By William Mauldin
Major trade legislation favored by President Barack Obama and
Republican leaders passed a Senate hurdle on Wednesday, despite
opposition from some Democrats.
The "fast track" bill, which would pave the way for a sweeping
trade agreement among 12 Pacific countries, cleared the Senate
Finance Committee by a vote of 20 to 6. It passed along with a
measure backed by Sen. Chuck Schumer (D., N.Y.) that would seek to
punish foreign companies that benefit from alleged currency
manipulation overseas. Another key currency provision was
defeated.
The fast track bill's progress in the Senate came on a day when
Mr. Obama faced a setback in the House, where his trade push faces
the biggest obstacles. The top Democrat in the House, Rep. Nancy
Pelosi (D., Calif.) threw her support behind a rival piece of trade
legislation. The alternative trade legislation, which Rep. Sander
Levin (D., Mich.) said he would introduce Thursday, includes
safeguards popular among labor groups and provisions to buttress
the Detroit auto industry, as well as strong provisions on currency
manipulation.
The lack of support among Democratic leaders, made clear on
Wednesday, means the administration will have to work harder to
clinch necessary Democratic votes for the main, bipartisan fast
track bill, also known as trade promotion authority. The
legislation, enacted under previous presidents, allows trade
agreements to get a simple majority vote in Congress, without
procedural delays or amendments.
Besides fast track, the Senate committee approved three other
bills that would provide a safety net for workers who lose their
jobs to trade, renew programs that give preferential tariffs to
developing countries, and facilitate customs processes and
enforcement.
In the customs bill, the committee easily approved Mr. Schumer's
currency legislation, which was opposed by the administration.
"It's time to do something that might actually solve this problem
and help America," Mr. Schumer said, pledging to get the
legislation enacted "one way or another." He opposed the fast track
bill, along with four other Democrats and Sen. Richard Burr (R.,
N.C.).
But the committee rejected another currency-manipulation
measure, offered as an amendment to the fast track bill. Introduced
by Sen. Rob Portman (R., Ohio) and backed by unions, the amendment
would have pushed the administration to negotiate enforceable
currency rules in the Pacific trade agreement, known as the
Trans-Pacific Partnership, or TPP.
The committee leaders sought to present Mr. Portman's amendment,
supported by Mr. Schumer and other Democrats, as a poison pill. "If
this amendment passes, you can kiss TPP goodbye," warned Sen. Orrin
Hatch (R., Utah), the committee's chairman. "This is an amendment
that is a bridge too far," said Sen. Ron Wyden (D., Ore.), the top
Democrat.
The Obama administration opposes putting binding currency rules
in trade agreements or U.S. law, citing objections of trading
partners and concerns that U.S. monetary policy could be
challenged.
But Ford Motor Co. had pushed lawmakers Wednesday to support the
currency rules, saying they could prevent Japan, the other giant
economy in the TPP talks, from intervening in the yen to gain an
advantage. Detroit is among the biggest critics of the TPP talks,
while Japanese auto makers support the agreement.
Following the Senate panel's passage of fast track and the
related bills, the House committee that oversees trade, led by Rep.
Paul Ryan (R., Wis.), may vote on a similar package as early as
Thursday.
Business groups and administration officials are seeking to
enact fast track as soon as possible in an effort to clinch a TPP
agreement and get the deal enacted before the presidential campaign
season further complicates the politics of trade.
But labor unions and allies ranging from environmental
organizations to some conservative groups are working to block the
TPP and fast track, citing potential job losses and concerns about
labor and environmental conditions in Vietnam and other TPP
countries.
Siobhan Hughes contributed to this article.
Write to William Mauldin at william.mauldin@wsj.com
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