Postmortem: the Battle over Trade Promotion Authority

What do trade politics portend for 2016?

@Critical Inquiry Blog

On Monday, President Obama signed Trade Promotion Authority, also known as ‘fast track’ or ‘TPA’. Trade Promotion legislation is a mechanism that allows the Executive branch to conclude negotiations on trade agreements and bring them to Congress for an up-or-down vote.

Trade politics makes for strange bedfellows. And yet the Trade Promotion Authority fight had surprisingly little to do with trade. In fact, international trade has widespread support from the American people and even more popularity among political and economic elites. Many of the nays on TPA from both sides of the aisle went to great lengths to couch their votes as ‘I support trade in principle, but…’. This signals that these Representatives’ main concern wasn’t trade; it was something else. Yet the otherwise-mundane TPA bill — an authority given to every President since FDR, excepting Nixon — became a lightning rod for Democratic opposition in the House of Representatives, leading to an embarrassing few days of headlines for President Obama as his Congressional supporter Nancy Pelosi voted against the bill.

So rather than a genuine dispute about trade agreements, the battle over TPA should rather be seen as the opening bout before November’s pay-per view event: the 2016 election. The signals we can pick up from the fight on Capitol Hill are cross-cutting, but unambiguous:

Republicans have their house in order — don’t expect a repeat of 2012.
Hillary can withstand the left-wing challenge — but there will be blood.

Let’s start on the right.

Within days of the Republican clawback of control in Congress last November, the voices began swirling: trade will be the Republican lodestar. Influential Republicans, sitting and former, found harmony in repeating the mantra of trade. Seven months later, the GOP credibly showed it can govern. Paul Ryan, Chairman of the Ways and Means Committee that oversees fast track, felt first-hand in 2012 the pain that party strife can cause when he lost his bid to become Vice President. No doubt this had compelled him to shepherd the stray members of his flock, including Tea Partiers opposed to ‘Obamatrade’, towards legislative pragmatism. Just comparing ‘hashtags’ for a moment — the ubiquitous ‘Obamacare’ vs the comical-sounding ‘Obamatrade’ — gives an indication of the change in Republican strategy. GOP leadership was able to clamp down on internal opposition, make the concessions required, and find an ally across the aisle, President Obama. In short, Republicans made themselves seem like a reasonable party.

This about-face from the last six-plus years demonstrates quite clearly that Republicans have learned from the failures of 2012 and 2014 and are gearing up for 2016 with a vengeance. The way the GOP coalesced around the principle of free trade, then found the legislative means to accomplish it, should be a warning sign to Democrats. Republicans could not unite on theory or practice in 2012: Mitt Romney was arguably undone by his party, not vice-versa, and President Obama capitalized by running a great campaign. But we can learn from the events of the past few weeks in Congress to expect less internal chaos from Republicans, not more, despite the numerous candidates vying for the ticket. Nonetheless, the still-dominant, but on the evidence false, impression is still that the Republican party is too ideologically divided to present a meaningful challenge in the next Presidential campaign.

The clearest sign that Republicans are unified, tactically savvy, and out for blood flew under the radar of most political observers, but it was a veritable dog whistle for those who have followed the trade debate from the start.

The way the bills were framed by Senate negotiators and House leadership meant that TPA could be forced through over Democratic opposition. And that’s exactly what happened. TPA is now become law after a few nail-biting sessions in Congress. In the House vote, no one knew where Pelosi would ultimately come down. Her meandering speech started off by asking for more time and a slower process. Bucking the President, she reluctantly said she would not vote for Trade Adjustment Assistance (TAA), a side-bill that was meant to garner Democratic support, as it provides redress for workers displaced by trade.

So the bargain made by bipartisan negotiators was clear: Democrats would get TAA while Republicans would get support for TPA. Pelosi put a bullet in the deal not by getting her bill and then cynically reneging on TPA, but by voting down TAA! Other Democrats quickly piled in — TAA was voted down handily — and Republicans had a snap choice to make. After TAA, a fig leaf to Democrats, was unceremoniously swatted away, Republicans could have delayed voting on TPA itself. That’s what Pelosi was signaling to Boehner: take TPA off the floor, meet me halfway, and then I’ll bring Democrats on board.

Pelosi’s strategy was poorly considered.

Instead, Republicans drove the trade truck right through the House. They announced the vote on TPA would go forward, even though there were implicit guarantees they wouldn’t hold a vote. TPA passed, 219–211 in the House, and after some wrangling in the Senate, the bill was delivered to the President and signed into law.

A neutral political observer would see that Republicans set up Democrats and the Administration for embarrassment by bringing the vote in the House so soon. On Monday of that week, it is fair to say that the White House and most trade watchers did not expect a vote in the House on Friday; by Wednesday, Obama was visiting the Congressional ballgame to ask for Pelosi’s help. By forcing the President’s hand, Republicans hedged their bets for a win-win, knowing that they would ram TPA through even if Democrats would try to torpedo the vote. Republicans couldn’t control the outcome, but they managed the opportunities in their favor. In all likelihood, the GOP was well aware that something like this turn of events could happen — and they were perfectly happy to push the button anyway. It fits with the broader Republican strategy to take credit for TPA in the Presidential campaign, win back the White House, and erase Democrats’ substantive and reputational achievements in TPP and TTIP.

The shrewd Republican handling of the minefield of trade politics should alert Democrats preparing for 2016. The opposition come November will present a challenge, one that perhaps isn’t sufficiently appreciated yet. But Democrats can take heart from the fact that nominee-in-waiting Hillary Clinton has shown she can handle the challenge from the left wing of her party with composure.

The TPA fight shows that the Sanders-DeLauro wing can cause real damage, but they can’t bring a knockout punch. At the time, the failure of TPA in the House seemed like a big scalp for left-of-center Democrats, led by Congresswoman Rosa DeLauro. The populist Democrats who opposed TPA are now patting themselves on the back for what was, in legislative terms, a win that they let slip through their fingers. It is also questionable whether progressive energies are being misused against a trade deal negotiated by a Democratic President. For Pelosi, her reputation as the best vote-sniffer of her generation must be in question as Democrats shuffle their leadership in the Senate with an eye towards the next election cycle.

As for Hillary, she was able to contort — but not contradict — herself by taking the line that she would wait to evaluate the merits of the trade deal, which she promoted vociferously as Secretary of State. As temporarily incredulous as this was, it proved to be a smart strategy, and she survived the onslaught. Now, as TPA passes and the TPP is finalized, candidate Clinton can say she either supports the agreement, or finds genuine issue with particular chapters and provisions. It also helps that she doesn’t have to vote on the TPP and therefore can remain ambiguous until absolutely necessary. Regardless of which option she takes — one presumes that it will be the latter, given that her foreign policy calling card — Hillary has made it clear that she’s nimble enough to duck the punches of a Sanders, O’Malley, or even a Warren.

For both Republicans and the presumptive Democratic nominee Hillary, all signs from the arena of trade politics show that they have learned from the failures of recent years.

Welcome to 2016, everyone.

WINNERS:

President Obama (Still got it).
Hillary (Unscathed).
Paul Ryan (We Passed a Bill!).

LOSERS:

Bernie Sanders (Hillary shadowboxes the socialist).
Nancy Pelosi (Opportunistic opposition undoes optimum outcome).
Ted Cruz (Harvard law grad thinks TPA is unconstitutional).

Ardevan Yaghoubi is a project assistant for the Global Business and Economics Program of the Atlantic Council, an international affairs think tank. He is a graduate of New College, Oxford and the University of Chicago.