Washington | Reuters — U.S. President Barack Obama’s signature Asian trade push cleared another hurdle in the U.S. Senate on Thursday after a knife-edge vote moved the White House closer to gaining the power to speed trade deals through Congress.
Senators voted 62-38 to give Obama a major victory and set up a speedy decision on the “fast-track” trade negotiating authority the president needs to complete the Trans-Pacific Partnership (TPP) trade deal. TPP is seen as central to U.S. efforts to counter China’s increasing economic muscle.
Thirteen of 44 Democrats supported the legislation through the second Senate vote. Some supported moving ahead with fast track after Senate majority leader Mitch McConnell, a Republican, assured them he would set a vote next month on a bill to renew the Export-Import Bank’s charter, according to leading Democratic senators. The charter is due to expire at the end of June.
They were joined by 49 of 54 Republicans, giving supporters of the legislation more than the 60 votes needed to proceed in the 100-member Senate.
Senators will now weigh amendments to the bill. If there is co-operation among all senators, the bill could come to a vote later Thursday, with only a simple majority of 51 needed for passage.
Under fast-track, Congress can approve or reject trade deals like the TPP — which includes Canada, Australia, Japan and eight other countries — but not amend their contents.
But the path is not clear yet. The Senate will now start considering amendments to the bill, including controversial sanctions for trading partners that manipulate their currencies, a move opposed by the partners.
The White House has said it will veto the bill if lawmakers insist on penalties over its preference of a diplomatic approach to dissuade countries from deliberately weakening their currencies to make exports cheaper.
The TPP, which is near completion after more than five years of negotiations, would create a free trade zone covering 40 per cent of the world economy. Trading partners have said they want to see fast-track enacted before finalizing the pact, a goal the administration has set for this year.
The bill must also pass the House of Representatives, where an even tougher fight is expected. Some conservatives oppose giving the White House more power and many of Obama’s Democrats worry about the impact on jobs and the environment.
Obama has campaigned aggressively for fast-track over objections from the left wing of the Democratic Party, including Senator Elizabeth Warren, the influential liberal from Massachusetts.
Warren is pushing another amendment that would hobble the TPP by disqualifying any deal from fast-track if it contains provisions to allow companies to sue foreign governments.
Critics say the rules, currently part of the TPP, undermine governments’ ability to set domestic policy on issues like health and the environment, although supporters argue they are essential to avoid discrimination against foreign investors.
The pact is the biggest trade deal since the North American Free Trade Agreement between the U.S., Canada and Mexico.
More than two decades later, many blame that deal for factory closures and job losses and see the TPP as producing more of the same.
— Richard Cowan is a Reuters correspondent based in Washington, D.C. Additional reporting for Reuters by Anna Yukhananov, Jason Lange and Krista Hughes.