WASHINGTON – The path to passage of the country’s largest free trade agreement just keeps getting longer.
The Trans-Pacific Partnership, a 12-country pact backed strongly by many Minnesota businesses, took seven years to negotiate. Now, it may take more than a year to get to a vote in the U.S. House and Senate.
That would make TPP one of the most long-delayed trade deals in the country’s history — if it gets approved at all.
“We remain optimistic that the Trans-Pacific Partnership will get passed in 2016,” said Devry Boughner Vorwerk, vice president of corporate affairs at Cargill, which has helped lead the charge for TPP. “We are hopeful Congress will find a way to move forward.”
But the deal among Pacific Rim countries is riding a political roller coaster that some trade experts say is steeper and more twisting than the 1993 North American Free Trade Agreement (NAFTA), the nation’s last big trade deal.
“The way the Republican presidential process is shaping up, this is not a time for getting [TPP] through without a potential political bomb exploding,” said Tim Kehoe, a University of Minnesota economics professor who worked as an adviser to Mexico on NAFTA.
As controversial as NAFTA was, it did not face the delays that now beset TPP. Kehoe thinks TPP is a better deal for Americans than NAFTA. But if President Obama wants it to pass, Kehoe said, he may have to wait because he needs Republican support.
Republican Senate Majority Leader Mitch McConnell sounded a warning in early December, telling the Washington Post that the White House should not bother to send the trade deal to Congress before the 2016 elections.
The White House continues to lobby furiously for the pact. It says it will eliminate over 18,000 taxes on American-made products and open markets in Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Obama’s advisers say he still intends to ask for a vote, but won’t say when.
Under trade promotion legislation passed in 2015 by the Senate and House, Congress must vote yes or no on the new pact within 90 days of receiving it from the president. But legislators cannot amend the agreement. The deal requires that all participating countries sign on by October 2017.
Several major Minnesota companies have joined the Trade Benefits America coalition to push for approval. Besides Cargill, they include Target Corp., 3M, General Mills and Medtronic.
U.S. Rep. Rick Nolan, D-Minn., has been one of TPP’s most vocal detractors. Nolan, who represents the state’s Eighth Congressional District, thinks the trade deal will cost jobs in his district and across the country because it forces American employers to compete with foreign employers who pay workers far less and provide few, if any, benefits. Nolan meets weekly with a group of legislators to devise ways to defeat the agreement.
“We’re getting the hell beaten out of us on mining and steel,” Nolan said of recent job losses on the Iron Range.
Experts like Kehoe and Bryan Riley, a senior trade analyst at the Heritage Foundation, a free-market think tank, say that those jobs were lost to a China slowdown that has nothing to do with TPP.
Nolan counters that illegal steel dumping by the Chinese is a huge problem in the U.S.
China is not a party to the TPP deal, but its potential dominance in controlling world trade drove the U.S. and others to strike the Trans-Pacific Partnership, most experts agree. Voting down TPP will leave a void in international trade that the Chinese could fill at the expense of the U.S., TPP supporters argue.
“One danger in getting the agreement strung out for a long time is that it gives opponents more time to take shots,” Riley said.
Still, Nolan has mixed feelings about delaying presentation of TPP to Congress. At this point it has attracted the scorn of Republican presidential candidates, as well as opposition from Democratic presidential candidate Hillary Clinton.
Nolan worries that holding a vote after the 2016 elections will essentially let political fence sitters come down on what he considers the wrong side without being held accountable.
Nolan’s Democratic colleague, Rep. Collin Peterson of Minnesota, said pushing a vote into the lame duck session would be “an unusually long lead time” that makes the deal’s fate uncertain. Peterson has not made up his mind about whether he will support TPP. Because of the agricultural makeup of his district, Peterson is studying parts of the agreement that will affect the sugar beet, corn and dairy industries.
When the vote takes place does not matter as much as a full-blown debate, Democratic Rep. Tim Walz added.
“We should do the important work of our nation when we need to,” he said in e-mail to the Star Tribune, “politics be damned.”