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Capital Hill Watch Alert

Senate To Vote On Obama's Fast Track Trade

As early as Tuesday, June 23, 2015, the Senate is expected to vote on Trade Promotion Authority (TPA) also known as “fast-track”. On Thursday, June 18, 2015, Senate Majority Leader Mitch McConnell (R-Kentucky) filed motions to advance “fast-track” authority and a separate package of trade preferences for African nations combined with an extension of Trade Adjustment Assistance (TAA), a program that helps workers displaced by foreign competition.

Demanding a variety of concessions to sweeten the deal are pro-trade Senate Democrats that have yet to sign off on the plan. At least 11 Democrat votes are needed by Senate Majority Leader Mitch McConnell (R-Kentucky) to make up for the expected loss of five Republicans who voted against “fast-track” in May.

Since Speaker of the House John A Boehner (R-Ohio) and Senate Majority Leader Mitch McConnell (R-Kentucky) have decoupled “fast-track” from TAA and cannot provide an ironclad promise that both will reach President Obama at the same time, Democrats have said it is going to cost.

To give Democrats any favors on Thursday, June 18, 2015, Senate Majority Leader Mitch McConnell appeared reluctant and urged Democrats instead to vote the same as they did last month on “fast-track” and TAA.  A reauthorization of the Export-Import Bank attached to the package of trade preferences and TAA is what some Democrats want.  An expansion of TAA, which now caps funding for worker training at $450 million annually is wanted by others. And arguing that it is woefully underfunded and have tried to increase it to its 2011 level of $575 million are House of Representative and Senate Democrats.

Also, Democrats want a promise that a separate customs and enforcement bill that includes labor and environmental protections will be passed by Congress. Versions of the legislation have been passed by both chambers but need to be reconciled in bicameral talks. Later this summer the customs bill would reach the Senate floor McConnell has promised. Finally, a guarantee that all four trade bills passed by the Senate in May will reach President Obama for a signature is wanted by pro-trade Senate Democrats.

At least for now, withholding their support to see what Senate Majority Leader Mitch McConnell (R-Kentucky) and Republican leaders negotiate are a number of the 14 pro-trade Democrat senators who supported “fast-track” authority and worker assistance.

On Thursday, June 18, 2015, Trade Promotion Authority powers (H.R. 2146; Text of Legislation)  was approved by the House of Representatives on a 218-208 vote (To view how your representative voted visit: 374). The measure allows President Barack Obama to work out the details of trade agreements then submit them without the chance for amendments for an up-or-down vote in Congress.  To rescue President Obama, which was embarrassed on the issue by his own party, House Republicans revived the massive free-trade bill which grants President Obama stand-alone fast-track negotiating powers, which he will need in order to complete a trade deal with 12 Pacific Rim nations.

In a legislative body notorious for esoteric procedural maneuvers, the mechanics of the vote are some of the most complicated in recent memory. 

Despite a personal plea from the President on Friday, June 12, 2015, Democrats banded together to defeat President Obama's trade agenda.  The House of Representatives on a 302-126 vote (To see how your representative voted: 361 )  failed to pass the Trade Act of 2015 (H.R. 1314; Text of legislation ), a worker aid bill that was tied to the President's main agenda that would grant Obama “fast-track” authority to negotiate trade deals. 

The Senate used the Ensuring Tax Exempt Organizations the Right to Appeal Act (H.R. 1314; Text of Legislation)  as the vehicle in the Senate to pass on Friday, May 22, 2015, on a 62-37 vote (To view how your senators voted visit:  193 ) trade promotion authority or fast-track authority.  The legislation empowers President Barack Obama and future Presidents to negotiate trade deals that Congress cannot change. And instead of having to clear the 60-vote hurdle required of controversial legislation, those deals can win Senate approval with simple-majority votes.    For up to six years the legislation grants expedited review of trade agreements.

 Trade Statistics Misrepresented

The same lies that were used to sell previous bad deals are being used by supporters of Fast Track.  For example, U.S. Representative of Wisconsin Paul Ryan (R) and U.S. Senator of Texas Ted Cruz (R) have claimed that Fast Track by reducing America's huge deficits would produce jobs. They wrote in an April 22, 2015 commentary:

"The American worker can compete with anybody, if given a fair chance.  If you add up all 20 countries that the U.S. has a trade agreement with, American manufacturers run a $50 billion trade surplus with them.  The problem is that not all countries have a trade agreement with the U.S.: American manufacturers run a $500 billion trade deficit with those nations."

However, deeply deceptive is their $50 billion surplus number. For example, it involves selecting some and excluding other goods exported and imported. The U.S. ran a deficit of 61.7 billion dollars in 2014 with its Free Trade Agreement (FTA) partners indicates a complete measure of the balance of trade for all goods

Furthermore, after the free trade agreements were negotiated, the U.S. trade deficits with the FTA partners got worse. The average deficit with each FTA partner was less than $0.8 billion in the year prior to implementation of each FTA.  And the average deficit with each FTA partner was over $3 billion by 2014. 

 Currency-Manipulation

The “free trade” treaty that former President George W. Bush and President Barack Obama negotiated with currency-manipulating South Korea is one example.  According to the calculations of University of Maryland economist Peter Morici, former director of the Office of Economics at the U.S. International Trade Commission, the FTA grew the overall U.S. trade deficit (goods plus services) with South Korea from $5.4 billion in 2011 to $13.3 billion in 2014.

At the expense of the U.S., the FTA with South Korea lets only one country grow its economy.  However, involved in the treaty that President Obama is currently negotiating are 11  countries (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam), three of which (Japan, Malaysia, and Vietnam) are active currency-manipulators committed to stopping U.S. efforts to end currency manipulation.  And expected to join later are additional currency-manipulating nations.

The legislation implicitly endorses currency manipulation which is the chief way that nations subsidize their exports and place on their imports hidden tariffs.  To a bill that encourages currency manipulation the words “free trade” should not be applied.  Trade surplus nations gain more factories, more research and development, and more economic growth by manipulating their currencies to unbalance trade. Conversely, the opposite effects such as reduced factories, reduced research and development and reduced economic growth are experienced by the trade deficit nations.

Congressional Decline

The further decline of Congressional authority under President Obama is exacerbated by “Fast Track.” For example, concerning massive and complex treaties negotiated in secret, it empowers the President to present Congress with a take-it-or leave-it demand.  Positive issues for the U.S. such as patent and copyright protection for American intellectual property and a reduction in tariffs on American agricultural products might be contained in the final trade agreements.  However, included in the final trade agreements might be negative issues for the U.S.  For example, creating a private court system that gives foreigners the right to sue the U.S. government if any law or regulation violates the treaty. And in the current draft of the treaty there is no doubt that this is included. Also, from Mexico and other treaty nations, is a mandate to end congressional limits on legal immigration.   

To see what is in it, members of Congress would be well-advised to avoid voting for “Fast Track.”  To prevent the President from ignoring the wishes of the American people Fast Track should be voted down.  President Obama should be forced to negotiate the treaty and then bring it to Congress−which is a much better strategy.  This would strengthen the administration's ability to extract favorable concessions if Congress retains its power to amend the final agreement. For example, the administration can say, “that they would like to negotiate what a nation wants but that provision would likely be amended out of the treaty by Congress.”  Any deal negotiated is much more likely to be good for the American people if Congress retains its full constitutional authority.

A Private Court System

Should a future President decide to balance its trade with currency-manipulating nations through tariffs, the establishment of a private court system that would render billions of dollars of judgment against the U.S. government is the worst aspect of Fast Track. In comparison, a provision that allows trade deficit nations to impose trade-balancing tariffs is included in World Trade Organization (WTO) rules.  In 1971, President Nixon took advantage of this provision when he imposed a 10 percent across-the-board tariff, which quickly forced changes that brought 1973 U.S. trade into balance. Currently, this provision could be used by the U.S.  As a result, the U.S. would have more factories, more research and development, and more economic growth.  However, everything would be changed by the new private court system.  For example, America's trade deficit would never be solved by future U.S. Presidents. 

Limits Congressional Power

Americans that want an economy that works for those that play by the rules and work hard and believe in the U.S. Constitution should be worried about Fast Track. To limit the power of Congress is why President Barack Obama wants Fast Track.  Congress alone has the power to “regulate commerce with foreign nations” according to Article I, Section 8 of the Constitution yet wanting to cede that power to the President are Congressional Republicans.  Broad negotiating powers for treaties are given to the President. Fast Track eliminates the 2/3 requirement for Senate ratification, eliminates amendments, limits debate and for passage of any trade agreement under allotted procedure requires a mere simple majority in both houses of Congress.    

Future Congress's hands are tied by Fast Track since it cedes the power of trade agreements beyond current members' two-year terms. Since the sitting President would have to sign a new law repealing their own extra-Constitutional power to regulate trade without Congress's consent, a popular revolt against Fast Track at the ballot box would be meaningless.

American sovereignty is surrendered to foreign trade bodies such as the WTO's court system, which has full jurisdiction for all trade disputes by the Trans-Pacific Partnership (TPP) and other trade agreements.   So Americans would not know where the food they are eating is coming from, TPP like previous trade agreements would bar Country of Origin Labelling (COOL) laws.  And foreign courts would be allowed to overrule U.S. federal and state courts by TPP.  For labor, environmental, tax, as well as COOL laws, this would be true.

For President Obama's nearly completed Trans-Pacific Partnership he should be denied Trade Promotion Authority or fast-track authority that enables a simple majority-vote for passage.   

Final Thoughts

For authority to negotiate a free trade agreement with Pacific nations, Congress should impose tough conditions on President Obama's request.  In changing immigration policies and releasing prisoners from the Guantanamo Bay detention camp to name a few President Obama has overstepped his powers and cannot be trusted.

Obama and his supporters say that Trans-Pacific Partnership (Obamatrade) will keep Communist China from taking over the world.   However, Obama told a public radio program that Communist China can join the pact and has in fact asked his administration to do so.  The President cannot not be trusted because he is a habitual liar.  Such is the case with Obamacare in 2010 when he told the American people  “If you like your insurance, you can keep it.”  Sadly, Americans learned the hard way that this was a lie after millions so far have had their policies cancelled.  The proposed Trans-Pacific Partnership can be rewritten and updated at any time in the future and is thus “a living agreement."   One would be a fool to believe that Congress will be involved in updating the agreement. A new global authority is created by the Trans-Pacific Partnership Commission that empowers it to enforce the deal and admit new members such as Communist China on its own. Simply on the basis of consensus agreement of existing members the Trans-Pacific Partnership like the European Union has the ability to admit other nations. And compared to other trade deals approved by Congress this is unlike any previous deal.

Tariffs and other administrative barriers to commerce such as restrictions on the operation of U.S. information technology for companies abroad and inadequate protection of U.S. patents and copyrights should be eliminated and reduced by trade agreements. U.S. exports should be increased by those agreements and a wider range of less expensive imported goods should be available to consumers.  

By moving workers from lower paying jobs, such as assembling computers, to higher paying positions designing new devices and software free trade should increase U.S. wages and incomes. However, this is not always the case.  For example, promising big job gains, President Obama implemented a free trade pact in March 2012 with South Korea. At a cost of at least 100,000 U.S. jobs bilateral imports increased by $15.5 billion and exports increased only $3 billion.

Economists expect the value of the dollar to fall against foreign currencies when imports grow more than exports. To rebalance trade and create good-paying jobs that would raise prices for foreign goods in U.S. stores and lower prices for U.S. products sold abroad. Principal U.S. competitors—Communist China, Japan, Germany, and South Korea—pursue monetary and exchange rate policies explicitly intended to keep their currencies inexpensive against the dollar and advantage their domestic industries frustrating these market adjustments.

Industries —such as autos, aircrafts and information technology are targeted by these governments and they compel U.S. firms to sell in their markets to establish factories and R&D in their nations.  More U.S. jobs are lost by this as those facilities often export back into the U.S.  Annually overall 4 million jobs are directly lost by U.S. imports that exceed exports by more than $500 billion.

Furthermore, under World Trade Organization (WTO) rules, currency manipulation is illegal.  However, pleas from industry to bring complaints in the WTO have been ignored by both Presidents George W. Bush and Barack Obama. 

Weakened in recent years are trade enforcement laws that permit the Commerce Department and U.S. International Trade Commission to impose tariffs on subsidized imports that result in the loss of jobs.  However, by shipping products through intermediate nations and altering customs, classifications many Asian exporters evade these laws.

By altering domestic regulations for product standards, the environment and the like modern trade agreements reach deeply into the treatment of foreign goods and services. If Congress can modify U.S. commitments during the ratification process, foreign leaders would not negotiate on those issues. 

What should concern every American is that Trade Promotion Authority (TPA) or fast track would turn over to a new international body similar to the economic union of the nascent European Union important Congressional powers preventing lawmakers from removing any objectionable provisions.  The American economy is experiencing an economic malaise and Americans are desperate for high paying jobs.  Yet for workers that lose their jobs, ostensibly as a result of free trade, the measure has a several billion dollar social welfare giveaway program.  Why would this be part of a trade deal that is alleged to enhance the U.S. economy and create jobs for Americans?  And at a time in American history when more people do not work than do, the deal could be used to accelerate the immigration of foreign workers.  Such a trade deal is not good for the American economy as it will cause more Americans to lose their jobs and depress wages further and will continue Obama's destruction of the middle class.       

So that they could stop President Obama's radical agenda, American voters gave Republican leaders majorities first the House and then the Senate in the 2010 and 2014 elections.  However, the Republican leadership has decided to give him more power instead of stopping him.  And despite deep opposition by their base, Republican leaders are determined to advance Obama's fast-track agenda.  Congress must not cede any additional authority to President Barack Obama who has spent the past six years shredding the constitutional separation of powers.  Fast Track would be another monumental failure of congressional Republicans to stop the President's fundamental transformation of America.

 Additional Reading:

McConnell forges ahead with trade votes despite Dem holdouts

Labor amps up pressure on key senators ahead of trade vote

Obamatrade Vote Tomorrow?

Obama trade push runs aground as House Democrats derail key bill

Congress should impose tough conditions for Obama's Pacific trade pact

Even more surprises hidden in Obamatrade

'Simple solution' to Obamatrade's problems

Franken-trade: Deal's ‘living agreement' plan that could rope in China draws fire

Fast-Tracking America's Economic Destruction

Sen. Jeff Sessions: Top Five Concerns With Trade Promotion Authority

Trade Authority For Obama Will Cut Congress Out Of Picture

Selling Out the Constitution and Main Street on Trade

What Can You Do?  

 Urge your senators to NOT SUPPORT   Trade Promotion Authority or “fast-track” legislation.  Target the following Democrats that voted for “fast-track” in May and urge them not to support the measure.

US Senator of Colorado Michael F. Bennet

(202) 224-5852

Contact: www.bennet.senate.gov/contact/

 

US Senator of Washington Maria Cantwell

(202) 224-3441

Contact: www.cantwell.senate.gov/public/index.cfm/email-maria

 

US Senator of Maryland Benjamin L. Cardin

(202) 224-4524

Contact: www.cardin.senate.gov/contact/

 

US Senator of Delaware Thomas R. Carper

(202) 224-2441

Contact: carper.senate.gov/public/index.cfm/email-senator-carper

 

US Senator of Delaware Christopher A. Coons

(202) 224-5042

Contact: www.coons.senate.gov/contact/

 

US Senator of California Dianne Feinstein

(202) 224-3841

Contact: www.feinstein.senate.gov/public/index.cfm/e-mail-me

 

US Senator of North Dakota Heidi Heitkamp

(202) 224-2043

Contact: www.heitkamp.senate.gov/public/index.cfm/contact

 

US Senator of Virginia Tim Kaine

(202) 224-4024

Contact: www.kaine.senate.gov/contact

 

US Senator of Missouri Claire McCaskill

(202) 224-6154

Contact: www.mccaskill.senate.gov/contact

 

US Senator of Washington Patty Murray

(202) 224-2621

Contact: www.murray.senate.gov/public/index.cfm/contactme

 

US Senator of Florida Bill Nelson

(202) 224-5274

Contact: www.billnelson.senate.gov/contact-bill

 

US Senator of New Hampshire Jeanne Shaheen

(202) 224-2841

Contact: www.shaheen.senate.gov/contact/

 

US Senator of Virginia Mark R. Warner

(202) 224-2023

Contact: www.warner.senate.gov/public/index.cfm?p=Contact

 

US Senator of Oregon Ron Wyden

(202) 224-5244

Contact: www.wyden.senate.gov/contact/

 

Contact Information:  

To go to your senators' websites, find their E-mail or to find out who your senators are... http://www.senate.gov/contacting/index_by_state.cfm     

Addressing Correspondence: 

The Honorable (full name)
United States Senate
Washington, DC 20510   

Dear Senator (last name):  

 

 

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