Election Outcome Could Stall Trade Talks

The Bush administration's success in passing trade agreements could end if Democrats win the House.

Several pending free-trade agreements could hinge on which party controls Congress after the midterm elections. That's because a Democrat-controlled Congress is less likely to renew President Bush's trade promotion authority (TPA), which grants the president the power to negotiate free-trade agreements that Congress can approve or deny but not amend. The president's TPA expires in July of 2007.

"Other nations insist on this arrangement if they are going to negotiate free trade with the United States, otherwise after painstaking trade negotiations Congress could make whatever changes it wishes," says Anita Epstein, Washington, D.C.-based senior government relations adviser for business and technology law firm Pillsbury Winthrop Shaw Pittman LLP.

The Bush administration has been pushing to complete free-trade negotiations with South Korea and to grant permanent normal trade relations with Vietnam before the TPA expires. Other countries with trade pacts in the works include Malaysia, Peru and Columbia.

Deputy U.S. Trade Representative Karan Bhatia said he believes these trade deals could get passed before the TPA expires next summer, according to the Los Angeles Times. But Epstein says a Democratic victory in Congress will make a hard task even more difficult. "Even if they don't win, there's going to be a serious question about whether you're going to be able to negotiate free-trade agreements," she says. "I also think that would make the WTO talks even harder, although that's kind of laying on the death bed right now."

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