Baucus announces grand bargain to clear three pending trade deals

Sen. Max Baucus (D-Mont.) announced a deal Tuesday that should clear the path for congressional approval of three pending trade agreements with Colombia, Panama and South Korea.

Baucus said he had secured an agreement with the White House and Rep. Dave Camp (R-Mich.), chairman of the House Ways and Means Committee, to renew the expanded version of Trade Adjustment Assistance (TAA). The program, which funds job-training programs and healthcare benefits for workers hurt by trade, will be extended until the end of 2013.

“The road to this point has not been an easy one, but our economy needs these jobs and these opportunities,” Baucus said in a statement. “That’s why we have continued to fight to pass these job-creating agreements and restore this vital worker-assistance program. We think this package can get the support needed to become law. American workers and our economy can’t afford for us to wait any longer to move forward.”

The White House hailed the agreement as a breakthrough.

“The president 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. Now it is time to move forward with TAA and with the Korea, Colombia and Panama trade agreements, which will support tens of thousands of jobs,” said White House press secretary Jay Carney in a statement. 

The White House said the trade deals would not be submitted to Congress until lawmakers reached a deal to renew the expanded version of TAA. The program expired in February of this year. Some Republicans balked at renewing the trade aid initiative because of worries over adding to the national deficit.

TAA’s renewal will be included in the Korea trade agreement’s implementing bill. In addition, the deal includes reauthorization of both the Generalized System of Preferences and the Andean Trade Preferences Act until the end of July 2013. Both of those measures will be added to the Colombia trade deal’s implementing bill.

Baucus said he would hold a mock markup on Thursday for all three pending trade agreements. Once lawmakers’ amendments are reviewed by the Obama administration, final versions of the trade deals’ implementing bills will be sent to Congress for up-or-down votes under Trade Promotion authority, often called “fast-track.”

Not everyone, however, was on board with the deal to renew TAA.

In a statement Tuesday, Sen. Orrin Hatch (R-Utah), ranking member of the Finance Committee, said it was “a highly partisan decision to include TAA in the South Korean FTA implementing bill” and that doing so “risks support for this critical job-creating trade pact in the name of a welfare program of questionable benefit at a time when our nation is broke.”

“TAA should move through the Congress on its own merit and should stand up to rigorous Senate debate. President Obama should send up our pending trade agreements with Colombia, Panama and Korea and allow for a clean vote,” Hatch said.

Senate Minority Leader Mitch McConnell (R-Ky.) asked the administration to reconsider its decision to add TAA to the Korea trade deal’s implementing bill. He also called for extension of Trade Promotion Authority, which the White House wants to hold off on until the trade deals are done.

“I would strongly urge the administration to rethink this action, and urge them to send up all three pending trade agreements without delay and without extraneous poison pills included. TAA should be considered separately along with an extension of Trade Promotion Authority, as it traditionally has been since 1974,” McConnell said in a statement.

TAA petitions filed after the program’s February expiration date will be retroactively covered while eligibility requirements and reforms that were included in the 2009 expansion of TAA attached to the stimulus package will be restored. The deal also includes “adjustments necessary to secure bipartisan support” for renewing TAA, according to the press release from Baucus’s office. 

The announcement of a grand bargain on trade followed news Monday that a key House Democrat would vote against the Colombia trade deal. Rep. Sandy Levin (D-Mich.) said a labor action plan to improve Colombia’s poor record of violence against trade unionists should be included in the implementing bill for its trade agreement.

Levin, however, said he would vote for the Panama and Korea trade deals.

Business lobbyists said Levin’s opposition to the Colombia deal could take away some Democratic support for the agreement in the House. Nevertheless, they remained confident that all three trade deals would pass once they come up for votes.

“It means that not as many Democrats will be voting for Colombia as there will be voting for Panama and Korea. That said, there will be sufficient votes to get all three through,” said Bill Reinsch, president of the National Foreign Trade Council.

Several lobbyists said the biggest impasse to the passage of the trade deals was not Levin but rather disagreement over TAA. With a deal struck on the program, it appears likely that the agreements will move forward in Congress this summer as planned.

U.S. companies have been worried about losing market share to foreign competitors as they await approval of the trade agreements. On Friday, a trade deal between Korea and the European Union will go into effect, and next month, Canada will implement its trade deal with Colombia.

The U.S. Chamber of Commerce urged lawmakers to act now on the pending trade deals and said it was in favor of TAA as well as the trade preferences programs.

“For members of Congress who care about American jobs, this is a moment of truth,” said Tom Donohue, the Chamber’s president and CEO. “I urge members of both parties to seize a reasonable compromise and move the trade agenda forward. The time to act is now.”

This story was originally published at 3:53 p.m. and updated at 7:06 p.m.

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