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Democrats Say They Intend To Reshape Bush’s Trade Authority January 30, 2007

Posted by notapundit in Congress, Politics, US News, White House.

WASHINGTON (Dow Jones)–A stronger safety net for Americans who lose their jobs will be a key condition for President George W. Bush to retain authority to negotiate trade agreements, Democratic legislators said Tuesday.

Bush is expected later this week to call on Congress to renew his Trade Promotion Authority, which expires at the end of June. Democratic leaders say they can support continuing the fast-track trade negotiating authority, but under new conditions. That might be too high a price for the Bush administration, say analysts.

“Trade negotiating authority is a valuable tool for the administration, but it requires a great deal of trust, and Congress must have some key assurances before it is willing to extend this leverage,” House Ways and Means Committee Chairman Charles Rangel, D-N.Y., said in a joint statement with Senate Finance Committee Chairman Max Baucus, D-Mont.

During Bush’s presidency, Congress has approved 12 free-trade agreements, largely along party lines and with close votes. Many Democrats say they feel burned by the way the Bush administration used TPA over the past four years, and have no intention of putting up with such treatment now that they are in charge of Capitol Hill.

For example, the U.S. Trade Representative’s office raised the ire of Democrats and Republicans when it left out an amendment to the U.S.-Oman Free Trade Agreement, approved by the Senate Finance Committee, that would have prohibited imports of goods produced by forced labor. USTR said the amendment was unnecessary, as such imports are illegal under current law.

Democrats have also complained that labor provisions in free-trade agreements with Peru and Colombia are too weak, and now are demanding the labor chapters of those agreements be rewritten before a vote.

Brian Pomper, former trade counsel to Baucus and now a political strategy consultant, said there may not be enough time for Congress and the Bush administration to come to an agreement on how to retool trade authority in a way acceptable to both sides by July 1.

“Democrats aren’t isolationists; they want to engage with trade policy, they just want to do it differently,” said Pomper. “We are just starting a conversation about TPA that we should have started a long time ago.”

Rangel presided over a hearing Tuesday with business leaders and former government officials from across the political spectrum. Most were in agreement that open trade benefits the U.S. economy, but more should be done to cushion the blow for workers who lose their jobs and to retrain them.

Grant Aldonas, formerly a senior Commerce Department official under Bush, said free trade and free markets benefit the poorest in a society because they diminish power for entrenched powerful special interests. He also said the government should do more to help workers stay in the workforce.

“We are facing a demographic challenge where we need every worker to be productive,” Aldonas told the House Ways and Means Committee. Among others, reforms are needed in U.S. education, tax policy and health care, Aldonas said.

Baucus has introduced legislation that would expand Trade Adjustment Assistance, a federal program that pays for health care, retraining and compensation for manufacturing workers forced to take lower-paying jobs when their companies move operations to countries in free-trade agreements with the U.S.

The Baucus proposal would extend coverage to workers in service industries, such as X-ray technicians and call-center employees. Workers would be eligible if their jobs moved to any foreign country, not just those in free-trade agreements with the U.S. It would also lower the age above which workers qualify for wage insurance to 40.

At a time when the federal budget is tight, the proposal would mark a massive expansion in a program that last year cost less than $1 billion. Bush, who has said he wants to balance the federal budget by 2012, said Tuesday in a speech in Illinois that he doesn’t want to raise taxes.

Rep. Jim McCrery, R-La., the ranking Republican on the Ways and Means Committee, said during the hearing that legislators are talking about changing the program to “Globalization Adjustment Assistance” to reflect the broader scope.

Others say the program should be even bigger, assisting not just workers hurt by trade, but also those whose jobs become obsolete due to technology.

Then there are the Democrats who aren’t going to support trade authority for Bush whether or not he accepts new spending for the unemployed, said Adam Posen, a senior fellow at the Peterson Institute for International Economics. These Democrats might support granting authority to the next president, just not Bush, he said.

“There is a general feeling among many in Congress that (they) are not going to give this president more discretion in any area, not just trade, because he’s been so irresponsible with American lives and money,” Posen said.

By Elizabeth Price, Dow Jones Newswires


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