Trade Promotion Authority Research Articles

How’s it going with the CPTPP?

There is no doubt that the United States is losing out on market access. But one of the original goals of the Trans-Pacific Partnership (TPP) was for a rules-based trading regime in the Pacific, namely rules not written by China. Thanks to Australia and Japan that seems to be happening even with the U.S. no longer at the helm. The Comprehensive and Progressive Trans-Pacific Partnership or the awkwardly nicknamed CPTPP is a Pacific trading bloc that consists of 11 countries, spanning the Pacific Rim, and includes Malaysia and Chile. The member countries represent 13% of world GDP. Once the UK officially joins, that figure jumps to 15% and the trade bloc will reach across the Atlantic. The United States was key in drafting the text of the agreement, starting with the George W. Bush administration, which was clear in its commitment to openness. As China shifted back to a more state-controlled economy, the Obama administration underscored a key U.S. goal: for the United States and not China to write the trade rules for Asia. Key goals included modernizing countries’ rules on ecommerce and digital trade and establishing rules on state-owned enterprises. The Obama administration carried the Trans-Pacific Partnership (TPP) through right up to the finish line. President Trump took a sharp turn and withdrew the United States from the agreement, claiming the agreement would not be good for the United States. Even though there are signs that the American public is open to more trade, the Biden administration and Congress have not pursued Trade Promotion Authority or any new trade deals that would lock in more market access abroad. The United States is no doubt missing out on market access in parts of the Pacific, especially agriculture. But thanks to quiet leadership by Australia and Japan a rules-based trading bloc in the Pacific not led by China is forming.

The impacts of trade‐related international intellectual property rights on domestic legislative debates: Evidence from the 104th to the 112th U.S. Congresses

AbstractDespite the large body of literature on the connection between intellectual property rights (IPRs) and trade at the international level, less attention has been paid to the impacts of such rights included in preferential trade agreements (PTAs) on domestic legislative debates. This article contributes to filling this gap by analyzing debates in the U.S. legislature where the IPRs included in PTAs were referred to. We consider the 1995–2012 period (104th to 112th Congresses). We also analyze trade laws enacted by Congress over the period. The data suggest that the IPRs negotiated with foreign partners affect Congress voting on the concession of trade promotion authority to the president. They may also trigger urges for adjustments to trade agreements and be tapped into by members of Congress to advocate for changes to domestic patent legislation. The importance placed on IPRs by members of Congress was not consistent over time and across parties. These results suggest that theoretical explanations of the U.S. trade policy must account for the diversity of views at the domestic level and for how such often divergent sentiments translate into policies, as framed by the domestic laws and institutions in place.

Developments Relating to U.S. Trade Negotiations—KORUS, NAFTA, and Trade Promotion Authority

Consistent with his approach on the campaign trail, President Trump has demonstrated a continued interest in revamping U.S. trade agreements. By the late spring of 2018, the Trump administration had negotiated modest changes to the United States-Republic of Korea Free Trade Agreement (KORUS) in favor of U.S. interests. It had yet to reach any final agreement with regard to the North American Free Trade Agreement (NAFTA), despite the expiration of an initial deadline that was designed to ensure adequate time for a vote on the negotiated agreement by the present Congress. To ease the passage of future trade deals, Trump has triggered the three-year extension of a process that provides expedited congressional consideration of negotiated trade agreements.

‘Writing the rules of the global economy’: how America defines the contours of international investment law

Some characterize the standards of protection promoted by investment treaty law as a form of denationalized law. International investment law, it is said, is comprised of generic rules, representing norms of global good governance, and not those of any particular state. This paper argues that investment treaty standards exemplify, in Bourdieu’s terms, the fictitious universalization of the particular case. This is revealed in debates over conferring upon President Obama trade promotion authority to negotiate new mega-regional treaties, like the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP). Disagreement turned, in large part, on the degree to which commitments to foreign investors corresponded to rights found in the US Bill of Rights. Both sides were preoccupied with the question of whether standards for investor protection in mega-regionals looked sufficiently like US constitutional law. By evaluating the strictures of investment treaty protections and US constitutional rights, the paper generates evidence that investor protections, while resembling those rights, surpass them by a considerable distance. So long as the origins of the content of investment treaty commitments remain misrecognized, US political actors will continue hold a monopoly in determining the content of the universal.

,,,Free Trade, Immigrant Workers, and Employment Discrimination

This article reframes the outward-looking perspective on workers’ rights provisions in free trade agreements. It argues that those provisions provide an opportunity to reinforce the workplace rights of noncitizen workers in the United States. Scholars and worker advocates have criticized recent free trade agreements for their lack of enforcement mechanisms and protections for workers in developing countries. They argue that this has encouraged a race to the bottom on the part of multi-national corporations who relocate to developing countries to take advantage of cheap labor costs, thereby costing U.S. workers’ jobs. This article shifts the focus. Instead, it argues that the anti-discrimination provisions and regulatory cohesion requirements in trade agreements can be employed to protect the rights of vulnerable, and, in particular, noncitizen workers in the United States. The provisions in the most recent iteration of trade promotion authority reinforce the rights of noncitizen workers in the United States in three ways. First, they have the potential to fill in gaps in U.S. agency enforcement of workplace rights; second, they provide additional incentives for the United States to enforce existing worker protections; and third, they provide a legal hook for workers’ advocates to exert political pressure on U.S. agencies to enforce anti-discrimination laws and multi-national corporations to change discriminatory practices.

The Study on US Trade Promotion Authority and the Reflections on the Treaty-making Procedures in China

The treaty-making is one of the most important foreign affairs of sovereign states. The power of foreign affairs laid down in US Constitution is relatively blurring and the Congress’s ratification processes are complicated and inefficient. As a result, the President has to find other methods, such as concluding executive agreements with foreign countries, so as to improve the efficiency of treaty-making. However, the Congress may boycott these executive agreements. The Trade Promotion Authority has empowered the President more discretions and also promoted good cooperation between the President and the Congress. Through a detailed study and analysis of Trade Promotion Authority, this paper tries to make some valuable suggestions to the development trend of treaty-making in China, taking its current circumstances into consideration.

Designing and Updating a US Carbon Tax in an Uncertain World

A carbon tax provides certainty about the price of emissions, but it does so in a context characterized by uncertainty about its environmental benefits, economic costs, and international relations implications. Given current knowledge, suppose that the government sets a carbon tax schedule. In the future, a higher (lower) carbon tax could be justified by the resolution of uncertainty along the following ways: climate change turns out to be worse (better) than current projections; the economic costs of a carbon tax are lower (higher) than expected; other major economies implement more (less) ambitious carbon mitigation programs. This paper describes the design of a predictable process for updating the carbon tax in light of new information. Under this “structured discretion” approach, every five years the president would recommend an adjustment to the carbon tax based on analyses by the Environmental Protection Agency, the Department of the Treasury, and the Department of State on the environmental, economic, and diplomatic dimensions of climate policy. Similar to the expedited, streamlined consideration of regulations under the Congressional Review Act and trade deals under trade promotion authority, Congress would vote up or down on the presidential recommendation for a carbon tax adjustment, without the prospect of filibuster or amendment. This process could be synchronized with the timing of updating of nationally determined contributions under the Paris Agreement in a manner to leverage greater emissions mitigation ambition by other countries in future pledging rounds. The communication of guiding information and the latest data and analysis could serve as “forward guidance” for carbon tax adjustments, akin to the Federal Reserve Board’s communication strategy.

Designing and Updating a US Carbon Tax in an Uncertain World

A carbon tax provides certainty about the price of emissions, but it does so in a context characterized by uncertainty about its environmental benefits, economic costs, and international relations implications. Given current knowledge, suppose that the government sets a carbon tax schedule. In the future, a higher (lower) carbon tax could be justified by the resolution of uncertainty along the following ways: climate change turns out to be worse (better) than current projections; the economic costs of a carbon tax are lower (higher) than expected; other major economies implement more (less) ambitious carbon mitigation programs. This paper describes the design of a predictable process for updating the carbon tax in light of new information. Under this structured discretion approach, every five years the president would recommend an adjustment to the carbon tax based on analyses by the Environmental Protection Agency, the Department of the Treasury, and the Department of State on the environmental, economic, and diplomatic dimensions of climate policy. Similar to the expedited, streamlined consideration of regulations under the Congressional Review Act and trade deals under trade promotion authority, Congress would vote up or down on the presidential recommendation for a carbon tax adjustment, without the prospect of filibuster or amendment. This process could be synchronized with the timing of updating of nationally determined contributions under the Paris Agreement in a manner to leverage greater emissions mitigation ambition by other countries in future pledging rounds. The communication of guiding information and the latest data and analysis could serve as forward guidance for carbon tax adjustments, akin to the Federal Reserve Board's communication strategy.

The Politics and Outcomes of Preferential Trade Strategies: Evidence from TRIPS-Plus Provisions in US-Latin America Relations

This article investigates the circumstances under which the agenda of intellectual property rights (IPRs) influences the decision of states to pursue preferential trade agreements (PTAs). Governments are often prone to negotiate PTAs due to distinctive pressures from IPR-intensive industries to disseminate TRIPS-Plus standards, which are particularly willing to capitalize on the advantages of preferential arrangements. To illustrate this argument, we examine the processes around the expansion of IPR provisions in the PTAs signed by the United States with Latin American countries, as enabled by the Trade Promotion Authority Act of 2002. We find that, while broad variations of TRIPS-Plus standards emerged across these PTAs, both governments and private sector tend to perceive gains from this setup, since PTAs are unlikely to undermine the IPR standards achieved by the Agreement on Trade-Related Aspects of Intellectual Property Rights (hereinafter ‘TRIPS Agreement’), but still provide opportunity for the promotion of higher IPR standards in each individual market.

Increasing the Host State's Regulatory Flexibility Under FTA Investment Chapters: US Approaches Under NAFTA, the AUSFTA and the TPP

Building on the negotiation of U.S. bilateral investment treaties beginning in the early 1980s, U.S. free trade agreements incorporating specific host-state obligations to foreign investors and binding investor-state dispute settlement (ISDS) have been a feature of U.S. trade and investment policy since 1992 (when the NAFTA negotiations were concluded). Presidents Ronald Reagan, George H.W. Bush, Bill Clinton, George W. Bush and Barack Obama have all endorsed ISDS, despite opposition by many Democratic legislators, organized labor and environmental groups. Yet the content of these investment chapters shows a significant evolution from NAFTA to the Australia — United States FTA (AUSFTA) (with investor protection but without ISDS), the United States — Chile FTA and the Singapore — United States FTA (2003) to the Trans-Pacific Partnership (TPP) (2015). The changes have been driven largely by the concerns of civil society and government officials over the dozens of NAFTA investment claims filed against the NAFTA Parties. They also reflect the perceived need for the United States and other host governments to maintain a higher level of regulatory flexibility and discretion, particularly in such areas as protecting the environment and maintaining public health. The United States’ Trade Promotion Authority (TPA) legislation enacted in 2002 and 2015 also mirrors these post-NAFTA changes. The newest iteration of the mechanism (Chapter 9 of the TPP) thus affords host governments far more regulatory discretion than earlier agreements such as NAFTA, along with increased transparency, making it more difficult for foreign investors to prevail against host governments with claims of denial of “fair and equitable treatment” and “regulatory takings.” The evolution of U.S. sponsored investment protection provisions into a significantly more host government friendly, regulatory friendly, process, is the principal theme of this paper.

Public Opinion Distribution and Party Competition in US Trade Policy

AbstractMass public opinion has generally been presumed to have little or no impact on American trade policy. I argue against this presumption. I assert that mass public opinion significantly affects US trade policy by shaping the way the two parties compete over that trade policy. When public opinion is unbalanced, the competition between the parties is likely to resemble a bidding war. When public opinion is balanced but split in a partisan manner the competition is likely to descend into Manichean conflict. When public opinion is balanced but split in a non‐partisan manner, the competition is likely to be characterised by political actors seeking to maintain the support of their core constituencies. To examine this relationship, I investigate three cases: the push to punish China over Tiananmen Square in 1989–90, the ratification of NAFTA in 1992–93 and the process through which President Bush was granted trade promotion authority in 2001–02.

U.S. Trade Preferences Extension Act (TPEA) of 2015 Could Lead to Increased Use of “Particular Market Situation” in Calculating Normal Value in Anti-Dumping Cases

At the end of 2016, China’s Protocol of Accession (POA) to the World Trade Organization (WTO) will require a change in the way WTO members calculate normal value in anti-dumping (AD) proceedings involving China.1 Although no organ of the U.S. government has officially acknowledged that Paragraph 15 of China’s POA will require the U.S. Department of Commerce (USDOC) to abandon its current non-market economy (NME) surrogate value method for calculating normal value for Chinese respondents post-2016, there is no question that some change in practice must take place in order to comply with the expiration of a key provision of that Paragraph that occurs effective December 12, 2016. Ultimately, it is quite possible that the WTO Dispute Settlement Body (DSB) will interpret the provision as requiring that members subject China to the “default” rules set forth in Article 2 of the WTO Anti-Dumping Agreement (ADA). What remains a mystery, however, is just what those default rules permit in terms of the flexibility afforded to investigating authorities in dealing with economies like China, where the state’s role in the economy remains pervasive, even if to a lesser degree than it was in the past. It will also be interesting to watch how these new rules might be applied to traditionally market economies (MEs) whose governments, although not formerly communist, may be sufficiently involved in a particular market to also justify application of Article 2 in a manner that, to date, has not been widely adopted by USDOC or any other investigating authorities. These inquiries are not merely the idle musings of the authors, but draw on action already taken by the U.S. Congress and the European Commission. In amendments to its AD laws, known as the Trade Preferences Extension Act (TPEA), passed during the summer of 2015 as part of granting the Obama Administration Trade Promotion Authority,2 the U.S. Congress added language that expands USDOC’s discretion to treat certain transactions as outside the ordinary course of trade (OCOT). Although no legislative history accompanied these amendments, they appear, at least in part, tailored to a post-NME normal value calculation paradigm, in which a respondent’s costs can be disregarded and replaced with an alternative that may well approximate the NME methodology that China hoped would be eliminated as a result Article 15 of its POA. Meanwhile, the European Commission has adopted a practice that uses similar tools—so far only for MEs—where a respondent’s transactions are deemed outside the OCOT. Together, the new U.S. law and recent European action both suggest a movement toward more flexible rejection of AD respondents’ own data and replacement with data that look eerily similar to NME surrogate methodologies—for respondents in any country. But, stay tuned, as these efforts are currently under WTO review, and one dispute settlement panel has indicated that Europe’s practice may have gone too far.

Tangle of Interest Groups and Institutions in American Trade Policy: Battle over Trade Promotion Authority

Tangle of Interest Groups and Institutions in American Trade Policy: Battle over Trade Promotion Authority

Obama Lays Out His 2015 Agenda

Some chemical industry executives are sharply criticizing President Barack Obama’s call during his State of the Union address on Jan. 20 for higher taxes on top earners, but they welcome his efforts to finalize two key trade agreements. Obama is proposing tax increases on the wealthy totaling $320 billion over the next decade to pay for expanded tax credits, educational benefits, and other programs for the middle class. But the “unfortunate reality is that the President’s proposal would ultimately increase an already heavy tax burden on our members,” says Lawrence D. Sloan, CEO of the Society of Chemical Manufacturers & Affiliates. Obama’s plan for tax hikes may be dead on arrival with Republicans, who control both houses of Congress. But Sloan says he is encouraged that Obama pressed Congress for trade promotion authority (TPA). The process is essential for wrapping up agreements the U.S. is negotiating with Asia and Europe ...

Is TTIP Really that Different ?

The TTIP has been lauded as the most important trade negotiation underway in Europe and United States. With the stagnation of the Doha Round and emergence of Asian regionalism, the US and EU have sought cross-regional bilateral free trade agreements as a means to promote export growth and disseminate new trade and investment rules for global governance. Though TTIP has garnered a lot of attention in terms of expected benefits, and has been much lauded by policymakers and pundits, it is arguably part of a larger global trend towards cross-regional free trade agreements. This paper examines TTIP in the context of US trade policy as the prospects for reaching a comprehensive deal are riddled with difficulties over sensitive sectors, as well as domestic political timetables with Congressional mid-term elections in 2014, and the US Trade Representative undertaking of trade negotiations without securing Trade Promotion Authority (TPA) to secure the ease of Congressional ratification. The paper concludes by considering the accompanying effects of a transatlantic agreement upon third countries.

The Trans‐Pacific Partnership: Can the United States Lead the Way in Asia–Pacific Integration?

High stakes are involved in the Trans‐Pacific Partnership (TPP) trade negotiations: the United States seems to be on the verge of redirecting Asian regionalism towards an Asia–Pacific trade grouping that proclaims will not tolerate sectoral exclusions and will tackle head on non‐tariff barriers (long considered glaring deficiencies of most free trade agreements). However, US domestic politics may prevent the realization of these lofty objectives. The influence of internal political constraints is evident in three areas: (i) the United States has pushed for a hybrid approach on market access negotiations that clouds the prospects of TPP adhering to the no‐carve‐out mantra; (ii) US trade negotiators have ramped up their negotiation objectives into a so‐called platinum standard that could impose heavy preconditions on accession for new members and diminish the chances of growing the TPP membership; and (iii) the protracted ratification process and lack of trade promotion authority undermines the credibility of the United States in the eyes of prospective trade partners.

Toward a free trade area of the Asia Pacific

At their latest annual summit in Vietnam in November 2006, the leaders of the 21 members of the Asia Pacific Economic Cooperation (APEC) forum agreed to seriously consider negotiating a Free Trade Area of the Asia Pacific (FTAAP). The FTAAP initiative may well turn out to be the best, or perhaps only, way to catalyze a substantively successful Doha Round. If it cannot do that, an FTAAP can still offer a Plan B to restore the momentum of trade liberalization, prevent further proliferation of bilateral and subregional preferential trade arrangements, avoid renewed risk of drawing a line down the middle of the Pacific, channel the US-China economic conflict into a more constructive, less confrontational context, and revitalize APEC itself. Perhaps most important, an FTAAP could maintain US engagement in Asian, and even global, trade relations by providing a basis for congressional extension of trade promotion authority in mid-2007 and a negotiating momentum that the next US president in early 2009 will feel compelled to maintain.

Congressional ambivalence: the political burdens of constitutional authority

Is the United States Congress dead, alive, or trapped in a moribund cycle? When confronted with controversial policy issues, members of Congress struggle to satisfy conflicting legislative, representative, and oversight duties. These competing goals, along with the pressure to satisfy local constituents, cause members of Congress to routinely cede power on a variety of policies, express regret over their loss of control, and later return to the habit of delegating their power. This pattern of institutional ambivalence undermines conventional wisdom about congressional party resurgence, the power of oversight, and the return of the so-called imperial presidency. In Ambivalence, Jasmine Farrier examines Congress' frequent delegation of power by analyzing primary source materials such as bills, committee reports, and the Congressional Record, Farrier demonstrates that Congress is caught between abdication and ambition and that this ambivalence affects numerous facets of the legislative process. Explaining specific instances of post-delegation disorder, including Congress's use of new bills, obstruction, public criticism, and oversight to salvage its lost power, Farrier exposes the tensions surrounding Congress's roles in recent hot-button issues such as base-closing commissions, presidential trade promotion authority, and responses to the attacks of September 11. She also examines shifting public rhetoric used by members of Congress as they emphasize, in institutionally self-conscious terms, the difficulties of balancing their multiple roles. With a deep understanding of the inner workings of the federal government, Farrier illuminates a developing trend in the practice of democracy. This title presents an in-depth look at Congress's institutional culture of ambivalence.

Would NAFTA have been Approved by the House of Representatives under President Bush? Presidents, Parties, and Trade Policy

This paper examines five trade policy votes in the United States House of Representatives, one during each of the last five presidential terms. The paper investigates the determinants of representative voting and shows that Congress members are more likely to support trade liberalization if the President is a member of their own party. The estimation allows a prediction to be made of the likely House trade votes under alternative presidential election outcomes. The model predicts that the probability of NAFTA being approved would have been greatly reduced by a victory for President Bush (41) in the 1992 election. Neither the trade promotion authority granted to President Bush (43) in 2001 nor the CAFTA signed in 2005 would likely have been approved under Democratic Presidents.

2008 Year in Review: International Trade

In 2008, the field of international trade experienced considerable activity in some areas and virtual stagnation in others. The World Trade Organization (WTO) welcomed two new members in 2008: Ukraine and Cape Verde. Progress on Russia’s accession suffered a setback in 2008 due to the Russian-Georgian War in South Ossetia and Abkhazia and other bilateral issues. Additionally, the expiration of Trade Promotion Authority (TPA) in 2007 and the U.S. presidential and congressional elections created uncertainty as to whether the next administration would honor U.S.-negotiated agreements and whether the new Congress would approve them. Thus, despite optimism that a conclusion to the Doha Development Round was possible in 2008, world financial problems and continued disagreement on key issues between developed and developing countries forestalled a global trade deal this year. Negotiations on agriculture and non-agricultural market access (NAMA) modalities also collapsed at the Ministerial meeting in July 2008.