Trade Promotion Authority Legislation: Can Congress and the President Agree?

ADBC member, King & Spalding, held a discussion on February 26th about “Trade Promotion Authority Legislation:  Can Congress and the President Agree?”  Leading the discussion was The Honorable Michael A. Andrew a former member of the Ways and Means Committee in the House of Representatives and now Senior Counsel in in the Government Advocacy and Public Policy group at King & Spalding.  Other members of the panel were Representative Earl Blumenauer (D-OR), former Maryland Governor Robert L. Ehrlich, Jr, and Geoff Antell, International Trade Counsel to the Ways and Means Committee in the House of Representatives.

Trade Promotion Authority (TPA), sometimes known as Fast Track, is a process by which Congress promises to consider completed trade agreements, entered into by the administration, on an expedited basis.  The last TPA Act was enacted in 2002 and lapsed in 2007.  In January 2014, the chairman of the Senate Finance Committee, Sen. Baucus, Ranking Member, Sen. Hatch, and the chairman of the House Ways and Means Committee, Rep. Camp, introduced a bill to renew TPA.  The bill is formally known as the Bipartisan Congressional Trade Priorities Act of 2014.  It is the intention of its authors that the new TPA bill will cover, among other things, the Trans-Pacific Partnership Agreement (TPP) as well as to the Transatlantic Trade and Investment Partnership (TTIP), provided negotiations wrap up in the next 4 years (7 years if the option to extend the bill for another 3 years is exercised).

According to Rep. Blumenauer, currency manipulation is one issue with broad bipartisan support and an issue tied to manufacturing.  This issue is particularly important regarding the Trans-Pacific Partnership Agreement.   Many in Congress are concerned by apparent currency manipulation by some Asian countries that unfairly disadvantages US manufacturing companies in particular.  This is an area that must be addressed along with cheap labor and the role of state-owned companies.

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There was broad agreement on the panel that TPP and TTIP are nothing like the North American Free Trade Agreement (NAFTA). According to some independent studies, TPP and TTIP could generate $200 billion for the United States, and would cover much of the world’s trade.   According to Rep. Blumenauer, however, both NAFTA and the way TPA was passed on a strict party line vote in 2002 have left a legacy of distrust and negative feelings.  It is this negative atmosphere that will need to be ameliorated.

Rep. Blumenauer lauded United States Trade Representative (USTR), Michael Froman, for being highly attentive to Congress.  He has consulted with Congress on numerous occasions and been available to answer questions.  Some suggested that President Obama should exert more leadership while others opined that involvement from the President would foster opposition.

In conclusion, while ideological opposition may play a role, it has always been difficult to gain public approval for trade deals.  According to former Governor Ehrlich, both Democrats and Republicans are protectionist in one way or another and both sides use issues to cover their real agendas.  Most panelists agreed that while it probably won’t happen before the midterm elections in the fall, TPA will pass eventually.

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