Harry Reid holes EU-US free trade talks
The highly influential Democrat politician and Senate Majority Leader Harry Reid has ‘holed’ the progress of the EU-US trade talks designed to establish a free trade agreement between the two big trading blocks. Reid broke publicly with President Obama who, in his State of the Union address, announced he would ‘fast track’ the EU-US trade deal (known as the Transatlatic Trade and Investment Partnership, or TTIP) and a proposed trade deal between the US and the Asia Pacific region, known as the Trans-Pacific Partnership (TPP).
Reid said that he opposed legislation aimed at rushing through free-trade agreements, said to be vital to the success of the negotiations, and told the supporters of the ‘fast track’ deal to ‘back down’. He said:
“I’m against fast track. I think everyone would be well advised just not to push this right now.”
‘Fast track’ is the US term for legislation preventing overseas trade agreements from being amended during the congressional process.
In Washington DC, Harry Reid’s words carry real weight. As Gary Hufbauer, senior trade expert at the Peterson Institute for International Economics in Washington explained:
“It’s a one-two punch against trade policy.”
Both trade deals need to be ‘fast tracked’ as the two sets of trading partners (the EU and the Asia–Pacific nations) are unlikely to accept a deal that allows US politicians to amend any negotiated deal back at the ranch.
Reid’s comments also reflect the real concerns of trade unions in the USA, in the EU and here in the UK about any deal and the likely effect on public procurement, workplace rights and decent employment standards. The TUC recently highlighted the many difficulties associated with TTIP, not just on employment rights but also on the arrangements for ‘Investor-State Dispute Settlement’ (ISDS) which the TUC says is unnecessary and harmful. The Campaign For Trade Union Freedom also published a detailed analysis by Adrian Weir of the effects of any EU-US deal on employment rights in Europe.
Reid is now seen as the leader of those Democrats who say recent trade deals have been bad for US workers and decent employment. The experience of the North American Free Trade Agreement (NAFTA) negotiated by George H. Bush’s administration and set in stone by Bill Clinton sticks in the craw of US union members who rightly argue that that these recent free-trade agreements failed to stop jobs being exported out of the USA to low cost, non-unionised areas where employment, environmental and other protections are openly ignored. On the Asia-Pacific TPP deal unions and Democrats say US jobs would be exported to low wage countries such as Vietnam.
Meanwhile the US Chamber of Commerce, one of the biggest supporters of the trade agreements, is on record as saying that employment rights have no place in the EU-US talks.
However, Harry Reid is seen as pro-worker. He is a senator for the heavily unionised state of Nevada and he also represents a caucus with several Democrats up for election in November who might have been forced to choose between Obama and the unions that help finance campaigns.
US unions welcomed Reid’s intervention. Larry Cohen, leader of the Communications Workers of America, said:
“For those of us who want to have a progressive trade agenda, it means that we’re encouraged.”
And Celeste Drake, trade policy specialist with the AFL-CIO said Mr. Reid’s comments offered:
“A great opportunity to get off the fast track to bad trade deals and open the policy window to a better deal for workers.”
In Washington, political commentators say a rough translation of Reid’s comments mean ‘unless and until President Obama rewrites major provisions of each of these two deals, both of them are, indeed, dead.’ We shall see!