White House holds trade pacts until deal struck on aid program

The Obama administration will not submit three pending trade deals for congressional approval until lawmakers agree to renew an aid program for U.S. workers.

The expanded Trade Adjustment Assistance (TAA) program — which helps fund benefits and job training for workers negatively affected by trade — expired earlier this year after being renewed in 2009. 

Republicans have been reluctant to renew the TAA, but the White House made clear Monday that passage of the trade deals with Colombia, Panama and South Korea needs to be paired with action on the program. 

“The administration will not submit implementing legislation on the three pending free-trade agreements until we have a deal with Congress on the renewal of a robust, expanded TAA program consistent with the objectives of the 2009 trade adjustment assistance law,” Gene Sperling, director of the National Economic Council, told reporters Monday on a conference call. 

U.S. Trade Representative Ron Kirk said the trade assistance program was “critical” to the administration’s agenda. 

“The president has always been unequivocal about the fact that keeping faith with our workers is just as important for us as an administration as opening new markets and enforcing our trade agreements,” Kirk said. 

The disagreement over renewing TAA could prove a snag in the passage of the three trade deals this year. Like the White House, Senate Democrats have said the aid program must be coupled with the pending trade agreements.

Last week at a Senate Finance Committee hearing, Sen. Max Baucus (D-Mont.), the panel’s chairman, said the three trade deals must move “in tandem” with renewal of TAA.  

That ruffled GOP feathers. At that same hearing, Sen. Orrin Hatch (R-Utah), the committee’s ranking member, said the administration was setting preconditions before submitting the agreements to Congress for a vote.

In a statement Monday, Hatch called TAA “unrelated spending” to the pending trade deals.

“The administration’s announcement that they will tie our three pending trade agreements to unrelated spending is hugely disappointing to American workers, farmers and job creators, who are losing out to foreign competitors with every passing day. It makes no sense to shut the door on increasing U.S. exports by over $10 billion in order to fund a costly program. With our economy struggling and our nation broke, it’s time to stop the excuses and give our exporters fair access to international markets,” Hatch said.

Rep. Dave Camp (R-Mich.), chairman of the House Ways and Means Committee, also has jurisdiction over the trade agreements. A spokesman for Camp’s panel took a softer tone than Hatch when reacting to the administration’s push Monday for renewal of TAA.

“Chairman Camp wants to see all three trade agreements readied for congressional consideration by July 1 to increase U.S. exports, create much-needed jobs and prevent the U.S. from losing more market share to our competitors abroad,” said the House Ways and Means Committee spokesman. “In addition, Chairman Camp looks forward to continuing to work to find a bipartisan path forward in the House and Senate to advance the other elements of the U.S. trade agenda, among them our preferences programs, trade adjustment assistance, WTO accessions and ongoing and new trade negotiations.”

White House officials could not give an estimate of how much it would cost to renew the program. Sperling said the administration would work with Congress to identify the necessary budgetary offsets so TAA would be renewed in “a deficit-neutral way.”

Kirk said administration officials were still working with congressional staffers on implementing legislation for the three trade deals. Asked if the administration would scuttle the trade deals if no agreement on renewing TAA was reached with lawmakers, Sperling said he didn’t expect that would happen.

“We just don’t expect it to come to that. We always expect that there will be a bipartisan agreement,” Sperling said. 

The aid program has passed with bipartisan support in the past, but many Democrats blamed Republicans for stalling renewal of the expanded TAA program when it expired earlier this year. 

Lori Wallach, director of Public Citizen’s Global Trade Watch, said if the trade assistance program were not reauthorized, it could cost the administration Democratic votes for the trade agreements.

“The administration is in a tricky place because already few Democrats support the Bush-signed NAFTA-style deals with Korea, Colombia and Panama and even fewer will if the lapsed assistance program that provides help to the many U.S. workers displaced by trade is not renewed,” said Wallach, an opponent of the trade deals. “At the same time the program highlights that these trade deals kill American jobs, with the Korea FTA projected to cost 159,000 jobs alone.”

The labor movement supports renewing TAA. Several unions, however, have lobbied heavily against all three pending trade deals, especially the Colombia agreement, due to that country’s record of violence against trade unionists.

“This is the administration laying down the marker. I hope they can they hold out for the full 2009 program, like they have said,” said a union official about the White House’s push for TAA renewal. “It’s unconscionable that this is even a question.”

The administration can turn to business groups for support for renewal of TAA. Lobbyists for several trade associations have said that the aid program needs to be reauthorized alongside the pending free trade deals.

Bill Reinsch, president of the National Foreign Trade Council, said business groups have long favored renewing TAA and have made the case repeatedly to lawmakers to reauthorize the aid program. 

“There's an obvious deal to be made here, and our message to both sides has been to get on with it. That message won't change either, and you can expect us to encourage both the administration and the Congress to move on the FTAs, TAA and the expired preference programs,” Reinsch said. 

“If they don't, the consequences are lost jobs and exports for America, more hardship for our unemployed workers and lost opportunities for poor people in developing countries,” Reinsch said. “This is a no-brainer!”

This post was updated at 11:21 a.m. and at 2:45 p.m.