Wire Line

DECEMBER 

Second Bush Term; What About Trade?


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There are several major trade policy hurdles that the Bush Administration will have to overcome during the next year. Perhaps the biggest is the expiration of presidential trade-negotiating authority (TPA). Renewing that right of the president to negotiate trade agreements that Congress cannot change is typically a struggle on Capitol Hill. In 2005, Congress must extend the existing negotiating authority for two years, and in 2007, a totally new bill must be debated.

Senate Finance Committee Chairman Charles Grassley (R-IA) stated that he expects Bush to request the extension of negotiating authority early next year. Grassley said that despite a wider Republican majority in the Senate after the elections, bipartisanship still is necessary to get the legislation passed. Trade-negotiating authority originally passed by a razor-thin margin in 2002.

Another issue is the US trade agreement with five Central American nations and maybe the Dominican Republic, which still is expected to face opposition from Democrats critical of the labor and environmental provisions.

On another front, the House and Senate will have to vote on renewing US membership in the WTO. Other issues facing Bush include concern about outsourced jobs overseas and an appreciation in China's currency value.

The biggest prize for a second Bush Administration would be the successful conclusion of the Doha multilateral round of trade talks. However, this might be hard considering the questions that are swirling about whether USTR Ambassador Robert Zoellick will stay for a second term. One possible successor being mentioned is Gary Edson, the former senior White House official who held a unique role as adviser on both economic and national security issues until he joined Bush's reelection campaign earlier this year. Other names mentioned include former Rep. Cal Dooley (D-CA), OMB Director Josh Bolten, and Commerce Undersecretary Grant Aldonas.

Changes in the 109th Congress could favor Bush's trade policy, but the retirement of Rep. Dooley was a key departure. He regularly helped get Democratic votes on trade. Moreover, seven of the 21 Democrats whose votes were crucial to Bush's victory in the House on trade negotiating authority will not be around for the 109th Congress, due to retirements and defeats in the last election. That possible dwindling core of Democrats willing to cross party lines on trade issues could strengthen the hands of farm- and textile-state Republicans, who were able to extract concessions from House GOP leaders in exchange for their trade votes.

Finally, the defeat of the House Trade Subcommittee Chairman - Phil Crane (R-IL) - an avowed free-trader - is a big loss to lawmakers supporting a free trade agenda.

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