WASHINGTON — On Tuesday, Senate Democrats signaled their opposition to the Trans-Pacific Partnership, a 12-nation trade deal that remains a key priority for President Obama.
Blocking consideration of his request for fast-track authority to complete negotiations on the trade pact, Senate Democrats underscored their belief that deals like the North American Free Trade Act (NAFTA) have harmed U.S. workers by outsourcing jobs to cheap labor markets.
Leading opponents of the measure in the Senate have pushed for additional protections for U.S. workers and address concerns about alleged foreign-currency manipulation by China that makes American produccts too expensive.
“It’s a betrayal of workers and small business in our communities to pass fast track, to put it on the president’s desk without enforcement ... and without helping workers,” Sen. Sherrod Brown, D-Ohio, told The Washington Post.
Obama and GOP leaders have portrayed the trade pact as a needed step to help open markets in the Asia-Pacific region, a move they say will strengthen the U.S. economy.
By Wednesday, after meeting with the president, Democrats agreed to reconsider fast-tract authorization. They also secured approval for a separate measure dealing with currency manipulation to come to a vote.
However, the revolt marked deep skepticism about the merits of free-trade deals within the party. And in 2015, that skepticism reflects the powerful current of economic populism; in addition, many events have moved the Democratic Party base to the left and have made economic inequality a central issue for the upcoming campaign season.
“The dynamics of this social-justice populism are being played out inside the Democratic Party, with the squabble in Congress over granting President Obama fast-track authority for pursuing trade,” Stephen Schneck, the director of the Institute for Policy Research & Catholic Studies at The Catholic University of America, told the Register.
“Such populism appeals to Catholic progressives aligned with social-justice causes.”
That stance was expressed by Sen. Bob Casey, D-Pa., a Catholic lawmaker who has spoken out against the deal.
“Over and over again, we’ve been told that trade deals will create jobs and better protect workers and the environment,” Casey told U.S. News and World Report back in March.
“Those promises have never come to fruition.”
U.S. Bishops’ Ethical Framework
Thus far, the U.S. bishops have not taken a formal position on the Trans-Pacific Partnership deal. But they have issued guidelines designed to serve as an ethical framework for evaluating such agreements and for promoting outcomes that will minimize the harm to U.S. workers and poor nations.
In a 2013 letter to Michael Froman, the U.S. trade representative, Bishop Stephen Blaire of Stockton, Calif., and Bishop Richard Pates of Des Moines, Iowa, then the U.S. bishops’ point men on social-justice issues, signaled their fears about the TPP deal’s impact on U.S. workers and small farmers in poor countries faced with competition from U.S. agribusiness, among other matters.
“Our concern with job loss in our own urban and rural communities requires that any agreement be accompanied by firm commitments to help U.S. workers, as well as their families and communities, cope with both the social and financial strain of dislocation that free trade might bring about,” stated the letter, which echoed the concerns of Senate Democrats who are still calling for protections for U.S. workers included in the deal.
In January 2015, the U.S. bishops repeated those long-standing concerns in a letter to Sen. Orrin Hatch, R-Utah, the chairman of the Senate Finance Committee.
In that letter, the U.S. bishops also targeted the inclusion of strong intellectual-property rights measures in the deal and asserted that it could reduce access to cheaper generic versions of vital medicines.
The January 2015 letter cited Pope Francis’ remarks about globalization in his apostolic exhortation Evangelii Gaudium.
“Pope Francis notes: ‘The worldwide crisis affecting finance and the economy lays bare their imbalances and, above all, their lack of real concern for human beings; man is reduced to one of his needs alone: consumption,’” read the U.S. Conference of Catholic Bishops’ letter.
Further, the bishops highlighted a passage from Pope Emeritus Benedict VI’s encyclical Caritas in Veritate, which warned against a utilitarian cost-benefit analysis as the basis for evaluating the success of such agreements.
“The economy needs ethics in order to function correctly — not any ethics whatsoever, but an ethics which is people-centered,” read the encyclical.
Leveraging Vatican Input
Meanwhile, the Vatican has criticized regional trade deals like the Trans-Pacific Partnership and expressed a preference for multilateral agreements, which, in the Holy See’s view, better accommodate the needs of poor countries.
The gap between rich and poor nations “is the result of ideologies that defend the absolute autonomy of the marketplace,” read a December 2013 statement, signed by Archbishop Silvano Tomasi, the permanent observer of the Holy See to the United Nations in Geneva.
The statement attacked “monopolies on lifesaving medicines, which reduce access and affordability and … provide excessive legal rights to foreign investors.”
Such harsh language from the Holy See has prompted opponents of the TPP to portray the Holy See as an ally in their quest to block or modify the deal.
“Catholics committed to the common good reject the assumption by President Obama [that] only labor and progressive groups primarily care about controversial provisions of the Trans-Pacific Partnership,” argued Stephen Seufert, the state director of Keystone Catholics, in an April 28 column for The Huffington Post that cited statements of the Holy See on the issue.
Pope Francis and Capitalism
While Pope Francis has not actually taken a position on the TPP, his sharp comments about capitalism and free markets may give the impression that he would oppose it, if asked. His stance has also frustrated some U.S. Catholics, who contend that a Latin-American Church leader doesn’t understand the American economy and should reduce his comments to an articulation of the principles that have guided Catholic social teaching.
Last year, Cardinal Timothy Dolan of New York sought to moderate the public image of Pope Francis as a sharp-tongued critic of U.S-style capitalism.
“The spread of the free market has undoubtedly led to a tremendous increase in overall wealth and well-being around the world,” wrote Cardinal Dolan in a 2014 column for The Wall Street Journal.
“Yet Pope Francis is certainly correct that ‘an important part of humanity does not share in the benefits of progress.’ ... It is in this context that the Holy Father’s earlier criticism of ‘trickle-down economics’ can be properly understood.”
Cardinal Dolan also suggested that the American experience of free-market capitalism was not widely practiced or understood in many parts of the world, and so the Pope rightly took aim at “capitalist” practices that might be better defined as an “exploitative racket for the benefit of the few powerful and wealthy.”
Asked to comment on the Holy See’s evolving position on trade issues since the pontificate of Pope St. John Paul II, Samuel Gregg, the legal director for the Acton Institute, a free-market research center, told the Register, “At the level of principle, I see no substantive change.”
That said, Gregg suggested that Pope Francis “seems less optimistic about the economic benefits of free trade, though he has said that economic globalization has taken many people out of poverty. That is a simple empirical fact which is very hard to deny.”
Overall, Gregg views the Church as “cautiously optimistic” about free trade “since the1990s, partly because free trade is rooted in the principle of free association, which doesn’t somehow stop at national boundaries, and partly, because, on balance, it gets people out of poverty.”
Church’s ‘Constructive Criticism’
Martha Cruz Zuniga, the director the economics programs at The Catholic University of America, agreed that the Church “has been open to the discussion of the benefits of free trade. But it has also shed some light on the potential consequences of these agreements.”
“As an economist and Catholic, I would describe the Church’s role as ‘constructive criticism,’” Cruz told the Register. “We need to be reminded of our call to use these [economic] tools to help people improve their standard of living, to promote human dignity.”
She noted that Archbishop Tomasi’s criticism of intellectual property-rights protections that may bar the introduction of generic versions of medicines marks a simmering debate among economists working on development issues.
There must be protections for intellectual property rights to maintain incentives for research and investment in innovation, including new medicines, she noted.
But the reality on the ground in developing countries “is more complex.” When medicines are priced too high, they are out of reach for many patients.
“Economists have not come up with an answer” to this conundrum, Cruz noted.
Still, she welcomed the Holy See’s critique as a necessary part of the discussion. And she noted that Pope Benedict, in Caritas in Veritate, had called for a holistic response to such problems that promoted “integral human development.”
Waiting Eco Encyclical’s Impact
Economic populists in the Democratic Party likely take a different view of the Vatican’s position, and some will look for Pope Francis to tie the debate over free trade to related concerns about the impact of such agreements on the environment and climate change.
Pope Francis’ long-awaited encyclical on the environment may well influence the ongoing debate on Capital Hill, and he could also raise the issue when he delivers a speech before Congress or the U.N.’s General Assembly during his September visit.
“The climate change debate does have some implications for globalization and free trade, insofar as developing nations are concerned that various efforts to address climate change will impede their ability to grow their way out of poverty,” said Gregg.
For now, though, he doubts that “Pope Francis’ forthcoming encyclical will get into the micro details of that particular discussion, because the magisterium has no special competence to speak authoritatively in that area.”
But overall, it might be useful to recall Pope Francis’ statement in a Jan. 11 interview with the Italian journal La Stampa: “When money, instead of man, is at the center of the system, when money becomes an idol, men and women are reduced to simple instruments of a social and economic system.”
Joan Frawley Desmond is the Register’s senior editor.