Wyden Vows to Flesh Out ‘Smart-Track'; Hatch Presses Froman on TPA, USTR Role

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By Len Bracken  

May 1 — Senate Finance Committee Chairman Ron Wyden (D-Ore.) May 1 said he would flesh out his plan for “smart-track” trade promotion authority (TPA), indicating in questions to U.S. Trade Representative Michael Froman that transparency and newer trade challenges are his paramount concerns.

“We need a TPA upgrade to reflect a modern trade agreement,” Wyden said. “As we walk through these issues, these issues of the future, some of which I now call smart track—we're going to be fleshing that out in the future—I just want it to be understood that we are going to be working closely in partnership with you.”

Trade promotion authority, also known as “fast-track,” sets congressional negotiating objectives for trade agreements while providing for streamlined voting procedures—set timelines for up-or-down votes—on legislation to implement trade pacts. TPA also establishes the consultation mechanisms that the executive branch must follow as it negotiates trade deals.

At his first hearing on the administration's annual trade policy agenda as committee chairman, Wyden suggested that the Office of the U.S. Trade Representative appoint a transparency officer and stressed the need for the public to be able to review trade agreements before the president signs them into law.

Froman said that in addition to experimenting with blog posts on negotiating positions and tweeting during negotiating rounds, his office is reviewing past practices under TPA for releasing the text of trade agreements. He said the administration will work with the committee to figure out the right process and with the chairman as the legislative process develops.

Wyden also highlighted barriers to the free flow of data, trade secret theft, unfair advantages enjoyed by state-owned enterprises, forced sharing of intellectual property and currency manipulation as some of the “new breed of trade challenges” that must be addressed in U.S. trade agreements.

Although no decision has been made as to what form the chairman's legislative action will take, a committee spokesman told reporters after the hearing it will include provisions that go beyond the pending TPA bill, the Bipartisan Congressional Trade Priorities Act (S. 1900; H.R. 3830), which was introduced in January by the previous Senate Finance chairman and other lawmakers.

Hatch Cites Need for TPA

The committee's ranking member, Sen. Orrin Hatch (R-Utah), told Froman that not having TPA in place creates a serious flaw in the president's trade agenda—the previous legislation expired in 2007.

“I do not believe you can conclude high-standard agreements that will meet Congress' approval without TPA,” Hatch said. “Ambassador Froman, I have no doubt in your capabilities or those of your staff, but history tells us very clearly that, without TPA, your trade agenda will almost certainly fail.”

The Utah lawmaker said he was disappointed in the president's “passive approach” on this issue that he compared unfavorably with the political effort by President Bill Clinton for the North American Free Trade Agreement and President George W. Bush's political commitment to renewing TPA in 2002.

“In those cases, war rooms were established and each cabinet secretary made congressional approval of those initiatives a public priority,” Hatch said.

Froman said the administration welcomed the introduction of the pending legislation when it was introduced in January and pledged to work with the committee when it is ready. Hatch is a cosponsor of S. 1900.

Interagency Process in Trade Talks

In addition to pressing Froman on TPA, Hatch said he was deeply concerned about USTR as an institution, noting that the agency ranks last in employee job satisfaction among small agencies.

“Part of the problem is USTR's failure to effectively play its traditional role as a bulwark against other federal agencies,” Hatch said. “Too often during the inter-agency process, regulatory agencies are just saying no to cooperative participation in international trade negotiations.”

Hatch said it was the Department of Health and Human Services that alleged the need for so-called “policy space” resulting in USTR's proposal to simply carve out tobacco products from the Trans-Pacific Partnership (TPP) negotiations.

“It was the Department of Treasury's insistence on relegating financial services discussion to pre-existing forums that resulted in USTR's position that financial services should be carved out of our trade negotiations with the European Union,” Hatch said, referring to the Transatlantic Trade and Investment Partnership.

He said it was the Food and Drug Administration's fear of dispute settlement that resulted in a weaker USTR proposal for the sanitary and phytosanitary chapter in the TPP talks, which he said excludes certain disciplines from dispute settlement.

“There is a clear pattern here,” Hatch said. “If this does not change, I am worried that any agreement this administration negotiates will never match the president's rhetoric of concluding high-standard 21st Century agreements.”

Froman said his primary objective was to bring home the best possible deals for American businesses and workers.

Several senators asked Froman about including currency manipulation provisions in the TPP negotiations. He responded that such provisions have not yet been discussed in the talks and said the administration is discussing the best way to handle the issue, adding that the Treasury Department has the lead role on currency.

To contact the reporter on this story: Len Bracken in Washington at lbracken@bna.com

To contact the editor responsible for this story: Jerome Ashton at jashton@bna.com

Statements by committee members and the witness, as well as a video of the hearing, can be found at http://www.finance.senate.gov/hearings/hearing/?id=3064b778-5056-a032-523b-0d5505711ac5.

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