Economy & Trade, Headlines, North America

TRADE-U.S.: Fast-Track Bill Clears Senate, Faces More Hurdles

Jim Lobe

WASHINGTON, May 24 2002 (IPS) - “Fast track” trade legislation approved by the historically trade-friendly U.S. Senate Thursday night must now be reconciled with a much different version passed by a one-vote margin in the House of Representatives last December.

President George W. Bush, who has made it a major administration priority to secure a fast-track bill, re-named trade promotion authority (TPA), hailed the 66-30 vote as a “critical step in advancing America’s trade agenda and strengthening the U.S. economy.” Analysts warned that there remain many bumps on the road before the bill becomes law, however.

“The conference committee is going to be grueling,” said one Senate aide in a reference to the as-yet unnamed group of senators and representatives whose job it will be to reconcile the two versions of the bill into a form that can pass both houses of Congress. The process could take all summer.

“Given what looms next, Senate passage was the easy part,” said Lori Wallach of Public Citizen, a leader in the coalition of labour unions and environmental and citizens’ groups that oppose fast track. “Now the package jumps into a swamp of a conference, and then, if a deal emerges, that final bill faces an uphill battle to obtain a House majority.”

Unlike the Senate version, the House bill, for example, includes language requiring U.S. negotiators to pay some heed to labour and environmental standards, while an amendment in the Senate bill includes a procedural provision that the White House has suggested it would veto if it survives the conference.

TPA gives the president authority to negotiate complicated trade agreements with foreign partners over a multi-year period without having to worry that Congress will tinker with the final package. Under parliamentary rules, Congress must vote ‘yes’ or ‘no’ on the entire package as submitted by the president without amendment or delay.

Congress routinely approved fast track until the mid-1990s, when growing popular anxiety about the impact on job losses and the environment of global economic integration of the kind fostered by such accords as the North American Free Trade Agreement (NAFTA) and the Uruguay Round, which created the World Trade Organisation (WTO), translated into Congressional resistance.

Several efforts by former President Bill Clinton to renew fast track authority, which expired in 1995, were rejected, usually due to opposition by a majority of his fellow Democrats whose core constituencies include labour unions and environmentalists.

On coming to office, Bush said he, like Clinton, favoured an ambitious trade agenda — including the negotiation of a Free Trade Agreement for the Americas (FTAA) and a new global negotiation round under the WTO — and needed fast track in order to do it.

The Senate bill approved Thursday night provides him with that authority, as well as the renewal and expansion of the Andean Trade Preference Act (ATPA), which waives tariffs on key exports from Bolivia, Colombia, Ecuador and Peru, and the extension of the Generalised System of Preferences, which provides duty-free status to certain products imported from some 140 developing nations.

The bill also provides an unprecedented tripling — to 1.2 billion dollars — of a programme to help workers whose jobs have been lost to foreign imports. That provision, favoured by the majority Democrats, is likely to come under heavy fire by House Republicans, the vast majority of whom will be needed by the administration to prevail in any final bill.

A yet more troublesome provision in the Senate version is the so-called Dayton-Craig amendment, named after its bipartisan co-sponsors. If enacted, this would permit the Senate to delete any part of trade packages submitted by the administration that, in its view, might weaken existing laws protecting U.S. industries from unfair practices, such as subsidies and dumping.

The amendment, which not only would expand Congressional powers to alter trade treaties but also contradicts the spirit of pledges made by Washington at last November’s WTO ministerial conference in Doha, has been strongly embraced by Democrats, more than 100 of whom this week signed a letter to the Republican House Speaker, Dennis Hastert, urging that House conferees work to retain and even strengthen Dayton-Craig in the final bill.

But top administration aides have strongly suggested that Bush will veto the entire bill if the amendment survives the conference. “It is protectionism under a procedural cover,” said U.S. Trade Representative Robert Zoellick. “We will work to ensure it is not in the final bill.”

Even if that effort succeeds, the administration must reconcile a number of different and competing interests in order to come up with a conference package that is assured of approval in the House which, although led by a small Republican majority, tends to be much more protectionist than the Senate.

In winning House passage last year, the administration opted for a controversial strategy that relied on marshalling all but a handful of Republicans behind a bill that failed to include the minimum conditions demanded by Democrats for worker rights and environmental protection. The result was an extremely partisan vote in which about two dozen Democrats, who generally supported free trade initiatives in the past, voted ‘no’.

Already, several Republicans who voted for the bill only because the president framed it as a patriotic issue in the wake of the Sep. 11 terrorist attacks have announced they will vote against it the next time. In addition, other right-wing Republicans who voted ‘yes’ in December may be inclined to change their vote if large worker benefits remain in the bill.

Several others from textile-producing states said they voted for the first bill only because the administration promised that it would alter existing preferences on textile imports from the Caribbean, the Andean countries, and Africa. That promise, which deeply angered the affected countries, has yet to be incorporated in new legislation.

This means the administration must gain Democratic votes to be assured of prevailing in the House. Major labour unions, led by the AFL-CIO, have already announced that they will oppose the bill even if the Senate-approved worker benefits remain in it.

Environmentalists, too, have not changed their position. On the contrary, their opposition to fast track has been hardened by the Senate’s rejection of one amendment that would have addressed concerns raised by a NAFTA provision that has permitted foreign corporations to sue local and state governments over their environmental and health laws. Three House Democrats have said they will vote for fast track only if the amendment, by Senator John Kerry, or something like it were included.

“There are a whole bunch of questions up in the air,” said Dan Seligman, trade lobbyist for the Sierra Club, an environmental group. “It will be very, very difficult to find a balance that can ensure House approval of a final package.”

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