At a time when the Biden administration’s approach to trade policy is coming under increasing scrutiny by both Republicans and Democrats, the White House got a vote of support this week from a group of new lawmakers.
Over the past two years U.S. Trade Representative Katherine Tai has led an effort to steer the U.S. away from free trade agreements and their emphasis on lowering tariffs to improve market access. Instead, Tai has emphasized creating a new worker-centric trade policy via agreements that don’t require congressional approval and cover a broader range of issues, from trade facilitation to supply chain resiliency to good regulatory practices.
The administration recently argued that this shift is necessitated by systemic shocks that have placed global economic relations at a turning point. However, at hearings held in late March many members of the Senate Finance and House Ways and Means committees took Tai to task over both the substance and the style of the administration’s approach, calling instead for more focus on traditional trade agreements, more aggressive actions against China, better trade enforcement efforts, and an increased recognition of Congress’ role in overseeing trade policy.
But the drumbeat of disappointment was disrupted in an April 19 letter to President Biden from all House Democrats first elected in 2022. The letter blamed “past trade policies, which were shaped by and for the largest corporate interests,” for ills such as job offshoring, unfair imports and broken supply chains “created in part by shortages of vital goods because of economic concentration, fostered by low road trade agreements or from a lack of diverse and domestic production.” The previous model of globalization also “exacerbated the climate crisis and weakened our national security as we became over-reliant on imports of essential goods.”
Instead, the lawmakers expressed support for administration initiatives such as the Indo-Pacific Economic Framework and the Americas Partnership for Economic Prosperity, which reflect a “focus on setting the rules of commerce rather than cutting the few remaining U.S. tariffs.” They urged the president to ensure that these initiatives improve on labor and environmental standards in existing U.S. agreements, stating that “the right rules and enforcement measures are key to ensuring any new agreements truly are worker-centered.” They also advocated updating global and regional trade rules to reflect new climate and geopolitical realities along and negotiating strong digital trade rules that “support fair competition by encouraging diverse marketplaces, promoting cyber-security for small and medium sized businesses, and limiting unhealthy market concentration and anti-competitive behavior by existing large firms.”
Finally, the lawmakers applauded the administration’s increasing utilization of industrial policy, including significant federal expenditures and subsidies in key sectors, as a way to “counter the climate crisis and enhance our reliance and security.” They urged particular focus on building domestic manufacturing capacity, “with strong Buy American and domestic content and assembly rules.”
For more information on U.S. trade policy and ensuring your interests are represented in its development and implementation, please contact Nicole Bivens Collinson at (202) 730-4956 or via email.
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