Keeping the “Free” in Free Trade

Yesterday, Senate Republicans successfully blocked a Finance Committee meeting to consider free trade agreements (FTA) with Korea, Colombia, and Panama.

The reason? President Obama and many Democrats have coupled their support for the trade agreements with the inclusion of funding for the employment Trade Adjustment Assistance (TAA). Most Republicans are in support of the trade agreements, but disapprove the inclusion of TAA. As Sen. Orrin Hatch (R-Utah) explained, “If the president and his Democratic allies want to pass TAA, go ahead and pass TAA. Have at it. Let it stand on its own accord like we always have in the past. But don’t attach it to these agreements.”

The Colombia free trade agreement was signed in 2006 and the Panama and South Korea agreements were signed in 2007, however, they must pass Congress before they can take effect.

Under a special set of rules known as “fast track” trade promotion authority, free trade agreements can be negotiated by the president, but must be sent to Capitol Hill for approval. Congress, meanwhile, must approve or disapprove of an agreement in its entirety. The agreement cannot be amended.

In an attempt to circumvent the fast track trade rules, the Finance Committee was to hold a “mock” amendment process, where amendments to the FTAs would have been debated and voted upon. Once approved, the FTAs and their corresponding “amendments” would have been sent back to the president. The White House would have taken the “amendments” into consideration and then send new versions of the agreements back to the House and Senate for approval.

CEI supports Sen. Hatch and his fellow Republicans’ decision to block the meeting. FTAs should be approved based on their own merits. As we have mentioned in the past, free trade boosts the economies of both all parties involved. Given the fact that the American economy is struggling to recover from its latest recession, this should be enough of an incentive for Congress to pass the agreements in a timely fashion. Moreover, tying the approval of these agreements to the inclusion of programs such as TAA, which would increase federal spending during a time when the threat of national debt default looms overhead, is irresponsible at best. Congress needs approve the FTAs without strings like TAA attached. Let’s let free trade remain free.