The path to ratification by Congress was greased after President Obama renegotiated trade treaties with South Korea, Colombia, and Panama. Obama would supply Democratic votes. Republicans were already on board, President Bush having put together the treaties in the first place. It had the look of a done deal.
It wasn’t. In May, the White House suddenly insisted the treaties be accompanied by roughly $1 billion in Trade Adjustment Assistance, or TAA as it’s known in Washington. Organized labor was demanding TAA funds be set aside for workers whose jobs might be lost as a result of the treaties. Obama took up the cause.
That wasn’t the last of labor’s demands. A month ago, labor officials said TAA had to be part of the trade agreements themselves. Again, Obama went along. This was unprecedented. Spending legislation had never been included in trade bills. Republican support instantly collapsed. It took the intervention of Senator Rob Portman of Ohio and a few other Republicans to get things back on track by stripping TAA from the treaties. Separate votes on the three pacts and TAA are likely in September. But don’t hold your breath.
There’s a pattern here that’s become emblematic of the Obama presidency. A mark of a strong president is the capability to act decisively in his own behalf, especially when his political interest coincides with the country’s. Obama lacks that trait. More often than not, he’s indecisive, particularly when liberal special interests exert pressure on him.
It’s happened on the long-delayed approval of a new oil pipeline from Canada and in the president’s negotiations with congressional Republicans on raising the debt limit. In both those cases, as with the trade agreements, Obama put an important initiative in jeopardy, at least temporarily, to assuage or accommodate interest groups.
The trade treaties represent a twofer for Obama. By itself, ratification would be a significant achievement. The U.S. Chamber of Commerce estimates the treaties would produce 380,000 American jobs. The Obama administration puts the figure at 250,000. It’s unclear whether any jobs at all would be lost. Yet the president balked.
By championing the treaties, the president would demonstrate his willingness to dismiss labor’s demands when they clash with the national interest. Not only would the economy get a boost, but relations with South Korea, Colombia, and Panama would be strengthened.
The Keystone XL pipeline from the oil sands in Canada to refineries on the Gulf Coast is another win-win issue for Obama, if only he’d embrace it. Canada is America’s leading foreign supplier of oil. The more Canada exports to the United States, the less we’re forced to rely on unfriendly folks in the Middle East and on Latin American countries (Mexico, Venezuela) whose oil production is declining. With the new pipeline, Canada would increase its exports by as much as 700,000 barrels a day. (The United States consumes 10-11 million barrels daily.)
A permit to build the pipeline was requested nearly three years ago by TransCanada. Because it would cross an international border, approval must be granted by the State Department. This was expected to be a snap, particularly after gasoline prices reached $4 a gallon. White House aides thought so, and Secretary of State Hillary Clinton indicated she was ready to approve it.
Then the environmental lobby, led by the Natural Resources Defense Council, began a campaign against approval, and the Environmental Protection Agency joined in. It criticized the State Department’s first environmental impact statement, which found the pipeline would have little effect on the environment. Clinton buckled, and a second impact statement was ordered. Last month, EPA said the new study was “inadequate.”
Besides oil, the Keystone project would create 20,000 jobs directly and 118,000 “spin off” jobs, according to TransCanada, and invest $20 billion in the American economy. Even if those projections are exaggerated, it’s clear the pipeline would be an economic boon. TransCanada has also signed building contracts with four labor unions.
So one might think that Obama would be eager to break the logjam and take credit for standing up to an interest group he’s normally allied with. His statement practically writes itself: “Today, I have moved to increase oil imports from our neighbor Canada. This will lower gasoline prices at the pump, increase our energy security, reduce our dependence on unreliable and unfriendly oil-producing countries, and create tens of thousands of jobs here in America.”