Obama Fires Back At Elizabeth Warren And Trade Critics, Escalating Democratic Feud

WASHINGTON -- President Barack Obama pushed back against Sen. Elizabeth Warren (D-Mass.) and Democratic critics of his trade agenda on Friday, accusing them of spreading "misinformation that stirs up the base but ultimately doesn't serve them."

Obama surprised reporters by appearing on a conference call with Labor Secretary Thomas Perez in effort to rebut criticisms from Warren and other key Democrats , who worry that his pending Trans-Pacific Partnership deal will exacerbate income inequality and undermine key regulations.

"The idea that we can shut down globalization, reduce trade is wrong-headed," Obama said on a conference call. "That horse has left the barn."

While Obama did not mention Warren by name, much of his commentary appeared to be directed at her. The two have already traded barbs on TPP this week. Obama said in a TV interview on Tuesday that Warren was "just wrong" on the issue. Warren responded by sending a fundraising email to her supporters warning that Obama's promises on the pact were hollow, since "people like you can't see the actual deal."

Obama seemed to implicitly reference Warren's response on the call on Friday, noting that members of Congress can now view the text of the pact and will have months to review the agreement before voting on the final version.

"Every single one of the critics saying this is a secret deal, or send out e-mails to their fundraising base that they're working to stop a secret deal, could walk over and see the text of the agreement," Obama said. "When I just keep on hearing people repeating this notion that it's secret -- I gotta say, it's dishonest. And it's a little concerning when I see friends of mine resorting to those sort of tactics."

The escalating feud between Obama and Warren on trade policy is reminiscent of last year's intraparty battle over financial regulations. Warren rallied Democrats against an Obama-backed budget deal that reinstated subsidies for risky Wall Street derivatives trading. Obama ultimately won the policy fight, after he and JPMorgan Chase CEO Jamie Dimon personally lobbied Democrats to support the package. However, the episode galvanized the progressive wing of the party and highlighted Warren's influence over House Democrats.

On Friday's call, Obama also fiercely defended TPP's enforcement mechanism, which Warren has frequently criticized for empowering multinational corporations to attack domestic regulations before an international tribunal.

"The notion that corporate America is going to be able to use this provision to eliminate our financial regulations and our food safety regulations and our consumer regulations -- that's just bunk," Obama said. "It's not true."

Obama noted the United States has only been sued 17 times in history under such trade enforcement mechanisms, and has won 13 of those cases. That's true. But it's also true that corporations have been relying much more on this process in recent years. While the international tribunal cannot overturn U.S. law, it can impose penalties on the United States if it determines a regulation unfairly harms foreign investments. Corporations have increasingly gone through such tribunals to attack environmental and public health regulations abroad.

Throughout the call, the president said he was pressing a progressive deal that unions and liberal Democrats should support as an improvement over the existing "status quo" on trade. At one point, he argued that the deal would improve on the North American Free Trade Agreement by including enforceable labor and environmental standards.

Democrats in Congress remain skeptical of Obama's claims about improved labor and environmental standards , in part due to the administration's weak record enforcing such standards in existing trade pacts. In November, the Government Accountability Office issued two reports faulting the administration's record.

"The fact of the matter is that TPP will end up being the most progressive trade agreement in our history," Obama said.

But in a few areas, the pitch to progressives seemed to falter. Public health groups including Doctors Without Borders have criticized a leaked draft of one of the agreement's chapters for including overly strong intellectual property terms that would inflate the price of medicine, particularly in poor countries. On the call, Obama pointed to strong intellectual property standards as evidence that he was protecting American companies.

The president also argued that TPP would help American automakers sell more cars in Japan, but didn't note that Ford Motor Co. actually does not support TPP , since the agreement does not address currency manipulation , the main tactic Japan uses to protect its own carmakers. Obama said on the call that a poorly worded currency manipulation provision could interfere with the Federal Reserve's monetary policy.

Obama also touted a deal he cut with Sens. Ron Wyden (D-Ore.) and Orrin Hatch (R-Utah) to provide financial aid and training to American workers who lose their jobs due to trade. He said the package has "a much higher budget for transition assistance than we have seen before." At $450 million per year, however, the deal is actually smaller than a $575 million package from 2011, although Perez argued that the bill would be more than sufficient to provide benefits to the people who need it.

The AFL-CIO, the nation's largest federation of labor unions, released a written statement responding to Obama on Friday afternoon.

"American workers who have lost their jobs due to trade deals are understandably skeptical," AFL-CIO spokesman Eric Hauser said. "The best way to regain workers confidence is to release the text, not scold the critics."