February 4, 2013
By Rep. Jon Porter (Ret.)
Every time the U.S. negotiates a new trade deal, it seems that there is an enormous amount of misinformation generated by all sides of the debate in an attempt to frame the issue in the narrowest terms, portraying it as either a panacea or the end of the world.
The fact of the matter is that trade is a complex and nuanced issue that can’t readily be broken down into sound bites. No side gets everything it puts on the table, and tradeoffs must be made depending on priorities: give a little in one area to get back something of value in another. With the Trans Pacific Partnership (TPP) agreement currently being negotiated between the United States and about a dozen Asia-Pacific nations, it’s no different. The countries currently in TPP negotiations comprise the 4th-largest export market for U.S. firms, and the broader Asia Pacific region accounts for more than 40 percent of global trade, so it’s critical that we get the best deal possible.
During my time in Congress, we passed several trade agreements, and I’ve personally seen first-hand the positive effects that sound trade policy can have with partner nations. Specifically, fair trade opens borders, fosters economic freedom and helps to increase rule of law, especially in developing nations. It fosters better relationships between the United States and key trading partners while creating a level playing field for businesses to compete abroad. Trade can be a critical vehicle for developing nations to boost their economies and help lift their people out of poverty, but only if strong rule-of-law provisions are included to ensure that governments don’t enrich themselves at the expense of their citizens. That’s why it’s important that we include labor, environmental and intellectual property rights language in all trade deals.
The TPP has the potential to become the “gold standard” of trade agreements. However, several potential stumbling blocks remain, particularly on intellectual property (IP) rights. As the U.S. is widely recognized to have the world’s strongest IP protections, this is one area where we can’t afford to budge. Trade agreements, if done properly, are essentially jobs bills. And in the 21st Century, IP-intensive industries like technology, advanced manufacturing and biopharmaceuticals will play an increasingly dominant role in our economy. Ensuring our innovators are protected with strong and enforceable IP provisions is essential if we are to reap the full benefits of a multi-nation agreement as significant as the TPP. In short, other nations in the TPP must adhere to our standards of IP protection, not vice versa.
Robust IP protections benefit everyone, not just developed countries. Our potential trading partners must realize that these protections are critical to build and grow domestic innovative industries that elevate standards of living and put more people to work in higher-paying jobs. Intellectual property also becomes a heightened issue with Canada’s recent inclusion in TPP, given its poor history of not respecting IP and its position on the USTR Priority Watch List alongside countries like China, India and Pakistan. Failure to hold a country like Canada to a high standard sends the wrong message to these nations and others who have already shown a propensity towards flouting trade agreements. If we don’t set a strong precedent with TPP, other nations will certainly become more aggressive in protecting their domestic industries at the expense of American jobs.
But this isn’t just a policy issue; it’s a political one as well. Any trade agreement must be ratified by both houses of Congress. A TPP agreement that doesn’t protect IP rights and grow jobs will likely be a non-starter in the Republican-controlled House. In the Senate, where Democrats hold the majority, any trade deal that doesn’t protect current jobs will certainly not win the support of organized labor that will be necessary to pass an agreement in that body. And with current U.S. Trade Representative Ron Kirk stepping down, President Obama’s nominee to that post will be a barometer for the Administration’s thinking on IP issues, and should be watched very carefully.
Regardless of political party, protection of IP – whether patent protections for software firms or data protection for biologic drugs – is a non-partisan issue. Especially in a weak economy, the stakes are far too high to let this opportunity slip away and hamstring American businesses looking to expand into emerging markets.
It’s a no-brainer for Republicans and Democrats seeking opportunities to get America working again. Equally important, the consequences of inaction will hurt our competitiveness and ability to negotiate with other nations in the future.
Both are reasons to ensure our priorities come out on top.
Former U.S. Representative Jon Porter is CEO of Porter Gordon Silver, a strategic consulting and government affairs firm in Washington, D.C.