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Business Lobbies for Program to Help Workers Hurt by Trade

June 11, 2008
Related Topics: Downsizing, Global Business Issues, Global Employment Law, Latest News
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Alarmed by the increasingly negative attitude toward trade liberalization on Capitol Hill and the campaign trail, a group of 26 businesses and trade associations is lobbying to increase federal help for victims of globalization.

The firms have coalesced as Congress and the Bush administration negotiate renewal of Trade Adjustment Assistance, a program that provides retraining, wage insurance, health care and other assistance to people who have lost their jobs because of imports or their company moving operations to a foreign country.

The fate of a trade agreement with Colombia, an administration and business priority, hinges in part on the outcome of TAA talks. In April, House Speaker Nancy Pelosi put an indefinite hold on legislation to implement the deal until “economic security” issues are addressed.

The formation of the Trade and American Competitiveness Coalition may be the catalyst for a TAA breakthrough, according to Sen. Max Baucus, D-Montana and chairman of the Senate Finance Committee.

“This is a big day,” Baucus said at the Capitol Hill launch of the group Wednesday, June 11. “I’m very excited. We’re turning the corner here.”

Baucus seeks to double TAA funding, which totaled $259 million in the last fiscal year.

He and the coalition advocate extending TAA to workers in the service sector. Currently, it applies only to those in manufacturing. Sen. Charles Grassley, R-Iowa and ranking member of the Finance Committee, is open to expanding TAA but declined to comment on negotiations, according to an aide.

Last fall, the House approved a TAA bill that would boost funding by $8.6 billion over 10 years. It includes provisions that would reform unemployment insurance and require companies to increase notice of plant closings from 60 to 90 days. The administration threatened to veto the House measure.

The business coalition is not endorsing specific legislation, but it is telling members of Congress that TAA is central to producing a skilled workforce and helping communities recover from global competition setbacks.

Sarah Bovim, director of government relations and international trade policy for Whirlpool, said that hundreds of former Maytag workers in Newton, Iowa, took advantage of the program when Whirlpool shut down operations in 2006 after taking over the company.

“TAA is critical during this adjustment period,” Bovim said.

About 3,500 employees in General Electric’s consumer and industrial division have utilized TAA in the last several years, according to Orit Frenkel, GE senior manager for international trade and investment.

The company helps dislocated workers upgrade their skills and return to the job market by providing up to $10,000 for retraining in addition to federal assistance, Frenkel said.

Beyond supporting former employees, GE also helps regions recover after the company departs.

“We want to see the communities attract investment and transition as smoothly as possible,” Frenkel said.

By focusing on those left behind in the global economy, the coalition hopes to ease trade fears.

“We want to send the message that trade is not the problem,” said Laura Lane, senior vice president of international government affairs for Citigroup. “Trade is the solution.”

—Mark Schoeff Jr.

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