iee. these private standards then can be incorporated or referencessed in government -- referenced in government regulations. and that can close off alternative methods of equivalence or compliance, and it can impact market access. using private standards referenced in government regulations. the third issue is that global
supply chains have profoundly affected the patents of international trade and production. but the interesting thing about ttip is that many firms, unlike a lot of other trade agreements, put in joint proposals in many sectors. we sort of set it out as the u.s. wants this, the e.u. want that. but in chemicals, auto, pharma and labor, there were a lot of joint proposals at the beginning of the negotiation process. so although production systems are not national, there has been some level of coordination of requests in this transatlantic trade agreement. and my last point would be when the agreement is done has come up today to, when will it be signed, 206, 2017? shaun donnan talked about the speculation of the timing. i think we need to look beyond the negotiations. one of the issues that's very important that gary raised is the division of competences.
who has primary or shared jurisdiction. and this is an important issue for europe now because the e.u. is in court about the singapore agreement about whether it's a mixed competence or a shared competence. and that's very important. so the issue then is the inclusion or not of subnational authorities and whether that requires changes in legislation. and then i think we need to distinguish beyond theç negotiations the procedural process of ratification, the formal requirements of publishingç the document, goinç to usitc from the more political process ofç compliance. what we can expect from that implementation and compliance of an agreement is thatç we will have a need for compliance mechanisms. there will be misinformation, and there will be continuedzv regulatory barriers. and so given that, what is ttip? and i think the negotiations have been organized into three
areas, three broad areas. market access for goods and services, that's tariffs and rules of origin, regulatory issues and procedures and the rules concerning investment, intellectual property, labor, the environment and what we might call new issues such as state-owned enterprises and regulatory coherence. but the one thing to remember about ttip is that both the u.s. and the e.u. have been using regional free trade agreements or regional trade agreements as susan said this morning to introduce new issues. it's put -- and now they've pushed themselves into these precedent-setting regional trade agreements. now they've got an opportunity to pursue a similar agreement transatlanticly. so the u.s. tends to use the model of the korea trade agreement. the e.u. is model with the the african caribbean pacific is
very, very different. it's revising its first generation agreement with mexico, and it has some stronger wto-plus commitments to canadian one. so the e.u. has a very mixed bag. so after more than two years and ten rounds, substantive differences remain. but we're really in the early stagings. if we're honest here and we look at how long it took to do tpp, it does highlight the difficulties of reconciling legitimacy, expediency and efficiency. so i should think, like gary, we can expect some very many long-term negotiations. [inaudible conversations] >> you know, the one thing that we need to remember is this is a living agreement. so we can also expect some issues to be shelfed or dealt with later on. i think it's going to be a long-term process. and if we look at what's actually done now, you know, all this sort of sectors, the only
one that's actually had any proposals on the table and movement has been in textiles. it's highly likely that some of them are going to be shelfed or not dealt with during this agreement. i don't know, it's a living agreement, you know? you pointed out you don't think there'll be one ambitious agreement. i'm in accord with that. so the state of negotiations are, you know, if you look at what we've actually offered, you know, tariff offers have been exchanged, you know? they're going to be -- there are going to be discussions on public procurement, but the exclusion of the states. the regulatory corporations, the textile sector is the only one with shared positions. others will be negotiated at a later date. and so we have some movement in the area of rules with customs and trade facilitation, and we also have a draft-consolidated text on smes. and so we are making progress, but it's going to take us some time as we expect with any trade agreement. but the interesting thing about ttip is many of the issues under negotiation are not new.
they've been the subject of continual negotiations and discussions for more than two decades to reduce regulatory barriers, promote regulatory cooperation. this is not a tab la race saw. we've been trying to have early warning systems, good manufacturing practices. we've got a lot of acronyms to remember that we've built on, transatlantic business dialogue, transatlanticking economic council, so i think that's very important. so regulatory cooperation is the key chapter to the overall success of ttip. there are lots of examples of these nontariff barriers, technical barriers to trade due to differences in regulations. we have differences in import licensing, customs valuation, preshipment inspection rules of origin as well as the tbts and spfs in agriculture such as domestic standardization rules, double conformity assessment,
special labeling. so regulatory cooperation is very difficult because it's a trust-building issue. it's not a typical market access issue that can be dealt with in a tradition aral reciprocal manner. so the title of the panel was what will it need to be truly ambitious in scope. and so i think if we want regulatory coherence and cooperation, we're going to have to realize, we're going to have to have a wide range of regulatory instruments. some of it might be just an extraining of information -- exchange of information. some of it will be manufacturing guidelines. some of it will be mutual recognition of conformity-assessment bodies. some of it will be joint impact assessment, and some of it will be -- most importantly -- upstream regulatory cooperation for future innovative technologies. that will be the range. no sector will get the same thing. it will not be a one size fits all. and the second point as an outsider and as a european, i'm
looking very strongly at the revision of the omb circular a119, and europeans should be looking at that more carefully. and finally, so what can we get? how can we get to an agreement? i sort of think it's like pick-a-mix. i think we can borrow from existing free trade agreements, and i'll give you one example on the u.s. side and one on the american -- the european side. the u.s./australia free trade agreement, it has enhanced commitments to accord equivalency upon request of one party. through standards, regulation or conformity assessment of the other party. and there is an obligation to provide justification if equivalence is not granted. that's actually quite important. the second one is the cta protocol, the u.s./e.u -- the
e.u./canada, canadian protocol on conformity assessment. it's buryied in the 1,500 document, but it's very important. it's a wide-ranging protocol on mutual recognition of conformity assessment in many sectors. if we want to talk about business, we want to talk about equivalence, regulatory cooperation, take a look and pick-a-mix at other free trade agreements. so finding the past to ttip's success, because i'm an academic and i'm not actually in the room with the trade negotiators, i can actually put some proposals out there to find the path. the first one, negotiators need to evaluate best practice efforts to promote regulatory cooperation through early warning systems, mutual recognition and safe harbor principles. a lot of us remember the mutual recognition agreement from a decade ago, and they tended to provide minor cost advantages, so we don't want to think about them again.
but we should pay attention to the ones that were successful. marjorie mentioned this morning, but the u.s. certification of aircraft agreements and the veterinary agreement on best practices might be a model to think and reflect on, number i one. number two, secondly, we focused a lot of attention on institutions. and i know i heard somebody this morning talk cato doesn't like new institutions. but we focused on the proposed regulatory cooperation council. but any new institutional framework has to have a scope, has to have a purpose with deadlines and adequate funding. if you're going to use the regulatory cooperation council between canada and the united states, the united states and mexico, it has had minimal impact due to funding shortfalls. it's fostered dual bilateralism rather than promoting north
instead i think we should start looking beyond ttip and look at the international forums that we already have that promote international standardization. why? because it also does the labeling of chemicals. the international conference on thharmonization of technical requirements for registration of pharmaceuticals, known in the lingle as i see it, looks at registration of pharmaceuticals. there are even international forums for medical devices, promoting regulatory convergence and guidelines. that would give us more access, more commonality beyond simply the u.s. and eu market. so to conclude, there are a lot of challenges in making this a living agreement, but we should look at fta, what are they doing, either examining the records are in standards
objective? are they sharing best practices? are they paying attention to monitoring and review? how successful they will deal with the post-draft, the implementation compliance issue will be the real success of ticket. personally i think reading all of this far too much attention has focused on the differences in procedures between the two regulatory systems. i think it's much more productive to focus on the identification of the equivalent levels of protection than the systemic differences, and marjorie made that point very effectively baby rattles this morning. thank you. [applause]
>> i have called this little talk the european union at the transatlantic trade and investment partnership, a crucial might have been. the promise of ttip is great but its prospects are dim. the reason is obvious. the european union is -- european union is a pity for what is at stake is the survival of the eu as a viable institution. as i speak the odds are turning against it. the refugee tragedy, the volkswagen scandal at the judgment of the european court of justice declared safe harbor agreement illegal are all ill omens. we are talking escalation of the crisis facing brussels represent, let this be clear, have you posted egypt. what has gone wrong with the european union? the story is a long one that will take us back to the very origins of the institution and in particular to the lack of provisions in its design for democratic representation, a fatal flaw. result there is no european the
most. since the time available to meet a short i could only touch on the historical origins of the present problems as they affect the theme of the conference by way of introduction only to simply insert a this point that estimation of liberalization and the european economy the eu's record is at best only next. over the past 50 or so years, the competition principle of the market economy and the industrial policy characteristic of state capitalism have divide one another as pencils of economic organization. the constant patient continues, those the much heralded single european market launched in 1986 is far from complete and progress has been on a gradual since 2005 when the french rejected the post-european that a constitution as a referendum. this is an instructive experience for the eu and deserves a closer look.
the anti-ratification movement in fact the touch on the specifics of the constitution itself. in any case not comfortable doctor. it focused instead as many as you may recall bomb the symbolic hate figure of the polish plumber, a despised job who threatened to put on his freshman out of work underlying this demagogue is a genuine and understandable fear of something deadly serious, namely the services directive crafted and championed by forceful advocate of the open economy, former eu commissioner with who may participate in the cato panel some years ago, in a word his directive would've opened the largest sector of the european economy to competition in labor markets. which across europe of course remain protected by restrict practices of many time. the negative french word on the cause edition preference set an alarming message for those able to get it, that that temperament
is ordered known as populism was a force to be reckoned with. now since the politics of every member state its influence reaches down any establishment parties and it spread unevenly across the ideological spectrum. it is the biggest headache facing brussels. populism is fueled by recent med, so-called savage and american capital, so they misplaced the closer to the mark, this rule by remote and unaccountable technocrats. but too often be conflated in the politics of the day. i simply make sure to underscore the point that the issue doesn't rest solely with the technical skill for the wisdom of negotiators. it will depend upon the public mood. the attempt of the late 1980s and early 1990s by the three compression of european commission to put you on a forced march to political debate to greg a superstate is a source
of the eu is present miseries. it is responsible for the huge and increasingly consequential policy blunders that essentially reverberated through european society. and they are then workable and wildly over ambitious treaty of 1992, the aborted constitutional project of 2004 and the disastrous decision to adopt the euro as a single currency. they have no direct the eu. the euro project no longer has many serious defenders. the one size fits all approach has driven europe into an affordable depression whose end is not in sight. has wrecked the very fabric of society to that member states against one another, made a mockery of the european dream, and produced an angry and resentful public. at a time when power and influence is shifting to the giants of asia and an international agent technology dons, europe is falling steadily behind.
the transatlantic trade and investment partnership is a potential game changer. its economic benefits described by others in greater detail than i can go into our immense and would be great if trans-pacific partnership ttp negotiations much of tuesday have now concluded. nothing like these deals has ever been attempted before, tariff reductions is on a secondary matter link rejected tax would set common standards can't even provide the framework of global economic constitution. together for to come ttip ntpp, would cover 80% of world trade. within europe as many of you have already heard, transatlantic trade and doesn't hardship would raid -- raised gdp by half a point on both sides, eliminate precaution principle which frustrates innovation increases the, promotes competition and increase the flexible labor markets. in short, ttip would serve as a crucial agent of structural
reform, like of which now which experts were universally bewailed and about which they can do very little. the transatlantic trade and investment partnership could get europe out of its rut. some experts have suggested that the now concluded pacific basin negotiations can galvanize ttip deal. tpp will have far-reaching consequences. once enacted the united states antiparticle control about 40% of world trade. the agreement will transform the domestic economies of many member countries to strengthen bargaining power, and to quote from an enthusiastic expert, set an agenda for the 21st century which can be spread not only as a template for subsequent free trade agreement that can be multilateralized back to the wto and thereby provide a new template for global trade relationships. highly successful pacific alliance with chile, colombia, mexico and peru, and others have
all indicated the desire to innovate as well. india went to strike and accommodation of its own. as for china, the great dark shadow over hanging tpp, japan's decision in 2013 to enter negotiations were submitted to move on the part of somewhat chastened beijing to penetrate talks with both koreas which is now approaching tpp, and japan. it is possible and is thinking about another expert that tpp will enable the united states quote to the future economic order in the asian region for decades to come. tpp may present a series potential danger to the eu. the recipient of about half american exports, asia is a natural market. trade diversion will challenge your not least of all because tpp what discipline corporate
governance and stimulate investment competition as well as innovation. it is, in other words, anything but surprising that not wanting to be left out of the banquet, the lives of the business communities member states strongly endorse ttip. yet they would probably not have the seats at the festive table. the chips are simply not in place for a deal. some on the inside, the determination of questions on the most beyond had to make things work. eliminate domestic opposition for tpp by women -- winning over women and electoral victory in the 2012 but also by detaining, cutting the legs of historical powerful and i protected rice growers lobby which was the most powerful opponent of free trade. or its part the eu is in disarray. the european commission can no longer lead. the european part of his groping
towards a nation and th and a mr states as represent and the european council just squabble. each of them represents one or more points that can derail the treaty negotiations. ttip we don't have a chance if the not a powerful electoral constituency backed it. this is not the case. from fear of generating public backlash and with taste of the services directive among the european commission at this point running the international tradeshow for brussels has done nothing to mobilize mass support for ttip and for first operate as usual by stealth. to introduce the ttip into the public forum would for one thing above and a piercing backhand admission that the connections line of the present commission has not worked and most egregiously in the case of high-tech policy cannot work. more importantly, the obvious failure which is evident at every level of the judgment
unfolding refugee tragedy has discredit brussels let nothing for it and left in its wake an angry mistrustful and risk-averse public that is in no mood to listen to any big ideas emanating from brussels. the transatlantic trade and investment partnership will fall victim to the general theory of european institutions. there is a coda, the long-term trend -- trend described over 50 years ago by the great harvard economist in its inaugural address to american and medical association will continue with or without the eu perhaps even inspite of it. europe may no longer play the lead role in expanding world trade as in the 18th and 19th century but the old civilization can get better on track by strafing fashionable to free trade agreement in which provide the underpinnings for the mac economic unions like ttp
and ttip. if such a case progress may be slow and and even but such modest orations can be arrived at i'm into the democratic process and supported by public consensus, they may well prove long lasting. [applause] >> i'm going to take moderator's prerogative and ask the first question to actually it's two questions, so we will have it out there. the first one i sort of want to put to all of you is the challenges to seem incredible. there so much we're putting into this deal. this is not a very simple straightforward trade agreement. there some issues involved. does it make sense and we do this as a single undertaking? we are pushing ahead so far, should we break this up into a series of biennial agreements
cracks should look at a different architecture in terms of completing this deal? and my second question will throw in there for michelle. how do we get canada and mexico involve? it's one thing i feel like we have to get into it nor, that translates to largest trading partners would have the rcc already existing between canada and the u.s. and the u.s. and mexico can we not integrate these come a special sense new mexicans are opening up their agreement already with the eu? can we coordinate the mexican agreement and ttip together and actually have a truly transatlantic deal and not just a usb you deal? >> i think it's fairly -- useu it is not the time for a megadeal. it has from the thing itself has a great deal to recommend it but in the present mode. it simply will not let with the public which is defensive, feels beseiged and is troubled by
problems have come much greater urgency than something abstract like e-trade arrangement that may be an economically beneficial in the future. they would of course help at the european economy could break out of its no growth slow growth situation and go out recently healthy rates but i don't see, i don't think this is going to happen soon. in the lack of any substantial economic change and the real growth trajectory that the public can see and feel, not just one-tenth of 1% on an abstract index. until that happens which may be a matter of you to a mood is going to stay the same. the kind of scandals that are not breaking across europe i think further undermine the case for tpp and ttip. the volkswagen scandal means there are many, many parts to it. one important point is that there is no clear separation of
interest between the response of a brussels and responsible of states from regulating emissions, the pollution from automobiles. the eu makes great claims and is making great claims of its, as a regular. if they couldn't get it right here, what does that say about more ambitious attempts, broader regulations with more far-reaching consequences of the future? it undermines the credibility of the union. that is a very important issue. another issue is the safe harbor thing. much of this came up in a keynote address today so not telling you anything you have not heard poverty. the safe harbor issue undercuts an agreement has been put into effect for 13 years and it's based on the notion the web is a seamless. so the eu now admittedly is a court decision but it's fully consistent with the policy of the commission itself, which is
punitive towards the giant platforms and so there were very much mistrust and there's an agenda. they want to reduce the power of whatever means is possible. even at great costs to the european if you want domestic economy which is going after duplicate a lot in order to meet the specifications of the commission's aggressive policy. the european court of justice, you can't call it simply an enforcement arm of the union but it is largely plays that role. so as i said to talk about snowden, privacy but what they really think about is the power of the american i.t. industry seems to be inundating europe and threatening the front running industries i get automobile industry, especially scares -- so i think for these genovese and a lot more than i could probably give you, if i could dominate the for which i
don't intend to do, the only way they can work is piecemeal, building incrementally on developments that are already in place but also i can't get into this because this is not about the eu but a much more fundamental reconfiguration of the eu is going to be necessary to make a deal like this work in the future. they involve political devolution and also i would changing, changing the rules governing the single currency. >> terry, michelle? >> i think that the first question about doesn't make sense with a single undertaking, we need to remember effective as of the of the things agreement. so the with the issues that are kicking the can down the road, particularly in the regulatory a been a. i think that when you think about this as a single
undertaking, if you look at the other free trade agreements, what would be the politicization and the ratification process if it is multiple deals? i think that would be quite difficult to do. i do agree that it's going to be faced in. it's going to take a long time to see the benefits, but i think about the ratification process and i can't emphasize how important i think that everybody is the focus in this town on safe harbors right now how potentially important the court case will be with singapore. because if it is a mixed agreement, that means the nation-states will all have the ratification process. right now it could be that everybody talks about here in -- european parliament, which will will it be. i want to remind everybody that parliament has had a lot more affordable in trade negotiations. in 2010, and 2011 it actually came to the floor of the european parliament 20 and 18
trade related agreements. so ttip isn't going to be its first experience. am also worried about the next undertaking decision because that will potentially mean that nation-states like to ratify it and our 13 states in europe that can technically have a referendum. so the more we get it done in one agreement, the less the potential to future battles down the road and mobilization of political opinion. entrance of the second issue come in terms of the rate at the issue, i do want to emphasize that it is not just transatlantic leg of the u.s. and eu engage in regulatory cooperation, i can't emphasize how important is the other international forum for medical devices, mechanical, pharmaceuticals and other players. the second issue i think in terms of regulatory cooperation,
including sort of canada, mexico, at all, do it international standard setting bodies, do it in international forums. that would be sort of my suggestion here in part of this is also driven by canadian politics. candidate is the one pushing dual bilateralism. so it's not sort of an eu issued a ttip issue. but to our provisions in the auto sector. they are talking about this. to our provisions if ttip happens. so there are certain provisions but you might also, gary would speak to this but what the canadians got out of tpp and what the canadians got out of ceta, are we really going to see the same thing in the united states? so the deals are not identical. >> well, you asked a very
provocative question. i guess that place i would start is that the next president should convene a group of wise women and wise men in the u.s., and decide whether, if the eu is incompetent to carry to this thh this negotiation, junior, became a kind of a quiet -- just by not reviving it, and that's a big question. it's the kind of question some people in the cia are pretty good at talking about an nsa. anyway, i would say that is a big question to decide there's incompetence they are or may be here, and just let it quietly died. now, if the next president comes to a more optimistic take on that question than john does, and that president is inclined
to carry out a ttip project, the first thing that she we will want to do is give it her or his own stamp. that's the record of all our trade agreements. so they want, maybe want to change the name, change the scope and so forth. that's exactly what obama did with tpp, but it's happened before with the site agreement and so on. when nafta. now, the next president, well, it's possible. i mean, there's some people who could have a worse relationship with mexico and canada than president obama. assuming that they don't make it through the primary. it would hard to a worse relationship with mexico and
canada that we no have under president obama. it's been very discouraging. i think if the next president is inclined to be an internationalist, she or he could very well expand the scope by making it in north america, you know, your agreement, maybe give it a new name, et cetera. at the same time, you know, maybe a less ambitious at least as a big instantaneous package, but instead go in this sequential issue by issue approach, you know, kind of small steps that encourage the basis community at least to believe in this effort. >> all right, thank you. i'd like to take some questions from the audience. if you can raise your hand. please state your name and affiliation when you get the m mic. [inaudible]
spin all you can talk really loudly. >> i want to ask a question come if you look at the first down, we have fredrik ericsson saint ttip is about making the nics making between a member of the family of john gilliam saint ttip is going to transform it successful what you will about he doesn't think it will be but if you were a ttip would transform the eu into a more american-style capitalism. i'm interested in michelle and carries perspective. to use the ttip dragging the united states more towards a european model of capitalist or do you see it the other way around, that united states pulling europe towards a more american-style capital? >> thanks. thanks, edward. you know, the u.s. is not going to become the 29th a member in any way, shape, or form.
i mean, even as i'm fairly modest and not so outrageous proposal for a permanent court for handling investment disputes. congress will not buy that. we are allergic to international courts. the wto appellate body got through in a very a very unusue in china by a slight of hand, but we're not going up more of those. and all of the other 29th member, the only constituency which would only constituency which will give him a the 29th member of approaches the afl-cio, which would like all the labor provisions that operate in europe and more or less empty 10% unemployment as a permanent fixture of life. somebody may want to rebut me on that but i think it's actually the result. and, unfortunately, for the afl-cio, they represent cairo less than 10% of the american workforce. that's not going to go through.
now, the other outcome is only slightly less implausible, but if europe wants to go, if there are leaders in europe who really want to stimulate growth, obviously there are macro projects they need to be but they also need to adopt more american-style business practices and capitalism. and some of them may want to do that. so i would be more towards that end than the former and. >> that's a very, very tough question. i suppose, you know, i'm from britain so perhaps the united states might not be the 29th but it might be the 28th if the way the polls are going off but -- [laughter] the notion of european model of capitalism strikes me as very, very odd.
if i am increase my model of capitalism with austerity measures being imposed by external body is going to look very different than in nordic model of cap wasn't our german model of capitalism. so i think we've got very different welfare state models, very different industrial revelations models, despite the eu. there's a lot of variation on the ground. so from that point of view what model are we talking about? the second issue is that the way i think this morning was saying is that this is society models have evolved and we send up a little bit more intrusion instance of our economies. yes without the intrusion of austerity measures and so forth and we've got growing income inequality, but we are coupling that with something else that perhaps is, john's talk about populism emerging in europe but i've also argued about the
challenges to the nation state. they are not just coming because of populism, a populist parties and tonight is coming because of austerity measures. they're coming because if our voting with their feet. scotland, catalonia. that's also going to have an impact on the level of unity within europe. so the one thing to think about and i hear very little in the ttip talks i go to is one of the most important issues there is state-owned enterprises, is one of the big issues there. and presumably that's directed at those because of lack of sort of rules of international law. that's directed at those that are giving subsidies and so forth and it's sort of third countries but the question becomes even the recession crisis how much of that intervention has europe done. so i was speaking with two voices speak what i would say that the long-term threat is not
that we're going to be colonized by europe. the europeans view they've been colonized i us and they think with more justification if you take a look at the changes that come across the european economy over the last 50 years you can't avoid the word americanization, multinationals. and, of course, the most recent is the high-tech invasion because nothing in europe on remotely on the same scale. there's nothing they can really do to defend themselves against it because it's influence extends that only to the state level, it extends to the family, through the manners and values of young people. you can't defend against these things very easily borders are becoming much more porous as a result. other kinds of borders, social boundaries and so on and so forth are disappearing. this is an elusive phenomenon and it's not very well understood. but it seems to me that if we
are talking about a more organized kind of capitalism come if you want to use these old-fashioned terms, as a kind of threat that comes from china, doesn't come fro from europe, nw kind of forms of state capitalism, given the dynamism of a society could represents some sort of alternative to what we think we stand for here. >> okay. take another question from the audience. right over here. >> yes. one question to michelle about this theory of agreement. we have 20 years of these various -- [inaudible] and the 20 years is recently zilch. so what made you believe if we
have a living agreement, 20 years, we would have in 20th we would have a different result? and a quick comment. i find it somewhat ironing that it denounces populism and then uses all these populist arguments. and true, u.s. system is not great, especially when you look at a very slow functioning of institutions in this city. but somehow as european consumer i can attest to the very good work that has been done by the commission on the market which is actually in some ways -- [inaudible] that the u.s. internal market, look at government procurement, for example. and as a consumer i can benefit
from prices on my tv in terms of bundles or in the aircraft tickets that cost me a fourth of what the cosby this country because the commission has been doing good work as an enforcer of competition. >> and you are asking, do you want to -- >> that's okay. >> you're asking of the single market, the one thing i really would like to see is that the eu has got the process of modernizing its single market and coming up with new proposals to sort of modernize to get a think i should be linked more closely to ttip, given what's in there. said you want to collaborate a little bit more what, you know, -- [inaudible] >> long-term project spent yes,
it is a long-term project. might issued his that my concern is that we are sort of having these ttip discussions as if it's a black slate, as if we haven't learned anything over the past 20 years. 1990 we start having our first mutual recognition agreements but we haven't had the images wh attorney. recalls let them with candidate. there are areas where for the remote of time and effort we put into them the results seen from a business point of view very martial but there have been some success stories, particularly and a couple of, a few areas. but the question is also very important image recognition for testing and certification is not the same as mutual recognition within the eu single market, within the eu single market we have a court and win a set of legal rulings. mutual recognition is really
about testing can really about certification and they don't think we will sort of move in the era of mutual recognition of standards. the term harmonization i think if every unhelpful. because if we have as you pointed out to cover models of capitalism, what are we using this language. but i do think we've had some success. what i'd like to see is let's look at what success we've had another part of the world. for example, new zealand, australia or for example, the african canada to try to do with canadian internal barriers. what are all these lessons to promote free trade and enter the market access? what can we borrow from them? also we need to declare that given of the legal structure in the eu we are not replicating the eu single market because if somebody points out, cato does one more institutions and we certainly would not want a european court of justice
transatlantic slave trade i'm not sure that directly addresses your question or not. >> i would like to take one more question from the audience as we have time. >> thank you. thanks to the panel. i was a little late. i'm not sure this was covered, but what sort of consideration has been given for this particular trade investment partnership in the context of the digital economy? and in particular, because this is a long-term partnership, and it seems like certain digital services could be a significant contribution to gdp in any country across the world. is there any talks yet or is it too early or is it relevant? >> i think these digitization come on an expert on the ttp but
i have been included in the treaty. the problem, the obstacle to it in europe is the european commission in its determination to enforce content rules. basically what they are. how long this opposition will continue at what sort of results that will bring, it's difficult is at this point because the battle is still being fought. woman hope that the same provisions that could be included in the chance that back, too. spent let me say about the digital. it's a great question because digital is the enormous pathway for more trade in services so it's extremely, the opportunities are enormous. between u.s. and europe, it should be possible to develop kind of a template for digital
commerce around the whole globe. however, however, without a couple of setbacks and the ecg case is a huge setback. maybe a clever lawyers and the european commission will work around and will get a new type of safe harbor agreement. the one we had was working quite nicely for a while. now it's up in the air, so that's not a good sign. the other setback, you could say the ecj decision was influenced by this come is of course snowden and nsa. but you know, make no mistake, there's nothing in the digital privacy suggestions have been put out by some european forces which would, in any way restrict the nsa.
you know, you can locate all the servers were ever you want, the bank of france if you think that's a good place to web servers, you know, down in the vault with their gold the nsa can get to them. as well as anyplace else. so what's happening is that this notion about consumer privacy is being turned into a device for protection. protections outright locate the servers here and locate the personal care and so forth, and destroyed a lot of the gains in efficiency that can come from consolidating work in one place, both of the people and of the equipment. so instead of being a pathway for the future, it's the pathway to the past which is going on right now. the privacy issue, the commercial espionage issue, military espionage issue to the only be dealt with at a state to state level and u.s. can't agree on there is forms of abstinence
and so on, and so can europe. the european, just one more offhand remark. i mean, the french are every bit as good as spine as the nsa big it's just that they keep it secret. assecret. [laughter] >> don't go anywhere and please join me in thanking both john, michelle and gary for their comments. [applause] [inaudible conversations]
[inaudible conversations] >> all right. so let's get started. i'm joakim reiter. i invited immigrant capacity as deputy secretary-general. let me first off start off by saying and congressionally cato very much for an incredibly interesting conference. particularly i would say this topic will be rather interesting in the sense of trying to --
were we supposed to discuss your is to get on the multilateral trading system in a broad sense, and we have with us three very eminent speakers to address this. after i spoke i will ask vinod aggarwal, university of california, berkeley to speak out about joost pauwelyn from georgetown university law center and finally harsha singh, ict and many other things. but let me start by saying this is been rather gloomy i must say on the ticket and, of course, it's effectiveness of whether it exists. so we work on the presumption of this seminar that ttip will be a resounding success. it may be a tall hypothesis, an assumption judging from previous panels but i would across all panelists to work on the assumption as we progressed because nothing in something doesn't exist obviously does not have an affect. so why this question is very important from the point of view of my perspective and what i thought it was very good that
cato put this is one of the key topics and for specific session. well, let me first try to recall the fact that actually the court global trading system was created, maintained and developed by the participants in ttip. and they don't take that assignment lightly in terms of their commitment to bilateral trading system, neither of the parties. so the effects of ttip is something they personally care about the second, they are major powers to give bracelet two weeks ago committed to sustainable development including the commitment to eradicate poverty. the manner in which people interact with the commitments by the united states and the european union on the development of the world is of course a relevant one. third, developing countries around the world are currently considering mitigation strategies to lateral agreements as well as -- i hope the fans
will be able to have a conversation of what could be the strategies. and, finally, of course the wto is the bedrock upon which all nations basically built the insurance systems for multilateral trade or global trade. i would like to go to address also look at the mitigation strategies, adaption stretches. i have been selected to be the moderator and to give an introductory speech come and thank you very much for that, dan. but these are the parameters that i am given to the panel your as concerned for our speech let me highlight a number of things that a lease for my perspective would need to be taken into account. first is actually to put ttip in a bit of context. in my view, of ttip is often oversold, it's often very, very large argument that you are mixing apples and orange the i
will do more of the fredrik from the first panel that this is a very important fta, very important for the world because the participants are so incredibly important for the global economy. but in the end it is fta. there's a lot of fta is out there. when you describe the effect of ttp also have to take into account the fact that we're not starting from scratch. it's not a vacuum. there's 206 he to free trade agreements currently in force. second point come when it comes to the effects of ttip on third countries and the global trading system, and i'd like to distinguish that from the multilateral trading system meaning the deputy l., distort what the effects on third countries, alicia my point of view i have to differentiate between the rate of tory agenda. if i start with a terrace park which is a force often overlooked if this is a serious free trade agreement providing for a number of substantial trade elimination of tariffs, it
is quite interesting to note that contrary to some of the concerned by developing countries, at least from your system and my organization, there would be quite limited trade numbers. in other words, because of the eu and the u.s. and stealing their economies through this, and it is on the supply-side, it's a separate conversation of what the eu and the u.s. should be doing on the demand side, which is really not any good state, but actually because it will stimulate increased trade for both the eu and the u.s. are sourcing heavily strong developing countries. you would imagine on the aggregate level that would be a positive effect on tariff elimination. this being said, i specific sectors that can be quite a negative affect. for example, when we have looked at this industries in common would be one example of agriculture pocket shoulder to the eu market considering the --
could be displaced on the eu market which a court need to be taken in account. in the country selling things the individual products matter. so in our view in terms of mitigation measures, there they could do more. first it's quite important to have liberal rules so as not to disrupt changes in which you and yours companies part of. unfortunately, that a track record of the eu when it comes to negotiating rules of origin allowing for mitchell to be counted as part of the preference treatment of free trade agreement is not encouraging and we would encourage both parties to do more and i feel. the second thing is for the us to expand its current preference schemes. a number of products are excluded. where the eu produces with this
is the eu produces with this is a better access to u.s. markets to african producers, or for that matter lcds which are also not fully covered in terms of -- so if the parties are serious about the development, impact a port of the countries these are two measure measures that they e intensive litigation strategy. with respect to the regular fuel i'm very happy, businessmen were a lot of people are very concerned that we talk about developing countries. our line is basically you could be worried ever talk about harmonization to higher level than the current level of regulation in the two parties. that's just not realistic. conversation, raising the standards is very, very, very unlikely. the most negative affects is just going to materialize. where we come out as i can almost the opposite in the sense that the worst-case scenario is, no benefits deriving to
developing countries. should it be right for approximation can for example, through commissioner testing. under the conditions these are extended to non-participants, produces that they seem to fill the requirements, they have to meet one test for both markers instead of to test which is a plus. in terms of the cost-benefit analysis, worst case, status quo, no improvements. ideal case, developing countries will probably benefit. my third thing is on the global trading system and do we actually do the affect more psychological than actual. in the sense that it is because of fears have been rising with the arrival of mega regional, people are starting to think about whether they are approaching both the wto and the old trade agenda. those are broadly speaking
positive. for example, in the way that africa ha have started to think about its own trilateral agreement, which is basically mega regional. there's an enormous untapped potential for trade growth to regional integration in developing countries. compare that with east asia, 50%, compared with eu it is 65%. there's an enormous untapped potential and the reason why is that many barriers that exist between african country. basically conductivity -- connectivity. if the field is again change going on through mega regional, thereby seeking closer, this is a good thing for africa produces, good thing for african consumers and is a good thing for african general development. so one mitigation strategy coming from a global picture would surely be to accelerate efforts elsewhere. another one which has to do with
the wto is a factor is a growing gap between the level of bishop within regional trade agreement and what we managed. the solution to that is not to put people on regional trade agreements but to start seriously discussing how to raise the level of ambition in the wto. from our point of the want of the conclusions by the rights of mega regions is to put more ambition into the agenda of the wto. the third mitigation strategy on global level is whether the country will be interested in talking into the agreement. this is not the solution for the vast majority of developing countries but it is a question that, for example, norway, turkey, we heard in the previous panel mexico and canada may want to consider. beyond, adverse to that is to be inspired by the provisions and take them into bilateral the bil agreements which are seeking with one of the ttip partners,
like the economic partnerships between the eu and its former colonies. so could there be a spillover effect. this is quite i want to put to the benefit i'm personally not at all convinced that people be prepared to sign the dotted line on individual provisions or for the agreement as a whole. the reason i say that, i see megarich is part as reaction to the changing distribution of power in the global system. so as you molt relies -- it's highly people will forget about these so why would this on any dotted line. that's my experience as a negotiator. i don't think emerging companies approach it like that. so that was my attempt at starting the conversation. i now turned over to vinod to
continue. >> well, thank you very much. i appreciate the invitation to speak at cato. i have to preparatory remarks but when is that after reading the various papers by dr. salem enter comments, i can see that adage that great minds think alike maybe two or small minds seldom differ between have a lot of similarities. the sacred mark is that my usual role as a politically economist at some of you may know me as detailed economist why would you want to give can't be done. edged all the political impediments in front of them despite what the economic models show these great games intricate in this case i have to say i'm pleasantly surprised and maybe, you will be published by the advice more often as our ttp or i would not have thought tpp would go as smoothly as they did
pick a think about it there's a lot of differences among the countries in tpp your it would be unlikely have an agreement in tpp. the fact you can get tpp done and it does include a number of same issues that are in ttip such as there may be cause for optimism. now i can revert back to my old style which is to say let me tell you what tpp, ttip is more problematic. ironically i think there's another strong similarities between the two. one is a geopolitical issue. both countries, both groups are very large, and they've been engaged in pitched battles in the wto for some time. i think the most important point in a different paper that we put together is to look at the fact that regulators in both countries are extremely strong. and i think what we really here have to say this juncture but what trade negotiable to get what regulars want to be. that could be regulars in the eu or such as the treasury or sba who don't want anybody touching their turf.
so there's a turf battle going on between regulators and trade negotiators and ustr and the counterparts in the eu may wish to make is pretty good but, of course, they said hey, stay with him finance, stay away from all these issues. moving forward i think one other point that is useful to think about is the fact that we talk about mega but we need to think about not only tpp and also talk about ttip but also the fact that it is moving along provides a different form in which both india and china are involved and it's a very important thing you need to do a comparative assessment and we have a special issue for self-rule in tpp and kind one can look at the differencdifferences coming oute journal. let me turn to record your ttip and think about the impact on third countries and think about sex possibly something some of them have been covered but just to be more systematic, we can think about the way in which you might have third parties try to
engage with the ttip process. the first is to just joined the negotiations but that was raised i think by inu. mike chadd the canadians, mexicans? garrett porter out nicely u.s. relations with canada and mexico have been at an all time low under the obama administration. and all the things tha that puze me with any decent let's join tpp i was shocked by how much opposition was in the united states to the canadians join tpp, given that we already have nafta. so very narrow specific interest replikin count applaud them for some time. i think this is a no go the other countries will join these negotiations and ustr was quite reluctant and so else wanted to join they were reluctant and they bluntly told a canadian judge a big chance to join before and you mocked because you know what to join a countries?
that option of joining the negotiation is not likely. a second that you could wait to the precocious have been concluded and you can join that accord. that's what you from nafta, got a canada-u.s. trade agreement, sensibly expand and, o and, of , other provisions as well as we could have that kind of approach. that seems to be complicated. they could do that but it's not obvious that there is any specified mechanism to join unlike tpp which is encouraging countries. i don't see th that in ttip and maybe that could be an advice to policymakers to kelly's give other countries an option to do that. a third option is that countries may respond by trying to negotiate an fta with either the eu or the u.s. and so the possibly the course could be indirectly doggone, depends on rules of origin. that's another possibility. there's a fourth option, is that you may simply wait and then try to multilateralized ttip in the
wto. i think there is precedent for this. i didn't think about the view is candid agreement in nafta with the us was able to introduce things into both nafta that were multilateralized. i think it was from cafta we got a multilateralized of the wto. that's another possibility you can wait for the just and multilateralized it. and you can also negotiate on separate accord. if we don't have a single undertaking or even if it is a single undertaking you to join piecemeal. ..