By Martin M. McSherry
Introduction
In a historically unproductive
Congress,[1]
one policy area of tremendous legal consequence is on a fast track to becoming
law with bipartisan support. Two international regulatory and investment
treaties, the Transatlantic Trade and Investment Partnership (TTIP) and the
Trans-Pacific Partnership (TPP), are currently under negotiation between the
United States, the European Union and Pacific Rim nations. At the heart of
these negotiations are questions over their content and the process through
which the treaties will cease to be proposals and become international trade
agreements. The role of the executive and legislative branches also enter
uncharted territory as the administration’s trade negotiators strike deals with
foreign nations that would seriously alter U.S. law with limited transparency. While
Congress will get the final say on the passage of TPP and TTIP, top Republicans
in the House and Senate are racing to empower the Democratic president with Trade
Promotion Authority (TPA). TPA, or fast track authority, is legislation that
would give the administration the power to negotiate the terms of an
international trade deal, facilitating only an up-or-down vote from Congress on
a final agreement.[2]
Why are congressional Republicans so eager to cede their legislative authority
to President Barack Obama? More broadly, what does TPA mean for
executive-legislative relations?
In seeking answers to these
questions, one finds scant coverage of TPP and TTIP in mainstream media
sources. The secrecy of the negotiations precludes much beyond rumors from entering
into the spotlight concerning talks that could have profound consequences for
labor relations, environmental protection and the bottom line of businesses in
nearly every sector of the economy. Stakeholders are only left with speculation
about the content of the negotiations; however, the process of finalizing TPP
and TTIP is a discussion that is worth having.
Powers of the President
The Office of the United States
Trade Representative (USTR), currently occupied by Michael Froman, operates
within the Executive Office of the President.[3]
The USTR is responsible for negotiating the terms of trade agreements at
bilateral and multilateral levels, and is currently overseeing TPP and TTIP.[4]
The Appointment Clause of Article II of the Constitution therefore grants the
president considerable power in the realm of trade, though the appointment of
the USTR requires Senate confirmation.[5]
International “free trade” agreements often focus on removing and altering
barriers such as import taxes, or tariffs, duties and even regulating the value
of currency.[6]
Senator Charles Schumer (D-NY) implored USTR Michael Froman at a Senate Finance
Committee hearing to more forcefully address currency manipulation in TPP,
referencing China’s practice of devaluing its currency to make domestic
products appear artificially cheaper when compared to American imports.[7]
Despite
this, the president’s authority to regulate foreign commerce is very limited by
the constitution. Article I gives Congress the power to “lay and collect Taxes,
Duties, Imposts and Excises,” and to “coin Money, regulate the Value thereof,
and of foreign Coin.”[8]
These appear to be huge legal contradictions that could be actionable constitutional
violations of power. However, they are not. In fact, under a new paradigm of
executive-legislative relations that defines current trade negotiations, members
of Congress are demanding a member of the executive branch to lay and collect
taxes, duties, imposts and excises and regulate the value of foreign coin.
Trade Promotion Authority
First granted to the president in
the Trade Act of 1974, Trade Promotion Authority (or fast track authority) delegates
negotiating power in trade agreements to the president with the commitment that
Congress will consider the final outcome of the negotiations under special
procedural rules.[9]
When the finalized agreement is submitted by the president to Congress, it is
not open to any changes or amendments.[10]
Once submitted by the president to the committees of jurisdiction (Senate
Finance and House Ways and Means), each committee has 45 days to report it and
put it to a floor vote.[11]
The House and Senate must vote within 15 days of the introduction of the bill. The
bill can be debated for no more than 20 hours on the House and Senate floors
and, therefore, cannot be subject to a filibuster in the latter chamber.[12]
The Constitution does not allow the
president to draft or introduce legislation in Congress, nor compel Congress to
vote on legislation in a particular timeframe. The Constitution provides little
guidance on treaty-making, though it is now understood that the president
negotiates treaties, which the Senate must confirm. Article II, section 2
grants the president the power, “by and with the Advice and Consent of the
Senate, to make Treaties, provided two-thirds of the Senators present concur.”[13]
This differs from the process outlined in TPA because of the two-thirds
threshold, a significant hurdle that executives like President Woodrow Wilson
found impossible to clear. In these ways, TPA represents a tremendous and
historically significant, though voluntary, transfer of authority from one
branch of the federal government to another.
The
Office of the United States Trade Representative, a major proponent of fast
track, disagrees in the definition on its website: “TPA does not provide new
power to the Executive Branch. TPA is a legislative procedure, written by
Congress, through which Congress defines U.S. negotiating objectives… Under TPA,
Congress retains the authority to review and decide whether any proposed U.S.
trade agreement will be implemented.”[14]
That TPA provides the Executive Branch with new power is incontrovertible. It
is power the president does not currently have and will have if TPA is passed.
TPA is new power.
In
2011, trade agreements with South Korea and Panama passed under TPA, which was
still in effect from a 2007 renewal.[15]
Typically, TPA lasts for five years and applies to any and all agreements that
are finalized by the administration during that time.[16]
Since 2012, the Obama Administration has been actively lobbying Congress for a
renewal of this authority. In a Congress controlled by Republicans who revile
the president but are proponents of free trade, congressional leaders and
administration officials are in an awkward position as they attempt to persuade
dissenters on both sides of the aisle to embrace fast track.
The Current Situation
With the end of TPP and TTIP
negotiations in sight, the Republican-controlled 114th Congress is racing
to pass TPA. Senate Finance Chairman Orrin Hatch (R-UT) and House Ways and
Means Committee Chairman Paul Ryan (R-WI) are both enthusiastic supporters of
expanding President Obama’s authority, with Ryan calling it his top priority for
economic growth. At the same time, members of the president’s own party are the
most vehement opponents of TPA. In response to the administration’s push to
pass TPA, progressive Reps. Rosa DeLauro (D-CT) and Louise Slaughter (D-NY)
released a statement saying, “Congress can no longer give this
administration—or any future one—the benefit of the doubt, especially given the
scope of these particular deals. America’s trade policy has not improved the
lives of the middle class and leading economists overwhelmingly agree that
trade has contributed to the rise in income inequality.”[17]
DeLauro
leads a broad coalition of Democrats who are opposed to the deal. Most experts
agree that TPA will pass with the majority of its support coming from
Republicans, who have been eager in recent years to deny President Obama any
legislative victory. Labor unions, which traditionally support Democrats,
oppose TPA and both of the pending trade deals. Business groups, such as the
Chamber of Commerce, will benefit from market access provisions in the
agreements. In his 2015 State of the Union Address, President Obama said, “I’m
asking both parties to give me trade promotion authority to protect American
workers, with strong new trade deals from Asia to Europe that aren’t just free,
but fair.”[18]
When there was an audible groan from Democrats in the chamber, the president
went on to say, “Look, I’m the first one to admit that past trade deals haven’t
always lived up to the hype, and that’s why we’ve gone after countries that
break the rules at our expense. But ninety-five percent of the world’s
customers live outside our borders, and we can’t close ourselves off from those
opportunities.”[19]
Chairman
Ryan inserted a bit of humor at a hearing with USTR Michael Froman,
highlighting the political tightrope pro-trade Republicans must walk as they
seek to give President Obama significant new power. In persuading his more
conservative colleagues on the House Ways and Means Committee to support giving
the administration sweeping authority on trade, the Wisconsin Republican
quipped, “I’d no sooner trust this administration with total power than I would
trust the Patriots with all of the footballs on Lambeau Field.”[20]
At the hearing, most members objected to the veil of secrecy surrounding the
negotiations for both TTIP and TPP, to which Froman replied that members could
access the text of certain parts of the deals at his office. This failed to
satisfy much of the concern over transparency, as access for members is still
limited until the negotiations are finalized.
The
significance of these deals should not be understated. The 12 nations in TPP
represent 40 percent of global domestic product alone.[21]
In current negotiations for TPP, there is even a potential for the final deal
to include “an unconditional and complete ban on agricultural export subsidies”
in the 12 nation partnership.[22]
This means that direct expenditures enacted by Congress for billions of dollars
may be, in essence, repealed by the administration and introduced to Congress
as part of the larger deal. Under special procedural rules, Congress would be
compelled to vote on a proposal drafted by administration officials in a
certain timeframe with limited debate and no filibusters.
Conclusion
While, indeed, TPA represents an
unprecedented expansion of executive power, concluding high-level trade
negotiations would be impossible without it. Negotiators must be able to make
concessions with the trust and confidence of their counterparts that the final
deal is final. Were Congress able to examine each line item of the deal and
strike down provisions some members do not like, it would undermine the
entirety of the negotiation. Each concession is contingent upon a separate
victory. If Congress failed to grant the president TPA, the entire deal would
unravel.
After all, a member of Congress
beholden to a population of 500 thousand may have a governing perspective
influenced by one industry or even one factory. With regard to a deal
encompassing 40 percent of the world’s GDP, it is not practical to reconcile
435 of these perspectives individually. The president, elected by the entire
country, must do his or her best to represent the aggregate interests of
Americans in the negotiations. Of course, it makes sense for Congress to vote
yea or nay on the final product, but this must be done without amendment to the
delicate balance of international interests spanning radically different
cultures and economic systems.
However, pretending that this is somehow
an insignificant transfer of power between branches with little or no
constitutionality is dishonest. This may be a necessary political tactic to
garner support from both progressives and conservatives, but that statement is
simply not true. In writing the majority opinion for the 1936 United States v. Curtiss-Wright case,
Supreme Court Justice George Sutherland determined that the president makes
treaties with foreign countries with the advice and consent of the Senate, “but
he alone negotiates. Into the field of negotiation the Senate cannot intrude;
and Congress itself is powerless to invade it.”[23]
The Constitution does not explicitly give the president this power, but the
Supreme Court thought President Roosevelt should have plenary authority to
conduct foreign policy as the United States became a major global actor. Since
1936, the process of globalization has only become more rapid.
If Congress adheres to strict
interpretations of the role of the executive from an isolationist era long gone
and rejects TPA, globalization will not halt or reverse. In the absence of
American leadership in the global economy, nations like China will fill that
power vacuum and write the rules of international trade. Congress, as Justice
Sutherland believed, is unable to participate in international negotiations but
must approve treaties in their final form. That said, one should not lose sight
on how significant a departure TPA is from the separation of powers prescribed
by the Constitution. Instead of ignoring the legal implications of TPA, it
should be regarded as a necessary adaptation to a rapidly changing world.
[1] Desilver, Drew. 2014. In late spurt of
activity, Congress avoids ‘least productive’ title. Pew Research Center. Pg 1.
[2] Hunter,Richard
J.,,Jr, John Shannon, and Hector Lozada. 2013. Presidential Trade Promotion
Authority. Mustang Journal of Law and Legal Studies 4, : 75-85.
[3] Umberger, Alison. 2008. Free trade
visas: exploring the constitutional boundaries of Trade Promotion Authority. Georgetown
Immigration Law Journal. , 22 (2), p. 319.
[4] Mission
of the USTR, available at ustr.gov/about-us/mission.
[5] U.S. Constitution art. II, § 2, cl. 1.
[6] Hunter,Richard J.,,Jr, John
Shannon, and Hector Lozada. 2013. Presidential Trade Promotion Authority. Mustang
Journal of Law and Legal Studies 4, : 75-85.
[7] Needham, Vicki. 2014. Schumer presses
for currency provisions in Asia-Pacific trade deal. The Hill. Pg. 1.
[8] U.S. Constitution art. I, § 8, cl. 1 and 3.
[9] Hunter,Richard
J.,,Jr, John Shannon, and Hector Lozada. 2013. Presidential Trade Promotion
Authority. Mustang Journal of Law and Legal Studies 4, : 75-85.
[10] Ibid.
[12] Ibid.
[13] U.S. Constitution art. II, § 2.
[15] Hunter,Richard
J.,,Jr, John Shannon, and Hector Lozada. 2013. Presidential Trade Promotion
Authority. Mustang Journal of Law and Legal Studies 4, : 75-85.
[17] French, Lauren. 2015. Obama cranks up
trade pitch to Dems. Politico. Page
1.
[18] 2015 State of the Union Address Text as
Prepared for Delivery. Available at http://www.whitehouse.gov/the-press-office/2015/01/20/remarks-president-barack-obama-prepared-delivery-state-union-address.
[20] Higgins, Sean. 2015. Republicans affirm
support for Obama’s trade agenda. The
Washington Examiner. Pg. 1.
[22] U.S. Signals Willingness to Agree to Ag
Export Subsidies Ban in TPP Deal. 2015. World
Trade Online. Pg. 1.
[23] United
States v. Curtis-Wright Corp., 299 U.S. 319.
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