Miami Law Professors Urge Congress to Reject TPP and other Trade Agreements

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Two University of Miami Law professors appear as signatories of a candid essay urging members of the United States Congress to reject the Trans-Pacific Partnership and other international trade agreements.

Professor Emeritus David Abraham

In all, 223 law and economics professors across the U. S. including Joseph Stiglitz, a Nobel Laureate in Economic Sciences, and Jeffrey Sachs, co-founder of The Global Fund to Fight AIDS, Tuberculosis, and Malaria, signed the paper.

David Abraham, professor of law emeritus at Miami Law and one of the signees, believes that ISDS takes away certain freedoms from autonomous democracies. “What we see now is the growth in arrogance on the part of major corporations and the desperation of governments … surrendering their autonomy, their judicial systems, in favor of private dispute resolutions.”

The article, dated September 7, 2016, primarily opposes the Investor-State Dispute Settlement provisions within the TPP, arguing that their passing into law “threatens domestic sovereignty, and weakens the rule of law.”

Investor-State Dispute Settlement is a mechanism that grants private investors the right to initiate dispute settlement proceedings against governments in whose countries they hold investments to seek damages for profits lost due to actions that were taken by a particular government. The TPP aims to expand the use of this system.

While ISDS tribunals have been in effect since the 1960’s, only about 10% of foreign direct investment in the U. S. is currently protected by a treaty with ISDS. Approximately 70% of investment would be covered should the TPP and TTIP pass.

Abraham said that the biggest winners from the passing of ISDS resolutions would be large international corporations, not states. “It’s bad for weak countries because it takes away any impetus to improve their judiciaries, and it’s bad for established, strong countries because it de-democratizes policy outcomes.”

One of the paper’s most cogent arguments against the inclusion of ISDS provisions in international trade agreements says that, while domestic courts have an established and refined framework for handling suits against the government, the ISDS tribunals that would arbitrate investor disputes are not subject to those rules.

“Through ISDS, the federal government gives foreign investors – and foreign investors alone – the ability to bypass that robust, nuanced, and democratically responsive legal framework,” the paper reads.

“[Governments and large investment corporations] should be subject to the rule of law established through democratic institutions in viable court systems,” Abraham said. “Why should anybody respect the court systems if the lesson is that the big boys don’t use them?”

Abraham, along with Professor Elizabeth Iglesias, the other Miami Law signee, was first contacted in regards to the essay by the Center for Sustainable Urban Development, a consortium based at Columbia University which aims to explore ways in which sustainable urban processes can be improved worldwide.

Part of the impetus for Columbia’s CSUD organizing the work was the potential detriment to urban development caused by ISDS. The essay points out that, “In recent years, corporations have challenged a wide range of environmental, health, and safety regulations," including bans on toxins and efforts to combat tax evasion, among others.

Abraham also questions the potential ethical implications of ISDS, citing the example of an Australian law mandating that cigarettes be sold in plain wrappers without advertising, and the consequent lawsuit by Philip Morris, a tobacco company, against the Australian government.

“The government of Australia is being told [by Philip Morris] that ... you have to pay us for the losses that we think we will incur with this new deterrent to the sale of cigarettes,” Abraham said. “That is a surrender by a mature, democratic society of its sovereignty.”

The professor said that he and his fellow signatories aim “to make clear that we think this is a bad idea from the perspective of legal scholars, and also as concerned citizens."