US House panel OKs bigger worker trade aid program
24 Oct 2007 21:05:01 GMT Source: Reuters
By Doug Palmer WASHINGTON, Oct 24 (Reuters) - A congressional committee on Wednesday approved a multibillion-dollar expansion of a federal assistance program to help retrain workers who have lost their jobs because of foreign trade, despite the Bush administration's strong opposition to many of the provisions. The House of Representatives Ways and Means Committee voted 25-14 to pass the bill crafted by the panel's senior Democrats, with all but a few Republicans opposed. The bill would extend the federal trade adjustment assistance program to the service sector -- which accounts for about 80 percent of U.S. employment -- for the first time and allow more manufacturing workers to apply for the aid. It also provides a two-year increase in federal subsidies to help displaced workers pay for health insurance after losing their jobs. Democrats say the current tax credit hasn't worked well and plan to revisit the issue later. House Ways and Means Committee Chairman Charles Rangel, a New York Democrat, called the bill "the next step" in forging a new trade policy more sensitive to the needs of workers. It could set the stage for approval of a free trade pact with Peru in November, but Republicans are frustrated that other deals with Colombia, Panama and South Korea are stalled. President George W. Bush said earlier this month he was a "big believer" in trade adjustment assistance and wanted to work with Congress on a reform bill. But in a letter to Rangel on Wednesday, U.S. Labor Secretary Elaine Chao objected to a number of provisions proposed by Democrats and said the Bush administration "strongly opposes this bill as drafted." The House panel's top Republican, Rep. Jim McCrery of Louisiana, also complained the reauthorization bill was not linked to renewal of White House authority to negotiate new trade agreements, as it has been in the past. The proposed expansion would boost the cost of the program by about $6.2 billion over ten years. That's partly paid for by extending an unemployment insurance surtax due to expire this year. The TAA program now costs about $900 million annually. Chao expressed concern about the "workability" and "appropriateness" of extending trade adjustment assistance to the growing U.S. services sector. Since its inception in the 1960s, the program has been "targeted for workers involved in the production of an article," Chao said. A provision requiring the Labor Department to make an entire industry eligible for trade adjustment assistance in certain circumstances, instead of just individual firms, could open up the program to many workers who have not actually lost their job because of trade, Chao said. "By using industry-wide certification to bring large numbers of workers not affected by trade into TAA, caseloads and costs could easily increase severalfold," she said. The U.S. Chamber of Commerce and the National Association of Manufacturers weighed in against tax provisions of the bill, including one that would delay until 2012 implementation of a international tax reform measure passed in 2004. "We reiterate our strong position that additional taxes on America's businesses lessen U.S. competitiveness in global markets and hinder companies' ability to expand, reinvest and create jobs," the groups told Rangel in a letter. The full House could vote on the TAA reform package as early as next week. Senate Finance Committee Chairman Max Baucus, a Montana Democrat, also plans to move legislation to expand the program, which expires at the end of the year.
