The fair track to expanded free trade: making TAA benefits more accessible to American workers.

But Congress significantly reformed and expanded the TAA program under the Trade Reform Act of 2002, and the current Trade Adjustment Assistance Act (TAA Act) (85) generally mandates that workers involved in the "production of an article" are entitled to receive an array of benefits through their state unemployment (re-employment) agency if DOL determines that they that are eligible to apply for TAA benefits. (86) These benefits are designed to help workers adjust to job loss caused by expanded free trade and to transition to new employment and provide:

* up to 130 weeks of training, including 104 weeks of vocational training, and 26 weeks of remedial training (e.g., English as a second language or literacy) (87)

* up to 104 weeks of extended income support--beyond the state unemployment (re-employment) insurance benefits under state law (typically 26 weeks)--while in training, unless the training condition is waived (88)

* up to $1,250 to conduct a job search, and up to $1,250, plus up to 90% reimbursement of certain relocation expenses, to relocate for a job in a different geography (89)

* wage supplements of $10,000 for two years for workers over age 50 who lack easily transferable skills and are re-employed within 26 weeks (90)

* a tax credit worth 65% of the health care premiums paid by certain workers over age 50 for up to two years (91)

Thus, the promise of TAA has been a regular and, sometimes, crucial aspect of the political bargain struck on behalf of U.S. production workers with proponents of U.S. trade liberalization. How well the Agency fulfills its administrative role in certifying workers' eligibility to apply for TAA benefits determines, in part, whether workers hurt by expanded free trade are adequately compensated for their losses. (92) Moreover, inadequate coverage and poor administrative performance by the Agency could increase worker resistance to expanded free trade. (93)

3. The Next Bargain for Fast Track Authority

The political machinery for the next bargain between opponents and proponents of expanded free trade has been activated, and the TAA program again appears to be the likely quid pro quo for renewal of fast track (trade promotion) authority. On Thursday, October 26, 2006, the Bureau of National Affairs (BNA) reported on the dim prospects for further U.S. trade liberalization, stating that "[i]t is highly unlikely that Congress will vote to approve legislation to renew the president's authority to negotiate trade agreements when it expires next year, particularly if the Democrats take control of the House...." (94)

The BNA also reported, that same day, that DOL would be proposing regulations "dealing with certification questions arising under [the trade adjustment assistance program] at a later date." (95) On January 4, 2007, Senate Finance Committee Chairman, Senator Max Baucus (D-Mont.) introduced a bill (S. 122) (96)--co-sponsored by Senators Norm Coleman (R-Minn.), Maria Cantwell (D-Wash.), and Ken Salazar (D-Colo.)--to "reauthorize the federal government's trade adjustment assistance program until 2012 and expand its coverage to include workers in service jobs." (97) And, in a speech on January 31, 2007, President George W. Bush "called on Congress to renew his authority to negotiate trade agreements" and said that he would "work with Congress to reauthorize and to improve the Trade Adjustment Assistance [sic] this year." (98)

The fast track authority (TPA) granted to President George W. Bush expired on June 30, 2007, (99) before successful completion of the WTO Doha Round and without the creation of a Free Trade Area of the Americas. (100) So, before free trade can be further expanded, a new grant of fast track authority must be made to the Executive branch. But the political price for the grant of fast track authority from a Democratically-controlled Congress to an unpopular, lame duck Republican President is likely to be high. Considering the alternatives, proponents of free trade should seek to improve the TAA program so that it functions more effectively as the principal mechanism for assisting workers hurt by expanded free trade and more adequately compensates workers for their losses. At the very least, the administrative defects in DOL's certification process should be fixed. And, if Congress once again chooses to use the TAA program as the quid pro quo for renewal of fast track authority, it should consider amending the TAA Act to reduce worker resistance to further U.S. trade liberalization. (101)

III. THE DEFECTIVE CERTIFICATION PROCESS AND UNSUITABLE SCHEME FOR JUDICIAL REVIEW

For workers, TAA is a phantom entitlement unless DOL certifies that they are eligible to apply for it. (102) Under the TAA Act, a group of workers, or their employer or duly authorized representative, may petition the Agency, or their state unemployment office, for certification of eligibility to apply for TAA benefits. (103) By statute, DOL is supposed to "determine whether the petitioning group meets the [eligibility] requirements of section [2272]" of the TAA Act within forty days after the petition is filed. (104) Once certified, an eligible worker may then apply for and receive TAA benefits from his or her state unemployment (reemployment) office--if he or she was certified and applies within two years of the date of his or her layoff--provided the worker: had sufficient (minimal) earnings from employment for at least 26 weeks of the 52 weeks before the layoff; was entitled to state unemployment insurance and was not otherwise disqualified for extended unemployment compensation; and was enrolled in an approved training program unless the training requirement is waived by DOL. (105) The petition form itself, however, typically does not provide DOL with substantial enough evidence to make an eligibility determination. (106) And, as demonstrated below, DOL frequently uses requests for voluntary remand to comply with the forty-day statutory period to investigate workers' eligibility, without actually gathering any additional determinative evidence. (107)

DOL's investigative shortcomings, though, are not related to its existing written guidelines for investigating TAA petitions. (108) Actually, the Agency's written guidelines for conducting TAA investigations seem to guarantee workers procedural due process. (109) In subpart B of the guidelines, the Agency appropriately articulates the kind of investigation required:

The investigation may include one or more field visits to confirm

information furnished by the petitioner(s) and to elicit other

relevant information. In the course of the investigation,

representatives of the Department shall be authorized to contact

and meet with responsible officials of firms, union officials,

employees, and any other persons, or organizations, both private

and public, as may be necessary to marshal all relevant facts to

make a determination on the petition. (110)

The Agency has also properly equipped itself in subpart B with all of the necessary administrative apparatus for conducting a thorough fact-finding investigation, including providing for a public hearing--replete with testimony, evidence, briefs, oral argument, authentication, transcripts, and appearances--and subpoena power. (111) And, again in subpart B, DOL correctly sets forth the required contents of the Agency record upon which it is obligated to make an eligibility determination, based on these findings of fact:

(1) A significant number or proportion of the workers in such workers' firm (or appropriate subdivision of the firm) have become, or are threatened to become, totally or partially separated;

(2) Sales or production, or both, of such firm or subdivision have decreased absolutely; and

(3) Increases (absolute or relative) of imports of articles like or directly competitive with articles produced by such workers' firm or an appropriate subdivision thereof contributed importantly to such total or partial separation, or threat thereof, and to such decline in sales or production.... (112)

The TAA Act mandates the Agency certify workers' eligibility, but, of course, not all workers are eligible. (113) DOL must certify a group of primary production workers' eligibility in both of the following job loss situations, if it determines that the workers' layoff or threat of layoff was due to:

* increased imports like or directly competitive with articles produced by the workers' firm or subdivision, that "contributed importantly" to an absolute decrease in sales or production and to the workers' layoff or threat of layoff; or

* a shift in production of articles like or directly competitive with articles produced by the workers' firm or subdivision, to a foreign country, if that country is (1) a party to a free trade agreement with the U.S., or (2) a beneficiary country under the Andean Trade Preference Act, African Growth and Opportunity Act, or the Caribbean Basin Economic Recovery Act, or if there has been or is likely to be an increase in imports of articles like or directly competitive with articles produced by the workers' firm. (114)

DOL must also certify a group of secondary production workers' eligibility to apply for TAA benefits in two other job loss situations, if it determines that:

* a significant number or proportion of workers have been laid-off or are threatened to be laid-off from an upstream "supplier" of a related article, if that supplier supplied component parts--that accounted for at least 20% of its production or sales--to a firm that employed a group of primary workers certified to apply for TAA benefits; or