- The Washington Times - Wednesday, March 11, 2009

ANALYSIS/OPINION:

ANALYSIS/OPINION:

COMMENTARY:

President Obama is trying hard to allay rising concerns about U.S. economic nationalism and boost confidence in his administration’s commitment to international trade. His first effort was in Canada, our North American Free Trade Agreement (NAFTA) partner that had been rattled both by then-candidate Barack Obama’s call for the pact’s renegotiation and by the “Buy American” provisions in the stimulus package.

In his Feb. 19 meeting with Canadian Prime Minister Stephen Harper, the president said, “We’ve got to be very careful about any signals of protectionism,” noting the importance of “showing leadership in the belief that trade is ultimately beneficial to all countries.” The president reassured the prime minister “I want to grow trade and not contract it.”

c Next, in his address to a joint session of the U.S. Congress, he again declared that we must “avoid the possibility of escalating protectionism, and spur demand for American goods in markets across the globe.” And during the visit of British Prime Minister Gordon Brown, a free trade stalwart, the president said we need to “encourage trade” and warned that “countries in this crisis cannot start turning inward and try to erect protectionist barriers.”

c This week the administration’s message became somewhat muddled when U.S. Trade Representative-nominee Ron Kirk appeared to question pending free trade deals with Korea and Colombia and called for a focus on enforcement rather than trade liberalization. This development is surprising. The world is looking to the United States to lead on trade, and instead our mixed message may be perceived as a retreat from the president’s recent statements.



As the world waits to see if our actions will be consistent with the president’s message on trade, there is no clearer signal that his administration could send than to call upon Congress now to approve the pending free trade agreements with Colombia and South Korea. The economic and national security case for each is compelling.

Under President Uribe, Colombia has emerged from a decades-long civil war and established itself as a democratic, market-oriented ally in a region increasingly challenged by unstable and repressive populists. Colombia has made great strides in the critical fight against narco-traffickers and continues to work closely with the U.S.

The economic case is also strong. Immediately upon passage of the FTA more than 80 percent of U.S. goods exports would enter Colombia duty-free. The independent and bipartisan International Trade Commission (ITC) has found that the U.S.-Colombia FTA would lead to a $1.1 billion increase in U.S. exports and, when fully implemented, result in a $2.5 billion increase in U.S. gross domestic product. In contrast, Colombia already enjoys largely duty-free access to the U.S. market for its exports.

The favorable economic impact of the U.S.-Korea FTA is even greater. In Asia, South Korea is our third largest goods trading partner and the second largest market for U.S. services. Here, again, the ITC has found that approval of the FTA would add about $10 billion to U.S. GDP and increase U.S. exports by $10-11 billion annually.

For U.S. national security, there are few greater concerns than a nuclear-armed North Korea. South Korea is the lynchpin of U.S. efforts to deal with this challenge. And last month Secretary of State Hillary Clinton thanked her counterpart in Seoul for Korea’s continued support of international efforts in Afghanistan.

Yet despite these sound economic and security reasons, the U.S. Congress refuses to approve these agreements. Congress’ stance can only be explained by the majority’s political indebtedness to the strident few who still embrace protectionism. Harder to understand is the administration’s continued inaction on these agreements, particularly as it seeks to assure others of U.S. leadership in the global economic recovery, including the “quick and ambitious conclusion” to the Doha Round trade talks urged by the G-7 finance ministers of the leading industrial nations just last month.

In his Inaugural address, President Obama spoke eloquently about the willingness of the United States to extend a hand even to nations “on the wrong side of history… if you are willing to unclench your fist.”

Colombia and South Korea are on the right side of history and stand waiting with the outstretched hand of friendship. It is time for President Obama to call upon Congress to unclench its fist and thus show unambiguously where his administration stands on trade.

Daniel M. Price was assistant to the president and deputy national security adviser for international economic affairs in the administration of George W. Bush. He is currently senior partner for global issues at Sidley Austin LLP.

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