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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoPlainText><b><i><span style='font-size:12.0pt'>“The free-trade lobby,” Dolan says, “uses these trade deals to enact a kind of domestic regulatory agenda that they can’t get otherwise.”</span></i></b><b><i><span style='font-size:14.0pt;font-family:"Arial Black","sans-serif"'><o:p></o:p></span></i></b></p><p class=MsoPlainText><span style='font-size:14.0pt;font-family:"Arial Black","sans-serif"'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:14.0pt;font-family:"Arial Black","sans-serif"'>Congressional Quarterly WEEKLY <o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>March 18, 2013 – Page 490<o:p></o:p></span></p><p class=MsoPlainText><o:p> </o:p></p><p class=MsoPlainText><span style='font-size:16.0pt'>From Negotiation to Policy: The Power of a Trade Pact</span> <o:p></o:p></p><p class=MsoPlainText><o:p> </o:p></p><p class=MsoPlainText><span style='font-size:12.0pt'>By Kate Ackley, CQ Staff<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>In a luxury hotel half a world away from Washington, lobbyists for U.S. corporations and trade groups spent the past two weeks hosting elegant receptions and wonky policy discussions while they staked out closed-door talks on a trans-Pacific free-trade agreement involving 11 nations.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>The hubbub at Singapore’s Grand Copthorne Waterfront Hotel could, at times, have passed for a scene on K Street. In fact, the involvement of business interests was driven not only by discussions of tariffs and of opening far-flung global markets but also of U.S. domestic issues.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Although the policies contained in a trade agreement typically don’t override federal law, experts in the field say that any inconsistencies could result in a trade dispute subjecting the noncompliant country to possible arbitration and sanctions. When faced with similar challenges, the United States has revised the offending regulations and, in some cases, is still considering how to bring them into compliance<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>In one case, Mexico successfully challenged U.S. regulations for keeping track of whether imported shrimp had been caught in turtle-safe nets. Another challenge from Mexico resulted in changes to “dolphin-safe” tuna labeling.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Just last week, the Agriculture Department proposed changing a rule on country-of-origin food labeling after an appeals panel of the World Trade Organization decided that the rule had had a detrimental effect on livestock imports from Mexico and Canada. Such a change could result in a tougher labeling rule or, as some industry advocates want, a decision to throw out the requirement.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“There certainly have been cases in which the United States has had laws related to consumer protection, food safety and consumer information that have been challenged at the World Trade Organization, and in some of those cases the U.S. has had to make modifications to its regulations in order to come into compliance,” says Elizabeth Drake, a partner with Stewart & Stewart, which represented the National Farmer’s Union and other domestic interests in the labeling case.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><b><span style='font-size:12.0pt'>Fear of Lowering Standards<o:p></o:p></span></b></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>TPP disputes might follow a similar path and serve as an alternative to revamping domestic laws and regulations to change their effect.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“An agreement like the TPP becomes a mechanism for a broad array of industry interests to re-litigate policies that they lost when the debate occurred in the sunshine of public scrutiny and the open congressional process,” says Lori Wallach, director of Public Citizen’s Global Trade Watch, who kept an eye on the negotiations unfolding in Singapore and whose group opposes the free-trade pact. “It can become a backdoor strategy for changing domestic policy.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>That prospect isn’t lost on Congress. Rep. Rosa DeLauro says she is worried that food and agriculture interests will weaken the 2010 food safety law, which she helped write, while the Obama administration continues to implement its provisions.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“It’s my fear,” the Connecticut Democrat says, that “it would mean we would have to lower our standards.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt;color:black'><o:p> </o:p></span></p><p class=MsoPlainText><b><span style='font-size:12.0pt'>Vessels for Grievances<o:p></o:p></span></b></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Congress typically takes up trade agreements under presidential fast-track authority, which forces lawmakers to vote up or down on the whole deal without being able to amend it. (The president’s fast-track authority has expired, but the administration is expected to seek its renewal.)<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>The Obama administration rejects the notion that the trans-Pacific talks could gut portions of statutes such as the Dodd-Frank financial overhaul, the 2010 health care law or DeLauro’s measure.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“Only Congress changes U.S. law, period,” Carol Guthrie, spokeswoman for the U.S. Trade Representative, wrote in an email, “and only administrations, in consultation with Congress, change U.S. policies and regulations.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Lobbyists and representatives of several corporations deny that the trade talks could be an opportunity for U.S. policy do-overs.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>One longtime lobbyist and expert in trade pacts calls the legislating-via-trade-deal route an “unusual strategy.” He says that companies and other groups weighing in on negotiations are more likely to use their muscle to raise other countries’ standards so that they are in harmony with those of the United States.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>But the complex nature of the TPP negotiations coupled with the reach of those countries involved with the United States — Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and, perhaps in the future, Japan — fuel speculation about the deal’s eventual impact on the policies of individual countries.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>David Thomas, the Business Roundtable’s vice president for trade, says the TPP agreement “creates an opportunity to sort of knit together a regional free-trade area that can allow companies to more efficiently do business across those countries as well as within those countries.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>There is precedent for trade-driven changes to U.S. laws. When Congress two decades ago passed the Uruguay Round Agreement Acts, transforming the General Agreement on Tariffs and Trade into the World Trade Organization, lawmakers approved a change in patent law that extended market exclusivity for U.S. products from 17 years to about 20 years. Trade and patent law experts say the change harmonized U.S. and international patent laws and benefited, in particular, big companies that file patents in multiple countries.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>The North American Free Trade Agreement that Congress approved in 1993, “downwardly harmonized” federal rules for interstate trucking, says Mike Dolan, the legislative representative who handles trade policy for the International Brotherhood of Teamsters, which complained about NAFTA provisions giving Mexican trucks access to U.S. highways.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“The free-trade lobby,” Dolan says, “uses these trade deals to enact a kind of domestic regulatory agenda that they can’t get otherwise.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt;color:black'><o:p> </o:p></span></p><p class=MsoPlainText><b><span style='font-size:12.0pt'>Inside Track<o:p></o:p></span></b></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>With the TPP talks, an immediate concern for Dolan is the “Buy American” policies that give preferential treatment to U.S. goods in federal procurement contracts. Negotiators could give that same preferred status to goods made in the 10 other countries.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Several senators late last year spelled out their Buy American concerns in a letter to President Barack Obama. Ohio Democrat Sherrod Brown, who signed the letter, has been a critic of pacts such as the Central American Free Trade Agreement and says he wants to use his position on the Finance Committee, which has jurisdiction over international trade matters, to illuminate the otherwise secretive process of trade negotiations such as the TPP.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“Corporate CEOs often have better access to information on trade negotiations than Congress does,” Brown says. “These trade agreements are often good for large corporations and not so good for American workers.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Rep. Zoe Lofgren, a California Democrat and free-trade supporter who backs the TPP generally, is especially concerned about what might be in the copyright provisions of a deal.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Lofgren opposed legislation aimed at curbing online piracy — known by its acronym, SOPA — which was backed by the movie industry and other sectors that rely on copyright protections, because it would, she said, hamper Internet freedom. Technology giants such as Google Inc. led a lobbying and grass-roots effort in 2012 that derailed the legislation. Movie executives and other content providers, she says, have looked to trade pacts such as the Anti-Counterfeiting Trade Agreement as a back channel to resurrect some of SOPA.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“In the past, there have been efforts by Big Content to get in a trade agreement what they could not get through the Congress,” Lofgren says, noting that ACTA had stalled.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Lofgren says she warned U.S. Trade Representative Ron Kirk, “Look at what happened to ACTA. ACTA went down because of a perception that it was delivering SOPA-like rules to the Internet. If there’s overreach in the TPP, the entire trade agreement could go down just as ACTA went down.” (Kirk stepped down March 15.)<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>A spokesman for the Motion Picture Association of America declined to comment, referring questions to the USTR and the U.S. Chamber of Commerce, which led a delegation to Singapore.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Richard Bates, senior vice president of government relations for Walt Disney Co., says movie studios would like to see in the TPP the same level of protections for intellectual-property rights as are included in a congressionally approved free-trade agreement with South Korea.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>One entertainment industry executive, who declined to speak on the record because of the sensitivity of the talks, says allegations that content providers are trying to get SOPA policies into the TPP deal are “scare tactics.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>On the flip side of this debate, some content providers and entertainment industry lobbyists say that technology companies are eying TPP as a way to weaken existing intellectual-property laws. Not surprisingly, both camps are watching the unfolding negotiations with immense interest. “Generally,” says one lobbyist familiar with the issue, “the approach in the United States to these trade agreements has been to get other countries to adopt stronger intellectual-property rights so our movies, our products, aren’t ripped off around the world.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Lawmakers gave corporate interests a say in trade talks in the Trade Act of 1974, which created industry trade-advisory committees that give feedback on relevant issues to trade negotiators. AFL-CIO President Richard Trumka has the same privilege.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“The purpose of a trade agreement is to help the U.S. economy,” says one entertainment industry official, who was not authorized to discuss the talks. “The U.S. exporters have an important role to play in understanding what the barriers are.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>This lobbyist added, though, that openness in negotiations often falls victim to the “horse trading” that goes on behind closed doors to arrive at a final deal.<o:p></o:p></span></p><p class=MsoPlainText><b><span style='font-size:12.0pt'><o:p> </o:p></span></b></p><p class=MsoPlainText><b><span style='font-size:12.0pt'>Potential Complications<o:p></o:p></span></b></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>The secrecy of the deal-making may well provide lobbyists with an opportunity, but it can just as easily get in their way.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Because the draft text of any agreement is secret, lobbyists with the best access to officials on the inside must be careful to not reveal too much in public while also figuring out how to press their cases.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>In Singapore, for example, the USTR hosted a “stakeholder engagement event” on March 6, at which business and other interests had “the opportunity to raise questions and share views directly with negotiators and other stakeholders,” according to the USTR website.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Such out-in-the-open discussion is not the only way to try to influence the deal, however. The American Chamber of Commerce in Singapore hosted a March 8 reception for diplomats and outside interests in the grand ballroom of the hotel where negotiations were being held.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Corporate representatives also book suites where they can huddle with their counterparts and with government officials. Even public interest groups get in on the lobbying: Wallach of Public Citizen said that during a previous TPP round in New Zealand she took to standing outside, in the rain, trying to persuade negotiators to chat about her concerns.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Catherine Mellor, a trade policy expert with the U.S. Chamber of Commerce, says the group regularly keeps in touch with the USTR’s office, administration officials and members of Congress. But the negotiations offer a potentially one-stop opportunity for face time with foreign officials too.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>“We do meet with the foreign negotiators,” explains Mellor, whose subtle accent in a reminder of her Australian roots. “A lot of these companies have real-market examples of why these policies are needed.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Banking-industry insiders say privately that the talks may be an opportunity to clarify “international, cross-border applications” of the “Volcker rule” in the Dodd-Frank law, which restricts banks from making speculative investments and is much maligned by the industry, one banking source says.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>High stakes ensure that business will be engaged in future deal-making on trade, even when negotiators rebuff their input. “They might publicly say they don’t want this, but they might give in if they need something else,” says Mark Grayson of the Pharmaceutical Research and Manufacturers of America. Industry groups hang around so “they know you’re there, in case they have some questions.”<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'><o:p> </o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>FOR FURTHER READING: Changing dynamics on congressional trade policy, 2008 Almanac, p. 6-18; World Trade Organization approval (PL 103-465), 1994 Almanac, p. 123; NAFTA approval (PL 103-182), 1993 Almanac, p. 171; Uruguay Round approval, 1993 Almanac, p. 171.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>Source: CQ Weekly<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>The definitive source for news about Congress.<o:p></o:p></span></p><p class=MsoPlainText><span style='font-size:12.0pt'>© 2013 CQ Roll Call All Rights Reserved.<o:p></o:p></span></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><b><span style='font-family:"Bell MT","serif"'>Michael F. Dolan, J.D.<o:p></o:p></span></b></p><p class=MsoNormal><span style='font-family:"Bell MT","serif"'>Legislative Representative<o:p></o:p></span></p><p class=MsoNormal><span style='font-family:"Bell MT","serif"'>International Brotherhood of Teamsters<o:p></o:p></span></p><p class=MsoNormal><span style='font-family:"Bell MT","serif"'>Desk 202.624.6891<o:p></o:p></span></p><p class=MsoNormal><span style='font-family:"Bell MT","serif"'>Fax 202.624.8973<o:p></o:p></span></p><p class=MsoNormal><span style='font-family:"Bell MT","serif"'>Cell 202.437.2254<o:p></o:p></span></p><p class=MsoNormal><o:p> </o:p></p></div></body></html>