WASHINGTON — With Trade Promotion Authority moving out of committee and into the full House and Senate, a contentious debate on trade is expected in both chambers.
After the Senate Finance Committee passed the measure on a vote of 20 to 6 Wednesday night, and the House Ways and Means was wrapping up its debate at press time and expected to give its approval, momentum on key trade measures is increasing.
The stakes for TPA is high and the outcome of the vote in Congress could potentially make or break an Asia-Pacific trade pact under negotiation. TPA allows Congress to set negotiating objectives and consultation requirements for the executive branch, but also limits Congress to an up or down vote on trade deals. It’s seen as a linchpin to securing the Trans-Pacific Partnership agreement with 11 countries.
Heated debate over TPA has splintered Democrats and pitted many lawmakers against President Obama, who is seeking to secure the authority to ultimately close a deal on the TPP. One of the biggest surprises during the Senate Finance Committee’s vote was the support it garnered from Democrats, said Juanita Duggan, president and chief executive officer of the American Apparel & Footwear Association. Seven Democrats voted for TPA, which had a final tally of 20 to 6.
“It’s a strong message,” Duggan said. “It might be the biggest message point out of the whole thing.”
Duggan said a full vote on TPA is likely in May, although “things can slip,” adding “they are making this a priority.”
Tensions were on full display at the Ways and Means markup on Thursday, illustrating the magnitude and potential divisiveness of the battle ahead.
Committee chairman Rep. Paul Ryan, (R., Wis.), chairman of the House Ways and Means committee, outlining the case for TPA, said: “We’re negotiating a lot of trade deals right now and our negotiators need this process in place so they can get a fair deal for the American worker. The reason is our trading partners won’t make concessions if they don’t trust us. If they think Congress will rewrite the deal, they won’t put their best offers on the table. So Congress and the President have to present a united front.”
Ryan argued that TPA does not mean Congress defers to the administration but rather the opposite.
“TPA puts Congress in the driver’s seat because we set the agenda. What we say to the administration is, first, ‘here are the negotiating objectives — tear down barriers to our exports. Beef up protections for our intellectual property. Get rid of kickbacks for government-owned firms,’” said Ryan, adding that clear guidelines have been set for transparency and consultation.
But Rep. Sander Levin (D., Mich.) voiced his dissent about TPA and TPP and repeatedly pressed for a vote on a substitute TPA bill he introduced. The issue of currency manipulation also played a central role in amendments and the committee debate Thursday.
Levin’s TPA substitute, which was denied a vote in committee, contained specific negotiating instructions for the administration on outstanding issues such as labor, environment and undervalued currencies and would establish a TPP Advisory Group that must certify that the President has followed the negotiating instructions and adequately consulted with Congress.
“The problem is that the TPP being negotiated today is not on the right track,” Levin asserted. “In some vital areas we do not know where USTR is headed and in other areas we don’t like where they seem to be. So before we turn over our leverage we need to be sure the negotiations are headed in the right direction. It is simply incorrect to say that this TPA puts Congress in the driver’s seat. What it does is to put us in the back seat.”
Levin and other Democrats also argued to include stronger currency manipulation language in TPA and TPP.
“We need a trade deal that has teeth and we need a TPA that will make it clear that we insist upon our trade deals having teeth to make sure that not just companies, but the countries, will follow the rules,” said Rep. Xavier Becerra, (D., Calif.). “The evidence is replete with cases of manipulation of currency,” pointing to China, Japan and South Korea as countries that are or have undervalued their currency in the past.
But Ryan argued that it would be a “mistake” for the U.S. to include enforceable currency manipulation language in TPA.
“We are the world’s reserve currency and we have to watch how we manage this situation,” Ryan said. “It is a deal-killer. I think the Treasury Secretary has made that pretty clear.”