Lawmakers, Industry Praise Obama's Push for Trade in State of the Union

The two pacts will break down barriers between the U.S. and its TPP partners, as well as the European Union, and will help attract U.S. manufacturing back to the U.S., Obama said. “I’m the first one to admit that past trade deals haven’t always lived up to the hype, and that’s why we’ve gone after countries that break the rules at our expense,” said Obama. “But 95 percent of the world’s customers live outside our borders.”

Those remarks took only a few moments from the roughly one hour long speech, but the trade and business community immediately applauded. The National Foreign Trade Council (here) and the U.S. Council on International Business (here) both praised the opportunities U.S. companies will reap through those two pacts.

The U.S. trade agenda will boost U.S. industry at all levels, said the National Association of Manufactures (here) and the Footwear Distributors and Retailers of America (here) in responses to Obama’s remarks. “The industry and our consumers paid over $2.7 billion in footwear duties in 2014, more than $400 million of which was taxed on TPP footwear imports alone,” said FDRA President Matt Priest. “Imagine the impact on consumers and footwear companies if outdated footwear tariffs from the 1930s – reaching upwards of 67.5% – were eliminated on footwear out of TPP countries.” TPP negotiations are still largely confidential, and the footwear industry has not yet reported progress in negotiations with Japan for its footwear tariff-rate quota (see 14040816). Prior to Obama's speech the American Apparel and Footwear Association also called on Obama to prioritize Generalized System of Preferences and African Growth and Opportunity Act renewals in the near future (here).

U.S. Trade Representative Michael Froman touted potential export gains through TPP and TTIP during remarks at the U.S. Mayors Conference on Jan. 21. "Some would have Americans continue the status quo – or worse, compete in a world where the rules of the road are defined by China, not the United States," said Froman, according to a transcript released by his office. "Done right, trade agreements are the keys for unlocking opportunity, for leveling the playing field for American workers and businesses, for making sure we’re the ones who write the rules of the road, for making sure those rules reflect our interests and our values."

Many lawmakers, mostly Republicans, also praised the trade remarks, while criticizing large segments of the speech. Senate Majority Leader Mitch McConnell, R-Ky., called Obama’s trade push a “positive signal” during Jan. 21 statements on the Senate floor. McConnell dismissed the speech as couched in partisan bickering throughout. House Ways and Means Chairman Paul Ryan, R-Wis., lauded the call for TPA (here). The committee’s trade subcommittee Chairman Pat Tiberi, R-Ohio, prodded Obama to encourage Democratic support for the legislation (here).

Some Democrats Still Resistant

Democrats on Capitol Hill responded far less enthusiastically to Obama’s trade comments. Newly appointed Export Council member, Dan Kildee, D-Mich., rejected the trade push as a threat to American jobs and the economy (here). “Secret trade policies like TPP are not the right course for Michigan and I will continue to oppose them being fast-tracked,” said Kildee. “My district was sold a bill of goods the last time around and is still dealing with the effect NAFTA had on our local economy. TPP would double down on these bad policies and I simply can’t support that happening.” Kildee is one House Democrat who has recently rallied to oppose the trade agenda (see 1501090022).

Senate Minority Leader Harry Reid, D-Nev., who has opposed TPA legislation, didn’t mention trade in his response to the speech (here). Senate Finance ranking member Ron Wyden, D-Ore., cautioned the administration against sealing trade deals that don’t serve all Americans. “In order to maximize job and wage growth, the nation must have a trade policy that doesn’t just benefit big business, but benefits small business and American workers while enforcing the rules fairly,” said Wyden (here).

Meanwhile, eight House Democrats joined Sen. Bernie Sanders, I-Vt., to reject President Barack Obama’s drive to secure TPA, as well as pending free trade agreements in a press conference on Jan. 21. Those at the press conference, led by Rep. Rosa DeLauro, D-Conn., lauded Obama’s income inequality messaging in his speech, but said the trade agenda will only worsen that economic disparity. “Fast track is a no-go. I’m sorry,” said Rep. Debbie Dingell, D-Mich.

The TPP will fall in line with a decades-old legacy of FTAs that fail American workers, said those House Democrats and Sanders. Obama’s concession that previous FTAs haven’t met many expectations is a severe “understatement,” said Rep. Louise Slaughter, D-N.Y., at the press conference, before pledging to “fight tooth and nail” against TPA, also known as fast-track.

While DeLauro reiterated her argument that the House lacks the votes to pass TPA, she did not specifically address whip counts. She also dismissed suggestions that House Democrats are reaching across the aisle to conservative opponents of TPA. "I believe there will be a strong effort in the Republican conference [to defeat TPA]," said DeLauro in a post-conference interview. "What we're not doing is going to look at conservative organizations and coalesce." A group of conservative organizations rejected TPA in recent days (see 1501140011).