Democrats knock back Obama trade push

Senate Democrats handed US President Barack Obama a major rebuke on Tuesday, blocking a bill granting him the congressional authority he needs to close a sprawling Pacific Rim trade deal at the centre of his second-term economic agenda.

The procedural vote to block the bill by 45 Democrats does not mark the end of Mr Obama's push to gain the fast-track authority he needs to conclude the Trans-Pacific Partnership with Japan and 10 other Asian and Latin American economies.

It does, however, contribute to increasing frustration among the US's negotiating partners. For months they have been waiting for Washington politics to play out so they can conclude what would be the biggest trade pact in two decades.

Both Japan and Australia expressed dismay and hopes that, in the words of Australia's minister for trade and investment Andrew Robb, the vote amounted to "more a bump in the road rather than a derailment."

Japan, which has much to lose if TPP fails, was equally optimistic. "We strongly hope it will pass soon," said chief cabinet secretary Yoshihide Suga. Officials are refusing to admit even private doubts; those close to the talks say there are few remaining issues with the US, but nobody can make a final offer without Mr Obama securing fast track authority.

Shinzo Abe, Japan's prime minister, is relying on the trade pact to help boost growth and tackle entrenched domestic interests in the agricultural sector.

US Republicans, who control both Houses of Congress, said after Tuesday's vote that they would seek "alternative paths forward" for the legislation formally known as Trade Promotion Authority. Even before the vote the White House called it a "procedural snafu" that would eventually be overcome.

But the 52-45 vote - short of the 60 votes needed for "cloture" - was a sign of the bitter divisions Mr Obama's trade push has engendered in the Democratic party and among its traditional base in the union movement.

Mr Obama has in recent weeks increasingly been forced to take on in public leading members of his party including Elizabeth Warren, the Massachusetts senator who has become the de facto leader of the party's left.

However, even as he has been cheered on by Republicans, that strategy seems to have served only to energise opposition among Democrats.

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The latest setback for the administration also adds to the delays facing the TPP, which the US and its partners had hoped to close before the summer. Negotiators say they need to do that to have enough time to get it ratified by Congress before the end of the year and before the 2016 presidential election campaigns heat up.

Republicans called Tuesday's vote in the hope of formally launching a floor debate on Trade Promotion Authority and calling a full vote on the measure before Congress goes into recess for the Memorial day holiday.

Informally called "fast-track" authority it delegates the power to negotiate trade deals to presidents and commits Congress to holding simple up-or-down votes on them when they are presented for ratification.

In a procedural move meant to block the bill's progress, Democrats insisted that the fast-track bill be bundled with three other trade bills including a customs one that contains contentious currency manipulation provisions aimed at China.

But Republicans refused, setting the stage for Tuesday's vote and yet more brinkmanship over the president's top economic priority.

Orrin Hatch, the Republican chair of the Senate finance committee and one of the lead sponsors of the legislation, said he remained hopeful that the bill could find another path through the Senate.

"I still believe we can get something done, that we can work something out," he said after the vote.

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There were also signs that enough Democrats were prepared to eventually side with the president and Republicans if another way could be found to bring the bill up for a vote.

At least 10 Democrats registered their support for the bill ahead of Tuesday although they voted against the motion to open debate on procedural grounds.

Business groups said they also retained hope.

"Legislating is never simple, and there are often stumbles in the course of enacting major legislation," said Bruce Josteb, executive vice-president for government affairs at the US Chamber of Commerce.

But opponents of Mr Obama's trade push were also keen to declare victory.

"The fast-track train went off the rails today," said Lori Wallach, head of Public Citizen's Global Trade Watch and a leading critic of US trade policy.

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