Future of three trade deals in jeopardy as Republicans balk after agreement

The fate of three pending trade deals is uncertain as congressional Democrats and Republicans remain at loggerheads over how to proceed. 

Despite an agreement between the White House and congressional negotiators earlier in the week designed to smooth the path, rhetorical fireworks erupted around the Capitol as Senate Republicans opted to boycott the Senate Finance Committee's mock markup, once again stalling the deals. 

GOP lawmakers are opposing the decision to include Trade Adjustment Assistance (TAA), which helps retrain workers displaced by foreign trade, as part of the South Korean deal, insisting, instead, that TAA be considered separately. 

U.S. Trade Representative Ron Kirk told The Associated Press on Friday that he was "dumbfounded" and "shell-shocked" following the boycott. 

"The Republicans for the most part said, 'You get these agreements here, we'll pass them tomorrow, send them up,' " he said. 

For most of the year, Senate and House Republicans have pressed the administration to send the pacts with Korea, Colombia and Panama up to Capitol Hill for approval as final details were worked out by the White House, saying the delay was costing jobs, billions for farmers and manufacturers and reducing U.S. market share as other nations ink trade deals. 

With Tuesday's agreement on TAA and other trade-related issues between the White House, congressional Democrats and at least one House Republican -- Ways and Means Chairman Dave Camp (Mich.) -- the trade deals seemed destined for quick review and approval. 

Then House and Senate Republicans balked at the decision to add TAA to the Korean deal, putting the agreements back into negotiation mode. 

Senior administration officials said recently that without TAA, President Obama might not send up the three trade deals. 

With both sides crying foul, there doesn't appear to be an immediate answer to solve the issue and time is running short to complete work on the long-delayed accords with a target deadline by all sides of before the August recess. 

Talks will continue into next week, the Senate returns on Tuesday and the House on Wednesday. 

The next step will likely be a mock mark-up in the House Ways and Means Committee, although one wasn't announced before the long holiday weekend. The panel needs to provide 48 hours notice, meaning the earliest that a meeting could happen would likely be Thursday. 

Kirk said he's still optimistic lawmakers will come to an agreement this summer.

"I hope the imperative of doing something good for this country will override the appeal of scoring political points short-term," he said.

If the deals don't pass this summer, it could become more difficult for the White House to reintroduce the pacts ahead of the 2012 election.   

"Right now, Congress can advance a set of trade agreements that would allow American businesses to sell more of their goods and services to countries in Asia and South America, agreements that would support tens of thousands of American jobs while helping those adversely affected by trade," President Obama said during a press conference on Wednesday.

Republicans on the committee said the boycott was staged to protest how Democrats were trying to "ram-through" the TAA program.

"We are not going to put up with being jammed," said Senate Finance ranking member Orrin Hatch (R-Utah). 

At a Thursday news conference, Hatch said that if the White House wants to "bring it up TAA on its own merits, it may very well pass.”

"I question whether it will, but it may pass," he said. "But to link it to the Korean free trade agreement is very offensive in every way. And it's a bad precedent to start."

Hatch has said that TAA is too costly to continue and probably doesn't have enough support to get through Congress. 

Under the new agreement, TAA will cost about $900 million for approximately three years, instead of $700 million a year, and doesn't include any new deficit spending, according to a fact sheet released by Camp. 

Camp also touted a handful of concessions, including reforms to unemployment insurance and a reduction in the number of weeks of income support from 156 in the 2009 law down to 117 weeks, as well as a decrease in the health coverage tax credit (HCTC) to 72.5 percent from the 2009 law’s 80 percent, eliminating it after 2013.

Sen. John Thune (R-S.D.) questioned additional spending for the program. 

"It is unfortunate that these free trade agreements, which are slam dunks, they're all trade agreements that there would be, I think, broad bipartisan support for up here -- are being held hostage to get new spending, additional spending for trade adjustment assistance," he said. 

"We need clean votes on them, and we can certainly have a debate about trade adjustment assistance in the context of -- with the debate over trade promotion authority."

Republican senators also have expressed concern that including TAA in the deal could negate "fast-track" authority, which guarantees that, once the trade deals are submitted to Congress by President Obama, they can’t be amended and must receive up-or-down votes. 

The Obama administration and Democratic supporters will likely cite the provision of fast-track authority that permits including “necessary and appropriate” provisions.

A renewal of TAA had support from the business community, including the U.S. Chamber of Commerce, even before the changes were made to streamline the program.

For its part, the Obama administration has been insistent on getting TAA done along with the trade deals with South Korea, Panama and Colombia. 

Sen. Chuck Schumer (D-N.Y.) provided another argument during a Friday conference call -- Republicans are deliberately trying to stifle the economy for their own political gains. 

"In recent months, on issue after issue, they are opposing things they have supported in the past, almost all of them focused on the economy," Schumer said. "They seem to be tying themselves in a pretzel of contradiction."

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