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Preview: RealClearPolitics - Articles - Stuart Eizenstat and Marney Cheek

RealClearPolitics - Articles - Stuart Eizenstat and Marney Cheek

Last Build Date: Mon, 02 Apr 2007 00:36:21 -0600

Copyright: Copyright 2007

Ending the Trade War in Washington: Saving the Trade Agenda by Protecting Workers

Mon, 02 Apr 2007 00:36:21 -0600

The value of U.S. trade and earnings on foreign investment increased 32-fold between 1970 and 2005 and 130 percent between 1994 (the year before the successful completion of the Uruguay Round of trade talks) and 2005 in nominal terms. In 2005, the value of U.S. trade in goods and services alone stood at a record 27 percent of GDP, up from a mere 11 percent in 1970 and 22 percent in 1994. Today, at least 12 million Americans owe their jobs to exports to the rest of the world. The United States' role in free trade is so central that were the country to appear to be closing its doors to trade, it would send a dangerous signal to the rest of the world that protectionism is acceptable. Any resulting protectionism would constrict the main arteries of global trade and jeopardize continued economic growth. Unfortunately, protectionist sentiments and partisan polarization seem to be on the rise on Capitol Hill. In the 2006 congressional elections, several Democratic Party candidates won on anti-free-trade platforms. The new Democratic House Speaker, Nancy Pelosi, has warned that their views need to be heeded in developing a new trade policy. Many Democrats are stating that they will refuse to renew President Bush's trade-promotion authority (known as "fast-track" authority), which allows the president to negotiate trade agreements and requires Congress to vote on them without amendments, after it expires at the end of June. The White House has relied almost solely on Republican votes to push its trade policy through Congress. In recent years, Democrats have struggled with the free-trade agenda. President Bill Clinton had to rely heavily on Republican support to pass the North American Free Trade Agreement (NAFTA) in 1993 and to normalize trade relations with China in 2000. In 1998, Democratic opposition in Congress blocked the renewal of Clinton's fast-track authority, even though a majority of House Republicans supported the bill. In 2002, a Republican majority supported an identical fast-track measure for Bush, but it received minimal support from Democrats. Republicans, for their part, reinforced partisan polarization on trade when they were the majority party. The Republican leadership of the House Ways and Means Committee, for instance, refused to consult on trade issues with ranking Democrats such as Charles Rangel (D-N.Y.), the committee's current chair, and Representative Sander Levin (D-Mich.), now chair of the Trade Subcommittee. They preferred to ram legislation through with just Republican votes. Today, the Bush administration and congressional Republicans could continue to tow a staunch free-trade line that ignores Democratic concerns, although this would likely end in failure. At the other end of the spectrum, Democrats could push an antitrade agenda that exploits Americans' concerns about free trade's negative effects and ignores its benefits. This would be unwise for both parties. Instead, congressional Democrats and President Bush should work together to fashion a new, bipartisan trade agenda. The prospects of building a bipartisan consensus on trade are brighter than is commonly recognized. Rangel, for example, is not the reflexive protectionist his opponents have made him out to be. He supported five of the seven bilateral free-trade agreements (FTAs) negotiated by the Bush administration, despite having been cut out of the loop. In the Senate, the Democratic chair of the finance Committee, Max Baucus (D-Mont.), worked cooperatively during the previous Congress with then Committee Chair Charles Grassley (R-Iowa) on a variety of trade issues; he opposed only the Central American Free Trade Agreement. In the dying days of the Republican Congress, in December 2006, an overwhelming majority of Democrats in the Senate and roughly 50 percent of Democrats in the House supported extending unilateral trade preferences for developing countries under the Generalized System of Preferences (GSP) program. Rangel and other Democrats have long been strong supporters of the GSP and regional trade preference programs, even [...]