The Trans-Pacific Partnership is long overdue. The TPP is expected to be highly beneficial for the US and its partners, providing opportunities in the international open market especially in the fastest-growing economies of the Asia-Pacific region. Given the weakened state of the US and global economies, this partnership will be the most vital international trade agreement in several decades, and it should expedite commerce in the Asia-Pacific region.
The Obama Administration has been working rather quickly to finalize the comprehensive 12-nation deal as a bipartisan effort containing Republicans’ support. The Senate approved the Trade Promotion Authority (TPA) last month with a large bipartisan vote. The TPA, known as the ‘fast-track’ authority legislation, gives the president the authorization to negotiate a deal that will only allow votes in Congress.
Conversely, Democrats in the House, followed by Minority Leader Nancy Pelosi, voted against the Trade Adjustment Assistance (TAA), a provision of the TPA. The TAA is a federal entitlement program that provides financial assistance, $450 million of annual appropriations through June 30, 2021, to American workers who may lose jobs from its partnerships’ competition.
House Democrats wanted to delay the ‘fast-track’ version of the legislation in order to seek better options for the American workers. Opposing democrats have concerns about a 0.25% reduction of Medicare providers and a 6 months extension of Medicare sequestration. In addition, several Republican members have voiced their concerns about consolidation of power in executive branches and the uncertainty of future employment opportunities for American workers.
The TPA and the TAA legislations are packaged as the Trade Act of 2015; thus, it is a critical matter to have both legislations passes through Congress. If the Obama Administration fails either one of the legislations, the major international trade deal could be completely dropped out of the current negotiations. As a top priority, the GOP and the Obama Administration should continue to help the growing number of democratic opponents and skeptical conservatives to understand the importance of the TAA in order to guarantee a fast-track authority to further negotiate the Trans-Pacific Partnership agreement.
So far, the best option is to use Speaker Boehner’s motion to reconsider the TAA. If pursued, the vote may be up on the floor by next Tuesday at the earliest. But, the House Republicans will have to gather 80 or more votes in a few days. This is the best scenario for Obama to sign the legislation into law since the two legislations will be identical both in the House and the Senate. If this option falls apart, another option is to get rid of the TAA by going into conference in the House and the Senate, which may put the whole TPP deal in danger, feasibly killing the major trade initiative.
It is the time to show American leadership in the Asia-Pacific region. Not only will the U.S enormously benefit economically by lessening the trade restrictions and regulations but will also aid to construct a vital free trade area and to expedite the commerce in the Asia-Pacific region. The global economy has been slowing down since the 2008 economic crisis, and the TPP deal can enhance economic engagements. With that said, it is noteworthy that the TPP accounts for approximately 40% of the World’s GDP and one-third of global trade. Moreover, about 40 million American jobs are held by foreign trade.
It is also impetrative to show American leadership strategically in security relations. America will show its commitment to allies and partners in the Asia-Pacific region by passing the TPP deal and by providing a strategic counterweight to China.
- Jimmy Youn serves as Research Fellow at the Indo-Korea Business and Policy Forum.Mr. Youn served as a legislative intern/aide for U.S Senator Arlen Specter in 2009 in Washington, DC. He received a Master’s Degree in Public Health in Health Policy from Brody School of Medicine, East Carolina University. He is currently preparing for a Ph.D program in security studies in the U.S.
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