July 31, 2001 | News Releases on Foreign Aid and Development
WASHINGTON, Jul. 31, 2001-Congress may break for the August recess without voting on whether to give the president "trade promotion authority" (TPA) to negotiate trade deals. But every day of delay is costly to American farmers, whose goods are being bypassed by countries that can buy them more cheaply elsewhere, due to existing trade and investment agreements, a new Heritage Foundation paper says.
There are 130 such agreements in the world today, but the United States is party to only two of them, notes Sara Fitzgerald, a policy analyst in Heritage's Center for International Trade and Economics. As a result, agricultural trade is being diverted from U.S. markets-a problem that could be remedied if the president had TPA.
"American farmers produce one-fourth of the world's beef and nearly one-fifth of the world's grain, milk and eggs," Fitzgerald says. "This huge market share wouldn't exist if past presidents hadn't been granted broad authority to negotiate key trade agreements."
For example, she says, consider the effect of the United States joining the General Agreement on Tariffs and Trade in 1993. Japan cut its tariff on blueberries from 10 percent to 6 percent, and South Korea and the Philippines lowered tariffs on soybeans. These are among Michigan's top agricultural exports, and in 1999 they accounted for $782 million in sales and supported nearly 12,000 jobs, government figures show.
The next World Trade Organization meeting will take place in November, Fitzgerald notes. "If the United States is to promote open markets and free trade effectively at this meeting, it's essential that the president be given trade promotion authority. Without it, American farmers will continue to be hurt by high tariffs and quotas."
Her view is shared by Rep. Calvin Dooley, D-Calif., a member of the House Agriculture Committee. "We have a lot of trading partners," he recently told a Heritage Foundation audience. "They are looking for excuses to say no to the United States … Our failure to grant the president trade promotion authority will play right into those hands."