TPP Trade Deal - Company Claims Gov't Offered A Bribe

The Boston Globe reports that the White House straight up promised New Balance a big money contract supplying shoes to the Department of Defense, as long as they either supported or remained neutral on the massive trade deal.

This latest scandal has more to do with the TPP’s economic impact, but as Internet and free speech advocates, we have deep concerns with this agreement’s impact on our digital rights.
The TPP was negotiated in complete secrecy by lobbyists and government bureaucrats––including some of the same ones that were behind SOPA and the DMCA––and it contains extreme copyright provisions that threaten to expand Internet censorship worldwide.

It reads like a wish list for monopolistic corporations and like a death sentence for the future of innovation, our Internet freedom, and our basic democratic process.
The giant corporations pushing the TPP have billions of dollars in potential profits on the line. They’re fighting dirty and there’s nothing they won’t do to get this deal passed....... from fightforthefuture.org


Shoe Company New Balance Says US Gov't Basically Offered It A Bribe To Support TPP

from the wow dept

We've mostly focused on the impact of the TPP and trade deals on the internet (and also on national sovereignty), because that's the kind of stuff that interests us most around here. We've spent a lot less time looking at the more traditional free trade arguments, in part because that's not nearly as controversial, and in part because -- despite claims to the contrary -- there really aren't that many tariff-related barriers that make a big difference any more. It's generally good to reduce such tariffs, and in response you see the typical response from firms based on whether or not they benefit from those reduced tariffs. The "benefits" of free trade tend to be focused on the companies looking to expand into those markets where tariffs are being lowered or abandoned -- and not so much for companies competing against products from those same countries. Frankly, I find arguments that the companies who freak out about trade deals because it will mean more competition against them a bit tiresome, because I tend to believe competition is a good thing for innovation.

However, the Boston Globe has quite a story about one such company, the sneaker company New Balance, which was quite worried about how the TPP would increase competition from shoemakers in Vietnam. Again, I find those concerns to be overblown, but the next part of the story is where it gets interesting: New Balance is now claiming that it stopped publicly complaining about the TPP after the US government more or less promised it a big government contract, which never came through:

After several years of resistance to the Trans-Pacific Partnership, a pact aimed at making it easier to conduct trade among the United States and 11 other countries, the Boston company had gone quiet last year. New Balance officials say one big reason is that they were told the Department of Defense would give them serious consideration for a contract to outfit recruits with athletic shoes.

But no order has been placed, and New Balance officials say the Pentagon is intentionally delaying any purchase.

New Balance is reviving its fight against the trade deal...

The US government, of course, is insisting the issue of a contract is entirely separate from the TPP, but New Balance said an explicit offer was made. The company notes that while most of the uniform worn by the military is American made, there has always been an exception for sneakers because so few were actually fully made in the US. New Balance apparently decided to change that in hopes of getting a government contract, and the administration more or less said that this would work if New Balance shut up about opposing the TPP:

In 2014, the Pentagon relented. With competition among US manufacturers, officials said they were ready to consider domestically made shoes.

LeBretton said a representative for the Obama administration then asked New Balance to accept a compromise version of the trade deal, partly in exchange for a pledge of help getting the Department the Defense to expedite the purchase of US-made shoes.

The Globe claims that the Defense Department says the reason that it didn't give New Balance a deal was because its shoes weren't durable or cheap enough, but even if that's true, the very idea that the government more or less tried to buy off the company's opposition to the TPP seems highly questionable.

Of course, I wonder, should the TPP get ratified and should the Defense Department then agree that it will only buy American made sneakers... one wonders if Vietnamese sneaker makers would then have an ISDS corporate sovereignty case against the US government? After all, it would be harming "future profits" that the Vietnamese sneaker-makers would have been expecting, and a "buy American" rule could clearly be seen as a non-tariff trade barrier to foreign goods, no?

https://www.techdirt.com/articles/20160412/07310334162/shoe-company-new-balance-says-us-govt-basically-offered-it-bribe-to-support-tpp.shtml?link_id=6&can_id=f8858a9607d2773e9635ac1 8cc1fad4e&source=email-revealed-tpp-bribery-scandal-2&email_referrer=revealed-tpp-bribery-scandal-2&email_subject=revealed-tpp-bribery-scandal

The clock is ticking on a time bomb that could blow up a free internet: the TPP

http://www.theguardian.com/commentis...ribery-scandal