SHARMINI PERIES, EXEC. PRODUCER, TRNN: Welcome to The Real News Network. I’m Sharmini Peries coming to you from Baltimore.
The Senate just approved the fast-track legislation in Washington, and with me to discuss this is Michael Hudson. He’s joining me from New York City. Michael is a distinguished research professor of economics at the University of Missouri, Kansas City. His two newest books are The Bubble and Beyond, and Finance Capitalism and Its Discontents. His upcoming book is titled Killing the Host: How Parasites and Debt Bondage Destroyed the Global Economy.
Thank you so much for joining us.
MICHAEL HUDSON, PROF. OF ECONOMICS, UNIV. OF MISSOURI-KC: Good to be here.
PERIES: Michael, what do you make of this fast-track legislation?
HUDSON: It’s appalling. It’s so bad that when I try to describe it to professors who are not economists or to foreigners they can’t believe that there’s actually a law that is classified as secret. That the congressmen and senators can only read by making an appointment, reading in secret, without taking notes. That they will be accused under national security legislation if they tell anybody what it’s all about. It’s amazing, what is happening is of such a great magnitude, that people are not out in the streets.
What is at stake is something that has been under international law for over 350 years. And that’s the Treaty of Westphalia in 1648 established the principle that nations are in charge of their own policy. The fast-track legislation for the Trans-Pacific Partnership, and the European partnership, is so radical that it takes economic policy out of the hands of government and puts it in the hands of unelected lobbyists for the corporate interests.
Now, the funny thing is that only the Republicans are really, the Republican right-wingers and libertarians are making a point of saying wait a minute, how can a government let its legislation laws be declared illegal by an international court? Canada, Prime Minister Harper, has already said that under the NAFTA act, North American Free Trade Agreement, which wasn’t really about free trade, America’s attempt to make the Volcker Rule to regulate banks is illegal. If the fast-track is passed by Congress, it will be illegal for America to regulate environmental pollution. It will be illegal for America, or impractical, to regulate the banks. All government regulations, if they cost the government money–for instance, if America were to fine British Petroleum $10 billion for environmental destruction, then America would be obliged under the court to pay back the $10 billion to British Petroleum. Saying wait a minute, you cannot pass a law regulating business unless you compensate the business for the result of any law.
So this court is to have authority over any law passed by Congress or the Senate, any national law. It is somehow to shift the ability to make rules out of the hands of elected officials and put them in the hands of unelected officials, very much like central banks have done by making financial laws by essentially bank lobbyists like Tim Geithner or the present Jacob Lew, or the Justice Department under Eric Holder or Loretta Lynch. You have essentially lobbyists for the corporate sector in charge of overruling legislation. So it doesn’t matter what the law says that are criminal penalties for banks or civil penalties for banks. If the courts refuse to enforce these laws, then the laws are nullified.
PERIES: So Michael, give us an example of what will happen as a result of this kind of fast-track, and as a result of an agreement like TPP.
HUDSON: It will, the free trade means that America’s few exports that are made now will be threatened by a wave of foreign imports. You’ve seen what happened to NAFTA. NAFTA hurt both America and Mexico. When NAFTA was passed, it was already begun under the Carter administration, and it gained power under the Clinton administration. The idea was wait a minute, if we have free trade with Mexico, then we can have free immigration of Mexican workers. We can shift the production of small-scale light manufacturing out of the hands of American workers into the maquiladoras right along the Mexican border. And you have masses of jobs lost to Mexico. And you also have under NAFTA the fact that when an Ecuadorean court found an oil company had made hundreds of millions of dollars of cleanup costs and pollution, the Ecuadorean government had to pay the companies by saying wait a minute, the laws against the environment are illegal under NAFTA.
So the attempt–there’s a belief among most Americans who read the paper that somehow if you sign this agreement it’s just about freer trade, and all of our existing laws would remain on the books, both for us and for Malaysia and Japan and other countries. But that’s not the case. They don’t realize that the agreement is to essentially pass, nullify any law on the book that doesn’t benefit corporations or protects labor.
PERIES: Michael, thank you so much for joining us.
PERIES: And thank you for joining us on The Real News Network.