President Obama is travelling to Brussels, the capital of the European Union, this week to discuss a wide range of topics with international leaders. Ukraine will certainly shadow the president throughout his trip, but there will be also be another source of great discussion centered around the unfulfilled charge on trade agreements. Approximately one year ago, E.U. and American leaders boldly declared that they would seek a free trade agreement that would ambitiously “eliminate all tariffs” on bilateral trade, creating the largest free trade zone in the world by 2015. This is an important milestone to achieve for Europeans and Americans.
Unfortunately, the clock is ticking, and without political leadership, the declaration will serve as little more than outside empty rhetoric, rather than a true catalyst for economic growth. The E.U. certainly shoulders some of the responsibility for the lack of consensus at this time, but much of the blame lies with the Obama administration and its Senate Democrat allies. The president has supported the trade agreement, known as the Transatlantic Trade and Investment Partnership (TTIP), but has hardly given it the full-throated endorsement it demands, including a vote whipping in Congress that many had hoped for.
In fact, some of President Obama’s staunchest allies have been a thorn in his side on this particular issue. Most notable is Senate Majority Leader Harry Reid (D-Nevada), who has been obstinate to put it mildly. In order to negotiate the trade deal, the president needs Congress to pass legislation giving him Trade Promotion Authority (TPA). TPA is a critical tool that every president since Franklin Delano Roosevelt has used to negotiate – and in some cases “fast track” — trade agreements, but with strict guidance and input from the Congress. However, TPA expired at the closing of President George W. Bush’s second term and Congress has refused to reauthorize the authority.
Most of these objections have come from Sen. Reid, who stated, “[e]veryone would be well advised not to push this right now.” Apparently, the Senate Majority Leader has more power than the President of the United States when it comes to domestic trade policy. Senator Reid is impeding TPA because he knows that doing nothing will continue to ingratiate him with union bosses, who previously bankrolled his re-election campaign and will finance efforts for his caucus this fall. This is – after all – is an election year, and with the balance of the Senate in jeopardy, Reid is unwilling to offend those he relies upon for campaign dollars. In the wake of these comments, the president has been reticent to push the issue and thus TTIP has languished.
It is sad that at this inflection point in American history, politics continues to block the path to good policy. According to the White House’s own website, TTIP would “Further open EU markets, increasing the $458 billion in goods and private services the United States exported in 2012 to the EU, our largest export market.” And this isn’t your typical White House spin; this is a policy that is firmly supported by the business community at-large.
The National Association of Manufacturers, U.S. Chamber of Commerce and Business Roundtable have all come out in support of TPA and TTIP, stating that free trade will improve the economic and employment outlook. These statements aren’t conjecture, they are backed by solid data. In fact, more than one in five American jobs are supported by international trade. According to outside studies, TTIP would increase exports by more than $120 billion a year, which in turn would boost the economy and lead to more American jobs.