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Democrats defeat Obama’s signature trade initiative

The White House and Republican leaders in Congress face long odds in trying to revive trade legislation after a telling defeat engineered by President Barack Obama's fellow Democrats.

world Updated: Jun 13, 2015 23:52 IST
Yashwant Raj
Yashwant Raj
Hindustan Times

President Barack Obama’s signature trade initiative suffered a humiliating defeat at the hands of his own party’s lawmakers in a vote in the House of Representatives on Friday.

Democrats rebuffed a last-minute personal appeal from the president and voted to defeat a legislation that the party has traditionally backed, to block his larger initiative.

The one they voted down was called Trade Adjustment Assistance (TAA) that funds retraining of American workers laid off because of trade pacts and globalisation.

They failed to prevent the larger legislation — Trade Promotion Authority (TPA), which will enable the president to pursue trade deals without being second-guessed by congress. This passed.

But the two legislations come as a package deal, as voted through by US senate earlier. Neither can pass, and make it to the president’s table, without the other.

By defeating TAA, Democrats prevented the TPA, which is the president’s signature initiative and which the lawmakers fear, echoing the powerful unions, may cost American jobs.

Obama is pushing the TPA to clinch a multinational trade agreement his administration is pursuing with 11 Pacific-rim nations, called the Trans-Pacific Partnership.

The US is pursuing a similar arrangement with Atlantic-rim nations, negotiating it with European Commission, called the Transatlantic Trade and Investment Partnership.

When through, they would determine tariff structures, state of intellectual property rights protection and other common trade issues in the signatory countries.

India is closely following both negations believing it will be inevitably impacted when they are completed, as is the rest of the world, including those outside the partnerships.

Obama has faced considerable opposition to this trade initiative from his own party — Republicans are backing him — and stepped up outreach to them in recent days.