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PRICE: Trade is key to future prosperity
Democrats’ stalling of pacts hurts American economy
American families continue to suffer from a weak and jobless economic recovery presided over and hindered by Washington’s failed liberal policies. As of late, the majority party in Congress and the White House has shifted its focus to finding a political solution to gloss over the fact that nearly one in 10 Americans is without a job. Democrats are touting their “Recovery Summer” to a skeptical public; meanwhile, proactive initiatives that could help build a foundation for our future prosperity sit dormant. Most notably, three existing free-trade agreements negotiated under the last administration - with South Korea, Colombia and Panama - have been idled under Democratic rule in Washington.
Free-trade agreements have fallen by the wayside, left to gather dust while America’s trading partners look to other nations and other markets. Rather than concrete action, Democrats have paid only lip service to the issue of trade. President Obama has stated his desire for America to double its exports in the next five years. While that’s a laudable goal, our nation has next to no chance of succeeding in this venture if Washington continues to avoid expanding our trading partnerships.
Failure to approve these existing agreements is not only a poor economic strategy, it is a poor foreign-policy strategy. It erodes confidence and goodwill between America and its trading partners. We run the risk of losing important inroads into other growing economies - a move that could cost American families untold billions in wealth creation. For example, the benefit to the American economy that would come with enacting the Korean Free Trade Agreement alone has been estimated at $10 billion to $12 billion in additional annual gross domestic product. That is a powerful sum to be forfeited unilaterally. Free-trade agreements that the U.S. has with trading partners accounted for $304.5 billion of output in 2008 while supporting 5.4 million jobs.
Despite this proven track record of economic benefit, Democrats have been slow to consider and at times have been outright opposed to moving forward with free-trade agreements for fear of upsetting their most potent political ally: Big Labor. They have adopted and supported protectionist policies at the behest of special interests at a time when we should be using every tool we have to help American families find jobs.
As troubling as are their passive disregard and inaction on existing negotiated agreements, the Democrats’ actions should give us all pause. Last September, the Obama administration chose to levy a 35 percent tariff on imported Chinese tires. This was not done at the urging of American tire manufacturers, which one would presume to have been the interested party behind this type of action. Rather, it was the United Steelworkers union that issued marching orders to President Obama. By serving a narrow political interest, the president was sending a negative signal to American trading partners, which potentially could feed higher prices for American families.
Arguments made by the majority party in opposition to approving a free-trade agreement with Colombia also have focused on union-related concerns - namely a history of violence against union organizers in this South American neighbor. But tremendous steps have been made to eradicate this violence as democracy in Colombia has grown stronger. We should not be abandoning efforts to contribute positively to the expansion of free economies in South America. We run the risk of losing a diplomatic partner in Colombia if its leadership sees other neighbors, such as Venezuelan President Hugo Chavez, as more inviting.
Remarkably, there even is a proposal - put forth as part of a job-killing cap-and-tax climate-change scheme - asking foreign importers to purchase allowances to cover the carbon emissions from the manufacturing of goods they wish to sell in the United States. While perhaps an effort to cripple foreign companies at the same time, this sort of national energy tax would undermine American businesses and entrepreneurs, and the greatest negative impact will be felt, as always, by American families, who inevitably will pay higher prices for products they need. We would be damaging our own prospects for strong economic growth and job creation while simultaneously fostering ill will with our neighbors.
All of these anti-trade policies will do real damage to our nation’s future prosperity. America sacrifices tremendous financial as well as diplomatic capital when we stall the forward progress of trade with other nations. Rather than turn a hostile eye to our foreign trading partners or passively ignore existing agreements, Congress should move in a timely manner to approve the Korean, Colombian and Panamanian agreements and seek balanced partnerships with other nations. Holding our nation’s future prosperity hostage to the wishes of a political special interest - particularly at a time when we need to harness all opportunities for growth and job creation - is unacceptable. Enacting current negotiated free-trade agreements would be a positive step forward and one that would signal to the rest of the world that the United States intends to be a leader in the development of prosperous global markets and a greater diplomatic dialogue.
Rep. Tom Price, a physician, is chairman of the Republican Study Committee.
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