Free-trade accords would create jobs
Despite some recent positive indicators, the sluggish U.S. economy is not creating enough jobs. We had 147 million jobs in November 2007, comparedwith 144.7 million in November 2013. It doesn’t have to be this way — and it won’t be, if Congress and President Obama can work together to advance a pro-trade agenda.
In fact, historic trade initiatives are moving forward right now that would dramatically boost economic growth by integrating America in freetrade zones incorporating about 65 percent of the world’s economy.
The first agreement, the Trans-Pacific Partnership, would form an immense freetrade region across the Pacific. This pact aims to strip away tariffs and slash other trade barriers among 13 countries that together make up 40 percent of global gross domestic product. The addition of Japan to the trans-Pacific negotiations last year offers the prospect of reducing and eliminating the maze of barriers that limit U.S. access to one of the world’s biggest economies.
The second initiative is a U.S.-European pact called the Trans-Atlantic Trade and Investment Partnership. As proposed, it would give U.S. firms duty-free access to the world’s largest group of highincome consumers, allowing Americans to compete on a fair footing in a continent that alone accounts for nearly a quarter of world GDP.
The partnership proposals are both 21st century trade pacts that aim to solidify U.S. intellectual property rights and eradicate behind-the-border trade barriers to U.S. goods and services. By including ironclad enforcement measures, they will open rich new markets to American farmers, manufacturers and small businesses. These will unite participants in truly free and fair trade.
For these agreements to take effect, it is crucial that Congress approve trade promotion authority, which would establish Congress’ objectives for these pacts and allow an up-or-down vote on them without amendments. However, while U.S. Trade Representative Michael Froman has energetically conferred with Congress on trade promotion authority, representatives of numerous foreign countries have noted that President Obama himself does not engage Congress on the issue and rarely speaks about its importance. Without the president’s decisive voice influencing his party, 151 House Democrats signed a letter to him opposing trade promotion authority.
Disappointingly, more than two dozen California representatives — roughly half our congressional delegation — signed the letter. Furthermore, both California senators have voted against trade promotion authority in the past.
This stance is self-defeating. As America’s second-largest exporting state, California would be a major beneficiary of these agreements. There would be more business for our small manufacturers and service providers, increased traffic through our ports, new customers for Silicon Valley technology, and more exports of dairy goods, nuts, citrus and other agricultural goods.
Californians would gain vast new opportunities across the world, giving rise to thousands of jobs in a state where unemployment is at 8.5 percent — among the highest in the nation. But the deals face opposition from powerful interest groups, including union leaders (who fear competition from nonunion businesses) and environmental extremists (who view commerce, manufacturing or any productive economic activity as a sinful intrusion on the unspoiled state of nature).
Trade is more widely supported by congressional Republicans, but even in our own camp 22 House members signed a letter opposing trade promotion authority. Some have expressed concerns about the pact’s constitutionality. This is a nonissue, because the agreement retains Congress’ authority to approve or reject trade agreements. It merely instructs the executive branch to do three main things: conduct negotiations to achieve certain objectives identified by Congress, consult with Congress during the negotiations and submit the resulting agreement to Congress for approval.
Other Republicans seem hostile to trade promotion authority as a result of their opposition to Obama’s overall agenda. While our nation’s turn to the left has indeed been disastrous for America’s economic and fiscal health, we have to support the administration’s efforts on those occasions when it does the right thing for the American people. And the record shows that trade liberalization enacted under both Democratic and Republican presidents has created jobs and lowered prices for consumers.
This year does not need to be another grim time of anemic economic growth. President Obama should lead from the front and work closely with Congress to pass trade promotion authority, which would pave the way for trade initiatives that would likely become his most significant economic achievements. We should move quickly, because these historic opportunities will not last forever.