Australian FTA Passes in House, Senate

Senate passage clears way for the President's expected signature. Jacqui Fatka

Published on: Jul 16, 2004

The House and Senate have both approved the Australian Free Trade Agreement. The House passed the agreement late Wednesday by a 314 to 109 margin, and the Senate achieved approval with a 80 to 16 vote.

The agreement would immediately end or phase out tariffs for many agricultural products, including beef, lamb, sheep, wool, wheat, and dairy products.

The industry remains mixed on their support for the agreement. Senate Minority Leader Tom Daschle, South Dakota, has been outspoken in opposition to the agreement. He says it undermines the United States' ability to create a level playing field.

Sen. Kent Conrad, D-N.D., was able to have an amendment approved in the mock-up of the trade agreement that directs the Trade Ambassador to get approval from Congress for any waiver in favor of foreign imports. Specifically, it would require approval from both the Senate Finance Committee and from the House Ways and Means Committee.

At issue is a safeguard in the Australia FTA intended to protect domestic beef producers in the event that the U.S. market is flooded with cheap Australian beef. Although the Bush administration has said the safeguard is automatic, that is in fact not the case. There is nothing to stop the Trade Ambassador from waiving the safeguards, says Conrad.

To help trade legislation quickly make it way through the Senate and House, a fast-track process allows the Senate Finance Committee and House Ways and Means Committee to approve the agreement with the opportunity for amendments at mock-up, not on the respective floors.

"It is unacceptable," Conrad says. "Even though the majority of my colleagues on the Finance Committee agreed that this is an important amendment, it was not accepted by the administration. More importantly, allowing the U.S. Trade Representative to unilaterally waive safeguards that were repeatedly promised to our beef industry is fundamentally unfair to America's ranchers and cattlemen."

The Senate Finance Committee oversees trade policy and the Committee Chairman Chuck Grassley adds that although support remains divided among the livestock industry, the manufacturing industry will benefit greatly from the agreement. "Under the agreement, we get unprecedented access for U.S. manufacturing," he says. "In fact, this is the most significant reduction of manufacturing tariffs ever for a U.S. free trade agreement."

Grassley says it is clear that a majority of senators appreciate the economic benefits of the agreement as well as the strong friendship with the Australian people. "This is the strongest Senate vote in favor of a free trade agreement since the passage of the Trade Act of 2002."