Labor unions and U.S. automotive manufacturers have outlined the concrete steps that they say the Office of the U.S. Trade Representative must take in order to ensure that the inclusion of Japan in the Trans-Pacific Partnership (TPP) talks does not end up harming U.S. companies and workers. On currency manipulation, these groups are aligned, but there appear to be some differences between them on issues like "managed trade" and rules of origin.
The groups made presentations outlining their view at a July 2 hearing of the Trade Policy Staff Committee on Japan's participation in TPP.
Matt Blunt, the president of the American Automobile Policy Council (AAPC), made clear that his group cannot support a final TPP deal unless its demands are met. "Unless the United States secures all of the commitments from Japan that we outlined in our June 9 submission, it will be impossible for the AAPC to support the TPP agreement," Blunt argued at the hearing.
Specifically, the AAPC is insisting on enforceable currency disciplines to prevent Tokyo from manipulating its currency; a phaseout period for U.S. auto tariffs that is at least 25-30 years long; elimination of all current non-tariff barriers (NTBs); an "accelerated" auto dispute settlement mechanism to address new NTBs when they arise and to impose penalties, including the reinstatement of auto tariffs; competition obligations; and an "oversight body" for auto issues.
However, the AAPC is not pushing for "managed trade" provisions, which refers to the general idea that the liberalization of U.S. auto tariffs would be directly linked, and contingent upon, increased U.S. auto exports to Japan. U.S. car companies are not necessarily opposed to this approach, which is favored by labor unions, but believe there is little chance that USTR could be convinced to endorse it in the TPP negotiations.