Economy & Business

Why Congress Must Give Obama Fast-Track Authority on the TPP

Loading up at the port of Seattle

Japanese prime minister Shinzo Abe is visiting America. And the prospective Trans-Pacific Partnership (TPP) free-trade agreement is at the top of his agenda. But Abe has a problem.

Before taking on powerful domestic interests — such as the Japanese agricultural lobby — and opening Japan’s protectionist economy to foreign competition, Abe wants assurances that the U.S. Congress won’t add last-minute amendments to the TPP. Other TPP partners share that concern. And for that reason, President Obama is pushing Congress for “fast track” negotiating authority and an amendment-free final vote.

President Obama deserves fast-track power. The TPP’s merits are obvious and undeniable. It’s economics 101. In the 20th and early 21st centuries, capital was relatively static. Poor infrastructure, political instability, and lower living standards motivated American investors to keep their money in America rather than investing it abroad.

Today, however, the world is very different. With growing foreign markets, improved skills among foreign workers, better infrastructure, and new political stability, capital in 2015 is highly moveable. According to U.N. and U.S. government statistics, foreign direct investment (FDI) in China nearly quadrupled between 2007 and the end of 2014. In the same period, FDI more than tripled in India and more than doubled in Brazil. Contrast that record with France’s efforts, for example, to lock its capital within France’s borders. France’s is now a land of economic collapse. Moreover, moveable capital explains why, from Greece to Scotland to Venezuela, socialism’s failure is now undeniable.

Globalization has brought greater wealth and opportunity but also greater competition. America must compete — it’s unavoidable. Yet the Democratic Left, whether Senator Elizabeth Warren or ADL-CIO President Richard Trumka, is now pushing hard against TPP fast-track authority. They want to bury the final agreement in a sea of amendments. Unfortunately, hedging from congressional Democrats and Hillary Clinton shows that the leftist populists are gaining traction.

Sabotaging the TPP won’t protect American jobs and American investment; it will simply ensure a jobs exodus alongside economic decline.

Lawmakers cannot allow this to continue. Sabotaging the TPP won’t protect American jobs and American investment; it will simply ensure a jobs exodus alongside economic decline. It would be economic idiocy for America to compete in the global economy by producing goods and services at far higher costs than those of foreign competitors. Protectionism only drives up costs for consumers and invites economic retaliation — incidentally, protectionism is a major reason Japan’s economy has stagnated.

TPP offers the positive alternative to Warren’s regulatory fetishism. Opening long-closed marketplaces to American competition would give U.S. businesses an expanded stall from which to sell. American high-skill and high-technology companies would shake up international markets. And across the TPP, industries would have to increase productivity and invest in better products.

America simply cannot compete in low-skill industries. Today’s China proves why. With productivity waning in its low-skill industries, alongside wage inflation, China is increasingly struggling to compete with nations such as Vietnam that produce the same goods more cheaply. What fueled China’s rise — mass production at low costs — will bring on its decline.

We must face reality. Companies like Apple and Google aren’t worldwide leaders because they offer useful products, but because they’re globally identified as the best at producing useful products. In the same way, TPP gives America the opportunity to empower our best entrepreneurial impulses: educating a skilled work force to produce high-quality goods and services at competitive prices. And remember, much of our domestic service economy (restaurants, theaters, etc.) would remain insulated from foreign competition.

But the merits of TPP aren’t rooted only in economics. TPP would also allow America to rebuff China’s expansionism in Asia. China is using bribery (from Pakistan to the EU) and threats to expand its imperial power; the TPP could check China in a non-aggressive way. Linking TPP partners such as Vietnam into mutually beneficial relationships that protect the rule of law (as China does not) would forge a consensus around American-led Asia-Pacific stability.

Ultimately, this isn’t complicated. America can either embrace economic reality or accept economic decline. TPP will serve America’s economy and our security, and that of our allies. Congress must give President Obama the fast-track support he needs. If not, the TPP will die and millions of Americans will suffer for it.

— Tom Rogan is a writer based in Washington, D.C. He is a panelist on The McLaughlin Group and holds the Tony Blankley chair at the Steamboat Institute.

Tom Rogan is a columnist for National Review Online, a contributor to the Washington Examiner, and a former panelist on The McLaughlin Group. Email him at

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