Deal struck on long-stalled trade pacts

June 28, 2011

The White House and congressional negotiators have cleared an impasse over three key trade pacts, ending weeks of wrangling and setting in motion the congressional approval process for the long-pending deals.

But the announcement Tuesday was met with some disapproval from leading Republicans who said they remain opposed to pairing the South Korea, Colombia and Panama trade deals with a renewal of the Trade Adjustment Assistance (TAA) program. The aid and retraining program for workers who lost their jobs because of outsourcing is an Obama administration priority that Republicans have sharply criticized as costly and unnecessary.

“I’ve never voted against a trade agreement before — but if the administration were to embed TAA into the Korean trade agreement, I would be compelled to vote against it,” Senate Minority Leader Mitch McConnell (R-Ky.) told reporters.

House Ways and Means Committee Chairman Dave Camp (R-Mich.), who negotiated the agreement with Senate Finance Committee Chairman Max Baucus (D-Mont.) and National Economic Council Director Gene B. Sperling, said in a statement Tuesday that while he was on board with most of the underlying agreement, it was not certain whether the House would move forward on the deals in their current form.

“Although Senator Baucus has announced the Senate Finance Committee will move forward on the agreements, with TAA included in the South Korea bill, the decision on how to move these items through the House is a matter for Republican leadership to determine,” Camp said.

The trade pacts, which were negotiated during the Bush administration, had been stalled since last month, when the White House announced that it would not submit the deals for approval unless Congress agreed to move forward on TAA.

Under the agreement announced Tuesday, the South Korea trade deal would include an extension of TAA through the end of 2013 and would retroactively cover petitions that were filed after the program’s previous expansion expired in February.

U.S. Trade Representative Ron Kirk called the inclusion of TAA “the right thing to do — because a balanced trade agenda recognizes the tough realities of trade for some Americans, even as we seize trade’s opportunities to create jobs here at home.”

In a statement, White House Press Secretary Jay Carney said that President Obama “embraces these critical elements of TAA needed to ensure that workers have the best opportunity to get good jobs that keep them in the middle class.”

But Sen. Orrin G. Hatch (R-Utah), the ranking Republican on the Finance Committee, called the move a “highly partisan decision” and a “catastrophe.”

“In all the hearings, we had nobody from the administration say any jobs were lost as a result of these free-trade agreements — not one job,” Hatch told reporters Tuesday. “This is just another payoff to unions.”

Congress is set to begin moving forward on the trade pacts Thursday, when the Finance Committee will hold an informal markup during which lawmakers may offer amendments to the trade deals. The House Ways and Means Committee is not likely to progress on the deals until next week at the earliest, when the House returns from recess.

If the deals are agreed to by both committees, any proposed amendments would then have to be reviewed by the Obama administration, and the final versions of the deals would be sent to Congress for an up-or-down vote in each chamber.

But given the lukewarm response from Republican leaders Tuesday -- as well as the potential for the House to try to separate TAA from the South Korea deal -- it was unclear whether the trade pacts would make it through both chambers before the congressional recess in August.

A senior administration official acknowledged that the negotiators had “agreed on the underlying substance” of the trade deals but not on the process for moving the pacts through Congress.

“We feel that there should be and will be strong support for passage of the three free trade agreements together with this expanded Trade Adjustment Assistance,” the official said, adding that the administration was “quite confident this will pass.”

Before the recent row over trade adjustment assistance, the trade deals had been held up for years because of concerns among Democrats over Panama’s labor and tax-haven laws and anti-union violence in Colombia.

Some prominent Democrats remain opposed to the trade agreements. On Monday, Rep. Sander M. Levin (D-Mich.), the top Democrat on the Ways and Means Committee, said that he planned to oppose the Colombia pact because provisions on workers’ rights were not included in the final deal.

Staff writers Howard Schneider and Zachary A. Goldfarb contributed to this report.

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