“NO” on the Trade Act of 2015 (H.R. 1314)

On Friday, the House plans to vote on Trade Act of 2015 (H.R. 1314).

Last month, Heritage Action said it was “incumbent upon House conservatives to use their leverage on TPA to extract ironclad public commitments” from Republican leaders in the House and Senate that the Export-Import Bank would not be reauthorized.  Instead of working to kill the bank, one Republican lawmaker said House Speaker John Boehner (R-OH) has “given assurances to outside groups that he’s in support of it and that we’ll see a vote.”

Absent ironclad public commitments from Boehner and Sen. Mitch McConnell (R-KY) 40% that the Export-Import Bank will not be reauthorized, Heritage Action will key vote against H.R. 1314.  The bill combines President Obama’s request for fast track authority or Trade Promotion Authority (TPA) with a stimulus-level extension of the Trade Adjustment Assistance (TAA) program and, as mentioned above, has become inextricably linked to the passage of the Export-Import Bank.

Free trade benefits the economy and all Americans.  Congress should not shy away from promoting free trade at every opportunity.  However, The Heritage Foundation’s Ambassador Terry Miller says this particular “TPA has gotten bogged down in the politics of protectionism and welfare spending.” 

Traditionally, TPA has been instituted at the front end of trade negotiations so that Congress can engage in and steer those negotiations. Also, TPA has traditionally been useful for pro-free trade Presidents to push free trade agreements (FTAs) through protectionist Congresses. Neither of these are facts in the current environment, limiting the utility of this TPA.

Current and previous Heritage presidents Jim DeMint and Ed Feulner, respectively, explained last month:

Trade Promotion Authority should be considered on its own merits, and good conservatives can disagree on whether the current draft of TPA is appropriate. However, all conservatives should agree that it should not be tied to Trade Adjustment Assistance, an expensive and ineffective program.

Now that it’s done, Trade Promotion Authority in its current form doesn’t deserve passage. A free trade deal worth making can and should be passed on its own, without throwing a bone to those who would waste our tax dollars.

Heritage’s David B. Muhlhausen, Ph.D. and James Sherk explain TAA is an ineffective and wasteful program funded by gimmicks:

Ineffective. Mathematica concluded that TAA financially hurt both its participants and society overall. A cost-benefit analysis found that the net benefit to society of TAA was a negative $53,802 per participant. 

Wasteful. Companies qualify for TAA by showing that they have laid off workers while imports of a “like” product have increased. Foreign trade need not be the primary reason that the company laid off workers—only an “important” contribution to it.

Gimmicks. Aside from budget gimmicks, these bills also lack any fiscal responsibility. They demonstrate the typical spend-now-pay-later Washington status quo.

Heritage Action has always been a free trade organization, but free-market conservatives are understandably split on this president’s request for fast track authority.  Including an egregiously ineffective welfare program in a bill intended to promote trade and promising a clear path forward on the Export-Import Bank, which is the antithesis of free trade, only exacerbates those concerns.  The Trade Act of 2015 (H.R. 1314) is no longer a bill intended to advance free trade — it has become a special interest boondoggle that deserves defeat.

Heritage Action opposes H.R. 1314 and will include it as a key vote on our legislative scorecard.