AFL-CIO, Congress, Democrats, fast track, Im-Politic, Jobs, Obama, reeducation, Republicans, retraining, TAA, TPA, TPP, Trade, Trade Adjustment Assistance, Trade Promotion Authority, Trans-Pacific Partnership, wages
As must be clear to anyone following the issue, the final twists and turns of the Congressional fight over President Obama’s fast track trade bill are so inane that they make the sausage-making process often compared to legislating look pretty. At this point, no one can know the final fate of the bill, which would among other provisions prevent Congress from amending any of the president’s new trade deals, like the Trans-Pacific Partnership (TPP). But one especially noteworthy feature of this climactic phase is how the chronically cynical use of a program called Trade Adjustment Assistance (TAA) is being hoisted on its own petard – and may actually sink the president’s trade agenda.
TAA aims at providing government-sponsored re-education and retraining for workers whose jobs are displaced for trade-related reasons. The first and most important thing to know about it is that it’s a proven failure. As made clear in numerous studies, the intended beneficiaries only rarely find new jobs that pay as well as the ones they’ve lost. Moreover, no one would should be surprised by this. As economist Ricardo Hausmann has once again reminded us, the evidence is clear that the best kind of job training is that provided by the private sector – on the job to start with.
The program is up for renewal, and Republicans generally oppose it because of their deeply held skepticism about government’s competence in any area outside national security and law enforcement. But many often vote for it for the same reason as some Democrats who tend to support trade agreements: They think it provides them with political cover for backing the trade policies that have wiped out these jobs and crushed their industries’ wage structures in the first place.
But despite the program’s proven ineffectiveness, many trade policy critics in Democratic and liberal ranks favor it as well for substantive reasons. Their rationale seems to follow “half a loaf” reasoning: TAA is far from perfect, but it’s better than nothing. And largely as a result, backers of offshoring-friendly trade deals have sometimes been able in effect to buy enough Democratic votes to secure their passage.
It’s clear that the White House and Congress’ Republican leadership were banking on this tactic this time out, too. But then something extraordinary happened. To simplify just a bit, very late in the game, large numbers of Democratic trade critics seem to have decided not to be played any more. Even the AFL-CIO, which has always supported TAA as strongly as it has opposed flawed trade agreements, has now evidently decided that it’s much more important to save large numbers of jobs by defeating trade policies that have destroyed them than to help an at-best-tiny number of workers with TAA. (Its stated rationale, to be sure, concerns allegedly inadequate funding levels and other specific shortcomings.) And because of possibly too-clever-by-half tactical decisions by House Republican leaders, the scheduled sequence of votes today could enable the trade critics to kill the fast track bill with an anti-TAA vote.
In fact, fast track’s advocates have become so desperate that they’re now making the logically absurd argument that if fast track is defeated, TAA will go down as well. In other words, if you scuttle the trade policies responsible for job destruction, programs that respond with a few flimsy band-aids for wounded labor markets will come to an end. As my father would have asked, “Is that a threat or a promise?”
Defeating fast track won’t swiftly cure all the trade woes ailing American workers. It doesn’t even guarantee defeating the TPP. But fast track’s demise certainly makes that outcome much more likely, and therefore at least reduces the odds of Washington doing further harm. These stakes explain why the offshoring lobby and its White House and Congressional supporters are tying common sense – not to mention themselves – up in knots. Therefore they explain why it would be so delicious, as well as economically encouraging, to see the fast track supporters fail. But however this trade saga ends, it’s great to see so many trade policy critics finally realize that threadbare handouts can’t possibly compensate for destructive trade policies.