14 May 2015

Obama Claims That Fast Track Will Not Kill Dodd-Frank. Canadian Files NAFTA Complaint to Kill Volker Rule

Obama calls the claim lubricious, but the government of Canada has moved to exempt its own bonds from the Volker Rule:
In her attacks on Obama’s pending trade deals, Elizabeth Warren has argued that could undermine US financial regulations like Dodd Frank. The Administration has taken to trying to dismiss Warren as not knowing what she was talking about. More skillful defenders of the traitorous trade deals took the tact of saying that Warren could in theory be right, but the odds of her fears playing out were so remote as to not be worth worrying about.

In a long, careful article in the Nation yesterday, George Zornick explains even with the limited information that we have now about the contents of proposed treaties like the TPP and its ugly European step-sister, the TTIP, Warren’s worries are valid. ………


But an example of Warren’s concerns came out of left field yesterday, as reported by the Wall Street Journal:

A U.S. rule that prohibits banks from taking risky bets with their own money violates the North American Free-Trade Agreement because it bans U.S. banks from trading triple-A-rated Canadian government debt, Canada’s finance minister said Wednesday…
Canadian concerns about the Volcker rule’s treatment of sovereign debt aren’t new. In 2012, Canada joined European countries and Japan in raising concerns about the law’s reach..

Mr. [Joe] Oliver noted that the Volcker rule reflects concerns about the credit standing of some foreign securities. That concern doesn’t apply to Canada, he said, because Canada’s credit rating is better than the U.S. government and U.S. municipalities…

“I believe—with strong legal basis—that this rule violates the terms of the Nafta agreement,” Mr. Oliver told a securities industry audience in New York that included the U.S. ambassador to Canada, Bruce Heyman. “I hope the United States administration sees that changing the Volcker rule is in its own best interests and that of its biggest trading partner.”
Yep, clearly Obama was right to portray Warren as a hysterical woman over the possibility of the Investor State Dispute Settlement (ISDS) process will never be used to roll back financial regulations.

When juxtaposed with how Mitch McConnell crowing about how a future Republican President will use Fast Track to run impose the Republican agenda:
If we had a Republican president right now, not a single Democrat would vote for Trade Promotion Authority. So what I’ve said to my members, if we want the next Republican president, who we hope will be sworn in less than two years from now, to have a chance to do trade agreements with the rest of the world, this bill is about that president as well as this one.
Fast Track, the TPP, and the TTIP are seen by the Republicans as a weapon to weild.


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