Tuesday, November 01, 2011

Trouble In TPP Land

In yesterday's post, I took a skeptical look at a Kyodo report of what seemed a supremely confident Democratic Party of Japan leadership leaking that, come what may, the Prime Minister was going to announce at the APEC conference his government's intent to become a participant in the Trans Pacific Partnership talks.

Well hold your horse, Daisy.

It seems that the government is having a hard time getting the membership of the Democratic Party of Japan, much less anyone in the opposition, to come together in favor of Japan joining in TPP discussions. At first, the government was going to halt internal discussions on November 2 (en). Then it announced that November 2 is too early but the DPJ project team will have definitely found intra-party consensus by November 4 (ja).

Well, guess what. It seems that the government has sort of had to let that November 4 deadline slide (ja). Instead there is now no deadline, save that the DPJ's leadership has to announce something by November 12, when the APEC conference starts.

Good luck guys (and why is it that you are all guys?).


Jan Moren said...

TPP is probably a bad idea for a number of reasons.

But the larger problem persists: A lot of Japanese export industry is being gradually shut out from the major markets in the absence of free-trade agreements enjoyed by its competitors. And none of those major markets are willing to give Japan a free pass on its agricultural import restrictions any more.

And while protecting the domestic agriculture sector is the main reason not to participate in any deals, the longer term issue of the future of agriculture here is looming: The Japanese agricultural sector is slowly killing itself, without any competition. Without serious reform of the sector there will be little left to protect in another generation from now.

So separate from the immediate issue of any particular trade deal, these are two issues that any government and opposition will have to address at one point. So far none have been willing to.

MTC said...

Herr Moren -

Bad ideas there may be yes, but the advantages of the TPP over a whole lot of bilateral FTAs seem clear.

OR said...

(pt. 1 of 2)
as someone who honestly doesn't really know what he's talking about, but would like to, what are the benefits of the TPP?

i want to be clear, like i said, i don't /really/ know what i'm talking about, and i don't want to argue or score points, but am just someone who thinks one way about this subject but would like to know more.

the tpp doesnt sound like a good thing to me. i read the newspaper editorials, which from what i've heard, will support anything the finance ministry backs for the access, asking the government to clarify the benefits of the TPP, to sell it to the public to end this debate. but have they? if they have, i apologize for missing this, but i still don't see what the benefits are.

my understanding of free trade is that its not really about exports, its about imports and that tariffs are there to protect domestic jobs or to make them competitive with foreign countries that have an advantage of not having the safety standards and regulations (expenses) the domestic country has, and that dropping a tariff means the domestic worker must either compete by forfeiting the safety regulations meant to protect him or find another job. this i don't think is a good thing for an economy because from what i've heard 30% of the country either works part time or is unemployed. so there arent other jobs for this displaced worker to find. and that i think will lower domestic demand and hurt the economy.

OR said...

pt 2

what industries in japan will start exporting more under this FTA? what industries havent already outsourced as much as they can overseas to save on costs? and for those that havent, why havent they? and why wont they eventually offshore anyway? at least with tariffs, these industries have to produce domestically for the domestic market because its more expensive to import, right?

also, i have heard that the TPP agreement specifics are going to be concealed from the public for four years. if this is true, what good reason could there be for this? it seems nefarious. the whole thing seems shrouded with mystery and yet the cabinet seems to be pushing forward in spite of public protest for reasons i dont understand other than my train of thought displayed here.

i've also heard that the reason the US wants Japan in the TPP so badly is because it;s financial industry wants to deregulate the big lucrative japanese savings market. won't this make the japanese prey to the same financial banks wrecking havoc on the us economy? is this a good thing for anyone besides these banks?

like i said i don't know what im talking about, and this may sound crazy and i would love to know whats actually going on so i can make a more informed decision. but what i think is happening is that multinationals cannot influence japanese politics directly because of campaign finance laws banning foreign donations. but the finance ministry is what's pushing for the TPP, right? and the cabinet has to pretty much bow to the bureaucrats because if they don't, the bureaucracy will just decide to stop functioning (like the METI w/ Kan and the touhoku reconstruction\relief? and didn't this happen with hatoyama too?) to frustrate the public with the cabinet till the PM resigns and a new one takes over that will listen or suffer the same fate. i don't know what the finance ministry wants from the TPP (because i don't know what the positives are). i can only see that maybe these multinationals, because they can't influence politics directly, are able to influence the ministries which from what i can tell are unelected and absolutely unaccountable for anything? and if thats what happening is the TPP really going to be a positive for Japan or a positive for the multinational corps who get access to Japan.

but like i said i don't really know, and though i might seem like im rambling like a crazy person, i would very much like to know what the other side of this is, what the TPP might offer and eventually what is the real truth of the matter. i am not stubborn that i have chose a side i stick to in spite of the truth.

MTC said...

OR -

A lot to chew on. Basically tariffs are bad because they distort incentives and are a tax on consumers. The TPP is an honest multilateral framework to lower tariffs to zero in a number of Pacific democracies, while also eliminating other barriers to entry in other areas of trade and investment.

What makes the TPP so difficult for Japan is that it cuts across all kinds of near fossilized political arrangements, ways of apportioning and employing the nation's resources that benefit entrenched political and economic actors rather than encouraging a more flexible and resilient political and economic structures.

Very theoretical, I know, but that's all I have time for now.