[Ip-health] FT Editorial: Congress’s fast track to discord on free trade

Thiru Balasubramaniam thiru at keionline.org
Mon Jun 22 07:29:58 PDT 2015


June 19, 2015 6:04 pm

Congress’s fast track to discord on free trade

US needs to discover a better way to forge agreement on global deals

Congress last week blocked the “fast-track” trade promotion authority (TPA)
that would have given President Barack Obama the power to submit trade
deals, notably the forthcoming Trans-Pacific Partnership (TPP), to a yes-no
vote on Capitol Hill. This week, after some procedural trickery, the House
of Representativespassed a version of it.

Whether the decision can be replicated in the Senate will rely on a set of
interlocking manoeuvres and trade-offs blindingly convoluted even by the
world-class standards of Washington. Yet the very fact that constructing a
majority has proved so difficult only underlines the lack of political
legitimacy in the process. By spreading disaffection with trade policy,
driving TPA and then TPP through Congress without broad support could be a
mixed blessing. Unless a much wider coalition in favour of such pacts can
be constructed, the US model for trade deals is coming to the end of its
useful life.

The current paradigm for setting trade policy is for the US administration
to negotiate deals under increasingly paranoid levels of secrecy and then
present a take-it-or-leave-it deal to Congress via the fast-track
mechanism. The latter part is understandable. Allowing amendments to a
trade bill would mean the administration having to go back and negotiate
changes with the other signatory governments, setting off a potentially
infinite series of iterations.

Yet the more secrecy that surrounds trade deals, the less legitimate TPA
becomes. There is no good reason for denying legislators, along with
campaign groups, the media and the public, the right to see at least the
outlines of negotiations like the TPP as they are going along. This is
especially true when they involve issues of intense domestic controversy
such as intellectual property rights At least some of the current
reluctance of some lawmakers in Congress to pass TPA is linked to the fact
that they will then be presented with a yes-no vote on a trade deal over
which they have had almost no say.

Without a means of constructively setting trade policy, the US system — and
that of the EU — could slip towards the impotence that characterises the
World Trade Organization. Multilateral deals under the WTO would be
considerably superior to bilateral or regional arrangements. But with the
failure of the so-called “Doha round”, the WTO has been allowed to become a
forum where striking poses is far more prevalent than actually agreeing

To see how this state of affairs might infect trade policy in the US, one
has only to turn to Nancy Pelosi, the leader of the Democrats in the House.
Ms Pelosi accurately wrote this week that the current paradigm of trade
policy is failing, but then bafflingly proposed a major role for the UN.

Such an idea can only be born out of ignorance or a disingenuous desire to
prevent any more deals ever being signed. A system centred on the UN would
outdo the WTO as the global epicentre of pointless gestures.

Whether or not fast-track authority, let alone the TPP, manages to sneak
past Congress down a maze of procedural back corridors is unknown. But a
controversial pact passed under such conditions will sour the atmosphere
for any deals in the future.

The best way to pass trade policy is under the aegis of a revived WTO. The
second best is for large regional or sectoral deals that focus on free
trade rather than intellectual property rights, and are negotiated
transparently. The current model of secrecy does no one any favours, and
gives globalisation in general and trade deals in particular an unfairly
bad name.

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