Posted by Consumers for World Trade
Thu, 20 Dec 2007 20:35:00 GMT
Michael Virga
December 20, 2007 -
The Republican primary ballot offers no shortage of possibilities for the undecided voter. However, several candidates show distinct potential for gaining their party’s nomination and they are: Rudy Giuliani; Mike Huckabee; Mitt Romney; John McCain; and Fred Thompson. Given these candidate’s conservative ideological underpinnings, it is not surprising that all support free trade to some extent. A closer examination, though, shows differences on the extent and nature of their support.
Giuliani:
Rudy Giuliani has been a vocal advocate for free trade while campaigning. Asked at a debate whether free trade benefited America, Giuliani responded, “Well, I think we're on a verge of going in one direction or another. I mean, for example, you want to get specific, the four trade deals with Peru, Colombia, Panama, South Korea that are in front of Congress right now, which the Democrats are trying to block, would be good deals for the United States.” Moreover, Giuliani’s “12 Commitments” plan calls for vigorously advancing free trade through tax and regulatory reform, in addition to renewal of the fast track authority and reinvigorating the Doha Round of WTO talks.
Huckabee:
Mike Huckabee has said that he supports free trade, ”as long as it is fair trade.”
Neither his website nor previous statements offer much more clarity on his position, or to the priority that trade measures would receive in a Huckabee administration. During a recent televised debate,
Huckabee stated that, “if somebody in the presidency doesn’t begin to understand that we can’t have free trade if it’s not fair trade, we’re going to continually see people who have worked for 20 and 30 years for companies one day walk in and get the pink slip and told ‘I’m sorry but everything you spent your life working for is no longer here.’”
Romney:
Mitt Romney has expressed support for free trade in terms of both economic and foreign policy. With regard to the former, Romney explained his stance at a recent debate, saying, “Well, I believe in trade, but I believe in opening up markets to American goods and services… I want to make sure that the American worker gets a fair shake. We need to make sure that the Chinese begin to float their currency and they protect our designs and our patents and our technology. We need to make sure that the American workers don't have to carry the burden of extra taxes as we sell our products around the world.” Romney also believes that free trade is a means of strengthening relationships with allies, especially in Latin America, and supports proposed and passed FTAs with countries of this region.
McCain:
John McCain has been a supporter of free trade in both his campaign statements and his voting record. According to his website, McCain believes in the benefits of opening up both foreign and domestic markets to competition, and is in favor of an increased Trade Adjustment Assistance (TAA) program. In response to a question on the benefits of free trade, McCain stated that, “it sounds like a lot of fun to bash Chinese and others, but free trade has been the engine of our economy in the last half of this year; it will continue to be. And free trade should be the continuing principle that guides this nation's economy.”
Thompson:
Fred Thompson boasts a pro-free trade voting record from his time in the U.S. Senate. He voted in favor of normalizing trade relations with China and Vietnam, establishing the Andean Trade Preference agreement, as well as for renewing the President’s fast-track authority. Thompson has also been an advocate for free trade on the campaign trail, saying at a recent debate that, “free and fair trade as been good for America; responsible for millions of jobs in this country. We cannot turn our back on that…But in terms of turning our back on free trade, that's not the direction to go in. It's meant too much for our country. And every country in the history in the world that's ever turned its back on free trade has suffered for it as a consequence.”
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Posted by Consumers for World Trade
Thu, 20 Dec 2007 16:15:00 GMT
Ezra Finkin
December 20, 2007 -
A recent AP article asked both Republican and Democratic Presidential candidates their position on a wide range of issues from the Iraq war to stem cell research. On trade, the article stated this of the leading Democratic candidates:
Clinton: Seek to reopen North American Free Trade Agreement to strengthen enforcement of labor and environmental standards.
Edwards: Make human rights "central to our trade policy." NAFTA and other regional trade agreements have been a "total disaster." Supported bringing China into World Trade Organization, says it's "wrong to not hold them responsible for their obligations."
Obama: Seek to reopen NAFTA to strengthen enforcement of labor and environmental standards
Stump speeches by all three back up these broad positions on free trade.
John Edwards has taken the strongest position against trade. At a recent stump speech in Iowa, Edwards stated that he would would renegotiate the North American Free Trade Agreement and “come down hard” on the Chinese for dumping cheap goods on the American market. Edwards states: “… this agreement does not meet my standard of putting American workers and communities first, ahead of the interests of the big multinational corporations, which for too long have rigged our trade policies for themselves and against American families.” Here, Edwards fails to note that under this agreement, the United States gets to export products – made with middle-class American union labor – to Peru.
Of all the candidates, Hillary Clinton maintains the most detailed stance on trade. Like Edwards, she calls for a renegotiation of NAFTA in the name of protecting American workers and the inclusion of tough labor and environment standards in forthcoming free trade deals. However, her voting record remains an interesting mix of support and opposition to free trade. For example, she opposed the Central American Free Trade Agreement (CAFTA) but voted for the Australia free trade deal and supported Vietnam’s entry into the World Trade Organization. A recent article also suggests that many of her husband's key trade and international economics advisors are now on the Clinton campaign. These were the same advisors that counseled the President in support of the creation of the World Trade Organization and the North American Free Trade Agreement – the same deal she now wants to renegotiate. This on-again-off-again position on trade has caught the eye of some influential labor leaders who would like to see a stronger anti-trade position from the former first lady.
Obama too has a somewhat on-again-off-again position on trade. The junior senator from Illinois supported the Oman free trade agreement yet opposed the Central American free trade deal stating that labor and environment provisions were lacking. According to his campaign website, international trade does not even make it onto the key issues he plans to tackle. Yet Obama has made statements that he wants to rengotiate NAFTA to include strict labor and environment provisions. One sound byte heard over an over again is that trade agreements should be good for Wall Street and for Main Street.
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Posted by Consumers for World Trade
Fri, 07 Dec 2007 16:32:00 GMT
Michael Virga
December 7, 2007 -
It seems like more and more Americans are thinking differently on trade these days. A
recent study conducted by the German Marshall Fund of the U.S. found some interesting trends among the American public regarding international trade, aid and investment. The GMF’s poll discovered that Americans are growing progressively more skeptical of the benefits of free trade, increasingly seeing it as more of a threat than an opportunity. According to the survey, while about half of Americans thought trade cost more jobs than it created in 2005, that number rose to 57% in 2007. Moreover, the percentage of American respondents that looked favorably on trade with some of the world’s poorest countries slumped from 75% last year to 69% in 2007.
These disparaging numbers beg to ask the question: What is souring the American people on trade? Among the people trying to find out are the researchers and scholars at the Third Way, a progressive think-tank looking into these recent declines in public support. It is engaged in a year-long study on why American attitudes are shifting on trade, and what is giving anti-trade voices more clout in this grand debate. In it’s initial paper on the topic, entitled "Why Lou Dobbs is Winning," the Third Way identifies several causes of the American people’s declining support for trade. The study points out that very often, those who lose from trade make a much more compelling case for protectionism than those advocating for free trade. These anti-trade activists appeal to values, such as the American working-man who is displaced by imports, while the pro-trade champion is to often far less persuasive, turning to abstract economic theory or cold statistical data to make their case. Moreover, the American government no longer attaches open trade policies to some higher calling or foreign policy priority, as it did in the contest with the Soviet Union during the Cold War. Perhaps most poignant of all the report’s findings was that American leadership is not offering a suitable vision of how to strengthen and grow the American middle class, and this uncertainty is leading many Americans to overestimate the negative impact of trade on their lives.
Despite the increasingly vociferous complaints of those who have unfortunately lost from trade, and the growing concern among ordinary Americans over the costs of trade, it seems that the facts continually back up the economic logic of free trade. Open trade continues to create more jobs than it costs. In looking at some of the recently-passed or proposed free trade agreements, for example, the countries we stand to cooperate with will only increase up the number of export-related jobs in America; furthermore, Peru, Panama or Colombia are not poised to take over the American market with an influx of their goods.
However, in communicating the realities of free-trade, especially in terms of explaining its wide-ranging benefits, separating negative emotions from assessing its impact, and offering a compelling case attached to an overarching goal, pro-traders have a long way to go. Thankfully, research institutions like the German Marshall Fund and the Third Way are continuing to offer incredibly valuable and timely information that will help accurately inform the American people, in addition to their policy makers, in the debate over trade.
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Posted by Consumers for World Trade
Fri, 17 Aug 2007 19:42:00 GMT
Michael Virga
August 17, 2007 - Legislation has been working its way through both the House and Senate recently
with the goal of forcing China to revalue its currency, the Yuan. Lawmakers and
interest groups have been loudly accusing the Chinese government of grossly undervaluing
its currency, thereby contributing to America's trade deficit with the People's
Republic. Their argument is that if the Yuan is artificially cheap, Chinese producers
have an unfair advantage in exporting products that are cheap in the U.S., while
American firms cannot sell their comparatively more expensive goods in China.
However, as is often the case in Washington, some of the outside voices calling
for Congress to punish China have more than America's best economic interests
at heart.
A
recent article on the Washington Post's website by Albert Keidel, former
Acting Director of the Office of East Asian Nations at the Treasury Department,
sheds light on self-serving interests in the financial sector that are advocating
for Chinese currency-change legislation. Keidel explains that American investors
and speculators bought up Yuan-based financial assets following the most recent
economic recession and corresponding drops in American interest rates several
years ago; Chinese financial assets were paying higher interest at the time. However,
fast-forward to the present and the motives of these speculators become quite
clear. If America was somehow able to force China into letting its currency appreciate,
as some proposed legislation aims to do, those individuals and firms holding Yuan-based
financial assets would see their assets' value skyrocket. Think of it this way
- Say you bought a Chinese asset, valued in Yuan, for $100, and then Congress
enacted a bill that caused the Chinese currency to appreciate by 40%: your asset
would be worth $140.
For his part, Keidel does not believe that any legislation will be able to force
China to revalue its currency, and that even if it were possible, a more valuable
Chinese Yuan would not change America's trade deficit with China. In looking at
American trade with China, it is important to realize that American exports to
China are growing at a faster rate than with any other country in the world, creating
jobs in the process. It is also a neglected truth that trade with China allows
Americans to have access to a wide array of affordable consumer goods. However,
the Wall Street speculators calling for Congress to take action against China
are just one voice in a chorus that wants to put protectionism and special interest
before the American people's economic well-being.
Posted in Congress, China | 4685 comments
Posted by Consumers for World Trade
Thu, 09 Aug 2007 18:04:00 GMT
Michael Virga
August 9, 2007 --
Most people would agree that governments have a legitimate role in ensuring the
safety of any goods, ranging from food to medicine to children's toys. Here in
the U.S., consumers are protected by a network of Federal agencies. Enormous entities
like the Food and Drug Administration and the Consumer Products Safety Commission
are devoted to this task. Similar government agencies exist in other countries.
Yet when it comes to imports, an alarming trend shows that many governments have
begun using their role as consumer guardians to play politics with safety issues.
This is nowhere more true than with regard to imported food. Many of the world's
major trading nations, including India, China, Russia and the United States, are
restricting each other's food imports over claims of uncertain product safety;
however, safety may not be the only thing on the agenda for many of these governments.
Using safety standards to protect consumers from dangerous products is certainly
a laudable policy. Yet using safety standards to protect domestic producers
and farmers from foreign competitors is not only unfair but hurts consumers.
After many decades of reducing import taxes, many countries can no longer use
these taxes to protect certain domestic producers from the global marketplace.
With tariffs on certain products already low, governments may use safety concerns
an effective way to exclude imports that would otherwise out-compete these domestic
producers.
As it pertains to agricultural commerce, trading nations impose their own specific
safety and sanitary regulations on imports referred to as "Sanitary Phyto-Sanitary
(SPS)" standards. There is no internationally agreed-upon set of SPS standards,
so countries can essentially concoct whatever standards they want under the
guise of consumer safety. For example, the European Union prohibits the import
of many U.S. agricultural commodities containing genetically modified organisms
for fear of food safety despite broad scientific evidence to the contrary. A
recent article in The Wall Street Journal shows how countries are increasingly
using SPS standards as a non-traditional, non-tariff barrier to food and goods
entering their respective states.
This type of discriminatory trade policy hurts consumers in a number of ways.
Limiting imports of cheaper foreign products will undoubtedly drive the price
of those goods much higher, as well as limit the variety foods and goods available
to consumers. Another dangerous risk associated with using arbitrary safety
rules to exclude imports comes from the risk of retaliation from our trading
partners. For example, if America were to slap an arbitrary ban on another
country's exports for supposed fear of safety, there will likely be retaliatory
safety bans by that country against American goods. Such a development would
hurt America's exports to the rest of the world and potentially even result
in a loss in American jobs. It is important that governments employ safety mechanisms
to protect their citizen-consumers, but the use of safety standards as trade
barriers could prove more harmful than any faulty product.