Background and Status of Trade Promotion Authority and Trans-Pacific Partnership
June 10, 2015
On May 22, 2015, the U.S. Senate passed the Bipartisan Congressional trade Priorities and Accountability Act, better known as Trade Promotion Authority (TPA). But the road to securing TPA, finalizing the Trans-Pacific Partnership (TPP) and implementing the agreement remains long and uncertain.
The TPA is a compact between the two branches, which essentially deputizes the president to negotiate trade agreements on behalf of Congress.
The TPP is a long-gestating trade negotiation between the United States and 11 other nations (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam). The TPP would reduce tariffs and other barriers to trade in goods and services between 12 countries on four continents. Ultimately, as some TPP architects and other trade-policy watchers have suggested, the TPP could eventually evolve into a larger Free Trade Area of the Asia Pacific. A final TPP agreement will include terms that are both liberalizing and protectionist.
- The TPP has been characterized by detractors as a sellout to multinational corporations that will destroy U.S. manufacturing; ship millions of jobs abroad; create health crises by impeding access to medicines; destroy the globe's water and air quality; poison the U.S. food supply; gut domestic health, safety, environmental, and banking regulations; and usurp U.S. sovereignty.
- Proponents assert with equal confidence that TPP will grow the economy, create jobs, reduce trade deficits, reassert U.S. economic leadership, curb China's unfair economic practices, and ensure greater opportunities by solidifying ties with the world's most robust economic region.
There have been twists and turns in the road for trade policy during the Obama administration. Expect several more in the weeks and months ahead. Although the likelihood that TPA will pass and the TPP will be completed and successfully implemented remains uncertain, it is clear that trade policy will be a ripe and contentious issue throughout the 2016 election year.
Source: Daniel J. Ikenson, "Trade Promotion Authority and the Trans-Pacific Partnership: What Lies Ahead?" Cato Institute, June 8, 2015.
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