Proponents of the 12-nation Trans-Pacific Partnership are spinning trade ministers’ inability to finalize a deal last weekend as an indication that the end is actually at hand. But they concede that if the pact collapses, so does President Obama’s trade legacy and pivot to Asia.
“I think a lot of progress was made at the last round of talks,” Secretary of State John Kerry said during an official visit to Vietnam on Friday. “And I think we are hoping very much that over the course of the next couple of months, before the end of the year, TPP can be completed.”
David Dollar, a Brookings Institution senior fellow and trade and China expert, said that negotiations in Hawaii between U.S. Trade Rep. Michael Froman and ministers from 11 Pacific Rim nations likely ended last weekend without a final deal because the compromises necessary to resolve the remaining issues need to be decided at the presidential and prime ministerial level.
Matters “are not as bleak as they look,” Dollar said.
Outstanding sections detail treatment of goods such as autos, textiles, dairy products and prescription drugs. That means that not only do final decisions have to be made above trade negotiators’ pay grades, but that leaders of major domestic industries need to be consulted as well, Dollar said.
Obama “set a pretty high bar for what’s acceptable to him when it comes to a final TPP agreement that he’s willing to sign on to,” White House spokesman Josh Earnest said on Tuesday. “And that means that our negotiators … are driving a pretty hard bargain.
“So it’s not particularly surprising to me that efforts to reach a final agreement are taking a little bit more time than originally expected,” Earnest added.
Responding to the drubbing Obama’s nuclear pact with Iran is taking on Capitol Hill, the administration and its allies are framing the delay as necessary to getting the best possible deal for America.
“Given the sensitivity of the remaining issues, it’s important to take more time to get it right than to rush something to conclusion and make it more difficult to get the support of Congress,” Obama’s trade point man in the House, Rep. Ron Kind, D-Wis., said.
Negotiators also face a series of U.S. timetables that make wrapping up quickly essential if Obama is to be the president who inks the deal.
After making the final agreement public, Obama has to wait 60 days before he can sign it. Then Congress has to schedule ratification votes within 90 days. The Iowa caucuses are Feb. 1. If Congress has not voted by then, TPP becomes a presidential campaign issue, which spills into congressional elections and could scare off the Democratic votes Obama needs.
Dollar said that a final deal is still obtainable by that artificial deadline.
The White House and Republican leaders on Capitol Hill want to get this done, he said. Talks could still wrap up in time for Obama to sign the pact during the Asia-Pacific Economic Cooperation meeting in mid-November. And then nothing in the trade promotion law governing the process requires Congress to wait 90 days to vote, he stressed.
House Ways and Means Chairman Paul Ryan, R-Wis., who authored TPA and has made securing TPP as much a part of his legacy as Obama’s, said he is optimistic they can get the pact, that would set trading rules for 40 percent of the world’s economy, over the finish line.
“But the negotiations have not yet reached an agreement that meets the high standards set in TPA,” he said. “So I support Ambassador Froman’s decision to continue negotiations until we get the best deal for American workers, farmers and families.”
Before leaving Maui with unfinished business, negotiators issued a joint statement claiming progress and sounding an optimistic tone that their work is almost done.
“In this last stage of negotiations, we are more confident than ever that TPP is within reach and will support jobs and economic growth,” the statement read.
Dollar said that if the deal collapses, it will stop Obama’s “pivot” to Asia mid-turn.
Despite inking new security agreements in the region and winning a free trade pact with South Korea, trade, TPP is “really the centerpiece to the pivot,” Dollar said.
“There’s been a lot of effort by quite a few countries,” Dollar said. “If it all falls apart now, it’s a diplomatic loss; it’s a significant loss for the United States,” Dollar said.
The White House says it is focused on boosting the U.S. economy, not Obama’s presidential achievements.
Obama “is much less worried about his legacy and much more worried about the impact of what a good trade agreement would have on the country,” Earnest said.
The U.S. is negotiating TPP with Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
