Meridian 5: Realigning U.S. Trade Priorities

On March 12, 2021 the Meridian Corporate Council partnered with Merck to host a virtual conversation with Chief Trade Counsel Alexandra Whittaker of the House Committee on Ways and Means and Subcommittee on Trade, for a discussion on Congressional Democrats’ trade priorities in 2021. In her remarks, she focused on the current U.S. engagement with the WTO and provided an update on the free trade negotiations currently in process.

Below are the top takeaways from the conversation:

INCREASING INCLUSIVITY AND EQUITY IN TRADE

Average Americans are less likely to feel the benefits from trade policy, suggested Ms. Whittaker, as she emphasized that Congressional Democrats are committed to examining the intersection between trade and equity. Many in the trade space understand the positive aspects of global trade, as in an increased GDP and market access for U.S. companies. However, that message does not translate to the American public who struggle to find the tangible economic outcomes of trade. Congressional Democrats, along with the Biden Administration, are working to rectify those discrepancies and are focusing on inclusivity and equity in their trade policy agenda and beyond. For example, on March 4th, House Ways & Means Committee Chairman Richard E. Neal (D-MA) announced the creation of the Racial Equity Initiative (REI), a working group geared towards addressing the role of racism in both health and economic disparities. Congressional Democrats are using a whole-of-government approach for correcting inequities in America and revamping trade policies is just one approach.

ENACTING A VALUES-BASED TRADE AGENDA

Congressional Democrats want to promote a values-based trade agenda in which the U.S.’ collective values on human rights, anti-corruption, environment, and rule of law are included in trade legislation.. Ms. Whittaker mentioned the expiration of the Generalized System of Preferences (GSP) as a prime example where Congressional Democrats tried to include provisions on human rights, rule of law, and anti-corruption as a criteria for countries to receive GSP status. When reviewing GSP, as well as the other ongoing trade negotiations, Ms. Whittaker assured the Corporate Council that American values will be honored in those trade talks so as to improve the lives of the American people and promote U.S. values abroad.

IMPLEMENTING WORKER-CENTRIC TRADE POLICIES

House Democrats are aligned with the Biden Administration on developing worker-centric trade policies. This was evident during the USMCA negotiations when House Democrats fought to raise the standards in the Labor Chapter to ensure that the trade deal was beneficial for both consumers and workers. Ms. Whittaker further explained that House Democrats are also looking at more traditional trade enforcement tools, such as tariffs, to enforce labor and environment provisions with trading partners. Additionally, Trade Adjustment Assistance (TAA), a program aimed to help displaced workers as a result to offshoring, also has faced some challenges under its current state, reference Ms. Whittaker. She and House Democrats are keen to make adjustments to TAA which should preemptively address some of the concerns faced by workers in that program.

UPHOLDING ENFORCEMENT MECHANISMS

Congressional Democrats are looking to use existing trade rules to ensure that U.S. trade partners uphold their trading obligations. Ms. Whittaker hopes to include robust enforcement mechanisms on future trade agreements, which is an important priority for both Congressional Democrats and Republicans, to ensure trading partners adhere to commitments on free and fair market access, among other issues. Sound enforcement in both bilateral and multilateral agreements continues to be a bipartisan issue and Ms. Whittaker hopes to work alongside partners both domestic and abroad to address these practices.

CONTINUING THE PUSH FOR WTO REFORM

Ms. Whittaker expressed her enthusiasm about collaborating with the WTO’s newly elected Director-General Ngozi Okonjo-Iweala on creative solutions to internal issues at the WTO. Holding trading partners accountable to fulfill their basic requirements is a necessity and has been a longstanding bicameral and bipartisan priority for years. The U.S. has had substantial concerns with the WTO system and will continue to work with likeminded partners on reforming the Appellate Body (AB) so it does not overreach but instead, operate to address unfair trading practices.   Furthermore, while the WTO has traditionally been used to navigate trade disputes, Ms. Whittaker hopes to utilize the multilateral organization to address positive changes such as that with women economic empowerment and environmental trade issues.