MEMORANDUM

TO:      Reporters and Editors
FROM:   Antonia Ferrier and Julia Lawless for Senate Finance Committee
            Ranking Member Orrin Hatch (R-Utah)
RE:       Abuse of Trade Promotion Authority, Trade Agreements
DATE:   Thursday, June 30, 2011

Moving forward with a highly-partisan strategy, Senate Democrats and the White House inserted a domestic spending program, Trade Adjustment Assistance (TAA), into the U.S.-South Korea Free Trade Agreement (FTA) implementing bill. This action abuses long-standing rules, procedures, and precedents governing the delegation of trade negotiating authority from the Congress to the President and puts a successful vote on the South Korean FTA - the largest trade pact negotiated in more than a decade – at risk.

These partisan actions to force a markup by the Finance Committee late this afternoon denies both Democrats and Republicans the ability to fully examine and consider the three pending trade agreements with South Korea, Colombia, and Panama. This is the first major action in international trade policy in four years. With 97 amendments by Democrats and Republicans, these trade agreements should be fully vetted by members of the Committee who deserve adequate time to understand the agreements.

Including unrelated and highly-controversial provisions, like the TAA spending program, into the Korean trade agreement violates the letter and spirit of this law.

• Under the Bipartisan Trade Act of 2002, trade agreement implementing bills are considered under Trade Promotion Authority (TPA) procedures.

• Under TPA, trade agreement implementing bills are developed jointly by Congress and the Administration. Close consultation with Congress during this process is key. Once submitted to Congress, these bills are not amendable. As added protection, the law says these bills can only consist of provisions that are necessary or appropriate to implement the trade agreement.

Without demonstrating whether any jobs would be lost, Senate Democrats and the White House are using the South Korea FTA to shield wholesale changes to U.S. labor, tax, pension and health care law from debate and amendment, going far beyond what is necessary or appropriate to implement this agreement.

• House and Senate Committee reports to the Trade Act of 2002 make it clear that the standard for what can be included in an implementing bill must be narrowly and strictly defined.

• Past Administrations and Finance Committees have carefully and faithfully followed these 2002 guidelines in implementing trade agreements, narrowly limiting any extraneous provisions in trade legislation.

• Unfortunately, Senate Democrats and the White House chose a different path, one that disregards congressional intent and runs counter to recent practice.

Instead of serious consultation, the expanded TAA provisions were jammed in the South Korean FTA, providing the Senate Finance committee with little notice and no consultation. This highly partisan maneuver ignored the advice of some of South Korea’s strongest congressional advocates thus risking crucial Senate support for the Agreement at a critical time.

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