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Wednesday, May 18, 2022

Fast track


by Jeffrey J. Schott

Fast-track legislation needs to be revived in 1999 for the United States to actively pursue its trading interests in regional negotiations, in the Asia Pacific and Western Hemisphere, and in new global trade talks scheduled to start in the World Trade Organization by the end of the decade. To do so, the administration should:

-Spell out the range of trade initiatives that will be undertaken pursuant to fast-track authority and persuasively lay out their benefits for US firms and workers;

-Consider modifications in the existing draft legislation with regard to both fast-track procedures and US objectives on labor and environmental issues; and

-Pursue complementary domestic initiatives, including earnings insurance for displaced workers, to

address the concerns of US workers adversely affected by new trade pacts.

“Restarting Fast Track,” a new report by the Institute for International Economics, argues that the US leadership role in the trading system and its ability to negotiate substantial reductions in foreign trade barriers will be seriously impaired without fast-track authority. While new trade talks can be launched, as for a Free Trade Area of the Americas at the Summit of the Americas in Santiago this weekend, the potential results of those negotiations will be sharply limited because other countries will not put their best

offers on the table for fear that Congress will reopen any trade deal that the administration concludes.

Negotiating without fast track would thus result in several interrelated costs for US firms and workers:

-Reduced opportunities to expand US exports due to slower opening of foreign markets;

-Increased discrimination against US exports in regions that negotiate free trade pacts without the United States;

-Reduced wage premiums for US workers in higher paying export industries; and

-Reduced US leadership in global affairs as the rest of the world questions the durability of US commitments on trade and other important global issues.

Jeffrey J. Schott is with the Institute for International Economics in Washington, D.C.

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