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Trade War: U.S. Chamber and AFL-CIO Square Off On TPA Renewal

Geographically the headquarters of U.S. Chamber and the AFL-CIO are only a block apart. But philosophically on trade policy they’re light years apart.

Although friends, the U.S. Chamber President and CEO Tom Donohue and AFL-CIO President Richard Trumka squared off on opposite sides at a Senate Finance Committee hearing on TPA renewal and forging ahead with trade agreements like the Trans-Pacific Partnership (TPP).

For Donohue, not renewing TPA and passing trade agreements like TPP “is the equivalent of going out and resigning from the rest of the world.” But for Trumka, TPA–he calls it, “fast track”–is an “outdated and undemocratic process.”

One particular person interested in this conversation on Capitol Hill happens to also work near both men. But President Obama would have to read the coverage later. He was in Fairfax, Virginia for an interview about TPA and trade to be aired later on MSNBC.

Trumka had three main arguments.

First, he complained that the TPP cake has already been baked and TPA won’t give Congress much of a say:

The idea that fast track lets Congress set the standards and goals for the TPP is a fiction – the agreement has been under negotiation for more than five years and is essentially complete. Congress cannot set meaningful negotiating objectives in a fast track bill if the administration has already negotiated most of the key provisions.

But that’s just not the case, Donohue said:

The Trans-Pacific Partnership agreement would open the Asia-Pacific dynamic markets to American goods and services. It is critical that we do so because nations across the Pacific are clinching their own trade agreements that exclude the United States, denying American exporters access to these very important markets.

TPA gives the United States a strong hand in writing the rules for trade for this important region. It makes us an active player, not a bystander stuck on the outside looking in.

TPP would affirm and deepen America’s ties to Asia at a time when there is a perception that we’re pulling back.

Second, Trumka charged that TPA is undemocratic:

[TPA] cedes important and long-lasting decisions about our economy to a few negotiators in a small room in the middle of the night. This is undemocratic. It’s wrong.

The truth is because Congress sets the terms for negotiation and must vote a trade agreement up or down it’s inherently democratic. Negotiators don’t impose anything on Congress.

Donohue address this point:

TPA is based on the common sense notion that Congress and the White House must work together on trade agreements. TPA is how Congress sets priorities and holds the administration accountable in trade negotiations.

A few people have claimed that this is a presidential power grab. I may be uniquely qualified to comment on this. After all, the Chamber has not been shy about criticizing some actions of the administration when we see overreach. But TPA isn’t about Congress ceding power to the president. On the contrary, TPA strengthens the voice of the Congress on trade.

Without TPA, the administration can pursue its priorities at the negotiating table and consult with Congress only when and if it chooses. TPA lets Congress set negotiation goals and sets forth detailed requirements for consultation between the trade negotiators and the Congress.

What TPA does is prevent Congress from acting like 538 additional trade negotiators, as Senator John Cornyn (R-Texas) described it. That would be no way to forge a 21st Century trade agreement.

Third, Trumka argued that TPA lacks accountability. “Congress should have the final say on whether negotiating objectives have been met.,” Trumka told the committee.

But that’s what TPA does. From Donohue’s testimony:

TPA allows Congress to show leadership on trade policy by doing three important things: (1) It allows Congress to set negotiating objectives for new trade pacts; (2) it requires the executive branch to consult extensively with Congress during negotiations; and (3) it gives Congress the final say on any trade agreement in the form of an up-or-down vote. The result is a true partnership stretching the length of Pennsylvania Avenue.

The TPA process has produced beneficial trade agreements, Donohue noted:

[Previous] trade agreements boosted U.S. output by more than $300 billion and in turn supports an estimated 5.4 million U.S. jobs….

The United States has a trade surplus with its 20 trade agreement partners as a group. This includes sizeable trade surpluses in manufactured goods, services, and agricultural products.

American companies have greater access to international markets and are creating jobs. At the same time, American consumers have access to a wider array of goods and services. Renewing TPA will lead to more beneficial trade agreement like TPP and the Transatlantic Trade and Investment Partnership (TTIP) with the European Union.

As Donohue summed up his testimony, “To create the jobs, growth, and prosperity our children need, we need to set the agenda. Otherwise, our workers and businesses will miss out on huge opportunities.”

TELL CONGRESS TO PASS TPA.

Meet Sean Hackbarth  @seanhackbarth Follow @uschamber

The decline and fall of America’s unions

“Hell hath no fury like a bureaucrat scorned.” – Milton Friedman

Many blame the decline of union membership on Republicans and big business. But is that what history tells us? The answer is: No!

As political power becomes more centralized there is an irreversible decline in the power of unions. It is a cause and effect that cannot be denied or stopped.

American unions began forming in the mid-19th century in response to the social and economic impact of the industrial revolution. National labor unions began to form in the post-Civil War Era. The Knights of Labor emerged as a major force in the late 1880s, but it collapsed because of poor organization, lack of effective leadership, disagreement over goals, and strong opposition from employers and government forces.

Government forces are accelerating the collapse of unions. But how?

Oleg Atbashian in his book Shakedown Socialism writes, “Union perks mean nothing when there is nothing left to redistribute. The Soviets learned it the hard way. The American unions don’t seem to be able to learn from the mistakes of others.”

A recent example is how the unions first supported the Affordable Care Act and are now opposing it.

Townhall.com reported in July 2013, “The leaders of three major U.S. unions, including the highly influential Teamsters, have sent a scathing open letter to Democratic leaders in Congress, warning that unless changes are made, President Obama’s health care reform plan will “destroy the foundation of the 40 hour work week that is the backbone of the American middle class.”

If that’s not bad enough, the Affordable Care Act, if not modified, will “destroy the very health and wellbeing of our members along with millions of other hardworking Americans,” the letter says.

Atbashian uses the example of Poland’s Solidarnosc, an independent union that spearheaded the overthrow of the oppressive Communist regime in 1989.  Why? Because, “…Current [union] perks can only exist in a free and competitive economy that ensures growth and generates wealth – known as ‘capitalist exploitation’ in the lingo of the champions of ‘redistributive justice’.”

Unions are only relevant if they retain their control to collectively bargain for wages and benefits. If the government takes over this role, as it did workplace safety with OSHA, then unions are doomed.

When government becomes the sole arbiter of the social and economic impact of industry, then unions are forced to submit.

Atbashian notes, “The workers are not herd animals, nor are they a separate biological species with a different set of interests. They are as human as anyone else who possesses a mind and free will, and therefore their long-term interests are not different than the rest of humanity. And since the interests of humanity lie with liberty, property rights and the rule of law, this is what the unions should stand for.”

Milton Friedman, in Free to Choose: A Personal Statement, wrote, “The ICC [Interstate Commerce Commission] illustrates what might be called the natural history of government intervention. A real or fancied evil leads to demands to do something about it. A political coalition forms consisting of sincere, high-minded reformers and equally sincere interested parties. The incompatible objectives of the members of the coalition (e.g., low prices to consumers and high prices to producers) are glossed over by fine rhetoric about ‘the public interest,’ ‘fair competition,’ and the like. The coalition succeeds in getting Congress (or a state legislature) to pass a law. The preamble to the law pays lip service to the rhetoric and the body of the law grants power to government officials to ‘do something.’ The high-minded reformers experience a glow of triumph and turn their attention to new causes. The interested parties go to work to make sure that the power is used for their benefit. They generally succeed. Success breeds its problems, which are met by broadening the scope of intervention.”

Friedman noted, “Bureaucracy takes its toll so that even the initial special interests [e.g. unions] no longer benefit. In the end the effects are precisely the opposite of the objectives of the reformers and generally do not even achieve the objectives of the special interests. Yet the activity is so firmly established and so many vested interests are connected with it that repeal of the initial legislation is nearly inconceivable. Instead, new government legislation is called for to cope with the problems produced by the earlier legislation and a new cycle begins.”

The “angel of death” for unions is progressivism, its primary weapon is big government bureaucrats, the anti-union soldiers.

RELATED: 

Union membership declines in 2012 – US Department of Labor

Under Obama, black unemployment back to twice the white rate – PEW Research