Trade policy experts have been shaken by a partisan dispute between Congress and the White House in the past week over a free trade agreement with Colombia.
Aside from the fear of rising protectionism in an election year, there is concern that the fight could undermine US trade policy for the final months of the presidency of George W. Bush, and beyond.
Stuart Eizenstat, who served as deputy Treasury secretary during the Clinton administration, told the Financial Times that the spat could hurt any remaining chances of an agreement in the Doha round of multilateral trade talks.
He said although many Democrats in Congress were more open to a good Doha deal than bilateral free trade agreements such as the one with Colombia, negotiators from developing countries could use the stand-off on trade to stall progress.
Paul Blustein, of the Brookings Institution, a liberal Washington think-tank, said the impasse was an understandable outcome of the Bush administration’s pursuit of bilateral trade deals such as the Colombia agreement, while multilateral talks have stalled.
“Maybe this time, we will finally learn that trade deals of this ilk can be a lot more trouble than they are worth,” said Mr Blustein. “The Colombia contretemps is the latest sign that the Bush administration’s policy of avidly pursuing such agreements with individual countries is prone to serious backfiring.”
Others put the blame on the decision by Nancy Pelosi, speaker of the House of Representatives, to delay a vote on the deal indefinitely.
Fred Bergsten, director of the Peterson Institute for International Economics, called the unprecedented move a “calamity for the world trading system”.
He argues that the decision would remove the confidence of trading partners that they can negotiate directly with the administration without having their agreements unpicked by Congress.
On Monday, Mr Eizenstat joined 34 other former Democratic administration officials and Democratic members of Congress who wrote an open letter to US legislators saying the Colombia deal “should be considered as soon as possible and that any obstacles be quickly and amicably resolved”.
The moves by Congress and the White House on the issue have raised the political temperature and pushed the boundaries of Washington protocol.
Last week, President George W. Bush submitted the Colombia FTA for ratification without the consent of congressional leaders – a move never tried since “fast-track” procedures were introduced more than 30 years ago to streamline passage of free trade deals.
Ms Pelosi rapidly called a vote that changed the House’s rules and indefinitely delayed consideration of the agreement.
The fight continued this week, with Mr Bush saying it was not in US interests to “stiff an ally”, and Ms Pelosi countering that the president had “stiffed the American people” through his economic agenda.
Democrats have been working to dismiss the notion that the delay of the Colombia deal adds to evidence of rising protectionism within the party. Both presidential candidates Barack Obama and Hillary Clinton have taken sceptical stances on free trade and oppose the Colombia deal.
One congressional aide says that by delaying a vote, Ms Pelosi chose the least harmful outcome, avoiding what could have potentially been even more damaging: the first defeat of a trade agreement in Congress under “fast track”.
The delay also allowed Ms Pelosi to link the deal to talks between Congress and the White House over other economic matters, such as housing legislation, in the hope of gaining more leverage on those issues.
The aide says Democrats believe they took the more responsible course of action to preserve good ties with Colombia in the face of White House action that would have virtually ensured the death of the agreement on the House floor.
