Bridging the Hatch-Wyden Divide Over Trade Promotion Authority

The eyes of the international trade community are fixed on Senators Orrin Hatch (R-UT) and Ron Wyden (D-OR), upon whom responsibility for crafting bipartisan Trade Promotion Authority (TPA) legislation has fallen. At last report, Senate Finance Committee Chairman Hatch and Ranking Member Wyden were at an impasse over some important components of the bill, passage of which is widely considered necessary to concluding the long-gestating, 12-nation Trans-Pacific Partnership (TPP) agreement. That agreement must be concluded before the Transatlantic Trade and Investment Partnership (TTIP) negotiations make any progress. Those negotiations will have far-reaching implications for the multilateral trading system, including China, India, Brazil and other countries not currently party to these mega-regional trade agreements. Hence, TPA’s outcome is of worldwide interest.

Trade Promotion Authority has been maligned as a congressional capitulation or executive power grab.  It is neither. The U.S. Constitution grants Congress the authority to “regulate commerce with foreign nations” and to “lay and collect taxes, duties, imposts, and excises” and grants the president power to make treaties with the advice and consent of the Senate. Accordingly, the formulation, negotiation, and implementation of trade agreements require the involvement and cooperation of both branches. TPA is a compact between the branches that obliges these respective constitutional authorities, while guaranteeing an up-or-down vote by Congress, on an expedited basis, of any trade agreement negotiated by the executive branch with foreign governments, provided that the agreements meet the objectives spelled-out by Congress in the legislation. This conditionality is often ignored or brushed over by news reporters, who either spend too much time with trade skeptics or who are looking to economize on words.

Without such a compact, trade agreements would be nearly impossible to conclude because foreign negotiators – knowing that any agreement reached would be subject to congressional revisions – would never put their best offers on the table.  The process of negotiating and renegotiating with 535 officials (instead of one agency, the Office of the U.S. Trade Representative) would make for an interminable process too cumbersome and costly to pursue.  For practical purposes, negotiations have to occur between small parties vested with the authority to speak on behalf of those whom they represent. Trade Promotion Authority is the solution.

But one important consideration that created the impasse between Hatch and Wyden concerned the process of holding the president to account.  The compact is intended to grant negotiating authority to the president – including expedited procedures that lead to an up-or-down vote within a certain number of calendar days – in exchange for the president’s commitment to negotiate on behalf of Congress by honoring a list of congressional objectives. The question is: how should Congress verify that the president satisfied his obligation to honor their objectives before proceeding with expedited congressional consideration?

Under previous TPA legislation, Congress was afforded opportunities to offer “Resolutions of Disapproval” over procedural concerns, including whether the trade deal advanced the objectives of Congress. Such resolutions were required to be reported to and approved by the respective trade committees in each chamber. That process would seem sufficient, given that most congressional action is funneled through committees with chairs and ranking members holding sway. Senator Wyden’s view, however, was that it should be easier to strip an agreement of “fast track” treatment, perhaps by allowing for more channels through which such “resolutions” could come to the floor for a vote and requiring 60, as opposed to 67, votes in the Senate to pass the resolution.  Wyden also seemed to favor affirmative “certification” that an agreement comports with congressional objectives, as opposed to requiring passage of a resolution that it doesn’t comport – an idea which Hatch equated to effectively requiring a second TPA vote.

Well, as of a few hours ago, various media were reporting that a deal had been struck and that Wyden agreed that the fast track “circuit breaker” would still require a resolution of disapproval to pass, but that the threshold number of votes would be 60, not 67.  That sounds like a reasonable compromise struck by senators who want TPA legislation to pass.

Of course, procedures for taking agreements off the fast track in the House will be different – presumably a resolution of disapproval channeled through Ways and Means Chairman Paul Ryan, which would require 218 votes.  But articulating those procedures and ensuring that the TPP and other trade agreements abide Congress’s wishes will square the constitutional circle with Trade Promotion Authority, and preserve the right of each member of Congress to vote “yea” or “nay” on the TPP.