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The debate in Congress on TAA reauthorization

With a failure to pass reauthorization legislation in the Senate, and facing the prospect of a presidential veto of the House version of a TAA bill, Trade Adjustment Assistance limped into 2008 with continuing resolutions.  The program is currently funded until the end of September. 

TAA reauthorization is a high priority for legislators from states with large numbers of workers displaced by trade, including North Carolina and Maine.  TAA reauthorization has also been caught up in the debate regarding passage of the US-Colombia Free Trade Agreement (see article below).  Senator Max Baucus, Chair of the Senate Finance Committee, has indicated that he isn't willing to bring the Colombia agreement forward for consideration until a TAA deal is in hand.

Among the reform provisions proposed in different TAA bills submitted over the past year:

  • Extension of eligibility to service workers.  Currently, TAA only applies to workers in the manufacturing sector who've lost their jobs due to trade or import competition.  But as the United States increasingly competes head-to-head on services with developing countries, the need for some sort of adjustment assistance for service workers becomes increasingly clear.
  • Production shifts to non-FTA countries.   Currently, workers are only eligible for TAA if their jobs move to a country with which the United States has a Free Trade Agreement.  In other words, if your job moves to Mexico, then you are covered; if it moves to China, you're not.  House Ways and Means Chair Representative Charles Rangel made extending TAA benefits to those who've lost their job to manufacturing competition with China a particular priority.
  • Doubling of funding for training from $220 million a year to a cap of $440 million a year--also a priority for Chairman Rangel.
  • Changes in eligibility for Alternative Trade Adjustment Assistance (ATAA), increasing the limit in total wage supplement, lowering the age of eligibility from fifty to forty years of age, and increasing the ceiling for ATAA eligibility from $50k to $60k.
  • Changes in the Health Coverage Tax Credit (HCTC) program.  Most observers believe that this program hasn't worked as intended, due to the continued high cost of premiums.  One proposal would increase the level of the credit from 60% of the total premium to 85%. 

The cost of these programs is one factor behind the threatened presidential veto.  Another is the belief that TAA could be adequately folded into other Department of Labor programs for retraining and support of displaced workers.   The debate continues.

Read the Congressional Research Service report on TAA
(February 2008)

News Stories
Political Standoff: TAA and Colombia
March 16th, 2008
Fast-track authority for the administration unraveled, making it less likely that the US-Colombia FTA will move forward now. Congressional leadership wants to see progress on ‘Trade Adjustment Assistance’ for displaced workers first.

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