Susan Schwab Sleepless in Seattle

♠ Posted by Emmanuel in at 8/12/2007 12:51:00 PM
With all the anti-trade and anti-globalization sentiment pervading American politics, let it never be said that US Trade Representative Susan Schwab has an easy job. "It's much easier to demagogue trade than to defend it," she says (see article below). In particular, appeasing an increasingly protectionist US Congress while sticking to the Bush administration's (generally) pro-free trade stance has proven to be difficult. Congress is currently holding hostage bilateral deals with Peru, Colombia, Panama, and Korea as part of its efforts to incorporate trade and environmental standards into trade deals. If you will reall, the expiration of Bush's fast-track authority now gives Congress the ability to tinker with the details of various trade deals struck by the administration. (I have argued that these standards may be protectionism masquerading under another guise.) Here is an interesting report from the Seattle Times on Schwab speaking to a trade group in Seattle about the challenges facing her as USTR. The Battle of Seattle might be eight years gone, but the sentiment it spawned remains strong:

The last time the top U.S. trade representative visited Seattle, in 1999, the city was erupting with anti-globalization protests in the streets [that would be Charlene Barshefsky, USTR under the Clinton administration].

This time, U.S. Trade Representative Susan Schwab found a calm Seattle, but across the country attitudes toward free trade are even more pessimistic than before.

"Trade is becoming a hard sell in the other Washington," Schwab said Friday, addressing the Washington Council on International Trade [at whose event you had to fork over $95-$195 to hear her speak, it turns out].

With four free-trade agreements signed by the president and awaiting passage by Congress, Schwab's challenge is to persuade legislators and the U.S. public that the agreements are in their best interest. The bilateral agreements are with Peru, Colombia, Panama and Korea.

Passing the agreements with the three Latin American countries will allow U.S. companies to sell their products to about 75 million consumers duty-free.

Washington agricultural products that could benefit from the deals include fruits, beef, wheat, dairy products and potatoes.

The U.S. trade agreement with Korea could offer similar benefits. It makes two-thirds of U.S. food products duty-free for the Korean market, which imports almost 70 percent of its food. Korea will eliminate its 24 percent tariff on sweet cherries immediately, under terms of the deal, and it will also lift its 29.5 percent tariff on roasted coffee.

The agreement levels the playing field for U.S. technology, which could be important for Seattle companies since Korea is a growing market for software and services, she said.

The trade agreements also give the U.S. strategic advantages in Asia and Latin America.

Signing a major trade deal with Korea gives the U.S. "a major permanent toehold in Asia" at a time when competition with China is growing and Asian regional agreements are being negotiated that could exclude U.S. interests, she said.

All four agreements were reopened after a bipartisan agreement with House Democrats to insert additional provisions for labor and environmental protection, Schwab said.

Environmental concerns are also reflected in the World Trade Organization's Doha round of negotiations, she said. Trade negotiators agreed to remove barriers to environmental goods and services and focus on eliminating subsidies that result in overfishing.

"The environmental community has made a real case that we can be using free-trade agreements more effectively for environmental protection," she said.

Because important trade agreements now include protections for the environment and labor, people who opposed them in the past should not use such concerns as an excuse for economic isolation or trade protectionism, she said.

The WTO protests in Seattle brought home the importance of explaining why trade is good for the U.S. and for U.S. workers, she said.

Looking out at the cargo ships in Puget Sound, Schwab called on the businesses and people with trade-dependent jobs to help make that case by talking about their own experience.

Ninety-five percent of the world's population is outside of our borders, she noted.

"It would be a disaster for U.S. position in the world, a truly unprecedented and negative outcome if we didn't get approval of these agreements," she said.

But these days that's easier said than done.

"It's much easier to demagogue trade than to defend it," she said.