Why Obama Is Wrong and Warren Is Right on Trade Bill Quarrel

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"...Elizabeth Warren has warned leery Democrats that a fast-track trade bill could undo U.S. laws such as the Dodd-Frank banking regulations later. A number of constitutional scholars and other legal experts say she’s right..."

In her quarrel with President Barack Obama over trade legislation, Elizabeth Warren has got the law on her side. The Massachusetts senator has warned leery Democrats that a fast-track trade bill in Congress now could undo U.S. laws such as the Dodd-Frank banking regulations later. A number of constitutional scholars and other legal experts say she’s right. The reason: An arcane provision of the trade legislation would make it easier for a future president and Congress to team up to undercut existing statutes, even ones with little to do with trade. The risk to Dodd-Frank is “real and meaningful and worth worrying about,” said Michael Barr, Obama’s former assistant Treasury secretary for financial institutions and an architect of the law.


The fight pits two of the most popular Democrats in the country against each other. Obama’s support of fast-track trade authority and regional free-trade deals under negotiation with Pacific Rim and European nations places him sharply at odds with most of his party. Warren says she’s concerned that Republicans could include provisions in a future trade deal undercutting Dodd-Frank. They could then pass it with a simple majority in the U.S. Senate because the fast-track bill would prevent Democrats from blocking the legislation through a filibuster. Normally, it takes 60 votes to break a filibuster.

“In the next few weeks, Congress will decide whether to give the president fast-track authority,” she said in a May 5 speech to the Institute for New Economic Thinking in Washington. “This is a long-term problem -— a six-year problem. If fast-track passes, a Republican president could easily use a future trade deal to override our domestic financial rules.”

‘Absolutely Wrong’

Obama called Warren’s contention “absolutely wrong” in an interview with Yahoo News and said he’d “have to be pretty stupid” to agree to a trade deal that would undermine the Dodd-Frank law he signed himself. The law, intended to rein in banks considered responsible for the 2008 financial crisis, is deeply popular with Democrats, and Warren’s contention that a trade deal might undermine it could help rally Democratic opposition. “Our priority has and continues to be defending against any attempts to undermine these critical protections,” Whitney Smith, a spokeswoman for the Treasury Department, said in an e-mail. “Our trade agreements would not weaken our ability to implement the law now or in the future.” On Warren’s side: One of the nation’s preeminent constitutional law scholars, Laurence Tribe of Harvard University, who counts Obama as a former student. “Any act of Congress or duly ratified treaty overrides any contrary prior federal legislation,” he said in an e-mail. The bill to grant the president fast-track authority for six years is expected to pass the Senate next week. It faces greater resistance from House Democrats.

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Sovereignty Provision

White House Press Secretary Josh Earnest said Wednesday that no trade agreement concluded under the fast-track authority would change any U.S. laws. “I will show you the specific text that’s included in the legislation that specifically, word for word, bars the agreement from being used to change U.S. law,” Earnest said. “That’s written into the bill. That is a concern that people do not have to have.” The so-called “sovereignty” provision Earnest cited indeed exists, preventing the trade agreement itself from overriding U.S. laws. The fast-track authority, however, doesn’t just govern the trade deal; it would speed consideration of legislation Congress must pass to implement the pact. That legislation could change U.S. laws. “It is possible it could undermine Dodd-Frank,” Krist said. European officials and financial industry executives are itching to loosen key requirements the Dodd-Frank law established to reduce the threat of another financial collapse, Barr said. Their targets include regulations on derivatives trading by bank affiliates outside the U.S.; a ban on proprietary trading, named after former Federal Reserve Chairman Paul Volcker; and the rules on capital requirements, he said. The Europeans also want banks to be able to count as acceptable capital higher-yielding assets that carry more risk, Hufbauer said.




cont'

http://www.bloomberg.com/politics/articles/2015-05-15/warren-claim-that-trade-bill-could-undermine-dodd-frank-is-right

[NYC_SKP]

1. For 2016: A Sanders Warren ticket would be the absolute end of the bullshit.

Imagine an announcement at just the right time, before any VP debates.

Bernie announces his running mate, a woman, Senator Warren.

4 or 8 years of Sanders followed by another term or two by Warren.

Fuck.

Sweet!

[Cali_Democrat]

10. What about Hillary/Webb 2016?

Your thoughts....

[Autumn]

12. OMG That would be a dream come true.

[Hoyt]

2. "It is POSSIBE it COULD undermine . . . . . ". Doesn't sound very convincing.

Most of what Warren has been saying is along the same line.

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3. Laurence Tribe of Harvard University disagrees with you...

On Warren’s side: One of the nation’s preeminent constitutional law scholars, Laurence Tribe of Harvard University, who counts Obama as a former student. “Any act of Congress or duly ratified treaty overrides any contrary prior federal legislation,” he said in an e-mail.

[Hoyt]

5. So find in the TPP or TTIP where it revokes Dodd-Frank.

Tribe also said some ugly things about Sotomayor. And he even bashed Obama's environmental laws as unconstitutional. Sounds like an old fool to me.

[Segami]

6. Don't bring Sotomayor into this...

Americans are also reacting to the threat that the TPP poses to national sovereignty — government’s ability to control the wealth and power of the giant multinationals. Bloomberg News yesterday, in Wall Street Seeks Dodd-Frank Changes Through Trade Talks warns that, “U.S. bankers and insurers are trying to use trade deals, which can trump existing legislation, to weaken parts of the Dodd-Frank Act designed to prevent a repeat of the 2008 financial crisis.”

The Bloomberg report gets into some specific problems that watchdog groups see. For example, “The trade talks could easily become a Trojan Horse,” said Marcus Stanley, the policy director for Americans for Financial Reform, a group that includes labor unions, civil rights organizations and consumer advocates.

Trade agreements, once signed, override national sovereignty and limit a country’s ability to regulate giant corporations. The Bloomberg report noted that the financial industry is already trying to use existing trade agreements to roll back regulations required by the 3-year-old Dodd-Frank law,

The financial services industry has already invoked international trade rules in its bid to weaken proposed regulations, notably the Volcker rule that would ban proprietary trading. Named after former Federal Reserve chairman Paul Volcker, the rule is a signature part of Dodd-Frank.
The U.S. Chamber of Commerce sought a review of the rule by U.S. trade authorities, arguing it violated existing agreements.

So the financial industry is trying to use the upcoming TPP to overturn portions of Dodd-Frank and other rules in other countries they see as restricting their power.

http://ourfuture.org/20130523/tpp-a-deregulation-treaty-not-a-trade-treaty

[Hoyt]

7. How could they use TPP in court, it's a secret you know. Dave Johnson cracks me up.

His experience as a computer game developer doesn't give me a lot of confidence in his "it's possible it could" articles.

[Segami]

8. Calling Laurence Tribe

an "old fool" tells me you don't know what you're talking about.

[Hoyt]

11. As another old fool, I disagree. Anyone who calls Sotomayor stupid is a fool.

[Dont call me Shirley]

4. The ISDS provision will overrule national sovereignty and taxpayers will be funding the

corporate raid and pillage of our treasuries, national state local and personal.

http://www.citizen.org/investorcases

"Among the most dangerous but least known parts of today's "trade" agreements are extraordinary new rights and privileges granted to foreign corporations and investors that formally prioritize corporate rights over the right of governments to regulate and the sovereign right of nations to govern their own affairs. These terms empower individual foreign corporations to skirt domestic courts and directly challenge any policy or action of a sovereign government before World Bank and UN tribunals.

Comprised of three private attorneys, the extrajudicial tribunals are authorized to order unlimited sums of taxpayer compensation for health, environmental, financial and other public interest policies seen as frustrating the corporations' expectations. The amount is based on the "expected future profits" the tribunal surmises that the corporation would have earned in the absence of the public policy it is attacking. There is no outside appeal. Many of these attorneys rotate between acting as tribunal "judges" and as the lawyers launching cases against the government on behalf of the corporations. Under this system, foreign corporations are provided greater rights than domestic firms.

This extreme "investor-state" system already has been included in a series of U.S. "trade" deals, forcing taxpayers to hand more than $440 million to corporations for toxics bans, land-use rules, regulatory permits, water and timber policies and more. Under a similar pact, a tribunal recently ordered payment of more than $2 billion to a multinational oil firm. Just under U.S. deals, more than $34 billion remains pending in corporate claims against medicine patent policies, pollution cleanup requirements, climate and energy laws, and other public interest policies. Continue reading..."

[abelenkpe]

9. But China!

We don't want them writing the rules or having a stronger economic influence over the world. Can't you see why we need these trade bills written by/for/with western corporations with no input from workers?