On Tuesday, President Bush stumped for free trade in Jacksonville, Fla. Compared to at least one other speech delivered the same day, it would be stretching to call his address newsworthy. He picked a port town that benefits from trade to deliver a well-worn message: Trade is good for America.
This is not an argument that How the World Works disagrees with, fundamentally. But "trade," in general, is a quite different beast from bilateral free trade agreements designed to gain market access for highly capitalized special interests, such as the pharmaceutical industry. And that's what Bush was really stumping for: The president wants the Senate to get moving on three FTAs currently awaiting ratification: deals with Colombia, Panama and South Korea. You might imagine that during a week in which the deepest financial crisis to threaten the U.S. economy in many years reached a fever pitch, Bush would find other matters to occupy his attention, but no: In Jacksonville, Bush's big lament was how unfair it was that "many U.S. exports going to Colombia face heavy tariffs."
Unhappily for the president, the Senate is evincing very little interest in ratifying the Colombian FTA. Sen. Max Baucus, D-Mt., chairman of the Senate Finance Committee, has his own priorities. He wants the government's Trade Adjustment Assistance (TAA) program beefed up before he is willing to even consider a vote on the Colombian FTA. As he told an audience at the Peterson Institute for International Economics in January:
Let me be clear. This task and no other must be our nation's trade policy priority -- until we accomplish it, other issues on today's trade agenda must take the back seat. That includes congressional consideration of pending free trade agreements with Colombia, Korea, and Panama. I simply cannot support or consider moving these trade agreements in the Senate, until we realize the goal of expanded and reauthorized Trade Adjustment Assistance.
The Trade Adjustment Assistance program is designed to compensate manufacturing sector workers who are displaced by trade. It includes financial support for education and training, a healthcare credit, wage insurance and other goodies. But its scope is limited, not just to the manufacturing sector, but also to trade that takes place with countries with whom the U.S. already has signed free trade agreements.
TAA, theoretically, has bipartisan support. In Jacksonville, the president made a gesture toward it:
Now, you're going to hear the word trade adjustment assistance talked about in Congress.... That basically says that we're going to have education programs aimed at helping people find skills... And I'm a supporter, and I believe it's important that trade adjustment be a component of our trade policy. I look forward to working with Congress to reform it and to reauthorize it, to make sure it does the job that it can -- is supposed to do. Just like I'm looking forward to signing those trade bills, particularly starting with the one from Colombia.
A supporter? In October, when the House of Representatives passed a revamped and expanded TAA, the White House immediately announced that the president would veto the bill if it was presented to him. The House bill would have, among other things, doubled funding, extended coverage to service sector workers, included trade with non-FTA countries, and significantly boosted the healthcare credit. The White House opposes all of those elements. When George Bush says he is looking forward to a "reformed and reauthorized" TAA, what he really means is a bill without teeth.
Thus, the deadlock in the Senate -- a classic case of horse-trading in action. Sen. Baucus has made his position clear -- no new FTAs without a bigger safety net.
A very good argument can be made that the existing Trade Adjustment Assistance program isn't the best way to take care of American workers who have been adversely affected by globalization. It is expensive to administer, covers a relatively small number of workers, and requires a lot of governmental judgment calls -- were those Ohio workers laid off because of competition with China, or because technological productivity enhancements made their jobs obsolete, or because their employer mismanaged the business? Does it make sense to try to shoehorn a healthcare credit for unemployed workers into a program that covers only a fraction of Americans, instead of a comprehensive national healthcare plan that would cover all Americans, and make a real difference in a world of global competition? These are questions that policy wonks can get righteously agitated about for weeks on end.
But such policy parsing is not relevant to the political fight now taking place in the Senate -- a struggle that once again demonstrates how utterly tone-deaf the Bush administration is to the concerns of working-class Americans in the early 21st century. Preaching the benefits of free trade without being willing to take care of the "losers" created by trade isn't very bright in an election year when workers are feeling squeezed, and the opposition party controls Congress. And pretending to support trade adjustment assistance when in actuality you are opposed to meaningful trade adjustment assistance is just shameless.
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