Agenda for Congress

Tea Party vs. Tea Partly

by Wayne Crews on June 13, 2011

in Agenda for Congress, Deregulate to Stimulate, Economy, Personal Liberty, Regulation

In noticing the upcoming debate tonight featuring Republican contenders, I wondered to myself under which candidate would the federal government actually be smaller after four years, should any of them win?

Maybe Ron Paul, in working with some imaginary 114th Congress; but of course Trump told the CPAC crowd that Paul could never win. But he’s fun to watch.

Tonight’s candidates will make the general case to to cut spending and debt. But sometimes it seems that “Big Government Conservative,” which detractors called Trump, is a redundancy. The largest spending and regulatory programs have and do enjoy their support. There’s more Tea Partly than Tea Party in my view.

Thus even slashing record spending and debt is no longer enough — even if the budget were balanced at, say, half its current level. The regulatory state has surged such that the U.S. is an increasingly hostile environment for anyone inclined to create a business (and employ others).

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Sen. Hatch Questions Illogic of Holding Three Trade Agreements Hostage to TAA

by Fran Smith on May 26, 2011

in Agenda for Congress, International, Trade

Consideration of the three pending trade pacts — with Colombia, Panama, and South Korea — presents a conundrum. The administration is saying that these Free Trade Agreements with bipartisan support will open markets, improve the economy and help create jobs. However, they won’t be submitted to  Congress for a vote unless a substantial Trade Adjustment Assistance program is enacted to support workers who ostensibly lost their jobs because of trade.

Come again? The U.S. won’t pass these agreements, which are expected to provide significant and sorely needed economic gains for the U.S. and put a lot of people back to work, unless we help workers. In fact, the Chairman of the Senate Finance Committee, Max Baucus (D-Mont.) at hearings today quantified the economic benefits of the U.S.-Korea FTA: “Once implemented, the FTA will increase U.S. exports to Korea by more than $10 billion annually and support at least 70,000 American jobs.” But instead of pushing hard for that agreement and other two FTAs, the administration is holding these pacts hostage to a $1.82 billion a year program – with estimates for 2010 at $2.5 billion — with dubious lasting benefits for workers.

Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance Committee, at today’s hearing and at Wednesday’s hearing on the Panama FTA, expressed his puzzlement and dismay at the administration’s contradictory stance on the FTAs. In fact, he grilled the U.S. Trade Representative’s witness at the Panama hearing about coupling TAA with the FTAs. He told her: “You admit that we’ll gain jobs [from the Panama FTA] … yet we’re treating this country like dirt — to pay off the unions.”

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Is the U.S. Serious About Trade and Economic Growth — Or About Currying Favor with Trade Unions?

by Fran Smith on May 19, 2011

in Agenda for Congress, Economy, International, Trade

Is the U.S. serious about trade or does the Obama administration just want to cater to union supporters and set up more obstacles for trade pacts? The latest of the delaying tactics is linking the renewal of Trade Adjustment Assistance — special aid for workers who purportedly lost their jobs because of international trade — with congressional consideration of the free trade agreements with Colombia, Panama, and South Korea. When looking at the history of the three pending trade agreements, it seems obvious that U.S. trade unions are calling the shots.

The most egregious hold-ups relate to the U.S.-Colombia Free Trade Agreement, which has been languishing for more than four years. In February 2006 the two countries announced that they had concluded their negotiations on the trade pact, and it was signed on November 22, 2006. Meanwhile, the other two trade agreements were progressing. Then what happened? The U.S. House of Representatives, under the leadership of Rep. Nancy Pelosi, decided that those agreed-upon and signed trade agreements needed to have more stringent environmental and labor provisions — despite the fact that those non-trade issues had already been included in the trade pacts. The so-called bi-partisan trade deal was touted by Pelosi in a statement, but the AFL-CIO reacted “coolly” to the changes that they had been advocating. Not enough, seemed to be their response.

Negotiators went back to the drawing boards and the U.S. strong-armed those countries into including the new provisions. On June 28, 2007, the United States and Panama signed a trade promotion agreement, followed a few days later by the signing of the U.S.- South Korea FTA on June 30, 2007. But the U.S. said that more had to be negotiated.  In the case of the Korea agreement, issues relating to beef and autos required more high-level meetings; with Panama, tax transparency and labor issues were still the subject of talks; with the Colombia FTA, however, labor unions, not satisfied with the new labor provisions, still opposed that deal.

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Is Trade Adjustment Assistance a Pre-Condition for Pending Trade Agreements?

by Fran Smith on May 11, 2011

in Agenda for Congress, International, Labor, Trade

Today, at the Senate Finance Committee’s hearing on the U.S.-Colombia Free Trade Agreement (FTA), the committee chairman, ranking Republican, and the U.S. Trade Representative’s witness all endorsed the importance of this trade pact, but emphasized a non-trade related issue — trade unions and worker rights in Colombia and the Labor Action Plan that Colombia agreed to as a condition for the FTA to be considered by Congress. Several committee members also said that reauthorization of Trade Adjustment Assistance — that provides subsidies for U.S. workers who ostensibly lose their jobs because of trade — must go hand in hand with consideration of the pending FTAs — with South Korea, Panama, and Colombia.

Senator Max Baucus (D-Mont), the committee’s chairman, in opening the hearing, noted that Colombia is a friend, ally, and partner, both economically and geopolitically. Despite this support for the FTA and trade, however, he did praise the Action Plan that tells Colombia just what that country has to do with respect to its workers. As Baucus said: “The FTA commits both parties to protect fundamental labor rights. This commitment is fully enforceable, just like the commercial provisions in the agreement. And this commitment is far stronger than those in Colombia’s FTAs with other countries, including Canada and the European Union.”

Ranking Member Senator Orrin Hatch made a forceful statement in support of the FTA and tried to pin down Miriam Sapiro, Deputy United States Trade Representative, about the Administration’s commitment to submit the agreement this summer. He pressed the witness on whether the vote on the Colombia FTA is contingent on an extension of Trade Adjustment Assistance. “Is it a pre-condition?” to considering the trade pact, he asked. Although he got no direct answer to his query, the tenor of the responses seemed to indicate that it is.

In his questioning of witnesses, Senator John Kerry (D-MA) said that he had previously opposed the FTA with Colombia on the same grounds as the AFL-CIO witness, who said that the Labor Action Plan does not go far enough.  But, Kerry said, it is time to ratify the treaty — “This is the moment,” he said.

Sen. Baucus emphasized that TAA must move in conjunction with the FTA — “the two must go together,” he reiterated.  However, Senator Chuck Grassley (R-IA) pointed out that the “goal posts keep moving” in terms of when the pending FTAs will be considered.  He noted the irony that four years and one day ago, the Bush Administration reached an agreement with the Democratic Congress that was supposed to allow the Colombia trade pact to move ahead.

From the way much of the hearing went, it sounds like Colombia still has to prove that it is living up to U.S.-imposed mandates for labor rights. It also sounds like TAA is going to have to move concurrently with the FTAs if they are going to get past the pro-union blockage.

Progress on Free Trade — With Strings Attached

by Fran Smith on May 5, 2011

in Agenda for Congress, International, Labor, Trade

Looks like there could finally be some progress on long-pending free trade agreements (FTAs). Yesterday U.S. Trade Representative Ron Kirk said that the administration will ask Congress to consider the three trade agreements that have been languishing for several years. In an announcement, Kirk said the administration will begin technical discussions today with key Congressional staff on draft legislation to implement the three pending trade pacts — with South Korea, Colombia, and Panama. Under trade laws, the president has to submit implementing legislation to Congress for their approval.

While some unions have been opposing all agreements, the Colombia FTA has been the main focus of U.S. trade unions’ opposition on grounds that the government hasn’t done enough to curb violence against union leaders, despite that country’s strong progress in addressing overall violence and corruption and providing protection for union leaders.

Kirk also announced that he had sent a letter to the chairmen and ranking members of the Senate Finance and House Ways and Means Committees “indicating that Colombia has taken the necessary steps, consistent with the April 22 milestones outlined in the Action Plan, to move to the next stage in the process.” That Action Plan includes stringent labor requirements that some have called interference in Colombia’s domestic labor market and a blow to that country’s sovereignty. (See CEI’s post on this issue.) Kirk’s letter said, however, that Colombia still had to meet other objectives in that plan before the President sends the trade agreement to Congress.

At the same time, the administration will also be preparing a beefed-up Trade Adjustment Assistance bill to give workers whose jobs were affected by trade training and other special assistance programs. That may not placate some long-time opponents of the Colombia trade agreement — who cater to the unions — such as House Democrats Sander Levin and Jim McDermott.

Cuts in Agricultural Subsidies Gain Support

by Fran Smith on April 11, 2011

in Agenda for Congress, Agriculture

“Farm Subsidies: Sacred Cows No More” is the headline of the WSJ April 9 article. Agricultural subsidies, in a period where budget cuts are de rigeur, may no longer be sacrosanct, noted the article. With farmers making record profits, yet still getting heavily subsidized, some policy makers are setting their sights on direct payments to farmers of about $5 billion per year. Last year total farm subsidies were about $15 billion.

Corn farmers are the ones who benefit most, with about $2.1 billion of those direct payments going to them.

Even some industry organizations see the need for some cuts in agricultural support:

Roger Johnson, president of the National Farmers Union, said the direct subsidies have become indefensible because they don’t go to farmers who need them to survive tough times.

Most of the payments go to the largest farmers in the U.S., given the amount of land they own. From 2002, when the program was expanded, through 2010, the top 10% of recipients received 67% of the funds, according to David DeGennaro, an Environmental Working Group legislative analyst.

What’s encouraging about the changing mood toward farm subsidies is that some influential policymakers are on board and are looking at agricultural support for some needed cuts.

Mr. Lucas of Oklahoma, the Republican chairman of the House Agriculture Committee, said in an interview that direct payments were fair game for lawmakers looking to cut spending next year. He still wants to resist some cuts, a point of view he outlined in a March 15 letter to the House Budget Committee written with Rep. Collin Peterson (D., Minn.). He didn’t specify what might be protected.

Senate Majority Leader Harry Reid (D., Nev.), however, suggested earlier this month that farm subsidies were a likely budget-cutting target. He didn’t specify which programs, but said, “Commodity price for farms, farm products have never been—never been higher than they are today. There’s money there.”

Stop the Sweet Deal for Sugar, Says Senator Lugar

by Fran Smith on March 30, 2011

in Agenda for Congress, Agriculture, International

There’s a great op-ed by Senator Richard Lugar (R-Ind.) in The Washington Times today telling how Big Sugar’s sweet deal harms consumers, leads to job losses, while benefitting a small group of sugar cane and sugar beet producers.  To address the egregious sugar program, Sen. Lugar is introducing a bill today – the Free Sugar Act of 2011 — that would repeal the Depression-era central planning system of allocating domestic supply, guaranteeing a minimum price for sugar, and restricting the import of less expensive sugar.  Sen. Lugar notes in his op-ed the command-and-control approach of the sugar program:

In sugar land, as in communist countries, prices are set by the government, not the market. Agriculture Department central planners determine “marketing allotments” to assure domestic producers at least 85 percent of the market. They limit imports to keep prices inflated far above world levels. The planners set the split between cane and beet sugar and mandate a sales limit for each processor and mill.

If prices fall below the official level, a price-support system of “loans” to processors ensures that Big Sugar gets its federal share. The recipients get their loans in taxpayer dollars, but can repay them in (what else?) sugar.

The U.S. historically is not self-sufficient in sugar and there’s usually plenty available on world markets. But American buyers can’t take advantage of lower-priced sugar thanks to strict import quotas, set individually for 40 different countries.

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Pressure Mounts for Three Free Trade Agreements to be Submitted

by Fran Smith on March 10, 2011

in Agenda for Congress, International, Trade

Bi-partisan pressure mounts for the Obama administration to move on long-pending free trade agreements (FTAs). At Senate Finance Committee hearings yesterday on the trade agenda, both Chairman Max Baucus (D-Mont.) and Ranking Member Sen. Orrin Hatch (R-Utah) gave the Obama administration a hard time on not moving on pending trade pacts as U.S. Trade Representative (USTR) Ron Kirk testified before the full committee.

Sen. Hatch took a particularly tough line in his questioning. He noted that while the Obama administration is prepared to submit the U.S.-Korea FTA, he questioned why it has dragged its feet on setting any definite timetable for considering the pending free trade agreements with Colombia and Panama. Both trade pacts have been negotiated and re-negotiated for several years now, and yet the administration still claims there are still some outstanding issues that need to be resolved, mainly relating to labor unions.

Sen. John Thune (R-S.D.) also expressed concern about the pace with which these agreements are being submitted to Congress. According to USTR Kirk, the U.S.-Korea FTA is ready for technical drafting and submission to Congress, but the Colombia and Panama FTAs don’t have clear timetables for congressional consideration. Sen. Thune asked what further changes the president wants in the agreements and questioned whether U.S. credibility about future agreements will be hurt if more revisions are required after the FTAs have been negotiated and signed.  He said, “A deal with the U.S. ought to be a deal.”

In response, Kirk said that “a vast majority of people in the U.S. don’t believe in the wisdom of our trade policy” and we have to “keep faith with American workers.” He noted that the Korea trade pact is ready, and Congress should move on that, while the other two agreements are moving forward and should be ready this year.

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House Republicans Push for Fast Action on Three Pending Trade Pacts

by Fran Smith on March 2, 2011

in Agenda for Congress, International, Politics as Usual, Trade

Post image for House Republicans Push for Fast Action on Three Pending Trade Pacts

The new House Republicans are pushing for fast action on the three pending free trade agreements (FTAs) — with South Korea, Colombia, and Panama. In a letter signed by 67 members of the 112th Congress, including freshmen members who had Tea Party support, the representatives said that they want action on the agreements within the next six months.

While the Obama administration has said it wanted to submit the U.S.-South Korea FTA by July of this year, no timetables have been announced for the other two trade pacts that have been stalled for several years. In the case of the Colombia FTA, the AFL-CIO has been the main campaigner against the agreement, charging that the Colombian government is allowing trade union officials to be killed with impunity. Yet research has shown that while Colombia is still a country with a high but declining level of violence, union officials are actually less likely to be crime victims than the average Colombian.

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Bill Clinton Enters the Food vs. Fuel Debate Regarding Corn Ethanol

by Fran Smith on February 25, 2011 · 5 comments

in Agenda for Congress, Agriculture, Energy, Ethanol

Post image for Bill Clinton Enters the Food vs. Fuel Debate Regarding Corn Ethanol

Another convert to the food vs. fuel debate on corn ethanol — former President Bill Clinton. In his speech on Thursday before the U.S. Department of Agriculture’s annual Agricultural Outlook Forum, Clinton said that farmers shouldn’t be putting so much of their corn crop into ethanol production rather than food. He cautioned that the diversion of the food and feed crop could increase food prices and lead to food riots in developing countries and urged farmers to look to the needs of the poor countries of the world.

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