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Legal Memorandum #4 on Trade and Economic Freedom

November 28, 2001

Why Trade Promotion Authority is Constitutional

By and

Congress is expected to vote soon on whether to grant trade promotion authority (TPA) to President George W. Bush. Some critics of TPA have suggested that it might compromise national sovereignty and may actually be unconstitutional. But an important aspect of national sovereignty is the right to enter into international agreements and to participate in their enforcement. Being bound by agreements, such as mutual defense treaties, does not weaken sovereign power even though it obligates nations to abide by these pacts while they are a party to them.

Another aspect of sovereignty is the right of nations to withdraw from treaties that no longer suit them, although nations do not abandon most treaties over minor disagreements or unforeseen circumstances. America's NATO allies are now in a situation they never imagined: helping patrol our skies with NATO surveillance planes. Even as they shoulder this obligation, their assistance does not diminish their sovereignty or America's in any way. In fact, the NATO Treaty still makes each nation stronger than it would be by itself.

The concern some lawmakers have expressed, that TPA would somehow diminish American sovereignty, is misplaced. If anything, the opposite is true.

Why the President Needs TPA. By granting TPA to the President, Congress agrees to take a straight up-or-down vote on trade and investment agreements the President negotiates before June 1, 2005. Congress has extended TPA to the previous five U.S. Presidents, and such authority is granted by most other nations to their heads of state. Without TPA, the President is denied an equal footing when he attempts to negotiate trade agreements on behalf of America.

It is extremely difficult for any U.S. President to negotiate significant trade deals if he cannot assure other nations that Congress will refrain from adding numerous amendments and conditions that must then be taken back to the negotiating table. Congress has not granted TPA for seven years--which is one reason why the United States is a party to only three of 131 trade and investment agreements currently in force worldwide.

The TPA legislation currently being debated (H.R. 3005) is clearly constitutional because Congress retains its authority to approve or reject all future trade agreements. It might be unconstitutional if Congress tried to delegate its authority to approve the final deal--but that is not at issue. Congress may always kill any future international agreement by withholding its final approval. The only difference under TPA is that Congress consents not to kill the agreement by amendment (i.e., the "death by a thousand cuts"). The Constitution grants each house of Congress the authority to establish its own rules of procedure, and it makes perfect sense for Congress to limit itself to straight up-or-down votes on certain resolutions, such as base closures and its own adjournment motions.

Why Sovereignty Is Not Eroded. Some critics of TPA point out that a subsequent trade deal might submit certain disputes, including labor and environmental matters, to an international body such as the World Trade Organization. This, they argue, would undermine U.S. sovereignty. It should be noted that this is not an argument against TPA legislation itself but against a future, hypothetical trade deal that might be negotiated with the aid of TPA.

Although unrelated labor and environmental conditions do not belong in trade agreements, TPA legislation should not attempt to mandate or prohibit them outright. Under well-established constitutional rulings, it would raise serious constitutional concerns for Congress to try to mandate the President's negotiating positions. Moreover, some Members of Congress want to require labor and environmental protections in all future trade agreements, and others want to prohibit them in any future agreement. The President must be sensitive to these conflicting sentiments when he negotiates future trade deals if he wants congressional approval. TPA would assist him in trying to reconcile these conflicting desires. If he cannot negotiate agreements that satisfy both houses of Congress (as the TPA legislation requires), nothing will have been lost in granting him enhanced negotiating authority. But no one benefits if potentially satisfactory trade negotiations are strangled in the crib.

Future trade deals would not be unconstitutional, nor would they undermine U.S. sovereignty, if they contained an agreement to submit some disputes to an international tribunal for an initial determination. The United States will always have the ultimate say over what its domestic laws provide. No future agreement could grant an international organization the power to change U.S. laws.

A ruling by an international tribunal that calls a U.S. law into question would have no domestic effect unless Congress changes the law to comply with the ruling. If Congress rejects a ruling or fails to act, other countries might impose a trade sanction or tariff, but they are more likely to impose high tariffs now without any agreement. The fact remains that no international body or foreign government may change any American law. Moreover, Congress may override an entire agreement at any time by a simple statute. Nations also may withdraw from international agreements by executive action alone. That is one reason why such agreements do not interfere with the underlying sovereignty of each nation to chart its own course in the world. In short, the U.S. Constitution and any laws and treaties we enact in accordance thereto are the only supreme law of our land.

Finally, while labor and environmental conditions generally should not be a part of trade and investment agreements, submitting these issues to an international tribunal for an initial ruling is no different (constitutionally) from submitting any other type of dispute to such a body. Many important multinational agreements provide for disputes to be submitted to an international tribunal for its determination. Congress and past Presidents have concluded that these tribunals are effective overall in eliminating unfair trade practices that hurt American producers and consumers.

Conclusion. Whether a given trade agreement should include labor or environmental provisions or should provide for disputes to be heard by an international organization are questions of policy. Agreements that include such provisions are not unconstitutional and do not diminish national sovereignty. The only action that will weaken overall U.S. sovereignty is for Congress to hobble the President's ability to negotiate trade deals with other nations by denying him enhanced trade promotion authority.

--Edwin Meese III is the Chairman and Todd Gaziano is the Director of the Center for Legal and Judicial Studies at The Heritage Foundation.

Nothing written here is to be construed as legal advice on any matter, as an attempt to create an attorney-client relationship, or as an attempt to aid or hinder the passage of any matter pending before Congress.

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