Congress wants role as Obama pushes trade agenda

The Obama administration has embarked on an aggressive trade agenda that could lower barriers and increase US exports to many of the economic giants of Asia and Europe. To make that a reality, though, it may first have to negotiate future trade policy a little closer to home, with Congress.

The administration hopes to complete talks by October on the Trans-Pacific Partnership, which would reduce duties on a wide range of goods and services in the world’s most vibrant trading area. Eleven countries, including Australia, Peru, Malaysia, Vietnam, Mexico and Canada, are participating, and Japan has expressed interest in joining.

In his State of the Union address, President Barack Obama announced plans for a second deal, the Transatlantic Trade and Investment Partnership, which would link the United States and the European Union, the world’s two largest economies.

Departing US Trade Representative Ron Kirk added to the agenda in January when he notified Congress of plans to start negotiations for a new agreement on international trade in services. The talks will include a group of 20 trading partners representing nearly two-thirds of global trade in services.

Obama has set a goal of doubling exports by the end of next year, after drawing criticism from free-trade advocates during his first term for moving too slowly on trade issues.

“The Obama administration suddenly has this highly ambitious trade agenda that they’ve laid out,” said John Murphy, vice president for international affairs at the US Chamber of Commerce, a leading pro-business lobbying group. “Now the challenge is going to be executing.”

First, Obama must nominate a successor to Kirk, who in January announced plans to step down. Then, he has to work with lawmakers to restore a procedure called Trade Promotion Authority (TPA) that is regarded as key to getting trade treaties finalised and approved by Congress.

TPA, also known as “fast track,” has a history going back to the 1930s and was formalised in a 1974 trade law. Under TPA, Congress and the White House agree on the objectives of trade negotiations, and Congress affirms that it will vote on any trade treaty without offering amendments that would force the administration to go back to the negotiating table.

The last TPA law expired in 2007, and up to now, the Obama White House hasn’t pushed for its renewal. Without TPA on the books, trade partners are reluctant to sign off on deals that could later be amended.

That could be fatal to some complex trade deals, such as the future talks with the EU where success hinges on reaching delicate compromises on such issues as European agriculture subsidies and Europe’s restrictions on genetically engineered crops.

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