The Terms of Trade: Questions and Answers on the President's Trade Deal

As Congress moves forward in its work on America’s trade policy, you may be hearing a lot of back and forth about the process and substance of the new, high-standards trade agreement the Administration is negotiating, the Trans-Pacific Partnership (TPP).  

The President is committed to ensuring that when we do trade, we do right by American small businesses, American workers, and people across the globe. Scrutiny is important – after all, as President Obama has said, past trade deals haven’t always lived up to the hype. And many people who care deeply about this issue are raising important questions on what the trade deal is about and how it will impact our country.   

But, if you’re listening to the discussion, it can be hard to understand what the questions mean and what the answers are. So here’s a quick rundown on the buzz you might be hearing about TPP, and some answers to questions you might be asking:

Is this trade agreement being kept secret from the American people?

The TPP negotiations are still ongoing, so there is no final agreement to review. But public input is vital to the process, and that is why the Administration has taken new steps to share our priorities and get feedback throughout the negotiation process.  We’ve:

• Published detailed summaries of U.S. objectives in negotiating all aspects of the agreement
• Solicited public comments on negotiation aims, priorities and concerns, including through the Federal Register
• Held public hearings inviting input on the negotiations

Congress’ voice is critical as well. In addition to more than 1,700 briefings with Congress, the trade promotion legislation they are currently considering will lay out specific and public negotiating objectives for the Administration.

Most importantly, the American people will be able to review every single word in the TPP and any trade agreement before the President signs it. As the President said: Every comma, every period, every semicolon. In fact, if Congress passes trade promotion authority -- for the first time ever -- it will be required by law that the agreement be made public for a minimum of 60 days before the President signs the agreement and for additional months before Congress votes on it – and we believe that’s a good thing.

President Obama to the @WSJ on how he's ensuring transparency in trade negotiations. #LeadOnTrade #TPP https://t.co/r9BhubwxDk

— The White House (@WhiteHouse) April 28, 2015

What we haven’t done and what we shouldn’t do is publically announce our bottom-lines in these negotiations before it is complete. This is a high-stakes international negotiation and there is a certain level of discretion that is needed to ensure that we get the best deal possible for the American people. 

You can dig deeper into the ways President Obama is making this as open a process as possible here.

Is this trade deal just a backroom deal that benefits big corporations at the expense of American workers?

“If I didn’t think this was the right thing to do for working families, I wouldn’t be fighting for it.” That’s why President Obama is crafting a deal that is good for our workers and small businesses.

Here’s how. The President’s trade deal will require our trading partners to live up to the strongest labor standards in history.

These high standards will help workers by:

• Providing the right to form unions and bargain collectively
• Prohibiting forced and child labor
• Protecting against employment discrimination
• Establishing a minimum wage and workplace safety

These standards will not only help bring hundreds of millions of people under enforceable protections, it will help level the playing field for workers and businesses here at home by ensuring our trading partners are playing by the rules.

This trade deal also focuses directly on small businesses by giving them better access to some of the fastest growing markets on the planet. Small businesses that export to foreign markets grow faster, support additional jobs, and pay higher wages.

What’s more, in a first for trade negotiations, the Administration worked hard to bring the voices of labor and small businesses to the negotiating table to provide advice on the best ways to protect workers, here at home and abroad. A broad range of stakeholders helped craft this deal, and that’s why it’s a deal that puts American workers first.

Won’t trade cost us jobs?

Actually, exports and trade are a vital part of the engine that keeps our economy going strong.

Here are a few facts about trade that may surprise you:

• Every billion dollars of goods and services our businesses export supports an average of nearly 5,800 American jobs.
• Last year, the United States exported more Made-in-America goods and services -- $2.34 trillion -- than at any other time in history, and today, U.S. goods and services exports support an estimated 11.7 million jobs. 
• Export jobs pay up to 18% more on average than non-export jobs.

How will this trade deal impact the environment?

Here’s something that everyone should know about the TPP – it includes the strongest environmental protections of any U.S. trade agreement in history.

That means, you can expect this trade deal to:

• Protect and conserve endangered species, like elephants and rhinos
• Combat illegal logging, illegal fishing, and illegal wildlife trafficking
• End harmful fisheries subsidies that jeopardize the health of our oceans
• Enforce environmental laws, and not weaken them

This is why leading environmental advocates like the World Wildlife Fund, The Humane Society, and Oceana have pointed to the environmental provisions of the TPP as a potentially historic mechanism to protect our planet.

What will this trade deal do to combat human trafficking in countries like Malaysia?

As President Obama has said, “Our fight against human trafficking is one of the great human rights causes of our time, and the United States will continue to lead it.” And trade policy can be a useful lever in that fight.

In Malaysia, human trafficking continues to be a serious problem.

The TPP is on track to require signatory countries to address forced labor. This will be backed by dispute settlement and sanctions in case countries do not comply, which would represent a major step forward in regional and international efforts against human trafficking. We are working directly with Malaysia and others on actions they can take to ensure they meet this commitment.

I’ve heard that the TPP will weaken our food safety rules, is that right?

No. Nothing in the TPP will prevent the United States from setting and enforcing our strong food safety standards. In fact, TPP reaffirms countries’ ability to set their own levels of protection for human health and it will help improve food safety systems in countries we trade with to better align their standards with U.S. safety and regulatory systems.

For example, Vietnam is already developing stronger food safety regulations in preparation for the TPP.

On Wall Street reform: I’ve heard that trade promotion authority and trade agreements might undermine Wall Street reform. Is that right?

The Dodd-Frank Wall Street Reform and Consumer Protection Act helps prevent excessive risk-taking that led to the 2008 financial crisis, provides common-sense consumer protections for families, and helps build a safer, more stable financial system. Wall Street Reform is one the President’s signature achievements, and he would never sign anything that would undermine it.

What on earth is the Investor-State Dispute Settlement and is it something I should worry about?

U.S. trade agreements help American businesses large and small find new opportunities in emerging markets abroad. But what happens if a foreign government decides to take over the American-owned business without compensation? Or what if the foreign government decides to discriminate against our people for no reason other than the fact they are Americans? How do we protect them?

That’s where investor-State dispute settlement (ISDS) comes in. ISDS is included in our trade agreements to provide a neutral and impartial process to resolve conflicts between countries and foreign investors.

Here are the three things you need to know about ISDS:

• ISDS cannot overturn U.S. laws or regulations. ISDS is a neutral, international arbitration procedure that has been around for over 50 years to resolve investment conflicts without creating state-to-state conflict.
• The U.S. is currently party to 50 ISDS agreements that are designed to protect the rights of Americans abroad and ensure that the rule of law will be respected.
• Most importantly, the U.S. has never lost an ISDS case because of the high standards of our legal system. In the TPP, we are working to create a higher-standard ISDS system that includes new transparency steps.

You can dive into what ISDS is and how it impacts our country here.  

And you can learn more about the whole picture of the President’s trade deal here: obamawhitehouse.archives.gov/trade