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McCain urges U.S. to restore Colombia trade benefits

WASHINGTON (Reuters) - Senator John McCain on Thursday urged President Barack Obama to help broker a deal that would restore valuable trade benefits for Colombia, a stalwart U.S. friend still reeling from recent severe floods.

"We've kicked an ally while they're down and right when they need us most" by allowing the program to expire, the Arizona Republican said on the Senate floor.

"The president of the United States and White House should be weighing in on this," McCain said.

However, with the House of Representatives scheduled to be off next week, there was no chance of a quick deal to restore the lapsed trade benefits, congressional aides said.

Even when House members return, there could be little progress unless Obama outlines a plan for enacting a long-delayed free trade pact with Colombia, one aide said.

Colombia and other Andean nations have received duty-free treatment for most of their exports to the United States since the early 1990s under a program aimed at reducing illegal drug production in the region by creating other job opportunities.

"Colombian officials tell me without these trade preferences, their cut flower industry, which is one of the pillars of their economy, could contract by 15 to 20 percent in the coming weeks," McCain said.

The program expired over the weekend, along with expanded job retraining benefits for displaced U.S. workers under another longtime program, Trade Adjustment Assistance (TAA).

Congress, as part of the 2009 stimulus bill, expanded the TAA program to cover additional workers and to provide a more generous tax credit to help them buy health care insurance.

The reforms pushed program costs to about $1.8 billion annually, from $1.0 billion before, a congressional aide said.

Democratic Senator Sherrod Brown blocked McCain's attempt to pass a bill by unanimous consent to extend the Andean trade preference through November of next year.

Brown said he could not support the renewal unless Congress also extended the expanded TAA benefits.

"I can't walk off this floor having helped the workers in Ecuador and Colombia, but not having helped the workers in Toledo and Cleveland and Phoenix and Charleston, West Virginia," Brown said.

McCain then blocked Brown's attempt to pass a bill extending both the Andean program and the expanded TAA.

In the current budget environment, $1 billion should be enough for the TAA program, McCain said.

(Reporting by Doug Palmer; Editing by Cynthia Osterman)