WASHINGTON U.S. Trade Representative Ron Kirk said on Tuesday he was optimistic a deal could be struck with Republicans clearing the way for Congress to pass free trade pacts with South Korea, Colombia and Panama after lawmakers return in September from a month-long recess.
President Barack Obama had hoped to win approval of the three agreements before the August break but Republicans balked at a White House plan to include an extension of the Trade Adjustment Assistance (TAA) program for displaced U.S. workers in the implementing legislation for the South Korea pact.
"We believe we have a framework for an agreement that will allow us very quickly when Congress reconvenes in September to approve and have a vote on Trade Adjustment Assistance and allow us to move forward with passage of the free trade agreements at the same time," Kirk said in a speech.
Kirk said the Obama administration had been working with congressional leaders in both parties to find a path forward on TAA and the trade pacts, telling reporters after the speech there were still a few more details to nail down.
"What's still needed is a final commitment by congressional leaders to a process that will move all three agreements and TAA," a second USTR official said.
Republicans have demanded a separate vote on TAA, which provides retraining and income assistance for workers who lost jobs due to trade. While some party members support the program, many others elected last year on promises to cut government spending question its cost and effectiveness.
Senate Republican Leader Mitch McConnell welcomed the administration's willingness to separate TAA from the South Korea pact as "an important step" and urged Obama to submit the trade deals to Congress before lawmakers leave town.
"Now that we all seem to agree the FTAs (free trade agreements) will be free from extraneous spending programs, I renew my call for the administration to immediately send up these job-creating agreements. Even if Congress can't act on all three before the recess, it will send a positive signal to the world that the U.S. is committed to the cause of global trade," McConnell said in a statement.
Democrats argue the nearly 50-year-old TAA program is a vital part of the U.S. social safety net and fear it could be killed if not shielded by the South Korea pact.
The White House has insisted on renewal of TAA in conjunction with the trade pacts, but did agree on a package of reforms to scale back the program from levels approved in the 2009 economic stimulus bill.
Congress would have to move quickly to approve all three trade deals in September. If the White House insists Congress approve TAA before submitting the trade deals, that could slow down the process, depending on how long that debate lasts.
McConnell repeated a promise to work with Senate Majority Leader Harry Reid "to find a fair and workable path for floor consideration of Trade Adjustment Assistance."
McConnell also has pressed for a separate vote on Trade Promotion Authority, which would give the White House authority to negotiate new trade deals it could present to Congress for straight yes-or-no votes.
"We're still working with the leadership to come up with the kind of specifics of how we'd sequence that," Kirk said.
But the proposed framework "would allow us to get a vote on TAA," provide McConnell a chance to make his case for Trade Promotion Authority and "give us a chance to move" the free trade agreements, he added.
Kirk also said the chances of a successful conclusion of the long-running Doha round of world trade talks were "looking less and less likely."
But he said the United States would work with other World Trade Organization members to chart a way forward for the talks.
Earlier on Tuesday, WTO Director General Pascal Lamy recommended members abandon an effort to reach a mini-Doha deal aimed primarily at helping the world's poorest countries by the end of the year.
Lamy said there was no consensus on what should be included in that package, which was intended to be a down payment toward a long-hoped-for bigger Doha round agreement covering areas such as agriculture, manufacturing and services.
(Reporting by Doug Palmer; Editing by Eric Walsh)