Boehner Says Trade Accords Must Move in Tandem With Worker Aid

Speaker John Boehner predicts the U.S. House can renew worker aid backed by the Senate and approve three free-trade accords in the next month, as long as President Barack Obama sends the delayed accords first.

The Senate voted to renew trade preferences for developing nations yesterday after adding benefits for employees who lose their jobs to overseas competition. The aid, which Obama set as a condition for sending the accords, heads to the House, and Boehner said debate will begin only when Congress gets the deals with South Korea, Colombia and Panama.

“We await the president’s submission of the three trade agreements sitting on his desk so the House can consider them in tandem” with the aid and preference programs, Boehner, an Ohio Republican, said in a statement yesterday. “If the president submits these agreements promptly, I’m confident that all four bills can be signed into law by mid-October.”

Obama has taken a different approach, saying he would send lawmakers the trade agreements reached under President George W. Bush once Congress commits to renew the worker aid. The split in the order for advancing the bills may block swift passage, William Reinsch, president of the National Foreign Trade Council and a Commerce Department official in the Clinton administration, said in an interview.

Speaker of the House John Boehner predicts the U.S. House can renew worker aid backed by the Senate and approve three free-trade accords in the next month, as long as President Barack Obama sends the delayed accords first. Photo: Saul Loeb/AFP/Getty Images Close

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Speaker of the House John Boehner predicts the U.S. House can renew worker aid backed by the Senate and approve three free-trade accords in the next month, as long as President Barack Obama sends the delayed accords first. Photo: Saul Loeb/AFP/Getty Images

“Somebody has to decide they’re going to be first and have the confidence the next guy will act and do what he says he’s going to do,” Reinsch said.

The Senate yesterday passed, on a 70-27 vote, the renewal of trade preferences along with a scaled-back version of Trade Adjustment Assistance negotiated by Senator Max Baucus, a Montana Democrat, and Representative Dave Camp, a Michigan Republican. Seventeen Republicans joined majority Democrats in backing the measure.

Trade Aid

Trade Adjustment Assistance augments health and unemployment benefits to workers who lose their jobs because of overseas competition. As part of stimulus legislation in 2009, it was expanded beyond manufacturing to include service workers such as call-center employees. Republicans say renewing the extended aid would be too costly when lawmakers are struggling to reduce the federal deficit.

The proposal to renew aid for service workers, estimated by the Senate Finance Committee to cost $320 million annually, would continue most of the assistance through 2013 and provide retroactive benefits to those left out so far this year.

“Discussions continue with congressional leadership on how these bills will move through the legislative process,” U.S. Trade Representative Ron Kirk said last night in a statement. “The trade agreements, along with Trade Adjustment Assistance, are an integral part of the president’s plan to create jobs here at home. The president looks forward to their prompt passage.”

Obama, Republicans

Obama and Senate Republicans deadlocked over the aid issue in June and July. Republicans led by Senator Orrin Hatch of Utah said the assistance, which was expanded in the 2009 stimulus measure, was unaffordable and inefficient.

Senate leaders from both parties ended the impasse on Aug. 3, agreeing to vote on the aid and then take up the trade deals.

The South Korea trade deal, the biggest for the U.S. since the North American Free Trade Agreement in 1994, would boost U.S. exports by as much as $10.9 billion in the first year it’s in full effect, according to the U.S. International Trade Commission. The accord with Colombia would increase exports by as much as $1.1 billion a year.

South Korea, Colombia

Companies such as Ace Ltd. (ACE), Citigroup Inc. (C) and Pfizer Inc. (PFE) have led the effort to get the South Korea deal passed, while Caterpillar Inc., General Electric Co. (GE) and Whirlpool Corp. (WHR), have been among the biggest backers of the accord with Colombia.

The U.S. Chamber of Commerce in Washington welcomed the Senate vote, Myron Brilliant, senior vice president for international policy at the largest business lobbying group, said in a statement.

“It clears the way for approval of the job-creating trade agreements, and not a moment too soon,” he said.

The Chamber estimates the trade agreements will prevent the loss of 380,000 jobs.

The amendment to add worker aid to the trade preferences bill passed 69-28, with 16 Republicans including Rob Portman of Ohio and Roy Blunt of Missouri joining the Democrats. The two senators in July said they had gathered enough Republican support to limit debate on worker aid by preventing a filibuster if Democrats brought it to the floor.

“It’s one step on an incredibly long path to get these agreements finally passed,” Phil Levy, a fellow at the American Enterprise Institute in Washington and a trade economist in the George W. Bush administration, said in an interview.

The bill is H.R. 2832.

To contact the reporter on this story: Eric Martin in Washington at emartin21@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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