Executive Memorandum- Heritage's Executive Memoranda gives Congressional staff and researchers the policy information they need to act and to make educated decisions.
August 26, 1998
On September 24, the House of Representatives will
vote on a bill to renew President Bill Clinton's fast-track
authority to negotiate trade agreements with other countries. Since
1974, Presidents have used fast-track authority to negotiate trade
agreements that reduced foreign taxes on American exports and
provided American consumers with a broad selection of goods and
services at competitive prices. President Clinton, however, has
been without fast track since 1994.
Protectionists claim that the American
people do not support renewal of fast track. In fact, a recent
survey of U.S. public opinion on international trade found that 59
percent of Americans support free trade agreements with other
countries and only 26 percent disapprove. Moreover, 83 percent know
little about fast-track authority, but 41 percent to 48 percent
oppose its renewal.
These opinion surveys suggest that much of
the popular reluctance to support the renewal of fast-track
authority may be due to a lack of familiarity with the issue. Most
Americans support free trade agreements with other countries
because they know that trade liberalization benefits them directly.
But before deciding whether to support or oppose fast track, they
want to know what it is and how it will be used.
Fast-track authority is not a
Fast track is an important and effective procedural tool
that allows the President to negotiate and implement agreements
with other countries to lower foreign trade barriers, open markets,
and rebalance trade relationships on more reciprocal terms.
Fast track does not dilute the
power of Congress to regulate trade
Under fast-track authority, trade agreements are submitted
to Congress for an up or down vote under rules barring committee or
floor amendments. Fast track does not give the President a blank
check to negotiate trade agreements, nor does it undermine the
constitutional prerogatives of Congress, which defines the
objectives and limits of the President's negotiating authority in
the legislation granting fast track. During any trade talks, the
Administration must consult frequently with the House Ways and
Means Committee, the Senate Finance Committee, and special advisers
designated by Congress. Only Congress has the final say on any
trade agreement negotiated by the President.
Fast track is not new
Congress created fast-track authority in 1974 to allow
U.S. Presidents to negotiate agreements reducing foreign tariff and
non-tariff barriers (NTBs) on American exports of merchandise goods
and services. NTBs are government measures other than tariffs--such
as import quotas, product standards, sanitary and phytosanitary
rules, and subsidies--that impede or distort the flow of
international commerce. In 1999, a new round of agriculture
liberalization talks will start at the World Trade Organization
(WTO). Without fast-track authority, the United States will not be
an active participant in discussions that could affect the American
farmer for decades.
Fast track is a bipartisan
The Trade Act of 1974, which created fast track, was
approved in the House of Representatives by a vote of 323 to 36.
Fast track was renewed in 1979 by a margin of 395 to 7; in 1988, by
376 to 45 votes; and in 1993, by 295 to 126 votes. The extension in
1993 was for the purpose of completing the Uruguay Round trade
negotiations under the General Agreement on Tariffs and Trade
(GATT) and moving the North American Free Trade Agreement (NAFTA)
and WTO implementing legislation through Congress. This residual
fast-track authority expired after Congress approved the Uruguay
Round Agreements in November 1994.
Fast track produces successful
Since 1974, U.S. Presidents from both political parties
have used fast-track authority to negotiate and implement (1) the
Tokyo Round of the GATT in 1979, (2) the U.S.-Israel Free Trade
Agreement in 1985, (3) the U.S.-Canada Free Trade Agreement in
1988, (4) the NAFTA in 1993, and (5) the Uruguay Round Agreements
in 1994 that replaced the GATT with the WTO.
Fast track enhances America's
Fast track gives the President the ability to exercise
international leadership in trade. If the President cannot wield
fast-track authority, no country will initiate serious trade
negotiations with the United States. Fast track guarantees that
trade accords negotiated in good faith with the President will not
be changed later by Congress.
Fast track makes the American
The free trade agreements achieved under fast-track
authority have produced tangible benefits for the American economy.
Now in its eighth consecutive year of economic expansion, the
United States is the world's largest exporter and importer of
merchandise goods and services, and the largest manufacturer of
sophisticated semiconductors, automobiles, and software. The United
States reports the highest productivity and competitiveness of any
economy in the world, creates more jobs each year than any other
industrialized economy, and accounts for 25 percent of all global
foreign investment each year. In 1997, two-way U.S. trade with the
world--defined by the Clinton Administration as trade in goods and
services plus earnings on U.S. foreign investment abroad--totaled
$2.3 trillion, or 30 percent of gross domestic product (GDP),
compared with only 13 percent of GDP in 1970.
lack of fast-track negotiating authority is the single most
important factor limiting the capacity of the United States to
access foreign markets, expand exports and investments overseas,
and sustain the dynamic performance of the economy at home.
Increasingly, major trade agreements have been negotiated without
U.S. participation, particularly in Latin America and Asia,
creating exclusive commercial alliances that hurt U.S. interests.
Renewal of the President's fast-track negotiating authority would
tell other countries that the United States stands united in
pursuit of free trade agreements that advance American economic
interests and values.
John Sweeney is Policy Analyst for Latin
America and Trade Issues in The Kathryn and Shelby Cullom Davis
International Studies Center at The Heritage Foundation.
Fast Track Negotiating Authority: The Facts
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