NY Times: "Obama’s Trade Chief, Undaunted by Odds, Pushes for Trans-Pacific Partnership"

December 31, 2014


Michael Froman, the United States trade representative, is confident he can persuade Congress to approve a long-pending agreement that encompasses 12 countries.

WASHINGTON — For Michael B. Froman, President Obama’s chief evangelist for expanding global trade, skepticism comes with the territory.

[by Mark Landler and Jonathan Weisman | December 30, 2014 | NY Times]

He and his colleagues have clocked more than 1,500 meetings on Capitol Hill to promote the president’s big potential trade deal, the Trans-Pacific Partnership — and still its prospects for passage look as problematic as ever.

Even before Mr. Froman began facing a leery Congress, he had to persuade wary colleagues at the White House that it was worth pursuing. They scoffed that the original T.P.P. concept, conceived during the administration of George W. Bush, was too small, with only four Asian countries as members. And in the chaotic days of 2009, when Mr. Froman was deputy national security adviser for international economic affairs, embarking on a campaign to advance a new trade agenda seemed less important than averting a global financial collapse.

Having won over his White House colleagues and secured the backing of the president, Mr. Froman, now the United States trade representative, is convinced that he can complete negotiations on a complex trade agreement that has grown to encompass 12 countries on both sides of the Pacific, and sell it to a Congress that remains deeply hostile to Mr. Obama.

“The endgame is a long game,” Mr. Froman said in a recent interview, “but we’re in that endgame.”

At stake is a colossal trade agreement that would stretch from Peru and Chile to Japan and Vietnam, accounting for 40 percent of the world’s economic activity. It would not just lower tariffs: The pact would require rigorous regulations on labor and environmental standards, as well as the first rules for state-owned enterprises like those run by the governments of Vietnam and Malaysia.

The T.P.P. has emerged as the linchpin of Mr. Obama’s strategic shift to Asia, giving the United States a way to counter the economic inroads made in the region by a rising China. The deal is supposed to be followed by the Trans-Atlantic Trade and Investment Partnership with Europe, though those talks have much farther to go.

“If the United States succeeds in these trade negotiations, and I think we will, Mike would have forged some of the most important institutions that the president will leave as a legacy,” said Thomas E. Donilon, a former national security adviser, whom Mr. Froman served as a deputy before being named trade representative in 2013.

A California-born lawyer who has known Mr. Obama since they were classmates at Harvard Law School, Mr. Froman, 52, exudes a genial charm. But it masks a relentless drive that propelled him from senior posts in the Clinton administration to a career at Citigroup, where he earned millions of dollars before resigning to join the Obama administration.

Caroline Atkinson, his former deputy at the White House, describes his style as a “New York hand in a California glove.”

“Both bits are important,” she said, noting that Mr. Froman was willing to walk away during the 11th hour of negotiations on a trade agreement with South Korea, even though Mr. Obama was then in Seoul, to extract better terms three weeks later.

As the negotiations for T.P.P. have dragged on, missing multiple deadlines, Mr. Froman has expressed unwavering confidence in the outcome, saying the various parties are searching for “landing zones” on issues ranging from Japanese farm subsidies to Vietnamese labor regulations.

Still, to members of Congress, both for and against expanded trade agreements, Mr. Obama’s trade agenda has been waiting in the wings for so long that the promises of action are beginning to ring hollow. Efforts in the House and Senate to grant Mr. Obama trade promotion authority — once known as fast-track authority, and viewed as critical to passing major trade deals — have gone nowhere.

Mr. Froman insists the political stars have aligned. Republican control of the Senate has elevated pro-trade lawmakers to key positions in leadership and committee control, and the international negotiations themselves have progressed.

But the deal’s completion is certainly not guaranteed. Republicans inclined to give the president trade-negotiating authority are still seething at his executive action deferring deportation of millions of undocumented immigrants. Many conservatives are in no mood to give Mr. Obama anything, said Senator Rob Portman, Republican of Ohio, and a former United States trade representative in the George W. Bush administration.

Over time, Mr. Portman said, those feelings might fade, especially if the president gets personally involved. “The president blew it by moving on immigration, but we can’t let that distract us from everything else,” he said.

Democrats may be the bigger problem. Mr. Froman has met dozens of times with Representative Sander M. Levin of Michigan, the ranking Democrat on the Ways and Means Committee, which has jurisdiction on trade. And Mr. Levin said he wants to work with the administration on the T.P.P., down to the finest details.

But he said he was not about to allow Mr. Obama to negotiate the partnership on his own, then present it to Congress for an up-or-down vote with no opportunity to change it. And Mr. Levin’s stature and seniority command respect in the House Democratic Caucus.

“You’re asking members to give away their leverage on a historic trade agreement when there are major issues outstanding,” Mr. Levin said, suggesting that a vote on trade promotion authority before the presentation of a completed T.P.P. “would be a donnybrook.”

Senator Ron Wyden of Oregon, ranking Democrat on the Senate Finance Committee in the coming Congress, is one of the strongest trade advocates in Washington; he said virtually no Democrat who had supported trade promotion authority in the past would be left in the Senate next year.

“It’s going to be a big challenge,” he said.

Then there are the details. Environmental groups are doubtful the administration is really pressing for binding, enforceable standards. Peru is already resisting enforcement mechanisms to rein in illegal logging.

Trade unions worry that the administration is putting too much emphasis on protecting intellectual property, a boon to pharmaceutical companies, Hollywood and rich investors, but not particularly useful to workers at home or poor consumers abroad.

“The goal of trade is not to have more trade,” said Thea Lee, deputy chief of staff of the A.F.L.-C.I.O. “It should be to help our own needs.”

And skeptics from both parties are pressing Mr. Froman to demand enforceable limits on currency manipulation, which they say inflates the value of the dollar, making American products artificially expensive and imports artificially cheap. The result is a wider trade deficit that costs jobs at home.

About 230 House members and 60 senators have signed letters demanding enforceable sanctions on currency manipulators, the part of the negotiations that has given the White House the most pause.

Dean Baker, co-director of the Center for Economic and Policy Research and a consultant to American unions monitoring trade talks, said strong currency provisions would do more to promote middle-class manufacturing jobs than any other provisions, including lowering tariff barriers on American goods.

“The value of the dollar swamps everything else,” Mr. Baker said. “The dollar is central.”

Administration officials worry that any enforceable currency regime will cut both ways. They say it could even infringe on the Federal Reserve, making it subject to an international tribunal.

On the broader concerns of reluctant Democratic senators like Elizabeth Warren of Massachusetts, Mr. Froman pointed to the 18 cases of alleged unfair trade practices the administration has brought before the World Trade Organization, half of them against China, as proof that Mr. Obama can be trusted to watch out for the interests of American workers.

For Mr. Froman, success would cement a bond with Mr. Obama that began at law school, where both were a few years older than most of their classmates — a distinction, one recalled, that gave them a more worldly aura.

The president has mobilized virtually his entire administration to see the trade agenda through: the Interior Department to work on wildlife trafficking; Health and Human Services to work through pharmaceutical issues, especially intellectual property; the Commerce Department to reach out to businesses; Treasury to handle currency; the Labor Department to address worker rights; the Environmental Protection Agency to deal with land, water and air conservation; and the State Department to take on broader diplomacy.

Cabinet secretaries have divided up members of Congress to press them individually.

“Mike Froman, he’s wonderful,” said Representative Dave Reichert, Republican of Washington, who has formed the Friends of T.P.P. with a small, bipartisan and regionally diverse group of four representatives.

But even Mr. Reichert said all that attention from the administration was not enough. Mr. Obama has to get involved personally. The Friends of T.P.P. wrote a letter earlier this month requesting a meeting with the president, Mr. Reichert said. They have had no response.

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