POLICY BRIEF 07-5

American Trade Politics in 2007: Building Bipartisan Compromise

by I. M. Destler, Peterson Institute for International Economics

May 2007

The May 10, 2007, congressional–executive branch agreement, labeled "A New Trade Policy for America," establishes a bipartisan foundation of confidence and trust and provides new language for pending free trade agreements (FTAs). Most important is the accord on inclusion of core labor standards, a matter of sharp partisan division over the past decade. The new trade policy also includes a range of environmental provisions, a new balance between intellectual property rights and trading partners' health needs, provisions on post security and US investor rights, and a general "strategic worker assistance and training (SWAT) initiative." The agreement was reached after four months of negotiations between key House Democrats—with Representative Charles B. Rangel, chairman of the House Ways and Means Committee, in the lead—and US Trade Representative (USTR) Susan C. Schwab, with ranking Ways and Means Republican Jim McCrery engaged throughout. Rangel had decided early that bipartisan accord on trade was possible and staked his reputation on bringing it about, working carefully with colleagues of both parties, persisting when hopes receded. His wisdom in reaching out to McCrery was vindicated as the ranking Republican worked assiduously and effectively to find compromises on the toughest issues. USTR Schwab recognized early that trade policy needed a new bipartisan base and that Rangel offered the only realistic hope of achieving it. She showed flexibility in making necessary concessions early and persistence in concluding the agreement. The base in substantive understanding and trust that the accord builds will be helpful if and when Congress addresses broader issues like renewal of trade promotion authority (TPA), which is necessary for completion of the multilateral Doha Round. But TPA extension is unlikely to be enacted until there is sufficient progress in the Doha talks to make it worth the necessary investment of time and political capital by the administration, Congress, and private interests.
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