Big Business Pushing FTAs

Posted February 5, 2010 at 3:16pm

With renewed White House support but tough midterm elections expected this fall, the business community says this year’s legislative window is closing quickly for a trio of trade deals still awaiting Congressional approval.

“We’re going to push like hell,” said Christopher Wenk, a trade expert with the U.S. Chamber of Commerce.

In his State of the Union address last month, President Barack Obama encouraged negotiators to revisit pending free-trade agreements with Colombia, South Korea and Panama, deals that have been approved in recent years by government officials but that still await ratification by Members.

“We have to seek new markets aggressively, just as our competitors are,” Obama said in his address. “If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores.”

Since then, the White House has encouraged free-trade-inclined Republicans to rally support around the administration’s new initiative. Obama reiterated his commitment to salvaging the three agreements at the GOP’s Baltimore retreat almost two weeks ago. And Treasury Secretary Timothy Geithner took his case to the Hill last week, telling the House Ways and Means Committee on Tuesday that the administration expects lawmakers to pass trade deals to help the economy.

“I think it’s a very realistic objective,” Geithner told Republicans on the tax-writing panel.

The chamber is lobbying Democratic leaders furiously to include the three trade proposals in a jobs package now being written. In an election year, Wenk said May is likely the deadline for Congressional approval of one or all of the pacts. He is selling it to Members from both parties as economic stimulus and as a rare bipartisan opportunity in a harsh partisan climate.

To make the sell, the chamber is pitching the trade deals as a deficit-neutral jobs generator that could be popular in Congressional districts hard hit by the recession.

“We can argue strongly that as Congress is looking to increase jobs without increasing the deficit, there aren’t very many ripe candidates out there in terms of legislative actions,” Wenk said. “But passing these free-trade agreements is actually one of these things Congress can do.”

“Trade is one of those unique issues that you will find strong bipartisan support on,” he added. “What we need now is strong leadership from the administration.”

A Republican trade lobbyist agreed that the clock is ticking on passing the trade agreements this year. This source said vulnerable Democratic incumbents, spooked by the prospect of returning to their districts this summer having already taken unpopular climate change and health care reform votes, will be jittery about casting a vote for trade deals. Then again, with broad Republican support expected, the lobbyist said these deals could be attractive to Democratic leaders looking to score legislative victories without making their Caucus walk the plank again.

“The majority of Republicans are going to vote for this,” the source said. “If you’re [Speaker] Nancy Pelosi, do you have to go to your Members for another hard vote? Actually, no, because everyone can vote how they want.”

Even with the White House’s blessing, critics of the Colombia, South Korea and Panama free-trade agreements say the business community and many lawmakers are overestimating the public support for new deals during tough economic times.

“They’re not going anywhere this year for sure,” said Lori Wallach, director of Public Citizen’s Global Trade Watch, an opponent of the current deals.

Aside from technical changes that need to be struck in all three pacts, Wallach said they would be a tough sell to working-class swing voters in key Democratic districts that Republicans are targeting vigorously this cycle. Many of those voters view free-trade agreements as a key reason for the closing of U.S. factories and the moving of jobs overseas.

“They’re white working-class people with populist economics and conservative social views who are suspicious of big companies. … [They] are not natural, default Democrats,” Wallach said. “These are the folks that all the polling shows hate these old trade agreements.”

At the recent House GOP retreat, Obama warned Republicans that they, too, should also be concerned about how popular the free-trade agreements, in their current forms, would be in their economically struggling districts.

“If you went to some of your constituencies, they’d be pretty suspicious about it,” Obama told the Republican Members.

Union opposition also poses a considerable obstacle for free-trade advocates. Organized labor, a key Democratic constituency that is lobbying against the three trade deals, is expected to play a crucial role in the 2010 midterm elections.

Thea Lee, a trade expert with the organized labor federation AFL-CIO, doubts Democratic leadership has the stomach to push the proposals through the painful legislative process this year.

“We’re in the middle of a recession and hit particularly hard on jobs. Is that a good time to bring forth these trade agreements?” Lee said. “We think there are pretty substantive problems with all three of the trade agreements and are not looking to move forward until the provisions are either renegotiated or that the conditions on the ground change pretty dramatically.”