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.
[11] Ibid.
[12] Ibid.
[13] U.S. Constitution art. II, § 2.
[14] What is TPA? Available at https://ustr.gov/trade-topics/trade-promotion-authority
[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.
[16] Ibid.
[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.
[19] Ibid.
[20] Higgins, Sean. 2015. Republicans affirm support for Obama’s trade agenda. The Washington Examiner. Pg. 1.
[21] Beshudi, Adam. 2015. TPA Spurs TPP Progress. Politico. 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.