Statement from EPI Director of Trade and Manufacturing Policy Research Robert E. Scott on the announcement that the United States and other countries reached an agreement on the Trans-Pacific Partnership (TPP).

The TPP, which is an agreement to manage trade and investment on behalf of large corporations, will put downward pressure on wages of workers in the United States, and will likely lead to growing trade deficits and job displacement. Both outsourcing and the growing use of parts from non-TPP countries will lead to rising imports, increasing trade deficits and job losses in the United States. Meanwhile, core issues like currency manipulation and abusive labor practices in Malaysia, Mexico, Vietnam, and Brunei are addressed only in weak side agreements, or agreements that cannot be enforced for at least five years, if at all.

By extending U.S. copyright and patent protections to consumers in the rest of the TPP, which will dramatically increase the prices of prescription drugs, the treaty will shift billions in profits to big pharmaceutical companies while denying access to life-saving medicines to countless poor consumers. The agreement will encourage the growth of outsourcing to low-wage export platforms in countries like Vietnam and Malaysia, and create a back door for dumped and subsidized imports from China and other non-TPP members to enter the United States duty-free or at preferential TPP tariff rates.

The United States could have negotiated an effective TPP that addressed currency manipulation, reduced greenhouse gas emissions, and harmonized financial regulations upwards. Instead, the TPP supports a race to the bottom in international regulations that will primarily benefit multinational corporations at the expense of workers and consumers in the United States and other TPP countries.