President Barack Obama mounted his latest defense of the 12-country Trans-Pacific Partnership (TPP) trade deal Friday at the Nike World Headquarters, the sprawling Oregon campus of the sporting goods giant.
Many critics questioned why Obama would make the case for the massive Pacific trade pact at one of America’s biggest outsourcers. Nike says it employs 26,000 people in the U.S., but it also works with an estimated one million contract workers abroad. Over 95 percent of Nike footwear is manufactured in Vietnam, China and Indonesia. Vietnam, which is a party to the TPP negotiations, is home to about one-third of Nike’s contract workers, according to the Oregonian.
But when Nike CEO Mark Parker took the stage in Nike’s Federer Platz near the Portland suburb of Beaverton to introduce the president, the choice of venue became clear: Parker promised that if the TPP passed, Nike would directly create 10,000 new jobs in the United States, and indirectly generate 40,000 U.S. jobs, when factoring the impact on Nike’s U.S. suppliers.
“I’m proud to say that if the TPP is ratified that Nike will accelerate our efforts to bring advanced manufacturing to the United States,” Parker said. “The future of Nike and this country depends not only on what we make, but how we make it. That’s why we support President Obama’s hard work on trade and the Trans-Pacific Partnership.”
The company pointed in a statement to tariff relief as the aspect of the TPP that would push them to enlarge their manufacturing footprint.
"Footwear tariff relief would allow Nike to accelerate development of new advanced manufacturing methods and a domestic supply chain to support U.S. based manufacturing," the statement said.
Obama argued that the deal would raise labor standards in such countries and open up their markets to U.S. goods, just as the United States has long been the recipients of imports, like Nike shoes, from Vietnam.
“It doesn’t mean that conditions in Vietnam are like they are here in Portland, but it moves us in the right direction,” he said, noting that such enforceable standards would help offset U.S. job losses. “That’s good for American businesses and American workers, because we already meet higher standards than the rest of the world and that helps level the playing field.”
Critics have urged Congress to deny the president Trade Promotion Authority (TPA) to secure passage of the final agreement, which would ensure that the final version of the pact receives only an up-or-down vote in Congress, with members unable to submit amendments.
Senate Majority Leader Mitch McConnell, R-Ky., who, like many congressional Republicans supports the deal, has set initial debate on TPA for early next week, although Senate Minority Leader Harry Reid, D-Nev., has said he would try to slow down the progression of the bill.
Obama lauded the TPP as a key piece of his middle-class economic agenda and said it was the most progressive trade deal negotiated yet.
“I view smart trade agreements as a vital part of middle-class economics, not a contradiction to middle-class economics,” Obama said. “I’ve run my last election and the only reason I do something is because it’s good for American workers and the American people. I don’t have any other rationale.”
The president reiterated again that the mistakes of past trade deals — particularly the North American Free Trade Agreement, which some economists blame for widespread factory closures and the loss of manufacturing jobs around the country — would not be repeated this time around.
“There was real displacement and real pain so for many Americans,” Obama said. “But we have to learn the right lessons from that — the lesson is not that we pull up the drawbridge and build a moat around ourselves. The lesson is that the trade deals we do shape are ones that allow us to compete fairly.”
The text of the agreement has remained hidden from the U.S. public while the details are worked out by negotiators. Only members of Congress and other stakeholders with a security clearance know its details, making it particularly difficult to assess the administration's claims.
Detractors continued to say that the TPP amounts to little more than a corporate give-away and offers few benefits to workers in the U.S. or abroad.
Thea Lee, deputy chief of staff for the AFL-CIO, which has been among the TPP’s most vocal critics, said practices that Nike has long engaged in, from outsourcing to maintaining lax labor standards, are encouraged by trade agreements like the Trans-Pacific Partnership.
“Companies have the ability to move jobs overseas with or without trade agreements, but our position that these trade agreements on balance end up doing more to protect outsourcing and offshoring and to promote imports than they do to open up export markets and create jobs,” she said. “This is just another corporate PR stunt — if Nike wanted to create 10,000 jobs in the United States, they could do it tomorrow.”
Lee noted that defeating fast track was TPP critics' last chance to fix the massive pact, which affects 40 percent of international commerce.
"If fast track is defeated, then I think the administration must rethink and go back and get the right provisions," she said. "Right now, they're not in a fix-it mode. They're in a defend-it mode."