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Obama Admin’s TPP Trade Officials Received Hefty Bonuses From Big Banks

By Lee Fang | Republic Report | February 18, 2014

Officials tapped by the Obama administration to lead the Trans-Pacific Partnership trade negotiations have received multimillion dollar bonuses from CitiGroup and Bank of America, financial disclosures obtained by Republic Report show.

Stefan Selig, a Bank of America investment banker nominated to become the Under Secretary for International Trade at the Department of Commerce, received more than $9 million in bonus pay as he was nominated to join the administration in November. The bonus pay came in addition to the $5.1 million in incentive pay awarded to Selig last year.

Michael Froman, the current U.S. Trade Representative, received over $4 million as part of multiple exit payments when he left CitiGroup to join the Obama administration. Froman told Senate Finance Committee members last summer that he donated approximately 75 percent of the $2.25 million bonus he received for his work in 2008 to charity. CitiGroup also gave Froman a $2 million payment in connection to his holdings in two investment funds, which was awarded “in recognition of [Froman’s] service to Citi in various capacities since 1999.”

Many large corporations with a strong incentive to influence public policy award bonuses and other incentive pay to executives if they take jobs within the government. CitiGroup, for instance, provides an executive contract that awards additional retirement pay upon leaving to take a “full time high level position with the U.S. government or regulatory body.” Goldman Sachs, Morgan Stanley, JPMorgan Chase, the Blackstone Group, Fannie Mae, Northern Trust, and Northrop Grumman are among the other firms that offer financial rewards upon retirement for government service.

Froman joined the administration in 2009. Selig is currently awaiting Senate confirmation before he can take his post, which collaborates with the trade officials to support the TPP.

The controversial TPP trade deal has rankled activists for containing provisions that would newly empower corporations to sue governments in ad hoc arbitration tribunals to demand compensation from governments for laws and regulations they claim undermine their business interests. Leaked TPP negotiation documents show the Obama administration is seeking to prevent foreign governments from issuing a broad variety of financial rules designed to stem another bank crisis.

A leaked text of the TPP’s investment chapter shows that the pact would include the controversial investor-state dispute resolution system. A fact-sheet provided by Public Citizen explains how multi-national corporations may use the TPP deal to skirt domestic courts and local laws. The arrangement would allows corporations to go after governments before foreign tribunals to demand compensations for tobacco, prescription drug and environment protections that they claim would undermine their expected future profits. Last year, Senator Elizabeth Warren warned that trade agreements such as the TPP provide “a chance for these banks to get something done quietly out of sight that they could not accomplish in a public place with the cameras rolling and the lights on.”

Others have raised similar alarm.

“Not only do US treaties mandate that all forms of finance move across borders freely and without delay, but deals such as the TPP would allow private investors to directly file claims against governments that regulate them, as opposed to a WTO-like system where nation states (ie the regulators) decide whether claims are brought,” notes Boston University associate professor Kevin Gallagher.

February 18, 2014 Posted by | Corruption, Economics, Progressive Hypocrite | , , , , , , , , | Leave a comment

The Most Nefarious Part Of The TPP Proposal: Making Copyright Reform Impossible

By Mike Masnick | Techdirt | November 14, 2013

So with yesterday’s revealing of the IP chapter of the TPP, there are plenty of great analyses out there of what’s in there, but I wanted to highlight some parts that are the most nefarious and downright slimy in that they represent parties (mainly the US) pretending to do one thing while really doing another. These are tricks pulled by a dishonest, shameful USTR, entirely focused on making his corporate buddies richer at the expense of everyone else. Remember, our current USTR, Michael Froman, has a long history of this kind of crap. While he hasn’t been there throughout the negotiating process, it shouldn’t be surprising that he “delivers” this sweetheart deal to a few legacy industry players.

Watch closely, and you’ll see supporters of TPP, and especially USTR employees, make the claim that nothing or almost nothing in the TPP will require legal changes in the US. They’ll say that this is just about “harmonizing” norms across borders to make it easier for businesses to do business internationally. This is a lie.

It’s a lie in two different ways. First, there are multiple provisions in here that will absolutely require changes to US law. We’ll discuss a few in other posts, but what’s much more nefarious and downright obnoxious, is that this would lock in a variety of really bad copyright policies, making it nearly impossible for Congress to go back and change them. And that’s a real issue, because, as we’ve been discussing, Congress is actually discussing copyright reform again. The head of the US Copyright Office, Maria Pallante, has proposed a bunch of changes to copyright law (some good, some bad), and astoundingly, just as Congress is at least trying to have the discussion about whether or not those and other ideas make sense, the USTR is looking to effectively tie everyone’s hands by saying “these things cannot be changed,” including many of the reforms that Pallante has directly proposed.

That’s really quite incredible if you think about it. On the one hand, you have the very head of the Copyright Office suggesting some reforms, and you have Congress beginning the process to explore that. On the other, you have the USTR totally ignoring the sole power of Congress to make copyright and patent law, and effectively saying “you cannot make any of the suggested reforms.” And then the USTR has the gall to ask Congress to give up its power to challenge specific provisions in the agreement? While we’re concerned about the Congressional copyright reform process, at least it’s being done in the open. The USTR has been hashing out the plan in TPP in total secrecy for years.

Who the hell does the USTR think they are that they can flat out override the Constitution and the Congressional process, and effectively block them in and stop any meaningful attempt at copyright reform? All done via a process driven entirely by a few special interests? It’s anti-democracy. It’s pure corporate cronyism by the worst cronies around.

Now, defenders of this proposal will lie. They’ll claim that technically (1) Congress has to approve this and (2) nothing in a trade agreement can limit Congress’s ability to pass laws. Neither point is really true (the fun with things that are “technically” true, but false in reality). As mentioned above, the USTR (and President Obama) is pushing extra hard for Trade Promotion Authority, which basically is Congress granting the USTR full power over the TPP. Normally, Congress would be able to debate, challenge and reject questionable provisions in the agreement. But, with TPA “fast track” ability, Congress could only give a yes/no vote on the whole package. And, yes, some will claim that they can just vote no, but the reality is that there are other parts of this agreement that are designed to make that nearly impossible. There are all sorts of little things that we’ll be told we “need.” TPA is a bit of theater. What’s delivered to Congress will almost have to be passed — so if it’s granted (before it’s even public what’s in the full agreement) — Congress has effectively approved the whole agreement.

As for the claim that Congress’ hands cannot be bound by a trade agreement, this is again technically true, but it ignores that it becomes realistically impossible. The second that Congress tries to change a law that goes against the TPP — such as, say, reducing the term of copyrights from the insane level today to merely crazy — lobbyists and pundits will come screaming from every direction about how we can’t abandon our “international obligations.” We’ll hear horror stories about how breaking the agreement will have widespread implications, including trade wars, tariffs and other horrible things. Once it’s in the trade agreement, “breaking it” becomes effectively impossible.

The lobbyists for the entertainment industry know this stuff cold. Over the past three decades they’ve perfected this process of getting crap they can’t get done in Congress pushed through in various trade agreements, and then they use that to mold US law to exactly how they want it. They’re not even shy about it, admitting this is exactly how they got the DMCA in the first place. Considering that the TPP has a form of DMCA-on-steroids, it shouldn’t be a surprise that they’re using an even bigger trade agreement to do the same thing.

All of this should lead to a basic question: why is the USTR and President Obama directly trying to undermine Congress’ sole authority over copyright and patent policy? Are they proud of the tricks they tossed in the agreement? I imagine that when the USTR staffers move on to their jobs in the same industries that pushed them to write the agreement this way, they’ll all laugh about that time they fucked over the American public.

November 14, 2013 Posted by | Civil Liberties, Deception, Economics | , , , , , | Leave a comment