A major business group representing smaller companies is breaking ranks with its brethren and positioning itself against renewing President Bush’s ability to negotiate free-trade deals without Congress changing them.
The U.S. Business and Industry Council, which says it represents America’s “Main Street” companies, opposes current trade policies because it says those policies have been turned into “engines of outsourcing,” according to Alan Tonelson, a research fellow with the organization.
Other, smaller groups are taking similar stands, but the U.S. Business and Industry Council, which represents 1,500 mainly small and medium-sized U.S. companies, is seen as the biggest and most established organization to make such a move.
Typically, major business groups such as the U.S. Chamber of Commerce, the National Foreign Trade Council and the U.S. Council for International Business support free-trade measures, while labor unions tend to oppose them.
The U.S. Business and Industry Council has been skeptical of U.S. trade policies going back to the 1930s, Mr. Tonelson said. That attitude has been strengthened since the North American Free Trade Agreement, because since then U.S. trade policies have turned into production-outsourcing policies, the group contends.
According to Mr. Tonelson, the United States has lost more than 3 million manufacturing jobs since 2000, with a “large percentage” of those losses a result of recent trade policy. In addition, he said, U.S. manufacturing output rose by 1.63 percent annually from 2000 through January of this year.
“That’s really sluggish, and indicates that too much of the U.S. demand for manufactured goods lately has been satisfied by imports, not by domestic production,” he said.
Council President Kevin L. Kearns has said that renewing trade-promotion authority would allow President Bush “to stay on a policy course that has racked up nearly $3.6 trillion in merchandise trade deficits, lost huge chunks of vital domestic manufacturing markets to imports and hemorrhaged millions of high-wage manufacturing jobs to foreign competitors.”
The group dismisses the notion that the authority is needed for the United States to make trade deals with other countries.
That idea is “nonsense,” Mr. Tonelson said.
The U.S. market, he said, is “far and away the biggest prize of any significant world trade negotiation,” and the market everyone needs to be in.
The council’s position stands in sharp contrast to many business organizations. The Business Roundtable, for example, calls the authority a “key tool necessary to keep America competitive in the global economy.”
Mr. Tonelson says these larger business groups are looking out for the interests of large U.S. multinational corporations.
Other business groups going against the grain include the American Manufacturing Trade Action Coalition, made up of 150 to 200 companies, largely in the textile industry, but also in such sectors as furniture, tool and die, and packaging.
The coalition opposes the extension, which its executive director, Auggie Tantillo, has called “the blank check Congress gives to the executive branch to offshore entire U.S. industries.”
Every trade agreement reached under the authority, Mr. Tantillo has said, “has resulted in the maximization of imports at the expense of domestic production.”
AFL-CIO Policy Director Thea M. Lee said it has always seemed “rational to us” that some business groups would agree on the need for new trade, tax and currency policies that make it easier to be more competitive in the United States.
The labor organization, she said, is happy to have a strong partner that can articulate concerns from a business perspective. The council’s presence, she said, changes the discussion when the argument is made that U.S. businesses, not just workers, are hurt by bad trade policies.
In addition, Miss Lee said, the U.S. Business and Industry Council has always had an easier entree into Republican offices than has the labor group. That access continues to be important, even with new Democratic majorities in the House and Senate.