November 28, 2001

November 28, 2001 | WebMemo on Trade, Economic Freedom

12 Reasons for TPA

"[O]pposing trade promotion authority is not a responsible position. The potential gains from trade liberalization -- to Americans and developing countries -- are too large."
The Washington Post, editorial, November 18, 2001

Trade is very important now, because trade is both good economic policy, and good foreign policy. Trade strengthens our allies, engages our potential adversaries, and its absence harms our enemies. Trade Promotion Authority (TPA) is another arrow for the president's foreign policy bow.

The Heritage Foundation's Center for International Trade and Economics has put together a convincing amount of papers -- all with cogent insight and analysis -- to highlight the benefits of TPA.

  1. Economic development:
    Increasing trade with other countries is clearly in the U.S. interest, as it raises incomes and provides better paying jobs while promoting economic development around the world. For more: Time to Give President Bush Trade Promotion Authority

  2. Economic engagement:
    "Our failure to grant the President trade promotion authority will play right into those hands and those nations that unfortunately are not willing to move forward with a policy of really economic engagement." For more: A Pragmatic Trade Agenda

  3. War on Terrorism:
    The terrorists declared war on America: its values, beliefs, culture, and products. By signing new trade agreements with other countries, the United States will show the terrorists that America, which has many allies and business partners, is undeterred by their actions. There is no better time for Congress to grant the President trade promotion authority and add a strong international economic program to the global fight against terrorism. For more: Fighting for America's Economy With Free Trade

  4. Negotiating leverage:
    With TPA, Congress agrees to take a straight up-or-down vote on trade agreements the president negotiates before June 1, 2005. It has been extended to the previous five U.S. presidents and is granted by most of our trading partners to their heads of state.

    It is much more difficult for the United States to negotiate significant trade deals without an assurance that Congress will refrain from adding numerous amendments and conditions the president must take back to the negotiating table. Congress hasn't granted TPA for seven years - one reason the United States is party to only three of the 131 trade and investment agreements in force worldwide. For more: Trade and Sovereignty

  5. Negotiating leverage II:
    The lesson is simple: Without Trade Promotion Authority, the United States won't be taken seriously as a prospective trading partner. Being in only three out of 150 trade agreements doesn't help matters, and it's made worse by the reluctance of many countries to enter into negotiations with the United States.

    Yes, we are currently negotiating a free trade agreement with Chile. But it took years to convince the Chileans to enter into such talks. We can't keep doing business that way. For more: Trade Benefits All

  6. Negotiating leverage III:
    "But here's what throws me: If liberals are so determined to keep America from turning isolationist, why aren't they just as anxious for the president to pursue a vigorous free trade agenda? On that issue, their impression of Teddy Roosevelt charging up San Juan Hill suddenly disappears.

    We see Bush repeatedly asking Congress to give him Trade Promotion Authority (TPA, formerly known as "fast track") to negotiate trade deals-- and repeatedly being rebuffed.

    The president wants this authority because he knows other nations are reluctant to enter into trade pacts with the United States if they know Congress can, at a later date, load up the agreements with unwanted amendments. With Trade Promotion Authority, our lawmakers can either approve a pact or reject it--but they can't rewrite it.

    There's nothing new or unusual about this authority. Both Republican and Democratic presidents held this authority from 1974 until 1994. Today most all of the world's other leaders enjoy this authority." For more: The Democrats Take The "Fast Track" To Hypocrisy

  7. Labor standards:
    Congress should give President Bush TPA that will allow him to negotiate trade agreements with foreign countries without insisting that they adopt labor standards that they may not be able to implement. If the President has TPA, it is likely that more countries will enter into trade agreements with the United States. Increased trade with the U.S. market will spur economic development in these countries, and this in turn will increase their labor standards. For more: Raising Labor Standards Through Trade

  8. Environmental standards:
    Efforts to impose stricter environmental standards through trade sanctions or by imposing regulations through trade agreements are fruitless and counterproductive. Countries in general--but developing countries in particular--are able to protect their environment only if their economies prosper and the standard of living of their citizens improves.

    The surest way to promote sustainable environmental policies around the world is to increase economic growth and the standard of living in poor countries. Economic growth is achieved through greater economic liberalization, including free trade. Therefore, those truly concerned with protecting the environment should support a trade promotion authority that effectively advances free trade. For more: Trade: The Best Way to Protect the Environment

  9. Auto industry:
    Lowering tariffs and non-tariff barriers will increase U.S. automotive exports. Increased exports mean more sales and a larger piece of the global automotive pie for the United States. A larger share of this global market means more choices and higher-paying jobs for American workers.

    Free trade has not diminished U.S. dominance in the global automotive market, nor has it taken "hundreds of thousands" of jobs from American workers. The United States continues to have the lion's share of the global market. Advancing free trade not only will maintain this share, but will increase it. For more: Free Trade Drives the Auto Industry

  10. Prosperity for the agriculture sector:
    As Secretary of Agriculture Veneman explains, "the long-term prosperity of the U.S. food and agriculture sector depends on our ability to stay ahead of the competition in the global economy. One of the most important tools we have in the struggle to remain competitive is Trade Promotion Authority. Only with TPA can we continue to create new market opportunities for U.S. food and agricultural products in growing, and competitive, global markets."

    ... If the United States is to lead the effort to promote further opening of markets during this meeting round, it is essential that the President have TPA. Without it, U.S. agricultural products will continue to be disadvantaged by high tariffs, quotas, and other non-tariff barriers to trade. For more: Trade Promotion Authority: Good for Farmers, Good for Consumers, Good for America

  11. Build economic and political freedom around the world:
    "This is a time to choose. Through the vote on U.S. Trade Promotion Authority, Americans will make a choice between two competing sets of ideas. Will we fight for America's national interests through an open trading system? Will we continue to help tear down walls to economic and political freedom around the world? Or will we preserve existing walls, erect new ones, and retreat as a nation?

    In order to succeed, we need a partnership with the Congress. Wherever I go, whatever progress we make, I am asked the same question: Will the Congress join with the Administration in supporting trade?

    These are not questions for Democrats or Republicans. They are for Americans.

    This is not an abstract debate on trade policy. I'm at the table now--every day--negotiating with countries from around the world. They have the full authority to negotiate for their nations' interest. I need it too. So now it is time. Not next year. Not later this year. But now." For more: A Time to Choose: Trade and the American Nation

  12. Free Trade Area of the Americas:
    "The negotiations for the Free Trade Area of the Americas (FTAA) have the potential to greatly facilitate free trade in the region. The countries of the Americas that met in Miami in 1994 set a goal of establishing the FTAA by 2005. However, progress toward that goal will be hindered if the current Administration in the United States is not given the trade promotion authority to pursue that agreement. The other countries in the American continent should be confident that they can negotiate with the Administration to develop an agreement that will be either approved or not approved by the U.S. Senate. It is not feasible for every Senator who may have some stake in the agreement to enter into a process of renegotiation. I strongly urge all parties to do what they can to ensure that the trade promotion authority is approved this year. If it is not approved this year, it will become more difficult to achieve as we get closer to the next elections. Postponing this decision will make the target date of 2005 impossible." For more: Free Trade: The Key to Success in the Western Hemisphere

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