Republicans Charge Dems With Holding GSP Hostage

Although the House Ways and Means Trade Subcommittee hearing was ostensibly about using trade agreements to promote environmental causes, Republicans on the dais mostly focused on their frustration that the Generalized System of Preferences benefits program and the Miscellaneous Tariff Bill have not been renewed, even though they have been lapsed for nearly two years.

Trade Subcommitee ranking member Adrian Smith, R-Neb., said during his opening remarks: "With just 17 days left this year, the window of opportunity is closing to reach a bipartisan agreement to renew two crucial and non-controversial programs -- the Generalized System of Preferences (GSP) and the Miscellaneous Tariff Bill (MTB).

"I have not given up hope on getting these programs renewed before the end of the year, but if we are to reach an agreement in short order, and we absolutely should, it will require my colleagues on the other side of the aisle to abandon their efforts to use GSP and MTB as leverage for partisan priorities, like Trade Adjustment Assistance.

"They support good American jobs and have long enjoyed strong bipartisan support. Given the topic of today’s hearing, it’s important to note Ways and Means Republicans have supported renewing GSP with environmental eligibility criteria. An action Congress could take this month to improve the environment would be to advance a long-term, bipartisan GSP bill. I hope we won’t squander this opportunity."

Rep. Drew Ferguson, R-Ga., was a little more confrontational. "Think about where we are with GSP and MTB," he said. "The fact that we have not addressed that, while there is wide bipartisan support, is malpractice."

Rep. Lloyd Smucker, R-Pa., said that neglecting to renew GSP works against the goal of leveraging trade to promote sustainable practices.

He pointed to Crayola, which he said saved a lot on tariffs through GSP, and he said Crayola then directed that money to use renewable energy to power its U.S. plants that make crayons and markers. It imports colored pencils from Brazil, and those were covered by GSP. He said that Brazilian plants, too, are zero-carbon operations.

He also said that the GSP renewal that passed the Senate as part of its trade title updates the environmental criteria, and that House Republicans support that language.

"I really do not understand why this isn’t being taken seriously," he said.

But Subcommittee Chairman Earl Blumenauer's comments during the hearing addressed the hold-up -- it's that Democrats do not want to move GSP and MTB unless Trade Adjustment Assistance is also renewed. Democrats have been insisting on this linkage for more than a month, which House Republicans reject (see 2211160068).

He argued that renewing TAA is not part of a political agenda. "It happens to be something that is important for the American workforce. I’m appalled we’re not able to do that and we’re holding these workers hostage."

At a press conference later in the day, Ways and Means ranking member Kevin Brady, R-Texas, said the trade negotiations are stickier than both tax and healthcare negotiations for a year-end package. "Trade Adjustment Assistance without a trade agenda, there’s just no need for it. I still think we can reach common ground on GSP and MTB," he said. "It just seems unfair that poor countries and U.S. manufacturers are being held hostage to this Trade Adjustment Assistance."

Democrats have proposed an expansion of TAA; Sen. Rob Portman, R-Ohio, has suggested that renewing TAA as it existed until July could be part of a "grand bargain" on trade -- he wants a limited Trade Promotion Authority, TAA, GSP, MTB and revisions to antidumping/countervailing duty laws rolled up into one trade package.

United Steelworkers legislative director Roy Houseman Jr. told International Trade Today after the hearing that his union is urging Democrats to compromise, and agree to bring back TAA as it existed earlier this year.

"The union is of the perspective that keeping the program going in the near term is super important," he said, as they say there are 40,000 workers that could have qualified since the program expired, and they deserve a chance to apply. "It allows us to have that broader conversation [later], what to do long-term."

He said they are concerned that if it doesn't get renewed before the end of February, its costs will no longer be considered part of the ongoing budget, and that would make it "significantly harder to renew." He said they're also concerned a House Republican majority would be less disposed to renewal, even though there are thousands of workers in Ohio, Texas and other states with strong Republican representation who have qualified for benefits.

Many Republicans said the fact that there has been no proposal from the administration for a new Trade Promotion Authority is an abdication of leadership. "I would say you can’t promote anything through trade if you don’t prioritize trade," Jodey Arrington, R-Texas, said.