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International Regime Building: The Trans-Pacific Partnership

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Last week’s procedural vote by Senate Democrats to block granting the administration trade promotion authority (TPA) necessary for the approval of the TPP was particularly disappointing. Trade matters aside, successfully achieving the Trans-Pacific Partnership (TPP) should be seen more than as a tool of open commerce but as a means of avoiding conflict with China.

Beyond what individual senators may believe about free trade, the TPP is about far more than open commerce. Unfortunately, to the detriment of the United States and the West’s broader geostrategic interests, the U.S. Senate’s debate over the largest multilateral agreement in recent has boiled down to tired, hashed over argument about the merits of free trade.

If the twentieth century was largely defined by wars and ideological struggles within an Atlantic-centered world, the twenty-first century is being defined by the Pacific.
The rise of China as a global power and the transformation of the security environment in Asia are driving this new landscape. Yet the expanding importance of the Pacific is not just about Asia, but rather about how Asia relates to the rest of the world. The Pacific is less a physical place than an arena in which China and the other countries of Asia relate to the United States, Canada, Latin America, and the Caribbean.

That relationship is about politics, ideas, and institutions as much as it is about trade and investment.

The narrative that China is engaged in a nefarious plot to de-throne the United States and impose itself as a hegemonic global power is wrong. But so is the narrative that the Middle Kingdom merely seeks a friendly “win-win” engagement through which it will develop itself as it develops the world. While the principal goals of the Chinese leadership are arguably the security, prosperity and power of China and its people, rather than political domination and military conquest, the manner in which the Chinese government is pursuing those objectives, and what such a world might look like for those who are not Chinese, is deeply troubling.

The West has enjoyed a series of good centuries in which its power has grown as a result of its domination of global capital and technology and its residents have benefitted from its high-valued-added economies.

Yet for more than a generation, with accumulating effect, the Chinese state has been laboring to appropriate technology and industrial know-how to build a world in which the banks that control the capital and the companies that decide where investments are made are Chinese, with the high-value-added production occurring in China, or at least by Chinese companies globally.

Such a “Chinese dream” is not illegitimate. Most regimes seek the development and prosperity of their people. Yet the combination of the scale and success of China’s efforts to do so is transforming the world, not only altering trade and investment flows, but also reshaping institutions, the distribution of wealth, and the political fortunes of other actors, from China’s neighbors in Asia, to Latin American regimes like Venezuela, Argentina, and Ecuador—whose political solvency has been bolstered by Chinese loans.

Many in the developing world applaud these trends, believing with the bitterness of their own experience that it is about time that the West learns how it feels when someone else controls the hiring and investment decisions, the capital, and the political power that goes along with it.

Yet the key to security and prosperity in the newly emerging Pacific community is not replacing one dominant actor with another, it is ensuring that all nations have the opportunity to reap the fruits of their own efforts and policies. Although China may not seek to impose its political will in the Pacific through military means, its state-supported predatory capitalism sows insecurity, as its government coordinates with Chinese-state owned enterprises to force open foreign markets and to appropriate technologies and production processes.

Enter the Trans-Pacific Partnership. While the TPP may be incomplete in its membership (it doesn’t yet include all economic powerhouses along the Pacific Rim) and the scope of its provisions may be flawed, it remains a necessary foundation in building a broader diplomatic, commercial regime in the Pacific governed by transparency, property rights, and the rule of law.

The absence of a broader trade net spanning the Pacific will only hurt U.S. workers by allowing for the continued weak labor provisions in many of these countries.

Moreover, without TPP, the commercial regime that would come to dominate the Pacific will be one much more amenable to China’s interests.

At the same time, passage of TPP shouldn’t be seen or presented as a loss for China. Indeed, eventual participation of China in a future version of such an agreement would be very much in its interests, as well as the U.S.’s and the rest of the community encompassed by the Pacific. China’s accession to a broader Pacific trade regime would include it in international norms for intellectual property rights and basic labor and regulatory standards governing trade competition and investment and transparency. Building out the TPP—should the U.S. agree to its foundation—would advance a more stable situation throughout the Pacific bringing development and security to all.

“International Regime Building: The Trans-Pacific Partnership,”  Latin America Goes Global,  May 19, 2015,