When Will Congress Consider TPP, And Would It Pass?

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Senate Majority Leader Mitch McConnell (R-Ky.) has repeatedly told the White House that he will not bring the Trans-Pacific Partnership (TPP) trade agreement up for a Senate vote until after Nov. 8 elections.

Vote may be bounced to 2017. While some observers said it could be taken up in a post-election lame-duck session of Congress, others say the timeline could change should the Democratic Party regain control of the Senate in 2017. If so, some observers predict, McConnell could punt the issue to the new Congress.

As for the eventual vote count, McConnell has told the White House the votes are not yet in hand to approve the multilateral trade agreement. Several GOP senators in expected close reelection races do not want to vote on the topic, and McConnell is obliging.

Democratic senators in the past have been lukewarm in their support of new trade agreements for several reasons, especially regarding labor, environmental and auto industry language. The lack of Democratic votes means the bulk of the votes for passage must come from Republicans, but the party in recent years has not been as favorably included toward trade agreements as in the past. For example, Sen. Rob Portman (R-Ohio), a former U.S. Trade Presentative in the Bush administration, has come out against the TPP.

Currency manipulation enforcement a key hurdle. Democratic senators and Portman and some other Republican senators have specifically pointed to a lack of enforcement language in the TPP relative to currency manipulation. This has given Democratic and Republican senators “cover” to say they will vote against it if provisions are not altered.

USTR: Concerns over TPP could be handled later. The U.S. has ways to address some of the concerns surrounding the Trans-Pacific Partnership (TPP) even though it cannot re-open the 12-nation deal signed in February, U.S. Trade Representative (USTR) Michael Froman said Mar. 29. “TPP isn’t something that can be renegotiated – that doesn’t mean that we can’t address some of the issues that stakeholders have raised through other mechanisms, including in the implementation process, in the enforcement process, in the context of the broader trade agenda,” Froman said.

New Zealand’s leader warns Congress not to reject TPP. China and other growing Asian economies could become alternatives to the U.S. in the region if Congress rejects the Trans-Pacific Partnership (TPP), the New Zealand prime minister said Wednesday during a speech at a pro-trade group that is urging lawmakers to back the 12-nation trade agreement. “The real issue here is can U.S. corporations get better access to the Asian market? The answer under TPP is yes,” Prime Minister John Key, an early supporter of the proposed trade deal, told the U.S. Chamber of Commerce. Key is in Washington for a nuclear security meeting today at the White House. Key warned that if Congress does not approve the TPP, member nations will seek trade agreements with other countries, including China, that provide favorable tariffs and trade policies for export businesses. “These nations will not stand still,” he said.

Drawing in China, S. Korea and other big economies in Asia. Key said the potential growth in markets for US companies would be more tied to TPP providing an attractive framework that might draw in China, South Korea and other big economies in Asia. “Over the course of the last five years, around about 60% to 70% of all income and growth and job creation has happened in the Asian market and the vast bulk of that has occurred in China. Basically, the Asian story has been a Chinese story but it might increasingly become an Indian story,” Key said. China is interested in the TPP because leaders are trying to transform its economy from an industrial manufacturing model to a service-based one, Key said.

Comments: President Barack Obama has repeatedly highlighted the importance of maintaining U.S. leadership in crafting global trade rules, notably with reference to potentially alternative Chinese initiatives. China is not a party to the TPP. Others argue that past trade pacts have had a limited impact on broad foreign policy dynamics.

NOTE: This column is copyrighted material; therefore reproduction or retransmission is prohibited under U.S. copyright laws.