Bridges Weekly Trade News Digest • Volume 6 • Number 19 • 22nd May 2002
Proposed Amendments Make Farce Out Of US Trade Promotion Authority Bill
PROPOSED AMENDMENTS MAKE FARCE OUT OF US TRADE PROMOTION AUTHORITY BILL In a beleaguered effort to give US President George W. Bush Trade Promotion Authority (formerly ‘fast-track’), the Senate backed an amendment that would allow Congress to veto specific provisions of trade pacts if they changed anti-dumping and other laws designed to protect US producers from unfair trade practices. The proposal put forward by Democrat Senator Mark Dayton of Minnesota and Republican Senator Larry E. Craig of Idaho was approved despite opposition and veto threats from the White House. The Senate also approved an amendment towards reciprocity in textile trade negotiations and extended a program giving lower tariffs for goods from the South American countries of Colombia, Peru, Bolivia and Ecuador (see related ‘In Brief’, this issue). Zoellick: "Protectionism under a Procedural Cover" The Dayton-Craig proposal would enable the Senate to pull out any portion of a trade agreement weakening laws protecting US industries from unfair practices such as subsidies and dumping. Senators would debate that provision separately, under regular procedures, while allowing the rest of the agreement to proceed on a so-called ‘fast track’. The questionable provision could then be altered, deleted or left alone. Supporters in both parties said the language was mainly meant to keep pressure on the administration not to undermine US trade remedies when it negotiates with US trading partners. Clearly disappointed by the vote, US Trade Representative Robert B. Zoellick denounced the Dayton-Craig proposal as "protectionism under a procedural cover", saying it would "cripple America’s ability to open markets around the world." He added that the administration would fight to keep it out of the final version of the legislation. According to one trade source, the Bush Administration is also concerned about a proposed amendment by Senator Kerry that would tighten investor-state rules under the North American Free Trade Agreement (NAFTA) to make it more difficult for a company to challenge a country’s domestic laws (see BRIDGES Weekly, 16 April 2002). The Senate also approved an amendment adding detailed textile negotiating objectives to the TPA bill. This is supposed to put the United States on the offensive for textile trade talks and, in the words of the sponsoring Democrat Senator John Edwards, ensure that the US no longer enters "into trade agreements that are unfair to North Carolina textile workers". The amendment would instruct US negotiators to make further reductions in US textile and apparel tariffs only if other countries reduce their own tariffs to the same level. The Senate, however, voted against an amendment offered by Senator Joseph Lieberman, a Connecticut Democrat, which would have allowed the use of sanctions to enforce labour and environmental provisions in trade pacts. According to some observers, the support for the Dayton-Craig proposal and the textile amendments reflect growing concern among many in Congress and reinforced by voices from strong domestic industrial and agricultural lobbies on the impact of trade liberalisation and low priced imports on US jobs. Five previous presidents enjoyed fast-track — now renamed Trade Promotion Authority — until in 1994, the Republican-controlled Congress refused to renew it for then-President Bill Clinton (see BRIDGES Weekly, 12 December 2001). Bush has argued that he must have the expanded power to advance US goals as the WTO enters a new round of talks to reduce trade barriers. He has also deemed the authority crucial to negotiate an expanded NAFTA (North American Free Trade Agreement) with the 31 additional countries in the Western Hemisphere (minus Cuba) by the end of his first term in January 2005 (see BRIDGES Weekly, 20 February 2002). "Senate Adds Textile Objectives To Bush Trade Bill," REUTERS, 15 May 2002; "Daschle Urges Bush Defer Duties On Andean Imports," REUTERS, 15 May 2002; "Bush Loses a Vote on Trade: White House Still Hopes to Kill Curb on Trade Pact Powers," WASHINGTON POST, 15 May 2002; "Senate Defies Bush In Trade Bill Vote," AP, 15 May 2002; "Senate Adopts Controversial Amendment To ATPA Trade Package, Etc.," INTERNATIONAL TRADE TODAY, 15 May 2002; "Senate Adds Curbs to ‘Fast Track,’ Defying White House Veto Threat," WSJ, 15 May 2002.