Pres. Obama has made expanding U.S. exports a centerpiece of his economic plan. In his January State of the Union Address, he noted that “95% of the world’s customers and fastest-growing markets are beyond our borders” and that export-related jobs “pay 15% more than average.” At a time when jobs are in short supply, he later said, “building exports is an imperative.”
So naturally, he’s done everything possible to ease passage of the Colombia Free Trade Pact, which the Bush Administration negotiated and the then-Democrat controlled Congress battled up. Right? Wrong.
As I write in Investor’s Business Daily, the Pact is lopsided towards the U.S. in that Colombia’s exports to us are already tariff-free, while our products sent there carry duties of up to 25 percent — an estimated $3.2 billion total since the agreement was reached.
Those tariffs would disappear and, according to the U.S. International Trade Commission, expand opportunities for a broad array of U.S. sectors, increase our gross domestic product by about $2.5 billion, lower our massive trade deficit and create J-O-B-S.
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Bi-partisan pressure mounts for the Obama administration to move on long-pending free trade agreements (FTAs). At Senate Finance Committee hearings yesterday on the trade agenda, both Chairman Max Baucus (D-Mont.) and Ranking Member Sen. Orrin Hatch (R-Utah) gave the Obama administration a hard time on not moving on pending trade pacts as U.S. Trade Representative (USTR) Ron Kirk testified before the full committee.
Sen. Hatch took a particularly tough line in his questioning. He noted that while the Obama administration is prepared to submit the U.S.-Korea FTA, he questioned why it has dragged its feet on setting any definite timetable for considering the pending free trade agreements with Colombia and Panama. Both trade pacts have been negotiated and re-negotiated for several years now, and yet the administration still claims there are still some outstanding issues that need to be resolved, mainly relating to labor unions.
Sen. John Thune (R-S.D.) also expressed concern about the pace with which these agreements are being submitted to Congress. According to USTR Kirk, the U.S.-Korea FTA is ready for technical drafting and submission to Congress, but the Colombia and Panama FTAs don’t have clear timetables for congressional consideration. Sen. Thune asked what further changes the president wants in the agreements and questioned whether U.S. credibility about future agreements will be hurt if more revisions are required after the FTAs have been negotiated and signed. He said, “A deal with the U.S. ought to be a deal.”
In response, Kirk said that “a vast majority of people in the U.S. don’t believe in the wisdom of our trade policy” and we have to “keep faith with American workers.” He noted that the Korea trade pact is ready, and Congress should move on that, while the other two agreements are moving forward and should be ready this year.
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President Obama needs to look beyond pushing only the U.S.-Korea Free Trade Agreement to standing behind ratification of the other pending trade agreements with Panama and Colombia, says Cato’s Dan Griswold in a Washington Times article today.
Griswold points out that while the FTA with Korea is economically of far greater consequence than the Colombia FTA, that agreement would help cement our relationship with an important ally that is a strong pro-democracy counterpart to dictators like Hugo Chavez. In economic terms, the trade pact would completely eliminate most tariffs on U.S. goods and services — providing companies like Caterpillar Inc. with strong market opportunities.
He takes issue with the Obama administration’s pronouncement that they will not be introducing the implementing legislation for the Colombia FTA anytime soon because they don’t have the votes. That shouldn’t be the case, Griswold says, because of the influx of new legislators who aren’t bound to the union-led opposition to free trade. As Griswold says,
It sounds more like a convenient and self-fulfilling prophecy on the part of the administration. If the votes are not there for the Colombian agreement, it is only because Mr. Obama so far has failed to exercise the same leadership he recently displayed in moving the Korean agreement toward passage.
Here’s what CEI has to say on the need to vote for the U.S.-Colombia FTA.
Image credit: tanya~b’s flickr photostream.
In his post-Summit of the Americas remarks in Trinidad and Tobago today, President Obama stated his administration’s commitment to improving relations with countries around the hemisphere. He rightly noted how unhelpful it is when other countries’ main interaction with the U.S. is either though military or drug interdiction efforts.
However, he failed to mention an immediate policy to improve both hemispheric relations and economic growth in the region: Commitment to win ratification of pending free trade agreements between the United States and other countries in the region. To date, ratification of trade agreements with Colombia and Panama — two strong U.S. allies — remains stalled on Capitol Hill.
For more on the U.S.-Colombia free trade agreement see here.
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