Administration Hasn't Resolved Lawmakers' TPP Concerns; Ways and Means Leaders Considering Hearing

While Obama administration officials have acknowledged House Republicans’ concerns with the Trans-Pacific Partnership, some GOP lawmakers are frustrated with the lack of “solid” executive branch proposals to resolve their hang-ups about the deal, Ways and Means Trade Subcommittee Chairman Dave Reichert, R-Wash., said in an interview with International Trade Today on April 18. He and Ways and Means Committee Chairman Kevin Brady, R-Texas, are discussing whether to hold a hearing on TPP, in part, as an attempt to underscore members’ concerns and to get more substantive answers to them, Reichert said. “But sometimes…hearings can do just the opposite,” Reichert said. “It’s been a consideration, but there’s been no decision.”

Reichert, Brady, and other House GOP lawmakers on April 19 met with “members of the financial services community” to discuss financial services provisions in TPP, a Reichert spokeswoman said. According to a source with close knowledge of ongoing discussions, U.S. Trade Representative Michael Froman hopes to meet with Reichert and other Congress members on the deal’s financial services provisions in the near future, but the two sides haven’t yet settled on a time. In preceding months, Reichert met on TPP with several industry and administration officials, including Froman and National Economic Council Director Jeffrey Zients. USTR did not comment.

Last month, House Republicans met with administration officials on the agreement’s pharmaceutical provisions. “They walked away with some frustration,” Reichert said of the participating lawmakers. “This is where we’re kind of stuck," he said. Despite administration assurances that "‘yes, we hear you, and understand you'" and "'we’ll provide solutions to you,’" such solutions "haven’t come, really.” Reichert said House Republican concerns include biologic data exclusivity, the carve-out of tobacco from investor-state dispute settlement, cross-border data flows, financial services, market access for agriculture, and Vietnam labor issues. “I think the communication is there, so I’m not complaining about that,” Reichert added, regarding TPP discussions with the administration.

Brady said the administration has been “seriously engaged,” but has “a lot of work to do” in addressing member concerns. “These are substantial issues, and you have 11 trading partners,” Brady told reporters on April 20. “I really believe that if you build support and resolve differences, the timetable will become much more clear. So I’m not pre-judging when we take this up, but I’m thinking the sooner we resolve those differences and build support, the more quickly we level that playing field with our TPP countries. I want our businesses and countries to be in those markets. The sooner we get this achieved, the better.” Reichert said he expects Congress to introduce TPP implementation legislation during the coming “lame-duck” session of Congress later this year, despite several members’ hopes it would be taken up by July recess. But both Reichert and Brady this week repeated a refrain heard from trade-focused lawmakers since TPP’s conclusion in October: The substance of Congressional-administration negotiations will drive the timing of introduction of any TPP implementation bill.

Although a slew of import tariffs will be slashed if and when TPP enters into force, Reichert predicted U.S. revenue would increase, because the resulting productivity and expanded hiring ability would presumptively translate to a wider tax base and more total tax paid in the long run. “I am really anxious to be out there touting the positives of TPP, because I think it is a job creator, as long as it’s structured in a way that protects American businesses, protects jobs, and allows us equal access to those markets,” Reichert said. “Americans have to be able to sell their products overseas because only five percent of the market is in the United States. It makes sense.” Some observers predicted coming debate over ways to replace the tariff revenue that would be reduced as a result of a TPP (see 1511130054).