“The Obama administration would like to negotiate separate free-trade agreements with some Pacific trading partners and with the European Union. The prospects of sufficient support on Capitol Hill for the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership are being weakened by European demands to include financial regulation in its partnership. The Europeans should drop this demand for political reasons and because it makes no sense from the perspective of making the financial system safer. (For more on current sticking points for Trans-Pacific Partnership see my Dec. 5 post.)

“Trade agreements of this kind need to pass both houses of Congress. The way this has been handled in the past is first to pass what is now called trade promotion authority – it used to be known as fast-track authority – which authorizes the administration to bring a trade agreement to Congress that would be voted up or down, without amendment.

“While first adopting trade promotion authority does not assure passage of a subsequently completed agreement, chances of adoption are greatly increased because the details of that agreement do not get amended in the congressional process, which would make for cumbersome rounds at the negotiating table. But for trade promotion authority to pass, enough members of Congress, including key people in leadership positions, must be confident that they will like what will be in trade agreements that have not yet been fully negotiated.

“Senator Harry Reid of Nevada, the Senate majority leader, said recently that he did not support trade promotion authority, so this looks like an uphill climb for the Obama administration.”

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Read full NY Times Economix article here