December 6, 2001
The House of Representatives today approved by a one-vote margin a bill that would extend to the President the authority to negotiate trade agreements that will be brought back to Congress for an up or down vote until mid-2007, if Congress fails to disapprove the authority two years earlier.
The House approved the bill by a vote of 215 to 214, with 194 Republicans and 21 Democrats voting for it. Rep. Cal Dooley (D-CA) had promised to deliver between 18 to 20 Democrats for the bill. Twenty-four Republicans and 189 Democrats voted against the bill.
The vote was produced with maximum pressure by the House Republican leadership, which worked on members with constituencies such as textiles that have traditionally opposed fast-track. To garner the vote of Rep. Jim DeMint (R-SC), the Administration offered to limit the trade preferences of the Caribbean Basin Initiative to U.S. fabric that must by dyed and finished in the United States. Interim regulations interpreting the law said that eligible fabric could be dyed and finished in the region.
Among the textile Republicans indicating their support for fast-track before the vote were Reps. Sue Myrick (R-NC), Henry Brown (R-SC) and Richard Burr (R-NC).
The dying and finishing provision is not reflected in the manager's amendment that was approved by the House Rules Committee late on Dec. 5.
The manager's amendment contains a nod to opponents of trade sanctions to enforce the labor and environmental obligations of the fast-track bill. It also includes a nod to textile and citrus industry by providing additional steps U.S. negotiators would have to take before agreeing to tariff cuts for these import-sensitive products.
On labor and environment, the manager's amendment adds a provision that there can be no sanctions against a country's decision to allocate no resources for the enforcement of labor and environmental matters or for a country's right to establish domestic labor standards and levels of environmental protection. At the urging of Sen. Phil Gramm (R-TX), conservative House Republicans had objected to the bill as making U.S. labor and environmental laws subject to international dispute settlement.
In the lead-up to the House vote, Gramm had dropped his opposition and had urged House members to support it.
House Ways & Means Committee Chairman Bill Thomas (R-CA) told the Rules Committee on Dec. 5 the change was negotiated at the request of Democratic co-sponsor Cal Dooley (D-CA), who said it "added no new rights or obligations" and was "redundant."--that is simply reiterated existing language asserting countries' rights in making decisions on labor and environmental enforcement.
"If they were comfortable with it, I'm comfortable with it," Thomas said.
The manager's amendment would add a provision to the principal negotiating objective on labor and environment, which states that parties to a trade agreement should not fail to effectively enforce their labor and environmental laws through a sustained course of action or inaction. The provision also states that parties recognize that countries can exercise discretion in how they allocate resources for enforcement. These resource allocation decisions do not constitute a failure to enforce their laws, provided it is a reasonable exercise of that discretion.
The manager's amendment adds the following statement: "and no retaliation may be authorized based on the exercise of these rights [to allocate resources] or the right to establish domestic labor standards and levels of environmental protection."
The manager's amendment also contains an addition to the bill's overall negotiating objectives, which are hortatory and not linked to dispute settlement. The addition stipulates that countries seek provisions in trade agreements to "strive to ensure that they do not weaken or reduce the protections afforded in domestic environmental and labor laws as an encouragement for trade."
On investment, the manager's amendment would provide for an appellate mechanism for investor-state proceedings in future trade agreements, and increased transparency in the handling of dispute proceedings. Rep. Bob Matsui (D-CA) has criticized the proposed appeal mechanism as setting too high a threshold that would make an appeal unlikely (see related story).
The manager's amendment also instructs negotiators to have parties to trade agreements establish consultative mechanisms to examine certain currency movements and to scrutinize whether a foreign government engages in a pattern of currency manipulation (see related story).
The amendment also changes the procedural disapproval resolution that can revoke fast-track for the Administration's failure to consult with Congress by stating that any member may introduce such a resolution. The amendment also expresses the sense of Congress that committees of primary jurisdiction should have adequate staffing to deal with their oversight of trade negotiations.
Going into the House floor vote, the Republican leadership did not have the necessary support to win. But it opted to proceed because leaders believed they were within striking distance of victory. Some pro-fast-track lobbyists said this week the leadership might bring the bill to the floor even if there is a shortfall of as many as five to seven votes.
In such a situation, the whips try to garner the necessary votes by pressuring members on the floor to support the bill. The House Speaker has the discretion to extend the time for the floor vote once it has started to allow time for such lobbying, sources said.
Traditionally, major bills that the leadership wants to pass with a margin of victory come to the floor with eight to 10 votes more than needed for passage, one informed source said.:
