The world’s two biggest economies, the United States and the European Union (EU), are negotiating an accord — the Transatlantic Trade and Investment Partnership (TTIP). They argue that it could boost the world economy by more than US$300 billion, and create millions of jobs. But at what price?
Free-trade agreements have historically boosted economic growth by eliminating border tariffs and opening up markets. But TTIP is different. Few significant tariff barriers exist between the United States and the EU, so the proposed accord focuses on reducing the economic impact of ‘non-tariff barriers’ — or, in plain language, reforms of standards and regulations on everything from the environment and public health to agriculture and pharmaceuticals. These could have wide-ranging and profound impacts, for good and bad.
There are clear benefits to be had from greater harmonization between the United States and the EU in some regulatory matters. Streamlining pharmaceutical regulation, for instance — so that an EU-approved product could be sold in the United States and vice versa — would reduce red tape and duplication. It would also boost research cooperation, cutting the costs of developing drugs and, ultimately, lowering prices. But other provisions of the accord could give drug companies more say in pricing and reimbursement policies — and so might result in higher medical costs and reduced access to health care. The humanitarian organization Médecins Sans Frontières (Doctors Without Borders) has also expressed concern that the impact of free-trade agreements on intellectual property increasingly threatens the access of millions of people in poor countries to affordable medicines.
As discussed on page 401, a major concern for scientific policy is that greater harmonization of EU and US policies might result in an overall decrease in regulatory standards on the environment, food safety or data protection, for example. Some say that such fears are overblown. Assessing what might be the true benefits and risks is not easy. Secrecy surrounds the negotiations, and the few details that are available usually come from unauthorized leaks. This is no way to conduct debate on such important matters. Civil society, including scientists and scientific organizations, must continue to badger for more access and information. At the very least, society should be given a similar level of access to that already granted to industry groups.
Beyond individual provisions, the nature of the proposed accord itself raises fundamental questions. Some leading economists — including Jeffrey Sachs at Columbia University in New York, previously a strong proponent of globalization, and Joseph Stiglitz, a 2001 economics Nobel laureate, also at Columbia — have called for TTIP to be rejected. They argue that it is not a trade agreement at all, but an undemocratic way for corporate lobbies to impose a narrow form of globalization — one that is focused more on commercial interests than on creating global systems to address such challenges as environmental and health crises (including biodiversity loss) and reducing economic inequality.
One proposed provision — a mechanism for settling disputes that is designed to protect investors — deserves much wider debate. It would allow companies to bring lawsuits against sovereign states in private arbitration courts to obtain financial compensation for any regulatory actions that could harm their ‘expected’ profits. Similar mechanisms have already allowed the tobacco company Philip Morris to sue Uruguay over the introduction of national anti-smoking measures. And Swedish energy company Vattenfall sued the German government in 2009 for introducing stricter environmental controls on coal-fired power plants; that case was settled out of court in 2010. The proposals mean that France, for example, might open itself up to lawsuits over its ban on fracking or its phasing out of a class of pesticides thought to harm bees and other insects.
“Science policy-setting is not, and must not be, chiefly about trade.”
The existence of such a legal mechanism at the highest levels of US and EU politics could have a dangerous and chilling effect, making countries think twice before introducing stricter regulations to protect public health or the environment, for example. It offers a ready-made route for corporate interests to usurp the right of sovereign states to act in the best interests of their citizens. In February, the European University Association expressed concern that TTIP could harm the ability of authorities to determine the shape of their higher-education systems.
The use of sound science to set regulations that affect trade is to be encouraged. But the science is not always unequivocal, and it must by no means be the only consideration. The practices of individual nations are forged from their own history and culture, resulting in different approaches to how they structure health care, agriculture, food or environmental systems — and in how these are shaped by government and the market, and to what extent. National attitudes to science and technology are formed in a similar way; for example, in the level of risk people are willing to accept, or the ethical limits that such attitudes place on research or medical practices.
That is why regulations differ worldwide. The dominant globalization ideology too often sees cultural differences, and citizens’ rights to determine the sort of society they desire, as trade barriers that must be overcome. This is misguided. Science policy-setting is not, and must not be, chiefly about trade.
Done right, the harmonization of regulations and standards between the United States and the EU could bring enormous benefits. But the potential risks it carries for increased deregulation, and for the role and diversity of science-related policies in democratic societies, deserves much greater scrutiny — and much more transparent debate. Scientists, social scientists and their representatives, such as national academies, could perform a public service by contributing to and helping to clarify the many detailed scientific, technical, regulatory and social aspects of this complex and wide-ranging accord.
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