Lawmakers May Move Trade Package in Parallel to TPA, Says Trade Economist
The Senate Finance Committee’s failure to reach a bipartisan deal on trade continues to push back introduction of Trade Promotion Authority, but the Senate can still float a bill, debate it and send it over to the House by early April, said Jeff Schott, senior fellow with the Peterson Institute for International Economics. Schott discussed the issue during a March 3 conference call. Finance ranking member Ron Wyden, D-Ore., recently criticized a Finance Committee hearing planned for Feb. 26, and committee Chairman Orrin Hatch, R-Utah, ultimately postponed it (see 1502250075).
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Despite the ongoing debate over the contents of TPA, Schott said the Finance Committee could still introduce and advance a bill within days. “The intensity of the debate will only increase" as the legislation "moves toward a vote in each house of Congress,” said Schott. Lawmakers are also still deciding whether to move TPA as a standalone bill or part of a trade package at the outset. Congressional staffers have said recently the legislation is likely to surface independently, which would allow lawmakers to create a trade package around TPA through the amendment process.
Wyden is insisting on rules to more easily revoke the fast-track mechanisms in TPA, should the Obama administration fall short of congressional negotiating objectives, said Schott. Those mechanisms include debate limits, amendment bans and up-or-down votes, within a certain timeframe. But TPA traditionally is subject to congressional rules that can scale back those mechanisms, as evidenced by Democratic pushback against the Colombia free trade agreement implementation legislation, Schott added. President George W. Bush sent the Colombia bill to Congress in 2008, but Democrats prevented a vote on it for three years (see 12041630). Schott said Wyden and Hatch are “splitting hairs” over a possible expansion, but said the administration should oppose a TPA bill that dangerously augments those mechanisms.
Industry and some lawmakers are targeting renewal of African Growth and Opportunity Act and the Generalized System of Preferences, as well as Customs Reauthorization, as prime candidates for a trade package. Many manufacturers are also pleading for passage of Miscellaneous Tariff Bill, but Republicans haven’t yet found a way to avoid earmark opposition to the duty suspension program (see 1502190061).
Lawmakers may also choose to move a trade package in “close tandem” with TPA and that bill could also originate in the Finance Committee, said Schott. The American Apparel and Footwear Association, among others, floated that idea recently (see 1501080021). Schott said such a package may take on controversial bills relating to Trade Adjustment Assistance and currency, on top of AGOA and GSP. “With support from the Republican leadership, Trade Adjustment Assistance would really grease the rails of all trade initiatives,” he said. “But I know there’s a lot of opposition in the Republican caucus, either on budgetary or ideological grounds.” Democrats in both chambers introduced TAA legislation in late February (see 1502250057).
A bipartisan group of senators and House members also introduced currency legislation in February (see 1502120014). Those bills would impose countervailing duties on imports from currency manipulators. Schott and another Peterson economist, Adam Posen, criticized those bills, saying such policies may violate global trade rules. The two economists called for more diplomacy to address currency manipulation.