Moreover, Fast Track was unique in that it also delegated to the executive branch control of the schedules of the House and Senate with respect to consideration of trade agreements. Fast Track empowered the executive branch to force a congressional vote on such implementing legislation and the related agreement within a set amount of time, regardless of the views of congressional leaders. Sixty legislative days after the president submitted to Congress whatever agreement he signed and whatever legislation he wrote, the House of Representatives was required to vote on the package. A Senate floor vote was required no more than 30 days later. Under Fast-Track, normal congressional floor procedures also were waived when Congress voted on the final pacts and implementing legislation. All amendments were forbidden and congressional debate was limited to 20 hours.2 Agreements were passed by simple majority votes, even in the Senate.
Yet, while Congress was largely excluded from the negotiating process, Fast Track set up private-sector advisory committees that entitled hundreds of business interests to have special access to negotiators and confidential U.S. negotiating documents not available to the legislative branch or the public. In short, the Richard Nixon-conceived Fast Track process3 undermined essential checks and balances between the branches of government that the Founding Fathers wisely built into the U.S. Constitution. The process facilitated a system of “diplomatic legislating” with executive branch trade negotiators able to effectively rewrite swaths of U.S. domestic non-trade policy otherwise under the jurisdiction of the Congress and U.S. state legislatures.
When Fast Track was first established, trade agreements were focused mainly on cutting tariffs and lifting quotas. In contrast, today’s “trade” agreements include hundreds of pages of expansive rules to which all signatory countries must conform their domestic non-trade policies. These non-trade provisions limit U.S. federal and state legislators’ policy space regarding the regulation of services such as banking, health care and energy; product and food safety; copyright and patent law; and even how American tax dollars may be spent through government procurement. Some of the agreements even allow foreign investors to use World Bank and United Nations tribunals to demand U.S. taxpayer
compensation for domestic environmental, health and other policies that undermine foreign investors’ expected future profits. Fast Track enabled the negotiation and expedited passage of 15 agreements, including the 1994 North American Free Trade Agreement (NAFTA), the 1995 World Trade Organization (WTO), and various expansions of the NAFTA model (including the Central America Free Trade Agreement (CAFTA) passed in 2005 by a one vote margin). The last grant of Fast Track expired in June 2007, but Fast Track’s extraordinary procedures nonetheless applied to the agreements signed with Korea, Colombia and Panama under the previous authority and passed in 2011.
Many scholars and policymakers believe that Fast Track is an inappropriate mechanism for today’s complex international commercial agreements, which directly affect a vast array of people and policies beyond the scope of the simple 1970s tariff-cutting agreements.4 Given the scope of today’s agreements, concerns have grown in Congress about how Fast Track undermines the balance between the branches of government, empowering the executive branch with enormous power in areas in which the Constitution provides Congress with exclusive authority. These concerns came to a head in April 2008 when President Bush triggered a Fast Track vote on the Colombia trade deal over the objections of congressional leaders. The House of Representatives responded by voting to amend Fast Track to remove the mandatory 60-day vote requirement for that pact, which obtained a vote in 2011.5
A more comprehensive rethink of Fast Track is likely to occur if President Obama seeks some form of trade authority. In considering how Fast Track might be best replaced by a new mechanism that provides a more robust role for Congress and for meaningful input from a greater number and diversity of affected parties, it is important to review the economic outcomes of the Fast Track-enabled trade model. Polling shows that increasing numbers of Americans have turned against NAFTA-style agreements.6 If a more inclusive process helped ensure that new trade agreements provided gains that outweighed the losses for most Americans, U.S. public support for trade agreements might increase.
1 Constitution of the United States, Article 1, Section 8.
2 U.S.C. 19 § 3801-3813; Hal S. Shapiro, Fast Track: A Legal, Historical, and Political Analysis, (Ardsley, N.Y.: Transnational Publishers, 2006).
3 In 1973, President Nixon first proposed Fast Track, which was passed by the House that same year. The following year, the Senate passed an amended version, which was signed by President Ford in January 1975. Edward Rohrbach, “Nixon asks free hand in trade, tariffs,” Chicago Tribune, April 11, 1973; Edwin L. Dale, Jr., “Credits to Soviet barred as House backs trade bill,” New York Times, Dec. 12, 1973; “The deal on the trade bill,” Washington Post, Dec. 20, 1974; Bernard Gwertzman, “Ford signs the trade act,” New York Times, Jan. 4, 1975.
4 Shapiro 2006, at 150-162; Letter from Sen. Barack Obama (D-Ill.) to Iowa Fair Trade Campaign, Dec. 26, 2007; Sign-on letter to Congress from 713 organizations, March 29, 2007; National Education Association letter to Congress, June 8, 2007.
5 Mark Drajem, “U.S. House Set to Vote on Delaying Colombian Trade Agreement,” Bloomberg, April 10, 2008.
6 Washington Post Poll, Jan. 13-17, 2011. Available at: http://www.washingtonpost.com/wp-dyn/content/story/2011/01/28/ST2011012802479.html?sid=ST2011012802479
NBC News and Wall Street Journal, “Survey: Study #101061,” Hart/McInturff, Sept. Available at: http://online.wsj.com/public/resources/documents/WSJNBCPoll09282010.pdf
Greenberg Quinlan Rosner Research, “Democracy Corps: Frequency Questionnaire,” Oct., Available at: http://www.democracycorps.com/wp-content/files/dcor100410fq10.pdf
Mathew Cooper, “Trade Gulf,” National Journal, May 26, 2011. Poll conducted by Allstate / National Journal / Heartland Monitor November 29 to December 1, 2010.
7 Average wage data for 1964-2012 from Bureau of Labor Statistics’ Current Employment Statistics survey, series CEU0500000008. Productivity data from Bureau of Labor Statistics’ Major Sector Productivity and Costs index, series ID PRS88003093, accessed December 10, 2012. All data expressed in current prices in this document were inflation-adjusted using the Consumer Price Index-U-RS calculated from 1977 through 2011 by the Bureau of Labor Statistics. Available at: http://www.bls.gov/cpi/cpiursai1978_2011.pdf. CPI-U-RS estimates prior to 1977 come from the U.S. Census Bureau. Available at: http://www.census.gov/hhes/www/income/data/incpovhlth/2010/CPI-U-RS-Index-2010.pdf. CPI-U-RS estimates after 2011 come from the Congressional Budget Office, “An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022,” August 2012, Summary Table 2, at 52. Available at: http://www.cbo.gov/sites/default/files/cbofiles/attachments/43539-08-22-2012-Update_One-Col.pdf.
8 Margaret Jacobson and Filippo Occhino, “Behind the Decline in Labor’s Share of Income,” Federal Reserve Bank of Cleveland, February 3, 2012. Available at: http://www.clevelandfed.org/research/trends/2012/0212/01gropro.cfm.
9 Stephen Roach, “The World Economy at the Crossroads: Outsourcing, Protectionism, and the Global Labor Arbitrage,” Speech before the Boao Forum for Asia, 2003.
10 Foreign Investment Department, “Import & Export Statistics by FIEs from Jan to Dec. 2011,” China Ministry of Commerce, updated Jan. 19, 2012. Available at: http://www.fdi.gov.cn/pub/FDI_EN/Statistics/FDIStatistics/IEStatisticsbyFIEs/t20120119_140577.htm.
11 Horizon Project, “Report and Recommendations,” February 2007, at 1.
12 International Trade Union Confederation, “Bangladesh: Government Must Support Decent Minimum Wage, and Cease Harassment of Union Rights Supporters,” Aug. 9, 2010. Available at: http://www.ituc-csi.org/bangladesh-government-must-support.html.
13 Ha-Joon Chang, Kicking Away the Ladder, (London: Anthem Press, 2002), at 108.
14 Paul A. Samuelson. Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization, Journal of Economic Perspectives—Volume 18, Number 3—Summer 2004—Pages 135–146 available at http://www.wilsoncenter.org/sites/default/files/SamuelsonJEP042.pdf
15 U.S. Census Bureau, “Educational Attainment: Table 2. Educational Attainment of the Population 25 Years and Over, by Selected Characteristics: 2010,” 2010. Available at: http://www.census.gov/hhes/socdemo/education/data/cps/2010/tables.html.
16 Dean Baker and Mark Weisbrot, “Will New Trade Gains Make Us Rich?” Center for Economic and Policy Research (CEPR) Paper, October 2001.
17 Wolfgang F. Stolper and Paul A. Samuelson, “Protection and Real Wages,” The Review of Economic Studies, 9:1, November 1941, at 58-73.
18 Josh Bivens, “Globalization and American Wages,” Economic Policy Institute (EPI) Report, October 2007
19 Bureau of Labor Statistics, Current Employment Statistics survey, series ID CEU7072000003, accommodation and food services industry.
20 Dean Baker, The United States Since 1980, (Cambridge: Cambridge University Press, 2007), at 35-45.
23 Thomas Piketty and Emmanuel Saez, “The Evolution of Top Incomes: A Historical and International Perspective,” National Bureau of Economic Research Paper 11955, January 2006; numbers updated through 2008 in a July 2010 extract, available at: http://www.econ.berkeley.edu/~saez/
24 William Cline, Trade and Income Distribution, (Washington, D.C.: Peterson Institute for International Economics, 1997), at 264; Dean Baker and Mark Weisbrot, “Will New Trade Gains Make Us Rich?” Center for Economic and Policy Research (CEPR) Paper, October 2001.
25 Bivens 2007.
26 World Economic Outlook 2007: Globalization and Inequality (Washington, D.C.: IMF, 2007), at 31-65.
27 David Card and John E. DiNardo, “Technology and U.S. Wage Inequality: A Brief Look,” Federal Reserve Bank of Atlanta: Economic Review, Third Quarter 2002, at 45-62.
28 Jared Bernstein and Lawrence Mishel, “Economy’s Gains Fail to Reach Most Workers’ Paychecks,” EPI Briefing Paper 195, September 2007.
29 Dean Baker, “Trade and Inequality: The Role of Economists,” CEPR Report, January 2008.
30 Employment And Training Administration, “FY 2013 Congressional Budget Justification: Federal Unemployment Benefits and Allowances,” 2012, at 14. Available at: http://www.dol.gov/dol/budget/2013/PDF/CBJ-2013-V1-08.pdf.
31 Baker 2008.
32 Census Bureau, "U.S. Trade in Goods and Services - Balance of Payments (BOP) Basis," June 8, 2012. Available at: http://www.census.gov/foreign-trade/statistics/historical/gands.pdf. GDP numbers taken from Bureau of Economic Analysis, "Gross Domestic Product: Third Quarter 2012 (Second Estimate)," November 29, 2012. Available at: http://www.bea.gov/newsreleases/national/gdp/2012/pdf/gdp3q12_2nd.pdf.
33 Franco Modigliani and Robert M. Solow (Nobel Laureates 1985 and 1987), “America Is Borrowing Trouble,” New York Times, April 9, 2001; Joseph E. Stiglitz (Nobel Laureate 2001), “The IMF’s America Problem,” column, 2006; Roger W. Ferguson (Fed Vice-chairman), “U.S. Current Account Deficit: Causes and Consequences,” Remarks to the Economics Club of the University of North Carolina at Chapel Hill, Chapel Hill, N.C., April 20, 2005; Timothy P. Geithner (Fed president), “Policy Implications of Global Imbalances,” Remarks at the Global Financial Imbalances Conference at Chatham House, London, Jan. 23, 2006; “Minutes of the Federal Reserve Open Market Committee,” June 29-30, 2004.
34 U.S. International Trade Commission, “Interactive Tariff and Trade DataWeb,” accessed January 14, 2013. Available at: http://dataweb.usitc.gov/.
35 The White House, “The U.S.-South Korea Free Trade Agreement: More American Jobs, Faster Economic Recovery through Exports.” Available at: http://www.whitehouse.gov/sites/default/files/09272011_wh_overview_fact_sheet_us_korea.pdf.
36 U.S. International Trade Commission, “Interactive Tariff and Trade DataWeb,” accessed January 14, 2013. Available at: http://dataweb.usitc.gov/.
37 The Department of Commerce estimates that a $150,000 increase (decrease) in goods exports is equivalent to gaining (losing) one U.S. job. International Trade Administration, “Exports Support American Jobs,” U.S. Department of Commerce, April 2010, at 3. Available at: http://trade.gov/publications/pdfs/exports-support-american-jobs.pdf.
38 Charles Conner, “Agribusiness Food Producers Back NAFTA,” Memphis Commercial Appeal, Aug. 15, 1993; Jennifer Lin, “In Texas, High Noon over NAFTA,” Knight-Ridder Newspapers, Oct. 31, 1993.
39 Figures are a comparison of the inflation-adjusted dollar value of food imports/exports from 2011 and the year prior to the implementation of FTAs with current FTA partners. Food imports/exports are defined by a zero in the end-use 1-digit system, located at U.S. International Trade Commission, “Interactive Tariff and Trade Dataweb,” accessed Dec. 11, 2012. Available at: http://dataweb.usitc.gov.
40 This is an inflation-adjusted comparison of beef imports in 1993 and 2011, with beef defined as 011 in the SITC system, located at U.S. International Trade Commission, “Interactive Tariff and Trade Dataweb,” accessed Dec. 27, 2012.
41 Farming typologies and numbers come from the USDA. Small family farms consist of “farming occupation” farms grossing less than $250,000 per year (“lower sales” and “higher sales”), while large farms include family farms grossing more than $250,000 per year (“large” and “very large”) and nonfamily farms. Comparisons are between 2011 and 1996, the latest and earliest data available. Economic Research Service, “Agricultural Resource Management Survey: Farm Financial and Crop Production Practices,” U.S. Department of Agriculture, updated Nov. 27, 2012. Available at: http://www.ers.usda.gov/data-products/arms-farm-financial-and-crop-production-practices/tailored-reports.aspx.
42 Mary Bottari, “Trade Deficit in Food Safety,” Public Citizen Report, July 2007.
43 The food items with the highest volume of highly redundant trade include rice, tomatoes, potatoes, watermelon, onions, and beef cuts. See Public Citizen, forthcoming, 2008.
44 John Vidal, “Maritime countries agree first ever shipping emissions regulation,” The Guardian, July 18, 2011. Available at: http://www.guardian.co.uk/environment/2011/jul/18/maritime-countries-shipping-emissions-regulation.
45 Bob Baugh and Joel Yudken, “Is Deindustrialization Inevitable?” New Labor Forum, 15:2, Summer 2006.
46 Bureau of Labor Statistics, Current Employment Statistics survey, series ID CES3000000001, manufacturing industry.
47 Bureau of Labor Statistics, “Table B-1. Employees on nonfarm payrolls by major industry sector, 1961 to date,” 2011, Available at: ftp://ftp.bls.gov/pub/suppl/empsit.ceseeb1.txt
48 Public Citizen, “Department of Labor Trade Adjustment Assistance Consolidated Petitions Database,” 2010, Available at: http://www.citizen.org/taadatabase
49 Lawrence Mishel, Jared Bernstein, and Sylvia Allegretto, State of Working America 2006-2007, (Washington, D.C.: EPI, 2006), Table 3.30, at 175.
50 Leaders from both parties and from manufacturing industry have called for a reinvigorated manufacturing policy. See Office of Congressman Daniel Lipinski, “Lipinski's Bill to Boost American Manufacturing Passes House on Strong Bipartisan Vote, Heads to Senate,” Sept. 13, 2012. Available at: http://lipinski.house.gov/index.cfm?sectionid=91&itemid=1726.
51 Lael Brainard, Robert E. Litan and Nicholas Warren, “Insuring America’s Workers in a New Era of Off-shoring,” Brookings Institution Policy Brief 143, July 2005, at 2.
52 Bureau of Labor Statistics, “Displaced Workers Summary,” Table 7, U.S. Department of Labor, Aug. 24, 2012. Available at: http://www.bls.gov/news.release/disp.nr0.htm.
53 Alan Blinder, “On the Measurability of Offshorability” Vox, Oct. 9, 2009. Available at: http://voxeu.org/article/twenty-five-percent-us-jobs-are-offshorable.
54 Alan Blinder and Alan Krueger, “Alternative Measures of Offshorability: A Survey Approach,” Princeton University Center for Economic Policy Studies Working Paper No. 190, August 2009.
55 Jared Bernstein, James Lin, Lawrence Mishel, “The Characteristics of Offshorable Jobs,” EPI Report, November 2007, at 3.
56 Lori Wallach, Fiona Wright and Chris Slevin, “Addressing the Regulatory Vacuum: Policy Considerations Regarding Public and Private Sector Service Job Off-shoring,” Public Citizen, June 2004.
57 Henri Capron and Olivier Debande, “The Role of the Manufacturing Base in the Development of Private and Public Services,” Regional Studies, 31:7, October 1997, at 681. For an overview of these issues, see Adam Hersh and Christian Weller, “Does Manufacturing Matter?” Challenge, 46: 2, March-April 2003.
58 Corliss Lentz, “Why Some Communities Pay More Than Others? The Example of Illinois Teachers,” Public Administration Review, 58:2, March-April 1998. This study shows that high levels of manufacturing employment are associated with higher starting salaries for public school educators.
59 David Brady and Michael Wallace, “Deindustrialization and Poverty: Manufacturing Decline and AFDC Recipiency in Lake County, Indiana, 1964-93,” Sociological Forum, 2001.
60 Robert Forrant, “Greater Springfield Deindustrialization: Staggering Job Loss, A Shrinking Revenue Base, and Grinding Decline,” U of Massachusetts-Lowell Paper, April 2005.
61 See http://www.citizen.org/trade/subfederal/services/ for more detail.
62 Todd Tucker, “Proposed Trans-Pacific Partnership Rules Could Undermine Medicare, Medicaid and Veterans’ Health, Hurting Seniors, Military Families and the Poor,” Public Citizen memo, June 14, 2012. Available at: http://www.citizen.org/documents/memo-tpp-drug-price-06-14-12.pdf.
63 48 CFR 25.402
64 Michael Kremer and Eric Maskin, “Globalization and Inequality,” unpublished paper, October 2006.
65 The percentage has rebounded somewhat since 2000, but remains below 1.5 percent. United Nations Conference on Trade and Development, Least Developed Countries Report, 2011, at 30-32. Available at: http://unctad.org/en/Docs/ldc2011_en.pdf.
66 Credit Suisse Research Institute, “Global Wealth Report 2012,” October 2012, at 13. Available at: http://economics.uwo.ca/news/Davies_CreditSuisse_Oct12.pdf.
67 Projected losers include Bangladesh, Mexico, Vietnam, the Middle East & North Africa, and most of Sub-Saharan Africa, Central Asia and Eastern Europe. See Kym Anderson and Will Martin, et. al., Agricultural Trade Reform and the Doha Development Agenda, (Washington, D.C.: World Bank, 2005), at 370-371.
68 Nina Pavcnik, “Globalization and Within-Country Income Inequality,” Making Globalization Socially Sustainable, World Trade Organization and International Labor Organization, 2011, 233-259.
69 United Nations Conference on Trade and Development, Trade and Development Report, 1997, at V.
70 Growth rates from 2000 to 2010 improved somewhat from the 1980-2000 period, but still proved lackluster in comparison to the pre-Fast Track era. Mark Weisbrot and Rebecca Ray, “The Scorecard on Development, 1960-2010: Closing the Gap?” Center for Economic and Policy Research, April 2011. Available at: http://www.cepr.net/documents/publications/scorecard-2011-04.pdf.
71 Mark Weisbrot, Dean Baker and David Rosnick, “Scorecard on Development: 25 Years of Diminished Progress,” CEPR Paper, September 2006.
72 “U.S.-Latin America Relations: A New Direction for a New Reality,” Council on Foreign Relations Report 60, May 2008; Michael Shifter, “In Search of Hugo Chávez,” Foreign Affairs, May / June 2006.
73 World Bank, “DataBank,” accessed December 2012. Available at: http://databank.worldbank.org.
74 Haiti provides one example. While the country produced most of its own food staples during the 1980’s, under IMF-pushed agricultural trade liberalization during the 1990’s, Haiti became dependent on imports for 70 percent of consumed rice, the country’s primary staple. The international price of rice doubled in a matter of weeks in 2008, and ensuing food riots soon ousted the prime minister. For more details, see Reed Lindsay, “Haiti on the Death Plan,” The Nation, May 15, 2008. Available at: http://www.thenation.com/article/haiti-death-plan.
75 Food and Agriculture Organization, “1.02 Billion People Hungry,” June 19, 2009. Available at: http://www.fao.org/news/story/0/item/20568/icode/en/.
76 John B. Judis, “Trade Secrets,” The New Republic, April 9, 2008. See also John Audley, Sandra Polaski, Demetrios G. Papademetriou, and Scott Vaughan, “NAFTA’s Promise and Reality: Lessons from Mexico for the Hemisphere,” Carnegie Endowment for International Peace Report, November 2003; Jeffrey S. Passel and Roberto Suro, “Rise, Peak and Decline: Trends in U.S. Immigration 1992 – 2004,” September 2005, Pew Hispanic Center, at 39; Robert Kuttner, “Foolish supporters vastly inflate the meaning of NAFTA,” Baltimore Sun, Oct. 29, 1993.
77 Weisbrot, Baker and Rosnick 2006.
78 Mark Weisbrot, Rebecca Ray, “The Scorecard on Development, 1960-2010: Closing the Gap?” CEPR Paper, Apr. 2011.
79 Todd Tucker, “The Uses of Chile,” Public Citizen Report, September 2006.