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Wed Aug 14, 2019, 12:11 PM

'The cat is out of the bag': Secret funders of centrist Democratic group Third Way revealed!

.

Virtually everyone in college PoliSci programs know that the Third-Way group is a shell for embracing Right Wingism.

The goal of the organization is to push a pragmatic approach to politics. Pragmatism only works when ALL are pragmatic. If you have one side starting at the 50 yard line, because that is the rational endpoint, and the other side are inflexible extremists, the best a pragmatic can get is half of their desires. Meanwhile, the extremists almost always get negotiations to skew in their favor. Now, Third Way supports Democratic positions, but they are malleable to Republican desires. If they were to shift too far, they would lose credibility, so there is a fine balance between liberalism and conservativism being played.



Koch Industries secretly funded a report by Third Way, a centrist Democratic think tank, to sell liberals on their trade agenda, according to the new book “Kochland” by investigative reporter Christopher Leonard.

The Kochs enlisted the help of Third Way, a corporate-funded centrist group that has long opposed progressive populists like Bernie Sanders and Elizabeth Warren, after the Democrats won control of Congress in 2006, according to excerpts from Leonard’s book published by The Intercept. Concerned that Democrats were souring on free trade, which threatened their oil importation business, the Kochs sought to use the group to promote free trade to Democrats.

Third Way issued a report, titled “Why Lou Dobbs is Winning” — a reference to the right-wing Fox News host’s economic nationalist agenda — in November 2007. The report warned of a “new and powerful populist strain has emerged on both the left and the right of American politics that threatens to turn the nation fearful and inward.”

The group did not report any funding from Koch Industries or their affiliates, but it did thank Koch Industries lobbyist and former Koch executive Rob Hall “for his support in helping us conceive of and design Third Way’s trade project.”


So much more at the jump:

https://www.rawstory.com/2019/08/the-cat-is-out-of-the-bag-secret-funders-of-centrist-democratic-group-third-way-revealed-as-infamous-american-oligarchs-in-new-book/



I'm not saying they are abandoning Democratic positions, they are just slightly shifting them to the right.
We worry about third-party spoilers, yet this is an internal splitting of ideology, which favors Republicans.

Notice that none of the Republicans subscribe to pragmatism, just Democrats--because we are more rational.
Also, there is more to the article, more to which RW groups shadow influence other aspects of Democratic policy.

In negotiations, one cannot enter them starting in the middle, else there is nothing to negotiate away, just losses.

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Reply 'The cat is out of the bag': Secret funders of centrist Democratic group Third Way revealed! (Original post)
TheBlackAdder Wednesday OP
hedda_foil Wednesday #1
UpInArms Wednesday #2
Post removed Wednesday #15
IronLionZion Wednesday #5
FiveGoodMen Wednesday #3
Maggiemayhem Wednesday #4
crazytown Wednesday #6
George II Wednesday #8
Eliot Rosewater Wednesday #26
MineralMan Wednesday #7
sprinkleeninow Wednesday #10
MineralMan Wednesday #11
sprinkleeninow Wednesday #13
Sogo Wednesday #18
MineralMan Wednesday #20
progressoid Wednesday #16
mountain grammy Wednesday #19
Bettie Wednesday #21
MarcA Wednesday #24
Eliot Rosewater Wednesday #27
progressoid Wednesday #28
ehrnst Thursday #33
progressoid Thursday #37
Eliot Rosewater Thursday #38
ehrnst Thursday #39
Eliot Rosewater Thursday #40
progressoid Thursday #41
appalachiablue Thursday #44
Yo_Mama_Been_Loggin Wednesday #30
melman Wednesday #31
MarcA Wednesday #9
proActivist Wednesday #12
HiloHatti Wednesday #14
mathematic Wednesday #17
Post removed Wednesday #22
GulfCoast66 Wednesday #25
appalachiablue Wednesday #23
KG Wednesday #29
Progressive dog Thursday #32
Celerity Thursday #34
Progressive dog Thursday #35
Celerity Thursday #36
Progressive dog Thursday #42
Celerity Thursday #43

Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 12:40 PM

1. Third Way is the resurrection of the DLC (Democratic) Leadership Council, which was also Koch-funded

The DLC was the group that encouraged Dems to take lots and lots of corporate campaign $$$ for backing so called "free" trade ... iow Reaganism. This bunch, with its corpo funding, is responsible for the mealy-mouthed rightward lurch of the Democratic party beginning in the 90s. They coined the term "centrist" but their original name for themselves was Corporate Democrats. DLC was immensely influential, and basically called the shots until the base finally caught on to their game. That was when they morphed into Third Way. Most of the terrible Dem "strategists" are products of the DLC corporate wing of the party. They've never been right about a damn thing and afaic are responsible for the loss of Democratic seats across the counry at all levels of government over the last couple of decades.

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Response to hedda_foil (Reply #1)

Wed Aug 14, 2019, 12:49 PM

2. This 👆🏼

I always called them “Democratic Lite Corporatists”

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Response to UpInArms (Reply #2)


Response to hedda_foil (Reply #1)

Wed Aug 14, 2019, 01:23 PM

5. Ironically, Trump is against free trade

favoring tariffs and trade wars, and subsidies and protectionism.

It turns out many voters are social conservatives and fiscal/economic liberals. The opposite of Turd Way.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 01:18 PM

3. Not everyone who says they're on our side is on our side.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 01:20 PM

4. Just read this on Salon.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 01:34 PM

6. The cat is out of the bag?

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Response to crazytown (Reply #6)

Wed Aug 14, 2019, 02:03 PM

8. Bazinga!

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Response to George II (Reply #8)

Wed Aug 14, 2019, 04:28 PM

26. double bazinga, one thing is sure, some progressive seemed bound and determined to guarantee

rump stays in the WH

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 01:50 PM

7. 2007? Really?

It's 2019, and soon it will be 2020.

After 12 years, and Donald Trump in office, maybe we can move on from this, OK?

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Response to MineralMan (Reply #7)

Wed Aug 14, 2019, 02:14 PM

10. Don't know how you meant this. IOW, how I should take this.

At times I am 😏 with what I read, HOWEVER, if my understanding is what I believe it is, then»»👍, I'm with you.

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Response to sprinkleeninow (Reply #10)

Wed Aug 14, 2019, 02:14 PM

11. I mean exactly what I said and no more than that.

Crap from 2007 is irrelevant.

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Response to MineralMan (Reply #11)

Wed Aug 14, 2019, 02:19 PM

13. Got it. n/t

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Response to MineralMan (Reply #11)

Wed Aug 14, 2019, 02:54 PM

18. Read reply #1 above.

It explains a lot about today's split in the Dem party.

I know MANY Bernie supporters and those who consider themselves the progressives who see everyone in this light. They refer to anyone who does not espouse the progressive agenda, as "corporatists." I never knew what they meant until reading this thread.

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Response to Sogo (Reply #18)

Wed Aug 14, 2019, 02:58 PM

20. Some people like to create artificial categories to support their

beliefs about things. If you don't agree with them, you are a bad person and can be called names freely. If you are in the majority, then those people will not join with you to vote for things, even if they advance the causes they support. Instead, they'd rather have nothing and let people we all agree are bad gain power.

It's a strange, strange paradox that has given us leaders like Hitler and Trump. It has happened before, and can happen again. More's the pity.

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Response to MineralMan (Reply #7)

Wed Aug 14, 2019, 02:37 PM

16. The book is new. And the Kochs are still going strong affecting public policy

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Response to progressoid (Reply #16)

Wed Aug 14, 2019, 02:56 PM

19. Exactly!

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Response to progressoid (Reply #16)

Wed Aug 14, 2019, 03:07 PM

21. I'm with you

we need to stop creeping ever rightward.

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Response to progressoid (Reply #16)

Wed Aug 14, 2019, 03:43 PM

24. Some won't accept reality and do what they can to deny it

and attack others who don't deny it with projections.

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Response to progressoid (Reply #16)

Wed Aug 14, 2019, 04:29 PM

27. I know, create a purity test for the Democratic nominee and if they dont pass YOUR

test, you can doom us to certain annihilation by electing rump!

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Response to Eliot Rosewater (Reply #27)

Wed Aug 14, 2019, 07:19 PM

28. That is exactly NOT what I said.

But it you want to build some fanciful purity test, playing footsie with the Koch brothers would be high on the list of things to avoid as a Democrat.

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Response to progressoid (Reply #28)

Thu Aug 15, 2019, 09:43 AM

33. Who is playing 'footsie' with the Koch bros?

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Response to ehrnst (Reply #33)

Thu Aug 15, 2019, 12:37 PM

37. Coming Soon to a Democratic Primary: Candidates Backed By Charles Koch

By Philip Elliott
June 7, 2019

The political arm of Charles Koch’s ambitious network is preparing to start playing in Democratic primaries for the Senate, House and local roles, according to a memo being sent Friday.

The decision is the result of a gradual shift away from aggressive and conservative politics inside the deep-pocketed donor network and one more toward comity and compromise.

Several major donors had bristled at the partisan image built around the Koch network and have been lobbying leaders to get behind candidates that promote progress on issues like immigration reform, regardless of their party. The groups will try to find candidates from either party that commit to pieces of the Koch agenda.

https://time.com/5602691/charles-koch-democratic-primaries/


And peviously:

Koch Industries secretly funded a report by Third Way, a centrist Democratic think tank, to sell liberals on their trade agenda, according to the new book “Kochland” by investigative reporter Christopher Leonard.

The Kochs enlisted the help of Third Way, a corporate-funded centrist group that has long opposed progressive populists like Bernie Sanders and Elizabeth Warren, after the Democrats won control of Congress in 2006, according to excerpts from Leonard's book

https://www.salon.com/2019/08/14/koch-brothers-funded-centrist-democratic-group-third-way-according-to-new-book/


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Response to progressoid (Reply #37)

Thu Aug 15, 2019, 01:44 PM

38. THe endless BASHING and ATTACKING of Democrats ....wow

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Response to Eliot Rosewater (Reply #38)

Thu Aug 15, 2019, 01:44 PM

39. On DU, no less. (nt)

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Response to ehrnst (Reply #39)

Thu Aug 15, 2019, 01:46 PM

40. And this FUCKING DANCE we have to do talking about it, sigh

driving me away, i post far less now which means you know who wins

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Response to Eliot Rosewater (Reply #38)

Thu Aug 15, 2019, 03:09 PM

41. WHAt the hell ARE you GOING on ABOUT?

I've made a total of 24 posts this week. Only two were mildly critical of a Democrat. None were critical of Democrats, plural.
My posts in this thread were more of a concern about the influence of the Kochs, than a bashing of Dems.

That's not exactly endless bashing and attacking.

Here's a happy post for you: https://www.democraticunderground.com/1287236564

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Response to progressoid (Reply #37)

Thu Aug 15, 2019, 08:44 PM

44. Interesting article in Salon

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Response to Eliot Rosewater (Reply #27)

Wed Aug 14, 2019, 07:24 PM

30. Really

Here we go again. I don't know anyone running who I would consider third way.

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Response to Eliot Rosewater (Reply #27)

Wed Aug 14, 2019, 07:29 PM

31. Funny how

you like to talk about how "WAY to the left" you are but then turn around and talk about bullshit like "purity tests"

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 02:08 PM

9. Very true. More oligarchic sponsored divide and conquer for a feudal society.

Labels may change but the organizations and efforts are still there;
as true today as it was in the past. Some don't mind Democratic
loses as long as they get some oligarchic goodies for themselves.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 02:16 PM

12. For those who may be interested,

here is a link to the report itself. I haven't read it, but I am interested pragmatic approaches to policy so I will be considering what they have to say.

http://content.thirdway.org/publications/90/Third_Way_Report_-_Why_Lou_Dobbs_Is_Winning_-_Problems_with_Current_Approach_to_Free_Trade_--_web_version.pdf

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 02:23 PM

14. Joe Crowley, Who Was Defeated by AOC

Was a key Democrat heading that group. He was the #4 Dem in the House until he got unseated. This is why Progressives rage against the centrist corporate Democrats, and why Citizens United needs to be repealed.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 02:48 PM

17. Everybody knows the Kochs broke with longheld conservative orthodoxy to side with liberals

on trade and immigration. That you think this is a bad thing is... strange.



Third Way issued a report, titled “Why Lou Dobbs is Winning” — a reference to the right-wing Fox News host’s economic nationalist agenda — in November 2007. The report warned of a “new and powerful populist strain has emerged on both the left and the right of American politics that threatens to turn the nation fearful and inward.”


So the objection is that we were warned and we couldn't defeat the scourge of nativism and protectionism?

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Response to TheBlackAdder (Original post)


Response to Post removed (Reply #22)

Wed Aug 14, 2019, 04:24 PM

25. Respectfully, but that is bullshit.

The country went thru a right wing turn. Hell with out Perot Clinton probably would not have won. And he only started talking to republicans after they won the house for the first time in 45 years. Has he not Dole would have been elected in 96.

The fact you blame democrats who disagree with you for this county’s problems rather than, well, you know, republicans says volumes.

You really think a left winger could have won in 92? You can’t be serious.

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 03:14 PM

23. Turd Way has been around since the 90s, well well

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Response to TheBlackAdder (Original post)

Wed Aug 14, 2019, 07:21 PM

29. I lulz'd

again

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Response to TheBlackAdder (Original post)

Thu Aug 15, 2019, 09:35 AM

32. There is no cat there,

in a bag or out. Twelve years and thousands of lies ago, some Democrats realized that Trump style protectionism did not work for most Americans and certainly not for the world.
Both Presidents Clinton and Obama worked to make trade fair, particularly in having patents enforced, subsidies removed, and quotas removed. Trump ripped up trade agreements that they supported. Trump withdrew from TPP, a trade agreement designed to create competition to Chinese trade dominance. Trump is not a pragmatist on trade either.

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Response to Progressive dog (Reply #32)

Thu Aug 15, 2019, 10:59 AM

34. false dichotomy and false framing

The choice is not a binary one between Trumpian protectionism or a bad (and most definitely NOT, as you claim, fair) trade deal. The TPP btw, was never fully ratified by the US Congress in any event, so was never a legally binding agreement here. Were there good parts of it? Yes, certainly, but there were also poison pills that made it a an overall bad agreement.

I say the TPP was a bad deal in large part due to the horrid investor-state dispute settlement mechanisms, aka ISDS, (that gave multinational corporations the whip-hand over national governments) and the evergreening and/or large extensions of patent provisions (that allow firms, especially big pharma, to rapaciously continue to extract hundreds of billions, if not trillions of future dollars in what at that point, is pure rentier income.)

It is disingenuous at best to see (as I have witnessed on this board in the past) opposition to TPP equated or insinuated or linked in any way to posit a form (or actual) support for Trump. You can absolutely work against Trump with every fibre of your being and still think the TTP was a bad deal. Support for trade deals like this is partially (the percentage is up for debate but it sure is not inconsequential) why we have such discontent here in our nation, discontent that just further adds to the latent and overt sexism, racism, misogyny, and hate that monsters like Trump tapped into. It just gave him another arrow in his quiver of poison for his mob.

The TPP also would have been a fundamental driver for further wealth inequality, here and globally, and wealth inequality is the number one interlocked statistic when it comes to the well-being of a society on basically all levels of measurement.


Why TPP Is a Bad Deal for America and American Workers

BY JOSEPH STIGLITZ

http://rooseveltinstitute.org/why-tpp-bad-deal-america-and-american-workers/


the whole series

Tricks of the Trade Deal: Six Big Problems with the Trans-Pacific Partnership

http://rooseveltinstitute.org/tricks-trade-deal-six-big-problems-trans-pacific-partnership/



How to Tell TPP Is a Bad Deal

https://www.huffpost.com/entry/how-to-tell-tpp-is-a-bad_b_8914388



9 Ways the TPP Is Bad for Developing Countries

https://foreignpolicy.com/2015/07/07/9-ways-the-tpp-is-bad-for-developing-countries/



The Trans-Pacific Partnership Is Unlikely to Be a Good Deal for American Workers

https://www.epi.org/publication/tpp-unlikely-to-be-good-deal-for-american-workers/



The TPP has the potential for real harm

https://www.abc.net.au/news/2015-03-16/verrender-the-tpp-has-the-potential-for-real-harm/6321538


Ending the corporate power grab of Investor-State Dispute Settlement

https://www.citizen.org/topic/globalization-trade/corporate-power-expanded-isds/



How trade deals like TPP fail the global poor

https://www.vox.com/policy-and-politics/2015/11/6/9680538/tpp-development-trade-poverty



Senate Democrats gang up to delay fast-track trade bill

https://www.reuters.com/article/us-usa-trade/senate-democrats-gang-up-to-delay-fast-track-trade-bill-idUSKBN0NX0B320150512

snip

The vote marked a victory for Senate Democratic leader Harry Reid, an outspoken opponent of fast-track, after weeks of speculation that the toughest fight would be in the House of Representatives and not the Senate.

snip

Only one Democrat, Senator Tom Carper of Delaware, backed the measure, despite a White House campaign blitz to win Democratic support.

snip

Failure sends a worrying signal about the level of support for fast track, which is opposed by unions, environmental and consumer groups but backed by businesses, which reacted with disappointment.

snip



Robert Reich takes on the Trans-Pacific Partnership




How economic inequality harms societies | Richard Wilkinson



snip


I so often see bait and switch tactics used when it comes to the framing of corporatist-written/friendly 'free trade' agreements and actual fair trade ones. The Nordic nations, amongst the LEAST isolationist nations on the planet, for example, are ardent opponents of the of most odious parts written into TTIP (,the European version of the TPP, which also failed). The bad parts of TTIP and TPP are NOT necessary to achieve the overarching goals of having freer yet STILL FAIR trade. At times, the gamesmanship used against thsoe of us who are for free AND FAIR trade, who are NOT isolationists at all, who absolutely do hate Trump, but who simply support agreements without the sinister baggage tossed in, borders on the ridiculous.

I close with a word from my member of the US House of Representatives.....


https://lieu.house.gov/media-center/press-releases/congressman-lieu-statement-trans-pacific-partnership

FOR IMMEDIATE RELEASE

Washington - Today, Congressman Ted W. Lieu (D | Los Angeles County) issued the following statement regarding the Trans-Pacific Partnership.

“Last year, I voted against Trade Promotion Authority because I did not believe a trade agreement with questionable environmental and labor provisions should be fast tracked for ratification. As I review the text of the Trans-Pacific Partnership today, my concerns have only worsened.

I will not support an unfair trade deal that lacks enforceable environmental and labor standards. Specifically, I believe trade agreements must uphold President Obama’s and other landmark climate regulations. They must ensure the protection of the environment, fish, and wildlife. Moreover, any agreement must put American workers first and strengthen, not weaken, labor protections.

It is unclear whether or not TPP will receive a vote in Congress this year, but in the meantime I will continue to listen to the deep concerns of my constituents.”






https://projects.propublica.org/represent/votes/114/house/1/374


https://lieu.house.gov/media-center/in-the-news/lieu-we-entrust

Trade policy

Lieu also listed his concerns to me about proposed secretive Trans-Pacific Partnership (TPP) 12-nation trade agreement, which has been kept from the American public, while large corporations have been at the TPP negotiating table for years.

On July 12, Lieu was one of over two hundred House members who cast historic ‘no’ votes that at least for now, prevent President Obama from receiving Trade Promotion Authority (TPA) to negotiate the TPP. Also known as ‘Fast Track’ authority, TPA would prevent the Congress from amending the TPP, and instead would only allow for a single up/down vote on it, once presented to them by the President.

Lieu’s concerns went beyond transparency, to concerns about the TPP’s lack of a currency provision, which he argued “means all enforcement mechanisms are ineffective, because countries can engage in mass cheating by manipulating their currency.” He also cited experience with other trade agreements, that had the effect of “hollowing out the middle class and leading to greater wage inequality by shipping jobs overseas and hurting the American worker.”

But perhaps most insidiously he cited the TPP’s “Investor-State Dispute Settlement,” or ISDS provision, that would allow foreign companies to challenge U.S. Laws — and to potentially pick up huge payouts from taxpayers -without ever stepping foot in a U.S. court.

The ISDS would allow foreign companies to challenge any U.S. Law that protects public health, safety, the environment or workers, by arguing it unreasonably limited their profits — from, say, Santa Monica’s Sustainability Rights of Nature ordinance, to water rationing on farm land owned by foreign investors here in drought-stricken California. If a company wins, the ruling can’t be challenged in U.S. courts, and secret arbitration panels can require American taxpayers to cough up millions — even billions — of dollars in damages, which would then also have a chilling effect on passing such future legislation.

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Response to Celerity (Reply #34)

Thu Aug 15, 2019, 11:48 AM

35. TPP was stopped by anti trade forces

and stopping it was a huge mistake. The ISDS was designed to stop unfair competition .
The government would never have to pay monies that the President deemed unfair because several Presidents have withdrawn from international agreements without challenge.
The executive branch has exclusive authority over foreign relations. Presidents from William McKinley to Franklin Roosevelt to Jimmy Carter terminated international agreements without explicit congressional authorization — including some that dealt with trade.

https://www.vox.com/policy-and-politics/2017/10/26/16505508/nafta-congress-block-trump-withdraw-trade-power

Since WW2, the USA has tried to make friends with many countries through trade. We do not exist in a vacuum, we are less than 5% of the world's population and have a GDP of 15-16% of world GDP'
Share of global

© Statista 2019

by H. Plecher, last edited Aug 9, 2019
In 2018, the United States accounted for 15.16 percent of global gross domestic product (GDP) after adjusting for purchasing power parity (PPP). This share was expected to decrease to 13.71 percent by 2024, which is roughly a seventh of the global total.

https://www.statista.com/statistics/270267/united-states-share-of-global-gross-domestic-product-gdp/

We are still far ahead of most nations in output per capita and number 1 in the size of our economy. It is not going to help us to restrain trade over a fairness provision. The US first allowed a fairness provision at the end of the war of 1812.

Then there is our experience with modern ISDS, where the US has never lost a case.
Proponents of ISDS argue that governments retain their regulatory ability, if the agreements in question specify that regulations protecting health, the environment, labour rights and human rights are allowed. The Office of the United States Trade Representative challenges the notion that ISDS challenges "the sovereign ability of governments impose any measure they wish to protect labor rights, the environment, or other issues of public welfare".[6] The International Bar Association (IBA) mirrors these sentiments, noting that "while investment treaties limit states’ ability to inflict arbitrary or discriminatory treatment, they do not limit (and, in fact, expressly safeguard) a state’s sovereign right to regulate in the public interest in a fair, reasonable and non-discriminatory manner."[4] The White House notes that investment protections are a component of more than 3,000 trade agreements, the vast majority of which have some form of neutral arbitration.[23] The United States is party to at least 50 such agreements, has only faced 13 ISDS cases and never lost an ISDS case.[23]

The Peterson Institute for International Economics claims that ISDS provisions are necessary, as they boost investment: "empirical evidence has shown that treaties including these provisions have a positive effect on foreign direct investment (FDI) flows between signatory countries."[24] PIIE challenges the claim that ISDS "arbitrators lack integrity", noting that arbitrators take an oath of impartiality and both sides of a case choose arbitrators.[3]

https://en.wikipedia.org/wiki/Investor-state_dispute_settlement#Regulatory_capacity

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Response to Progressive dog (Reply #35)

Thu Aug 15, 2019, 12:30 PM

36. it was stopped by a broad coalition, including many Democrats, many unions, many progressives, many

environmentalists, NGO's etc. Rightly so, IMHO. To use reductionist language to label all those groups as simply being 'anti-trade' is ludicrous. It was a bad deal, as I have already laid out. You are once again pushing a false dichotomy that to be against the TPP is to somehow be a priori against trade and to be an isolationist. That is simply not true.

Your preferred candidate's (Biden) own chief economist is against ISDS btw, as well.


The Trans-Pacific Partnership clause everyone should oppose

By Elizabeth Warren

February 25, 2015

https://www.washingtonpost.com/opinions/kill-the-dispute-settlement-language-in-the-trans-pacific-partnership/2015/02/25/ec7705a2-bd1e-11e4-b274-e5209a3bc9a9_story.html

The United States is in the final stages of negotiating the Trans-Pacific Partnership (TPP), a massive free-trade agreement with Mexico, Canada, Japan, Singapore and seven other countries. Who will benefit from the TPP? American workers? Consumers? Small businesses? Taxpayers? Or the biggest multinational corporations in the world?

One strong hint is buried in the fine print of the closely guarded draft. The provision, an increasingly common feature of trade agreements, is called “Investor-State Dispute Settlement,” or ISDS. The name may sound mild, but don’t be fooled. Agreeing to ISDS in this enormous new treaty would tilt the playing field in the United States further in favor of big multinational corporations. Worse, it would undermine U.S. sovereignty.

ISDS would allow foreign companies to challenge U.S. laws — and potentially to pick up huge payouts from taxpayers — without ever stepping foot in a U.S. court. Here’s how it would work. Imagine that the United States bans a toxic chemical that is often added to gasoline because of its health and environmental consequences. If a foreign company that makes the toxic chemical opposes the law, it would normally have to challenge it in a U.S. court. But with ISDS, the company could skip the U.S. courts and go before an international panel of arbitrators. If the company won, the ruling couldn’t be challenged in U.S. courts, and the arbitration panel could require American taxpayers to cough up millions — and even billions — of dollars in damages.

If that seems shocking, buckle your seat belt. ISDS could lead to gigantic fines, but it wouldn’t employ independent judges. Instead, highly paid corporate lawyers would go back and forth between representing corporations one day and sitting in judgment the next. Maybe that makes sense in an arbitration between two corporations, but not in cases between corporations and governments. If you’re a lawyer looking to maintain or attract high-paying corporate clients, how likely are you to rule against those corporations when it’s your turn in the judge’s seat?

If the tilt toward giant corporations wasn’t clear enough, consider who would get to use this special court: only international investors, which are, by and large, big corporations. So if a Vietnamese company with U.S. operations wanted to challenge an increase in the U.S. minimum wage, it could use ISDS. But if an American labor union believed Vietnam was allowing Vietnamese companies to pay slave wages in violation of trade commitments, the union would have to make its case in the Vietnamese courts.

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Table of Foreign Investor-State Cases and Claims Under NAFTA and Other U.S. “Trade” Deals

https://www.citizen.org/article/table-of-foreign-investor-state-cases-and-claims-under-nafta-and-other-u-s-trade-deals/

The North American Free Trade Agreement (NAFTA) established an array of new corporate rights and protections that were unprecedented in scope and power. NAFTA’s Investor-State Dispute Settlement (ISDS) regime empowers multinational corporations to sue our governments before panels of three corporate lawyers. These lawyers can award the corporations unlimited sums to be paid by taxpayers, including for the loss of their expected future profits. The corporations need only convince the lawyers that a law, safety regulation, court ruling or other government action violates the new rights that NAFTA grants them. The lawyers’ decisions are not subject to appeal. By elevating individual corporations to the same status as sovereign governments, ISDS drastically consolidates and formalizes corporate power.

NAFTA’s extreme rules have been replicated in other U.S. “free trade” agreements (FTAs), including the Central American Free Trade Agreement and FTAs with Korea, Colombia, Peru, Panama and Oman. Not only has more than $475 million in compensation been paid out to corporations using ISDS just under U.S. agreements, but these corporate protections make it less risky and cheaper to outsource jobs. The corporate payoffs came after attacks on natural resource policies, environmental protections, health and safety measures and more. In fact, of the more than $55 billion in the 23 pending ISDS claims under NAFTA and other U.S. FTAs, nearly all relate to environmental, energy, financial, public health, land use and transportation policies – not trade issues or government seizures of property or investments. ISDS creates a parallel and privileged set of legal rights for multinational corporations to own and control other countries’ natural resources and land, establish or acquire local firms, and to operate them under privileged terms relative to domestic enterprises. For instance, corporations have received payouts when new policies undermine their “expectations” of a “stable regulatory environment.” The scope of the “investments” covered is vast, including derivatives and other financial instruments, intellectual property rights, government licenses and permits, as well as more traditional forms of investment.

The rigged ISDS enforcement system allows multinational firms to skirt national court systems and privately enforce their extraordinary privileges by directly challenging national governments before extrajudicial tribunals. Cases are litigated outside any domestic legal system in international arbitration bodies of the World Bank and the United Nations. A panel composed of three corporate lawyers has the power to award an unlimited amount of taxpayer dollars to corporations for the “expected future profits” that the attorneys surmise the firms would have earned if not for the challenged policy. If a corporation wins its investor-state case, the taxpayers of the “losing” country must foot the bill. States whose laws are challenged have no standing in the cases and must rely on the federal government to defend state policies
that the federal government may not support. While fewer than 50 cases were filed in the first three decades of the investor-state system, corporations launched at least 50 cases each year for the last six years, intensifying concerns about the system’s threats to democracy, taxpayers and the public interest. Countries from South Africa to Indonesia to India have withdrawn from or renegotiated their ISDS-enforced pacts. The corporate lobby is desperately trying to save their ISDS regime, but are increasingly isolated.

The U.S. National Conference of State Legislatures representing the mainly Republican GOP-controlled U.S. state legislative bodies, the U.S. National Association of Attorneys General, small business organizations, unions and consumer and environmental groups and Democratic and Republican members of the U.S. Congress alike have called for ISDS to be removed from U.S. trade agreements. Stark criticism of ISDS also has come from voices as disparate as U.S. Supreme Court Chief Justice John Roberts and pro-free trade think tanks such as the Cato Institute and progressive Democratic U.S. Senator Elizabeth Warren (D-Mass.) and former Vice President Biden’s chief economist Jared Bernstein.

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ISDS and the US

http://jaredbernsteinblog.com/isds-and-the-us/

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But their are still at least two big, existing problems. First, ISDS has been used by corporate bullies of rich countries to extract millions in fines and fees from poorer countries, and not for investor takings (which would be legit) but for protections prohibited by trade deals (examples here and here). What I want to see much more in U.S. trade agreements–and Jay might agree–is less protectionism of the advanced countries’ investor class and its IP and drug patents, and more lifting of standards in poor countries.

The second problem with ISDS is broader:

Through the backdoor of trade agreements, the ISDS process imposes extreme property rights’ concepts rejected repeatedly by Congress and U.S. courts, such as the notion that governments should pay “regulatory takings” compensation to property owners for the right to enforce environmental, health and other safeguards that could undermine the value of their property or investment. We must not solve the problem of weak rule of law among our trading partners by having the broad public bear investment risk or by changing fundamental principles of U.S. law. Instead, investment risk must be borne by the investors themselves; it is their skin, not ours, that should be in the game.


Final point. While the US hasn’t lost a case, a country is only really exposed to ISDS risk when partner countries have substantial investments in the other countries in the deal. That’s why, according to Lori, “54 of the 56 NAFTA ISDS cases to date attacking U.S. or Canadian laws were brought by investors from the Canada or the U.S., not from Mexico.” Surely, this makes no sense. ISDS isn’t in place–or at least it shouldn’t be–to be invoked in advanced countries with mature legal systems. Let the nationally-sanctioned, highly functional court systems work it out! (Jay: agree or disagree?.)

In fact, recent journalistic research reveals speculation by financial investors in ISDS cases, wherein investors either purchase companies with the express purpose of filing an ISDS claim or directly bankrolling the cases in order to claim a share of the fine. (Investors refer to this practice as “third-party funding of international arbitration against foreign sovereigns”.) Gus van Harten, a law professor who has studied these activities, finds that investors “…can get an award for billions of dollars when that award would never come out in domestic law. It’s just a jackpot for speculators.”

End of the day, the fact that ISDS hasn’t overridden any U.S. laws is comforting and Jay’s right to “ask” about it. But that doesn’t mean it’s non-evil!

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Response to Celerity (Reply #36)

Thu Aug 15, 2019, 06:03 PM

42. As Wikipedia says the USA has never lost an ISDS case

ISDS prevents unfair dealings by governments, dealings that the USA has avoided. Fifty some agreements with ISDS that the US has been party to and only 13 complaints filed.
One of the cases that Sen. Warren used to attack ISDS is summarized in Wikipedia.
In a February 2016 op-ed against the TPP, Senator Elizabeth Warren used the example of a French company suing Egypt because Egypt raised its minimum wage as an argument against the ISDS provisions of the TPP.[22] The editorial board of The Washington Post has, however, challenged this characterization of the case, noting that "Veolia of France, a waste management company, invoked ISDS to enforce a contract with the government of Alexandria, Egypt, that it says required compensation if costs increased; the company maintains that the wage increases triggered this provision. Incidentally, Veolia was working with Alexandria on a World Bank-supported project to reduce greenhouse gases, not some corporate plot to exploit the people. The case — which would result, at most, in a monetary award to Veolia, not the overthrow of the minimum wage — remains in litigation."[25]

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Response to Progressive dog (Reply #42)

Thu Aug 15, 2019, 06:22 PM

43. you chose to ignore all the other nefarious effects ISDS have, effects I have well documented

and ISDS is but one part of what made the TPP a bad deal. Even your example of pushback end up undermining your own argument (and not even updated as you simply lifted it from Wikipedia.)

https://isds.bilaterals.org/?veolia-loses-isds-case-against

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Veolia had signed a contract with the Governorate of Alexandria in 2000, to provide waste management services for 15 years. In 2012 Veolia took action against Egypt under the Bilateral Investment Agreement between France and Egypt, which allows for a French investor to sue the state if they can claim that a change in law causes damage to its investment. In this case part of the damage was alleged to arise from the increase in the minimum wage following a change in the labour law.

It took until April 2105 for the Tribunal to rule that it had jurisdiction over the case, and a further three years for the three-person panel to decide against the company. This is an important win for government’s right to improve workers’ wages against a private investor’s ‘rights’. But the detailed reasons for the decision remain secret.

However, it is also another case where governments lose even if they win, because the Egyptian government had to spend six years defending the case and pay millions of dollars in arbitration and legal costs. Although the costs of this particular case have not been made public, OECD studies show that average costs are $8-10 million and can be as high as $30 million.

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Done here. I am not going to change and start supporting the TPP. You are, of course free to do so, but I will always call out false framing and false dichotomies that attempt to wrongly put its opponents in a negative light, especially when such attempts use loaded terms and phraseology (anti-trade, isolationist, etc) in an attempt to unjustly pre-tilt the playing field.

Cheers

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