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Rethinking Trade - Season 1 Episode 21: China Phase 2

Rethinking Trade - Season 1 Episode 20: Fast Track

The most damaging U.S. trade agreements were hatched using the same process: “Fast Track.” Fast Track empowers the executive branch to unilaterally select partner countries for trade deals, decide their contents, and negotiate and sign them – all before Congress gets to vote on the matter. 

Meanwhile, hundreds of official U.S. trade advisors representing corporate interests have special access to texts and negotiators. Under Fast Track, when Congress finally has a say, it is limited to a “yes” or “no” vote with limited debate and amendments forbidden. 

The result? Wide swathes of U.S. law and policy entirely unrelated to trade get rewritten with the public and Congress locked out, and the U.S. is locked into corporate-rigged agreements with trade sanctions imposed on us if Big Pharma does not get special protections, food imports that do not meet U.S. safety standards are prohibited or foreign investors do not get better treatment when they offshore investment. 

But there’s good news: Fast Track only exists if Congress grants it. And the last grant ends on July 1st, 2021. That means soon, we will have a chance to create a new process with the public and congress playings the lead role in the formative stages of trade deals with more accountability over trade negotiations.

Transcribed by Garrett O’Brien

Ryan: Welcome back to Rethinking Trade, where we don’t just talk about trade policy, we fight to change it. I’m Ryan, and I’m joined once again by our in-house trade expert Lori Wallach.

Lori, all of the most damaging trade deals of recent years have happened under a system called fast track. Fast track allows the executive branch to unilaterally select partner countries for trade deals, decide the agreement's contents, and then negotiate and sign them all before Congress gets to vote on the matter. You literally wrote the book on fast track, or rather the book exposing and opposing it. Can you tell us what fast track is exactly, and why it is such a big deal for those looking to transform our current corporate-rigged trade policies?

Lori: So, Fast Track Trade Authority is kind of the root of all evil of how we’ve gotten into this disaster of corporate rigged trade agreements. So, I want to take a step way back to the founding of the country. The United States was created in part because of a trade war. Which is to say the Boston Tea Party everyone learns about in grade school involved tariffs, taxes on imports on tea and other goods imposed by the King of England against the colonies because he wanted to raise money to finance his war with France, imposed in way that really messed with people’s lives and they went “that was the last straw” – they wanted a rebellion. And when the Founders wrote the Constitution they were steeped, pun intended, in that example. So they gave exclusive constitutional authority over trade to the United States Congress, with the logic that this was the body closest to the people and they didn’t want the same scenario as with the king, the president, being able to unilaterally impose terms of trade that were not in the national interest or moreover favored some foreign entanglement over what would be good for workers and businesses and consumers in the country. And so, Article 1 (8) of the U.S. Constitution is one of the starkest, most clean checks and balances. It makes clear that Congress has exclusive authority over tariff levels but also setting the terms of commerce between the nations. And separately the Constitution gives the Executive branch exclusive authority to negotiate with foreign sovereigns. So, to negotiate a trade agreement, Congress sets the terms and then the Executive branch is supposed to go out and negotiate it. And in the history of the country there were different ways that those authorities were coordinated, typically Congress calling the shots and the Executive branch doing the negotiations. 

Enter Richard Nixon. Now here’s a shocker, he wanted to consolidate more power in his control. So, he proposed a new trade authority that would consolidate, really, Congress’ trade authority but moreover piece of Congress’ core function, legislating, under the president’s right to proclaim changes to U.S. laws after setting terms in negotiations with foreign countries in the context of trade. 

Now if this sounds like a form of, if you will, diplomatic legislating, where Congress gets put in a deep freeze and one president and his or her trade negotiators are suddenly both setting the terms of international commerce and rewriting wide swathes of U.S. law – BINGO! That’s exactly what it is. Now, ultimately Congress said ‘no it's not constitutional to simply have the president dictating changes to US law; and the deal they settled on, on which Congress got the short end of the stick, was the Fast Track Authority which for the first time in the history of the country allowed U.S. trade negotiators new authorities to start writing in trade agreements policies and things like procurement and product safety standards and worker safety standards and food standards. And then in 1988, Ronald Reagan took what was Nixon’s initial incursion into diplomatic legislating and made it a deregulation corporate power tool by expanding the areas that trade negotiators could set rules binding on the US Congress and all the state legislatures to also service sector regulations, everything from education and healthcare to energy and transport, intellectual property so what length of patents for big pharma or whether textbooks copyrights would make education more expensive. And effectively, suddenly, our trade agreements went from being about trade, thanks to Fast Track, into being kind of slow-motion coup d'états.

Ryan: Under the Fast Track system, when a trade deal is created, just remind us again, Congress literally doesn’t have a say in it until it comes to the floor for a vote and even then they can’t edit it, correct?

Lori: So, the way Tast Track works is hard to even fathom. Effectively when Congress passes fast track, they have set a five-year or ten-year term where they have created effectively a Fast Track factory, and in that factory, they hand the keys over... as soon as that legislation is in place a president can unilaterally, number one, pick any country to negotiate with and Congress has no say, Congress can think it’s a really bad idea to have that country as a trade partner, too bad so sad you’ve thrown away any control. Number two, the Executive branch gets some negotiating objectives that are general but are like, taped up on the wall of the Fast Track factory, “here’s how it’s supposed to go” but there’s no accountability. So, the Executive branch, the president, can negotiate whatever terms it wants. Number 3, it can sign and enter into the agreement before Congress has any vote either on what country or what terms. Then number 4, and this is a shocker, the Executive branch writes legislation that is going to Congress. It is the only legislation the Executive branch writes. It is exempted from having to go to congressional committees for normal what is called a markup and it’s in review as that piece of legislation goes right into a hopper to go right to a vote. And then number five, the rules for consideration of this legislation written by the Executive branch that Congress has not had any say on what would rewrite wide swathes of US law to implement an international executive agreement to which the U.S. is bound and would face trade sanctions if they violate. That vote is preset as yes or no with no amendments, 20 hours of debate only allowed and that’s even in the Senate so there’s no filibuster, there’s no normal process. It’s a legislative luge run at the end for an agreement on the front-end Congress has had no role in for legislation that has, and can, rewrite wide swathes of legislation that has nothing to do with trade. If this hadn’t been the system that was used to pass more than a dozen really unhelpful agreements people wouldn’t believe it was possible or constitutional.

Ryan: Maybe you could talk about some of the specific historic examples and also like the Fast Track has been on your radar for a long time so maybe talk about some of the moments in which people have confronted the fast track system and tried to get rid of it.

Lori: So, here’s the good news: this is also looking forward to the fact that, yay, Fast Track in its current Fast Track factory closes its doors on July 1st 2021 there was a delegation that was passed  for six years in 2015. So, there have been long gaps as more and more members of Congress, but also the public, has realized that this is a lunatic way to make policy and it has resulted in these corporate-captured agreements that are doing a lot of damage economically for sure. But not only there has been more and more resistance by chunks of Congress to give away this authority. 

So for instance fast track lapsed for the period between 1995 and 2002 that was sort of fallout from all the badness that happened with NAFTA and the WTO and members of Congress realized. There was a knock-down drag-out Fast Track fight that got Fast Track reauthorized for a short period of time in 2002 but then that ended in 2007 and it took a knock-down drag-out fight in 2015 to pass it by very few votes and that authorization is going away. 

So now is the moment when the whole thing can be redone, and a new kind of trade authority can be created that puts a steering wheel and emergency brake on these negotiators. Because the kind of really bad stuff that has happened is, for instance, in the World Trade Organization, and the NAFTA, but mainly in the World Trade Organization agreement, one of the ways that corporate interests were able to use the broad fast track delegation was to achieve something that the big pharmaceutical corporations were trying to do for decades. So Big Pharma had been trying to get the US patent system changed. A patent is a monopoly license. For decades the US law had been that a patent lasted for 17 years. So for 17 years the maker of a medicine could have the right to set any price, to decide how much of it could be produced, to not license production to anyone else, and this system of monopoly patents on medicines and the duration of the medicine monopolies is part of why medicine prices are so high. So, people can remember say you know, ibuprofen, is now sold as Nuprin and other brands, Motrin, when that was under prescription, each tablet was the equivalent to almost $100 today. Now you can buy a whole container for $12 with 300 tablets. So that is the difference between something under monopoly license. So, 17 years is what we had, in the WTO negotiations U.S. negotiators pushed on the whole rest of the world and then basically rewrote U.S. law to 20 years of monopoly. And this is something consumer groups had worked with a variety of members of Congress to stop over and over and over for decades when Big Pharma was trying to do it in Congress, and we won. It got done through the back door of the Uruguay Round, which created the World Trade Organization. The World Trade Organization’s implementing bill passed on this legislative loser on the Fast Track, literally, just has a provision in the thousands of pages that said “strike 17 replace with 20” and that quickly U.S. patent law was written to give Big Pharma a longer monopoly to raise medicine prices by billions and there was no debate, there was no discussion, something that had been rejected in democratic processes was undone through the back door of a trade agreement  and there are scores of examples like that. For instance, we didn’t import any meat or poultry that didn’t at least meet U.S. safety standards. In the NAFTA and the WTO implementing legislation passed on Fast Track was another of these changes and again none of this stuff can be amended when it comes to Congress it just goes right through and it changed the words from “must be equal to US standards” to “must be equivalent to” and now we import an enormous amount of meat and poultry from countries whose inspection safety systems are not only not similar to ours but are diametrically opposed in key ways, for instance not having continuous inspection, not having the same risk standards, et cetera. So, these are just a handful of the examples of the really bad things that got rammed down our throat thanks to this procedure.

Ryan: And you mentioned this earlier but the current Fast Track period ends next year which means whoever wins in November will have to decide reauthorization. Are you anticipating another public fight around this?

Lori: I suspect that whomever is elected president, there will not be any trade authority immediately but there could be a fight over it. I think in Congress there is a real appetite to rethink a new model of trade authority that has Congress have a more robust role on the formative stages of trade agreements to shape what the contents are and also to have more accountability over negotiations to make clear that Congress has a role in all negotiations. But also I suspect if Biden is elected, the Biden administration is not as likely to ask for a new authority given that Biden has promised he’s not going to focus on new trade agreements but rather focus initially on trying to get U.S. policies in place to try to fix the economy and get our own house in order. If Trump is reelected, he probably will ask for Fast Track authority right away and I doubt he would get it. Not only because Congress wants to have a big rethink about it in general but also because many in Congress think the president has basically bent the rules of the current system and many in Congress are not of a mind to extend more authority. 

But there will be a big knock-down drag-out fight over that because the corporate interest that want the status quo will be wanting to see an extension of what is an incredible corporate power tool.  I mean from their perspective, it allows behind-the-borders non-trade policies to be set in a context where hundreds of corporate trade advisors have privileged access to otherwise secret documents, secret negotiations, access to negotiators while congress is left Cooling its heels. And Congress, the press, and the public are basically excluded from even seeing the documents much less than having a more fulsome role, as would be the case if these policies were made in the sunshine of democratic policies.

Ryan: Rethinking trade is produced by Public Citizen’s Global Trade Watch. I would encourage you to visit Rethinktrade.org as well as tradewatch.org to educate yourself and find out how you can get involved in work we are doing in the fight for fairer and more equitable trade policies.

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