Observations on the Trade Act of 2002

  
At first glance, the 305 pages of the Trade Act of 2002 seem filled with minutiae and complexity. But its five divisions must be seen in the context of what had to be done politically to achieve trade legislation and the history of existing laws that the new provisions fit into or revise. Some informed observers believe that a greater effort should have been made to include stronger language regarding labor rights and environmental standards, especially when negotiating bilateral free trade agreements, to gain more Democratic support and make the legislation truly bipartisan. But many analysts doubt that Democrats beholden to the unions would have supported the Act in any case. Others believe the inclusion in the bill of sectoral provisions, especially in agriculture and textiles, will make the USTR's negotiating job more difficult.

Division A, Trade Adjustment Assistance Program, is an update of provisions to assist workers who lose their jobs due to trade-related competition. This assistance dates from the 1974 Trade Act, but Congress believes that many workers who could qualify for the assistance never made use of it due to lack of knowledge or an onerous application process. The new legislation therefore provides for disseminating information about benefits to potential recipients. It also tries to extend benefits of pay compensation, job training and moving assistance, as well as a new provision for paying 65% of health insurance premiums for a certain period. To protect taxpayers, additional measures are intended to ensure that the benefits are not abused.

Division A also includes much needed reforms to and appropriations for the US Customs Service to tighten border security against terrorism and drug trafficking. Equipment and personnel, for purposes including air and marine interdiction, are appropriated to the USCS, especially for the Mexico-US and Canada-US borders. New powers to inspect mail and improved documentation for waterborne cargo are mandated, as well as a new electronic monitoring system of cargo. There are two sides to this coin: increased involvement of the government in business and private activities balanced by the need for increased security.

The heart of the Act is Division B - Trade Promotion Authority. Some academic observers charge Congress with trying to micromanage trade negotiations by creating so many specific negotiating objectives. These include eliminating trade barriers and distortions, supporting intellectual property rights, transparency, anti-corruption, dispute settlement, labor rights and environmental standards, trade remedy laws, child labor, and others. Realistically, all of these objectives cannot be achieved to the maximum in every area. There will be trade offs, compromises and delayed implementation. But the objectives themselves undoubtedly were crucial in forming a sufficiently strong coalition to achieve passage of the Act.

This section explicitly obliges the administration to report to and consult with Congress on trade negotiations. It calls for creation of a Congressional Oversight Group to formalize consultations on trade matters. If Congress believes that consultation was insufficient, then it (either the House or the Senate) may pass, under the terms of the Act, a "procedural disapproval resolution." Many critics of the Congressional decision to approve TPA accused the legislature of giving up its constitutional responsibility and authority to the administration. By rigorously defining its terms, and adding explicit consultation and reporting requirements, Congress took much of the bite out of this criticism. Furthermore, any trade agreement negotiated by the administration and sent to Congress must be accompanied by an implementation and enforcement plan. To those who object that this appears to give Congress a role in trade management, supporters respond that trade law violations have not always been properly enforced nor the provisions of these laws efficiently implemented.

Another important trade measure in the Act is Division C - the Andean Trade Preference and Drug Eradication Act (ATPDEA). This legislation extends and expands previously granted trade preferences to Bolivia, Colombia, Ecuador and Peru. The ATPDEA argues that granting temporary trade preferences (mainly for textiles and apparel, footwear, leather goods, tuna, petroleum products, watches and handicrafts) to the Andean countries will contribute to US security by reducing drug production and trafficking, cutting back on illegal immigration, and solidifying the assistance of these countries in the fight against terrorism. Considering that this region is the almost exclusive source of cocaine for the US market, and is home to a particularly savage civil conflict in Colombia, this is not a bad foreign policy argument, in addition to the mutual economic benefits of ATPDEA trade preferences.

Other sections of this division provide for extending additional benefits to textile and apparel producing Caribbean Basin and sub-Saharan African countries. The argument in favor of granting trade preferences to these regions focuses mainly on economic growth. The same can be said for the provisions on extending the life of the Generalized System of Preferences under this division of the Act.