Shadow Government

The Blocked Fast Track Trade Bill is a Foreign Policy Disaster

The Senate just dealt a serious blow to U.S. trade policy. Nominally, it was a procedural measure on whether to proceed to a vote on a Trade Promotion Authority (TPA) package, and 52 senators actually voted in favor. But 45 senators opposed — more than enough to block the move to cut off debate. The ...

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The Senate just dealt a serious blow to U.S. trade policy. Nominally, it was a procedural measure on whether to proceed to a vote on a Trade Promotion Authority (TPA) package, and 52 senators actually voted in favor. But 45 senators opposed — more than enough to block the move to cut off debate. The repercussions of such parliamentary maneuvering for U.S. foreign policy could be very serious indeed.

I wrote last week about the perilous state of the U.S. trade agenda. While the Obama administration had worked assiduously on the international aspect of ambitious trade deals, it had neglected the domestic debate. It had finally reached a point at which talks with trade partners could not advance and deals could not conclude without TPA. The figurative lateness of the hour meant that Obama administration needed a whole sequence of congressional votes to go its way in quick succession. That approach worked on the first stage – getting TPA bills reported out of the Senate Finance and House Ways and Means committees. But that feat was accomplished with a sort of shell game that caught up with trade proponents today.

There is not just one trade bill moving through; there are four. In addition to TPA, there is a bill to renew and fund Trade Adjustment Assistance (TAA), one to renew trade preference programs, and one to deal with customs matters. The virtue of having these four separate bills was that problematic amendments could be shunted off onto the more “optional” bills. But that just delayed the day of reckoning. Trade opponents understood the approach — move their amendments to bills that would never pass, while keeping TPA clean. Hence, the argument leading up to today’s vote was how the bills would be bundled together. Senate Majority Leader Mitch McConnell (R-Ky.) tried to move TPP and TAA as a package; opponents insisted all four bills move together.

The vote was nearly along party lines. One Democrat supported (Sen. Tom Carper of Delaware). Sen. McConnell ended up switching his vote to “no” for procedural reasons, which made him the only Republican to oppose.

One might ask why this is such a big deal. It was a procedural motion, not a final verdict. The Senate could take the motion up again, if it wanted to (McConnell’s procedural ploy allows him to raise it). A new deal could be struck. The president could twist arms within his own party.

The problem is that momentum was not moving in TPA’s direction. The president has been pushing on the issue — hard. He just did not seem to move anyone. There aren’t many more votes to be had on the Republican side (Sens. Graham and Rubio did not vote). Other than Hillary Clinton coming out in favor of TPA, it is hard to see what could change on the Democratic side.

Sen. McConnell could accede to Democratic demands and bundle the four bills together, but he might well lose more Republican votes than he gained among Democrats. Further, some of the objectionable provisions (e.g., currency manipulation clauses) have been labeled deal-killers by the administration.

This leaves the administration’s foreign policy in tatters. On the trade front, no partner country will want to make sensitive concessions if the deal will be blocked in Congress. Further, it badly undermines the administration’s credibility, as U.S. negotiators had repeatedly assured other countries that they had U.S. domestic politics under control. Even if this is only a temporary delay, there is very little time to push through the big Trans-Pacific Partnership (TPP) deal before next year’s election is upon us; the delay itself could block the deal.

The connection from commercial policy to foreign policy comes because of the central role that the TPP played in the administration’s pivot (or “rebalance”) to Asia. The TPP is seen as a key test of U.S. commitment to the region, and the Obama administration had labeled the pivot its top foreign policy priority.

The danger now is that trade partners and allies will see the United States as rudderless, isolationist, and unreliable for at least the next year and a half, if not beyond.

BRENDAN SMIALOWSKI/AFP/Getty Images

Phil Levy is Senior Fellow on the Global Economy, The Chicago Council on Global Affairs, and teaches strategy at Northwestern University’s Kellogg Schoool of Management.

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