It looks like manufacturers in general and the automobile industry in particular, are taking a few steps back from just-in-time manufacturing. It appears that they have discovered that the system where they accumulate little or no inventory may save a few bucks, but when it breaks, it gets ugly fast:
Toyota Motor Corp. is stockpiling up to four months of some parts. Volkswagen AG is building six factories so it can get its own batteries. And, in shades of Henry Ford, Tesla Inc. is trying to lock up access to raw materials.
The hyperefficient auto supply chain symbolized by the words “just in time” is undergoing its biggest transformation in more than half a century, accelerated by the troubles car makers have suffered during the pandemic. After sudden swings in demand, freak weather and a series of accidents, they are reassessing their basic assumption that they could always get the parts they needed when they needed them.
“The just-in-time model is designed for supply-chain efficiencies and economies of scale,” said Ashwani Gupta, Nissan Motor Co.’s chief operating officer. “The repercussions of an unprecedented crisis like Covid highlight the fragility of our supply-chain model.”
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The basic idea of just in time is avoiding waste. By having suppliers deliver parts to the assembly line a few hours or days before they go into a vehicle, auto makers don’t pay for what they don’t use. They save on warehouses and the people to manage them.
But as supply chains get more global and car makers increasingly rely on single suppliers, the system has grown brittle. The crises are more frequent.
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A freak snowstorm in Texas in mid-February shut down a refinery that feeds production of 85% of resins produced in the U.S. Those resins go into components from car bumpers to steering wheels. They’re some of the least expensive raw materials in a car, but they go into seat foam, and dealers can’t sell a car without seats.
At the end of March, Toyota shut down production at several U.S. plants due to the shortage, according to a schedule seen by The Wall Street Journal, hitting production of some of its bestsellers, including the RAV4 sport-utility vehicle.
Obviously, excessive inventory can be as much of a problem as not enough, but when you have inventory levels that are measured in hours, as opposed to weeks, when something goes wrong, you are completely f%$#ed.
I had hoped that they would eventually do this, but I expected that there would be 6 months of denials and alibis until the moral outrage forced them to take this move.
Happy to be wrong:
The Biden administration on Wednesday threw its support behind a controversial proposal to waive intellectual property protections for coronavirus vaccines, with liberals framing it as a necessary bid to speed the shots to billions in the developing world, while the drug industry warned of devastating effects to vaccine production.
U.S. Trade Representative Katherine Tai said the United States will now move forward with international discussions to waive the protections for the duration of the pandemic. U.S. officials helped block a World Trade Organization proposal that was introduced last year to stop enforcing patents for coronavirus-related medical products. Dozens of developing countries have pushed for the proposal, arguing that it would allow them to rapidly produce their own generic vaccines, rather than wait months or years for sufficient doses.
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The decision to go forward with the waiver after weeks of internal deliberations was finalized at a White House meeting on Tuesday with President Biden, said senior administration officials who spoke on the condition of anonymity to describe the deliberations. Staff at the meeting included Tai, national security adviser Jake Sullivan, coronavirus coordinator Jeff Zients, and Bruce Reed, deputy chief of staff for policy, all of whom supported the decision. But Commerce Secretary Gina Raimondo, who had concerns about the waiver, was not included in the meeting, the people said. The Commerce Department declined to comment.
Of course Gina Raimondo wasn’t involved. She’s a complete corporate stooge, and she would always take the side of whoever is closest to Wall Street, much as she self-dealt to herself and her Wall Street buddies as Governor of Rhode Island.
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Administration officials have acknowledged their uncertainty about whether the waiver will actually speed up production of coronavirus vaccines across the world. The mRNA vaccines, made by Pfizer-BioNTech and Moderna, require special technology that most countries do not have access to, raising questions about which countries will actually have the technological capacity to manufacture the complicated vaccines.
So, is it a lie? MRNA vaccines are super-new tech. Maybe their manufacture is so esoteric that only the richest, most powerful countries can make them?
Nope.
“Rapid development and deployment of high‐volume vaccines for pandemic response” (DOI: 10.1002.amp2.10060) is an open access, peer-reviewed paper in the American Institute of Chemical Engineers’ Journal of Advanced Manufacturing and Processing:
Its co-authors are an interdisciplinary team of chemical engineers, infectious disease specialists and vaccine specialists from Imperial College London and the International AIDS Vaccine Initiative.
The authors aren’t specifically addressing themselves to the question of global development of mRNA vaccine production, but are instead concerned with any kind of generic rampup in production — either in response to a new virus, or because of an mRNA-based vaccine breakthrough for an existing virus. They reason that any kind of annual covid shot will occupy the majority of existing mRNA vaccine production facilities, so any new global vaccination project will require that new production sites be built.
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I know, I just blockquoted all of that, so it would be redundant to bullet it below, but JESUS F%$#ING HOLY GODDAMNED SH%$BALLS, does this ever bear repeating:
New facilities will be 99–99.9% smaller than conventional vaccine facilities
They will be 95–99.7% cheaper than conventional vaccine facilities
You could use a single room in a conventional vaccine factory to make more vaccine doses of mRNA vaccines than the entire output of the rest of the factory
New vaccines can be made 1,000% faster than previous vaccines
There’s more, like the fact that you only need part of the facility to be a high-spec clean-room, and the rest can be built on more conventional lines.
For $20m, they say they can build a facility where, for $100m/year, they can turn out 1b doses/year, using a single 5L bioreactor.
(%$# mine)
Run the numbers there. That’s a cost of $0.12/dose.
Add in the cost of regulatory compliance, packaging, maintaining a cold chain while shipping it a few hundred (as opposed to a few thousand) miles, and tracking lots, and you are still below $10/dose.
The Pharma powers that be are opposed to any sort of relaxation of IP regulations not because duplicating their instrumentality is hard, but because it is trivially easy, and said technology is publicly developed and publicly funded.
They want to continue to extract their rents and keep their ill-gotten gains, because they want another yacht to water-ski behind.
Pfizer has backed down over its controversial demand that the South African government put up sovereign assets guaranteeing an indemnity against the cost of any future legal cases. During Covid-19 vaccine negotiations, the company sought indemnity against civil claims from citizens who had experienced adverse vaccine effects – meaning that the government would have to cover the costs instead.
On Wednesday, the South African health minister, Zweli Mkhize, voiced frustrations about “difficult and sometimes unreasonable” terms his country’s government had been presented with during contract negotiations with vaccine manufacturers including Pfizer.
In a briefing letter sent ahead of his appearance at the parliamentary health committee, Mkhize said one condition in particular demanded by Pfizer was “too risky” – that the country put up sovereign assets as potential collateral.
In its negotiations to provide vaccines to countries around the world, Pfizer has been asking governments for wide-ranging indemnity protection against any civil claims a citizen might file. This means that if Pfizer was to be sued by someone who had suffered a rare adverse effect from the vaccine then the government, not the company, would have to pay for legal costs and compensation. This would apply even if the case had been brought as a result of the company’s own acts of negligence, fraud or malice. In other negotiations, Pfizer went further.
The company required some Latin American governments to put up sovereign assets – which could include federal bank reserves, embassy buildings or military bases – as a guarantee against indemnifying the cost of future legal cases. This was reported by the Bureau in February and picked up by more than 100 media organisations worldwide.
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Experts have raised concerns about the fact that Pfizer and some other big pharma companies have demanded complete confidentiality during the recent vaccine negotiations, which would prevent the public from knowing about issues including indemnity protection and price. In South Africa, there are fears that any such secrecy clauses could undo public trust built up by years of anti-corruption work.
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The delayed Pfizer deal arrives as South Africa is facing a third wave of Covid-19. In total, the country has recorded nearly 1.6m cases and more than 53,000 deaths.
We need to be clear about this: The pharmaceutical industry will let nothing stand between them and their outrageous rents and are now behaving like mob bosses.
Their power needs to broken thoroughly and completely.
The capitalist system cannot create robustness in markets, because the creation of safety margins are expensive, and inherently unprofitable.
Our hyper-efficient global economy has a glass jaw:
The deepening global chip crunch is spreading to makers of smartphones, televisions and home appliances, according to suppliers in Asia, as companies boost stockpiles of in-demand semiconductors.
Chip supplies have tightened due to booming demand for electronics during the Covid-19 pandemic and outages at large production facilities.
But the shortage has been worsened by hoarding by sanctions-hit Chinese groups, which has made it harder for some companies to secure components for everyday electronics such as washing machines and toasters.
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LG, a big appliance maker, said the chip shortage had not yet disrupted its production but admitted it was a risk. “We are closely monitoring the situation as no manufacturer can be free of the problem if it gets prolonged,” the company said.
A small TV maker in Seoul said: “It is getting more difficult to secure key components unless you pay higher prices. We have to hike TV prices, reflecting the rising material costs.”
Production of low-margin processors that carry out simple tasks such as weighing clothes in a washing machine or crisping bread in a smart toaster has been affected.
“Microcontroller units are in tight supply, which could be impacting general appliances,” said Randy Abrams, head of Asian semiconductor research at Credit Suisse.
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Foundries in South Korea said they were unable to satisfy surging orders even while operating at full capacity.
This is why we need governments, and government regulation.
Running a society completely on selfishness is insane.
What’s more, it has increasingly been juxtaposed with economic fragility driven by the increasingly oligopolistic nature of shipping, which means that if one shipper fails, the entire system can seize up.
The classic Clarke and Dawe sketch, “The Front Fell Off,” (shown) is a perfect metaphor for this:
In this newsletter, I do a lot of explaining about complicated problems caused by big dumb corporate institutions. I don’t have to do that this time, because the story of the mess in the Suez is so simple. “After years of bitcoin and reddit short selling and credit default swaps and a million other things I don’t understand,” one random person put in a tweet that went viral, “it’s so refreshing to hear that global commerce is in peril because a big boat got stuck in a canal.”
That’s basically the story right there, it’s a big boat and it got stuck in a canal. The ship blocking the Suez, called the Ever Given, weights 220,000 tons, and is as long as the Empire State Building is high. Despite the hilarious nature of the problem, the disruption to world trade is large and serious, costing tens of billions of dollars. And if the ship can’t be dislodged soon, some consumers will once again experience shortages of basic staples like toilet paper.
That said, the reason this disruption to global commerce seems so dumb is because it is. It starts with the ship size itself. Over the last few decades, ships have gotten really really big, four times the size of what they were 25 years ago, what the FT calls “too big to sail.’ The argument behind making such massive boats was efficiency, since you can carry more at a lower cost. The downside of such mega-ships should have been obvious. Ships like this, which are in effect floating islands, are really hard to steer in tight spaces like ports and canals, and if they get stuck, they are difficult to unstick. In other words, the super smart wizard financiers who run global trade made ships that don’t fit in the canals they need to fit into.
The rise of mega-ships is paralleled by the consolidation of the shipping industry itself. In 2000, the ten biggest shipping companies had a 12% market share, by 2019 that share had increased to 82%. This understates the consolidation, because there are alliances among these shippers. The stuck ship is being run by the Taiwanese shipping conglomerate Evergreen, which bought Italian shipping firm Italia Marittima in 1998 and London-based Hatsu in 2002, and is itself part of the OCEAN alliance, which has more than a third of global shipping.
Making ships massive, and combining such massive ships into massive shipping monopolies, is a bad way to run global commerce. We’ve already seen significant problems from big shipping lines helping to transmit financial shocks into trade shocks, such as when Korean shipper Hanjin went under and stranded $14 billion of cargo on the ocean while in bankruptcy. It’s also much harder for small producers and retailers to get shipping space, because large shippers want to deal with large clients. And fewer ports can handle these mega-ships, so such ships induce geographical inequality. Increasingly, we’re not moving ships between cities, we’re moving cities to where the small number of giant shipping lines find it efficient to ship.
Dumb big ships owned by monopolies are the result of dumb big ideas, the physical manifestation of what Thomas Friedman was pushing in the 1990s and 2000s with books such as The Lexus and the Olive Tree and The World is Flat, the idea that “taking fat out of the system at every joint” was leading towards a more prosperous, peaceful and competitive world. Friedman’s was a finance-friendly perspective, a belief that making us all interdependent with a very thin margin of error would force global cooperation.
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What is new isn’t the vulnerability of the Suez Canal as a chokepoint, it’s that we’ve intentionally created lots of other artificial chokepoints. And since our production systems have little fat, these systems are tightly coupled, meaning a shortage in one area cascades throughout the global economy, costing us time, money, and lives.
It’s a dumb way to organize a global supply chain system, just as it was dumb to build ships that are too big to fit into canals. And that’s why the “big boat stuck in canal” is such a great illustration of the problem, it shows our policymakers and corporate leaders couldn’t even think through what would happen if Really Big Thing Got Stuck In Important Canal.
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The answer to addressing the problem of thinned out supply chains is to recognize that hyper-efficient globalization inherently carries the downside of unpredictable shortages, geopolitical tension, and supply disruptions. And then redesign our global trading order to make it less efficient and more resilient. There are three basic changes we’ll need.
Matt Stoller calls for a rigorous enforcement of anti-monopoly measures, a reimpositition of border friction like tariffs, and a restructuring of business so that they are less indebted and less vulnerable.
Unfortunately, this will not happen, because this system was created to benefit financial institutions and to drive wages down through labor arbitrage, so his reforms are actually a repudiation of the entire system.
I support his ideas, but I don’t think that they are politically realistic at this time.
So, now we have a former Reagan and Clinton trade official and a retired general arguing that the Trans Pacific Partnership (TPP) is a security risk to the United States because it will hasten the hollowing out of American manufacturing, which makes the US dependent on foreign manufacturers in places like China and Vietnam for the crucial building blocks of military equipment.
This is a rather interesting counterpoint to the Obama administration’s argument that we have to pass the TPP as a counter weight to Chinese influence in the region.
The first OP/ED appeared in the New York Times. The second appeared in The Hill.
It doesn’t get any more establishment than that.
I’m actually beginning to think that Obama won’t be able to get it through during the lame duck session.
Today, EFF joined a broad coalition of other public interest groups at Democratic Leader Nancy Pelosi’s office in San Francisco, to present her with a petition carrying an incredible 209,419 signatures with a request to oppose the introduction of the Trans-Pacific Partnership (TPP) during the post-election “lame duck” session of Congress. And with your help, we succeeded! In a letter that she handed us at our meeting, Leader Pelosi wrote:
As Congress and the American people review the finalized terms of the Trans Pacific Partnership (TPP), we must put American workers first to allow our economy to grow and America to succeed. Please be assured that I will oppose the TPP as it is currently written or any deal that attempts to separate commerce from the environment and will work to ensure that our nation’s trade policies include increased transparency, more consultation, and stronger protections to create jobs, strengthen human rights, and preserve the environment.
The US is hoping that a quick trade and investment deal with the UK after it leaves the EU could kickstart the stalled negotiations for the Transatlantic Trade and Investment Partnership (TTIP), which has met increasing resistance on the continent. As well as serving the US’s purposes, such an agreement would be welcomed by the UK government as proof that it can recreate the necessary web of trade links post-Brexit.
The US secretary of state, John Kerry, has just spent two days in the UK talking with the prime minister’s officials and with the new foreign secretary, Boris Johnson, exploring what form such a UK-US trade deal might take.
As The Guardian explains: “The UK cannot formally sign any trade deals with other countries or trading blocs until it has left the EU, but it appears to be accepted that negotiations on the outline shape of such deals can start before that happens.”
As an aside, it appears that chief among US goals is to make current and future steps toward privatization of the British NHS irreversible:
One of the issues raised by those advocating leaving the EU was that remaining a member state would see the UK obliged to sign up to a TTIP deal that included ISDS. The fear was that ISDS would make re-nationalising privatised NHS services prohibitively expensive if US companies were involved. In theory, the latter might try to use the ISDS provisions in TTIP to claim that their future profits had been “expropriated” by nationalisation, and to demand compensation.
However, the UK could now sign up to a US investment treaty with significantly fewer protections than those offered by TTIP’s ICS system, which is what the EU is still pushing for. Instead of Brexit helping to protect the NHS, it may end up bringing in a system that protects it less than if the UK had stayed in the EU.
With a new Senate likely to be hostile to free trade deals, the road to signing the Trans-Pacific Partnership just got bumpy, writes Richard Denniss. One thing that is certain after Saturday’s election, the Trans-Pacific Partnership (TPP) is dead, and along with it the Coalition’s economic agenda and narrative. The free trade agreements that Andrew Robb signed with China, Korea, and Japan were some of Tony Abbott’s proudest achievements, yet they are exactly the sort of deals that Pauline Hanson, Nick Xenophon, and Jacqui Lambie believe cost Australian manufacturing workers jobs. And thanks to Malcolm Turnbull’s new Senate voting rules and double dissolution election, Hanson, Xenophon, and Lambie are now the block of votes that the Coalition will need to win over to pass their legislation when the ALP and Greens are opposed.
This may not kill the TPP, but it has the effect of making the timetable Obama that wants (he sees it as a presidential legacy issus), where there is a lame duck vote, next to impossible.
It is not clear who will win the election, but it is clear that the Colalition will not have the votes to pass TPP without significant support from smaller parties because the Senate is looking to be a complete mess, and unlike other upper houses in the British Commonwealth, the Australian Senate is much more powerful, being somewhat analogous to the US Senate in power.
Again, good news, because much like CETA and the TPIP, the TPP is a horribly flawed “trade deal.”
The European Commission performed a startling U-turn on its landmark trade agreement with Canada on Tuesday, succumbing to pressure from France and Germany by deciding that national parliaments would have to ratify the deal. The need for approval from almost 40 national and regional assemblies not only threatens to scupper the Canadian deal itself, but delivers an ominous signal to British politicians who insist that the U.K. could negotiate a quick post-Brexit trade accord with the EU. Speaking in Strasbourg, Trade Commissioner Cecilia Malmström said the EU had decided to call the Canada deal a “mixed agreement.” This means that the bloc’s most significant trade deal to date is now hostage to hostile lawmakers in parliaments ranging from Romania to the Belgian region of Wallonia.
I think that this development is being driven by two things:
Concern that the British Brexit vote is spreading to other EU members, particularly on the periphery.
Setting a precedent of allowing every member of the EU to have a potential veto over the conditions over which the UK would negotiate its leaving the EU.
I think that this also means that the trade deal, which is a kind of mini-TTIP will not happen in the next 12 months or so, if at all:
The decision, taken during a meeting of the EU’s commissioners in Strasbourg, represented a surprising volte-face because the Commission had hoped to treat the accord as an EU-only deal, meaning it would require approval only from the European Parliament and national governments in the Council.
The Canadian deal has stoked sensitivities across Europe primarily because it is seen as a precursor to the far more contentious Transatlantic Trade and Investment Partnership with the U.S.
Matthias Fekl, France’s trade minister, said it was “unbelievable” that Brussels had been planning to treat the deal as an exclusively EU competence.
“I find it even more hallucinatory only a few days after the result of the British referendum that one could envisage this type of procedure at the level of the European Commission,” he told the news agency AFP in an interview.
The tortuous path to approve the deal will sound alarms in London, where politicians are pinning their hopes on a quick settlement with the EU after Brexit. Debates in national parliaments could potentially add years of delay to the Canadian accord, which has already taken seven years to finalize.
It isn’t often that you get a diplomat using the adjective hallucinatory.
This also does not bode well for the TTIP.
Considering the impacts of such trade deals, inflated pharmaceutical prices, destructive capital flows, increased financialization of economies, etc. This is a good thing.
There were 46,501,241 votes cast, with 15,203,370 leave votes and 14,157,273 stay votes counted at this point, which means that Brexit leads by 51.8% to 48.2% and the stay votes will need to get 56.1% of the remaining vote to win.
So, my prediction appears to have been wrong, and Britain will vote for a Brexit.
Rather unsurprisingly, there was a significant geographic divide, with England and Wales going Brexit, and Scotland going stay. (middle pic)
The question, of course, is what it all means. I’m inclined to believe, as Moon of Alabama posits, that neither Cameron, nor the EU, nor the City of London will meekly accede to this vote as the bottom pic clearly shows.
I rather expect that we will be talking about “When the Brexit finally happens” 10 years from now.
Trade is a hot issue in the 2016 U.S. presidential campaign. But correspondence from Hillary Clinton and her top State Department aides about a controversial 12-nation trade deal will not be available for public review — at least not until after the election. The Obama administration abruptly blocked the release of Clinton’s State Department correspondence about the so-called Trans-Pacific Partnership (TPP), after first saying it expected to produce the emails this spring.
The decision came in response to International Business Times’ open records request for correspondence between Clinton’s State Department office and the United States Trade Representative. The request, which was submitted in July 2015, specifically asked for all such correspondence that made reference to the TPP.
The State Department originally said it estimated the request would be completed by April 2016. Last week the agency said it had completed the search process for the correspondence but also said it was delaying the completion of the request until late November 2016 — weeks after the presidential election. The delay was issued in the same week the Obama administration filed a court motion to try to kill a lawsuit aimed at forcing the federal government to more quickly comply with open records requests for Clinton-era State Department documents.
Clinton’s shifting positions on the TPP have been a source of controversy during the campaign: She repeatedly promoted the deal as secretary of state but then in 2015 said, “I did not work on TPP,” even though some leaked State Department cables show that her agency was involved in diplomatic discussions about the pact. Under pressure from her Democratic primary opponent, Bernie Sanders, Clinton announced in October that she now opposes the deal — and has disputed that she ever fully backed it in the first place.
On May 7th, Deutsche Wirtschafts Nachrichten, or German Economic News, headlined, “USA planen mit TTIP Frontal-Angriff auf Gerichte in Europa” or “U.S. Plans Frontal Attack on Europe’s Courts via TTIP,” and reported that, “America’s urgency to sign TTIP with Europe has solid reason: Megabanks must protect themselves from claims by European investors who allege that they were cheated during the debt crisis. … The U.S. Ambassador to Italy has now let the cat out of the bag on this — probably unintentionally.”
In this particular case, the megabank that’s being sued isn’t American but German, Deutsche Bank, which the U.S. Ambassador to Italy has cited as his example to defend, perhaps so as to appeal to Germans to protect their megabanks against lawsuits from foreign investors (such as Italians) who complain. In that case it was investors in the Italian city of Trani, population 53,000. The smallness of the city was an issue the Ambassador raised against the suit’s having been brought there.
Reuters headlined on May 6th, “Italian prosecutor investigates Deutsche Bank over 2011 bond sale”, and reported that, “An Italian prosecutor is investigating Deutsche Bank (DBKGn.DE) over its sale of 7 billion euros ($8 billion) of Italian government bonds five years ago, an investigative source told Reuters. A prosecutor in Trani, a town in southern Italy, is investigating because Deutsche Bank allegedly told clients in a research note in early 2011 that Italy’s public debt was no cause for concern, and then sold almost 90 percent of its own holding of the country’s bonds.” The U.S. bond-rating agencies are also subjects in this suit, because Trani had relied upon their ratings of those bonds.
The Obama Administration (through its Italian Ambassador) seems thus to be saying, in effect, that unless TTIP is passed into law, Europe’s megabanks (and the U.S. bond-rating agencies, S&P, Moody’s and Fitch) will be able successfully to be sued by cheated investors, just as has been happening with such American banks as JPMorgan/Chase and Goldman Sachs in the United States, which — since TTIP hasn’t yet been in force anywhere, including in the U.S. — were forced to pay billions to cheated investors. Apparently, Obama would be happier if those suits had been impossible in the U.S. The argument here, though only implicitly, seems to be that TTIP is the way to protect megabanks and the bond-rating firms. It concerns specifically the selling of sophisticated derivative investments.
I didn’t think that there was any bit of news that would make me more opposed to the TTIP or TPP.
Craig Mazin Ted Cruz’s roomate from his freshman year, who has made it know that he hates Cruz on a basic human level, and he is doing his happy dance.
Greenpeace has published leaked documents detailing the negotiations between the US and EU over the TTIP, and it is worse than previously thought:
Bernd Lange, the chairman of the European Parliament’s important trade committee, has indicated that he now expects the Transatlantic Trade and Investment Partnership (TTIP) negotiations will probably fail, following a major leak of confidential documents from the talks.
Greenpeace Netherlands has released half of the entire TTIP draft text as of April 2016, prior to the start of the 13th round of TTIP negotiations between the EU and the US, which reveal US demands in detail for the first time.
Although the EU has improved transparency recently, and routinely publishes its offers for each TTIP chapter, the US has consistently refused to do so. Even MEPs and MPs have faced extreme restrictions on what they are allowed to look at, copy, or even say when it comes to the US position. The new leak by an unknown whistleblower represents a major blow to US attempts to keep its negotiating demands confidential, and provides important information to the both the EU and US public for the first time.
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As Ars noted last September, in the face of massive public concerns about ISDS, the European Commission is proposing a modified approach, the Investment Court System (ICS), which it claims addresses the problems of ISDS. However, even though the ICS idea was formally presented to the US last year, one of the TTIP leaks shows that it was not even discussed during the 12th round, something that the European Commission’s public report on the negotiations omitted to mention. This confirms earlier indications that the US is not interested in ICS, and will insist on including standard ISDS in TTIP, regardless of EU worries.
A leaked chapter on “Regulatory coherence, transparency and other good regulatory practices” indicates that the US wants all regulations, even those concerning health and safety or environmental issues, to be judged by the yardstick of their effects on trade: “When developing a regulation, a regulatory authority of a Party shall evaluate any information provided in comments by the other Party or a person of the other Party regarding the potential trade effects of the regulation that it receives during the comment period.”
n practice, this means that companies will be able to challenge any new EU and US regulations that might have an adverse effect on their profits, as is often the case when new environment regulations are brought in. It is likely to make it much harder to strengthen laws that might disadvantage business but protect public health and safety.
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The key sentence comes in the particularly sensitive document entitled “Tactical State of Play of the TTIP Negotiations.” This is essentially the European Commision’s frank evaluation of where things stand in the TTIP talks. Here’s what it has to say on the US demand: “progress on motor vehicle-related parts would only be possible if the EU showed progress in the discussion on agricultural tariffs.” In other words, if the EU doesn’t open up its markets to agricultural products from the US—which means things like beef treated with hormones, and maybe even chlorine chickens—there will be no improved access for EU car manufacturers.
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It is also concerned that the EU’s “precautionary principle,” which requires that products should be shown to be safe before they can be put on the market is being replaced by the US “risk-based” approach, which allows products to be sold until it is proved that they are dangerous.
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Finally, and perhaps most importantly, public support for TTIP was already plummeting, even before this leak appeared. It seems unlikely that the information it reveals about US demands will assuage any European fears.
Looking at the positions that have been taken by the US in these negotiations, I can only say that, “We have met the enemy, and he is us.”
The worst parts of the trade deals that the US have negotiated over the past few decades is not that reality, and our partners, require compromises.
The worst parts of the trade deals that the US have negotiated over the past few decades come from a foreign trade establishment who follows the most extreme and destructive philosophy.
Here is hoping that the free market market mousketeers who have been driving foreign trade deals get a job flipping burgers, because their death toll is beginning to rival that of Josef Stalin.
This is, of course, a shameless attempt to threaten the British voters into staying in the EU, so that US influence on this body is not diminished.
The US (IMNSHO correctly) that the UK will blindly promulgate US policies and US interests within the European Union:
The UK could take up to 10 years to negotiate trade deals with the US if it leaves the EU, Barack Obama has said. In a BBC interview, the US president said: “It could be five years from now, 10 years from now before we were able to actually get something done.” Britain would also have less influence globally if it left, he added. His warning over trade has angered UK campaigners for leaving the EU – with UKIP leader Nigel Farage dismissing Mr Obama’s comments as “utter tosh”.
As much as it pains me to agree with him, Nigel Farage is right.
The government of the French-speaking Belgian region of Wallonia has refused to ratify the EU-Canada free trade agreement approved by the Belgian cabinet, the region’s minister-president said.
“As long as we do not have all the guarantees…. it will be impossible for us to ratify such a text [the Comprehensive Economic and Trade Agreement (CETA)], and it is not possible to give full powers to the Minister of Foreign Affairs to sign it either,” Paul Magnette was quoted by the RBTF broadcaster as saying late on Wednesday.
The opponents draw a parallel between CETA and the US-EU Transatlantic Trade and Investment Partnership (TTIP), which has been criticized for the lack of transparency in the negotiations and the power it would give to international corporations at the expense of small and medium-sized businesses.
The guarantees appear to deal primarily with the Investor State Dispute Settlement system, while Romania is upset that it does not have visa free travel to Canada, and the lack of support on this matter from its EU partners:
Romania will not ratify the Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada which was concluded in 2014, as an angry reaction to the refusal by Ottawa to lift the visa requirement of its nationals, but also for the lack of EU solidarity for solving the issue. The Romanian Ministry of Foreign Affairs has published a position regarding Canada maintaining the visa requirement for Romanian citizens, expressing disappointment that Ottawa had not delivered on its promise to solve the issue, contained in the Statement of the 2014 EU-Canada summit. Canada has a visa-free regime with all EU countries except Romania and Bulgaria.
These deals no longer being a sure thing is good.
Tariff barriers are minimal now, and these deals are really about giving rent seekers like Pharma, Music, Film, and Finance an opportunity for increased profits.
The secondary goal is to create a regime where profit trumps government power and the will of the people.
Shutting this down shutting this down is a very good thing.
In discussing the Trans Pacific Partnership (TPP) trade deal, supporter have have stopped talking about the merits of the deal, and instead are suggesting that its defeat would be a blow for American prestige:
“Failure to move forward … would be a profound setback for American interests in the region,” Ben Rhodes, a White House deputy national security adviser, said Tuesday of the 12-nation Trans-Pacific Partnership. “It would be a signal that we do not have staying power and cause countries to hedge on their alignment with the United States.”
The administration is running out of time to get the accord ratified by Congress and faces an uphill slog to win approval with the leading presidential candidates in both parties opposed to the deal. Republican front-runner Donald Trump has denounced free trade deals as harmful to American workers and a drag on the U.S. economy. Democratic front-runner Hillary Clinton, who supported the TPP as secretary of state under Obama, has come out against the TPP under pressure from the left, including labor unions and her opponent Sen. Bernie Sanders (Vt.), who also opposes it.
But in a conference call with reporters, administration officials warned that China is poised to step into an economic and leadership void if the U.S. falters in the pact with 11 other nations, including Japan, Malaysia, Vietnam and Australia. While Trump and Sanders have called outsourcing and trade imbalances with China detrimental to the United States, White House allies said that the economic competition from China, which is not included in the TPP, is a reason to endorse the deal.
So apparently it’s not a trade deal, and it won’t provide meaningful benefits, it’s a political and diplomatic ploy to be used in a war against China.
Do you want to lose your job just to f%$# with China?
After months of outrage the Obama administration has finally taking action againat the tax dobbed known as “Corporate Inversion”, and accoording to FT, this is provoking a, “foreign fury.”
Cry me a f%$#ing river:
A White House tax crackdown designed to put a halt to Pfizer’s planned $160bn takeover of Allergan has provoked fury from foreign multinationals with operations in the US.
Barack Obama stepped up the offensive on Tuesday championing new proposals to deter “inversion” deals — such as Pfizer-Allergan — that companies use to move to low-tax jurisdictions, accusing them of exploiting “one of the most insidious tax loopholes out there”.
Multinationals responded by saying they were being unfairly caught in the crossfire of Mr Obama’s campaign as their operations in the US could also be affected by the new rules.
The angry rhetoric came a day after the Treasury department released new proposals which threatened the biggest planned inversion to date — Pfizer’s takeover of Irish-domiciled Allergan — and triggered big losses for some hedge funds, such as Paulson & Co and Third Point.
“It came as a total surprise. Everyone thought the Treasury had used all their firepower,” said one hedge fund manager.
………
The Treasury’s latest moves would make inversions less lucrative by eliminating a tax benefit for “abusive” inverters. But its plan would also deny the benefit to foreign companies with US operations.
“Rather than using a scalpel to deal with this issue they are using a machete,” said Nancy McLernon, president of the Organisation for International Investment, a trade group for foreign companies in the US.
“It’s a misguided approach. They’re trying to go after those companies that are doing something they think is problematic and carelessly hitting a whole class of employers.”
The tax benefit stems from companies’ use of internal loans to cut their tax bills. By loading up US subsidiaries with debt from head office, foreign companies can deduct the interest payments from their US tax bills — a practice called earnings stripping.
Here is my response to the aggrieved tax dodgers:
The fact that you have been able to skate on corporate taxes for the past few decades do not give you the right to continue stealing from the rest of us.
Here is my response to the aggrieved tax dodgers: