“Will TTIP solve the massive EU-US unemployment? Absolutely not!” A revealing Sting Exclusive with Tim Bennett from the Transatlantic Business Council

Tim Bennett’s exclusive interview by Carlo Motta at the Sting’s pavilion during EBS 2014

This revealing exclusive interview with Mr Tim Bennett, Director General and CEO of the Transatlantic Business Council (TABC), was conducted by Carlo Motta at the European Sting’s pavilion during European Business Summit 2014. In the following interview Carlo Motta will be signalled as C.M and Tim Bennett as T.M.

C.M.: It is a pleasure and honour to have here with us today Mr Tim Bennett, Director General and CEO of the Transatlantic Business Council. Mr Bennett welcome and thank you very much for this interview. We would like to start with a very wide topic, the Transatlantic Trade and Investment Partnership, TTIP. Allegedly it could be a great opportunity for the European economy to recover from the crisis fast and for the American to boost its upturn. Do you agree with this and could you give us some figures so that we can measure TTIP’s contribution to the European and American economies?

T.B.: I think the way to look at TTIP is that there is global problem with job creation. There are not enough jobs globally. Clearly in the United States and in many member states of the European Union there is massive unemployment, the official figures probably do a disservice to the level of unemployment. It might be even greater than some of the staggering figures that we see. What the governments have done during the financial crisis during the last 6 years is that they try to address the issue with the macro-economic policy tools that they have. They are using monetary policy and fiscal policy; money pumped into their economies, adjustments of tax policy for examples, those had quite mixed and limited result. There are not many large macro-economic policy tools that governments have left; trade policy is probably the primary macroeconomic tool they have left. So for the United States and the European Union the TTIP idea, which has been around for nearly 20 years, and the business sector has been pushing for some kind of trade agreement between the US and the EU for at least 20 years, the TTIP is an opportunity for the governments to stimulate greater economic growth and greater job creation than otherwise would occur. So that is the primary benefit of TTIP. In terms of the numbers, the EU did a number of studies or funded a number of studies that came up with different ideas or estimates of job creation, amount of increased revenue or income per household. The thing to keep in mind about these estimates is that they were based upon best case scenario and the studies were done in order to help the policy makers make a decision on whether or not to actually do the negotiation. Personally from my prior experience in trade negotiations those are not accurate estimates in terms of what the end result will be. But what we do know from the history of trade agreements is that in the post World War II period they do result in greater economic growth and from that you get greater job creation than you otherwise would have. Will TTIP solve the massive unemployment in Europe and the United States? Absolutely not, it won’t! But it moves the needle more than you otherwise would do and governments have the responsibility now to do whatever they can to try and stimulate greater jobs.

C.M.: What is the American citizens’ sentiment on a trade agreement with Brussels. Are the American businessmen, voters and citizens eager and ready to benefit from a huge trade agreement with the European Union?

T.B.: Now that’s an excellent question! You have the business community which is very supportive of this trade agreement, the US Congress, where most of the members don’t even know that the TTIP has even started, and if you ask the general population outside of Washington, and there has been some recent polls; so some general questions are  – do you support international trade agreements?- and the majority say yes;  do you support a major trade agreement with Europe? – yes we do;  do you support a major trade agreement with Asia? the support is actually less. But for Europe there is support. Then if you ask them, do you support TTIP? Then they will ask -what is it? is it a new brand of a cotton swap for the ears? Is it like a cue tip? (laughter) The have no idea what TTIP itself is. So the US population is less educated on TTIP than is the European population at this particular time. So broad support for the idea but for the specifics of TTIP they are clueless at this time.

C.M.: There is no secret that there are some obstacles on the road to the conclusion of the TTIP agreement, data privacy, for which EU citizens are really sensitive now, especially now after the NSA and the Snowden scandals, and also GMO policy. The cultural, political and economic difference between the two peoples result in a different treatment and sensitivity on the aforementioned matters by the citizens of the two countries. How do you believe that TTIP will affect people’s everyday life in Europe? it’s now been a year since the negotiations have begun and what is your estimation on the conclusion of this negotiation?

T.B.: I am going to take, Carlo, the second part of your question first and then I will come to the obstacles and the cultural issues. On the timeline our members, our organisation, and we are half half here, 35 US companies and 35 EU companies, we think the negotiations are proceeding exactly on schedule; we have always thought that the technical negotiations would not conclude until late summer of 2015 or early fall of 2015. Then it will be the translation of the negotiated text into legal language, that would be completed by the end of 2015, and the agreement will be submitted to the US Congress and the European Parliament for their consideration and hopefully their approval in the months of January-April 2016. We hope that the agreement will be approved by late spring of 2016. There is no question that the agreement has some really substantial questions that have risen; food safety is clearly one. The food safety issue is more a cultural issue than a technical issue. On the GMOs, there is none recorded case ever in history that one has ever died from eating GMO food. The US population consumes large amounts. But it is such a sensitive issue that it is possible that that issue at the end of the day will come off the table; that there will be no changes on that. That is a very popular outcome on that one. The two governments are dedicated to the proposition that nothing will be included in this TTIP agreement that impacts consumer welfare, worker safety, environmental standards. I think they have repeatedly made that point. And from the terms of the business sector we have tabled numerous papers with recommendations on things that will need to be addressed in terms of trade barriers, I’ve not seen one single business recommendation seeking to weaken any particular standard that would affect the average citizen. And then overall benefit the greater economic growth is the primary benefit for certain specialty products that have higher tariffs, for example in the US I think the US citizen will have greater access to a lot of specialty products, like food and alcoholic beverages for example. Greater choice, lower prices, hopefully greater job creation.

C.M.: According to some recent surveys the TPP (TransPacific Partnership) is gaining momentum against the TTIP apparently at the heart and mind of the US citizen (Pew Poll April 2014). What is really the public sentiment in the US on the “dilemma” TTIP Vs. TPP? Do you see a conflict of political and economic interest between the two agreements?

T.M.: The two agreements will compliment each other. What TPP is trying to do which includes 12 countries, is push out the frontier of trade liberization and discipline in a matter of various issues such as intellectual property in the Asian countries. The US-EU agreement is very similar. The TPP is been under negotiation for 4 years. TTIP is just one year. The sentiment in the US Congress among those who are at least vaguely aware of these two trade negotiation, the sentiment is more in favour of the Europe agreement than it is the Asia agreement. They don’t even necessarily use the TPP and TTIP acronyms, they just would say “I like better that Europe agreement better than I like that Asia agreement”. And this is even without knowing the details yet. So I think it shows a certain predisposition, a sentiment, a favourable attitude towards the TTIP agreement as opposed to the Asia agreement. And just speaking for myself, not my organisation, I think that’s a possibility that the Pacific agreement will never come to conclusion whereas I am very confident that the agreement between the United States and the European Union is so important for economic reasons, for geopolitical reasons and for setting global rules that I think it will be successful.-