CETA Potpourrie

It has been speculated that Britain soon gone, protectionist forces in the EU eventually would stop ratification of CETA and also end TTIP. I always thought that this is a misleading speculation as many more countries then Britain are principally pro-trade, for the simple reason that they are exporting economies. Hence, the fate of CETA and TTIP are not dependent from the Brexit saga. And yet, the fate of CETA is on the brink. This is mainly due to President Juncker’s extraordinary tactical mishap to state that CETA will be ratified without any participation of national parliaments. Sure, he has the expertise of the Commission’s legal service on his side. But legal expertise do not differ very much from economic expertise: They differ from expert to expert. Legal scholars consulting the German government, for example, came out strongly to rank the CETA text as a mixed agreement that requires the saying of national parliaments. It is clear that Juncker and the Commission are not a bit interested to include national parliaments, not least because CETA would run into problems to getting sufficient support. Still, it speaks of the political ignorance of Juncker to make a public statement in such a way without further consulting national governments.

The Brexit referendum, in my view, was never about the EU but about British xenophobia and scare about migration. If it needed some EU bashing, though, Juncker provided some good input with his CETA take. There are times when the EU needs to be safeguarded from its own leaders, and it seems this point has been reached. The real problem, though, is that the EU misses since a long time to make an convincing argument in regards to positive trade effects. More recent research shows that such agreements come with significant gains. Now, CETA is – as its name suggests – more then a trade agreement. It covers an enormous range of items, from regulatory to investment and to public procurement issues, to name only the most prominent ones. And it is here where the problems are, in legal terms as well as in terms of public concerns. From a purely technical point of view it is rather difficult to understand why the EU is not dealing in better ways with the regulatory aspects and even goes a bit further in regards to ISDS. Both elements in CETA reflect a totally outdated liberal approach towards sovereignty , and should not be part of an agreement at all. In political terms, though, such a step would be like a revolution as the EU and its member economies still hangs on to a economic philosophy that expects macroeconomic benefits by serving the sole interests of capital. A few years ago some scholars (James A. Caporaso and Sidney Tarrow (2009). Polanyi in Brussels: Supranational Institutions and the Transnational Embedding of Markets. International Organization, 63, pp 593-620. doi:10.1017/S0020818309990099) saw ‘Polanyi in Brussels’ – even then I thought that they may suffer from eye defects. Today we know for sure that Polanyi is not even on the invitation list of the EU.

CETA had all the potential to become a welcomed trade agreement. Rather then fighting CETA and willingly supporting the protectionist sentiments of populist parties, one should argue to pass CETA if the Commission rethinks it one-sided market liberalization sentiment.