Tuesday, November 22, 2011

Friday, November 18, 2011

WTD Friday Afternoon Postcast November 18, 2011



Chief domestic economic adviser to the President, Gene Sperling, showed up briefly on Wednesday morning for a high-level meeting of the full President’s Export Council to bemoan the fact that the national economy will have to grow a lot more than the two to 2.2 percent rate currently projected by economists. That level of growth won’t even begin to affect the still-too-high unemployment rate.

Just afterwards new Commerce Secretary John Bryson said that US exports are providing a boost to the overall economy, but they also are far too low.

Mr. Sperling had another complaint. While he said that the recent easy passage by Congress of the three long-pending free trade agreements with South Korea, Panama and Colombia held out some hope for bipartisanship within Congress and with the White House, the near-term future did not. He remarked that White House staff get up every morning thinking how they can move forward with the nation’s business without the "help" of Congress. At 9:15 am, Mr. Sperling looked, indeed, like he started worrying very early that morning.

Avoiding Congress on the trade policy front won’t work. It’s like avoiding homework and still expecting to pass.

1. House Rules Committee Chairman David Dreier (R-Calif) and free-trade Democrat Gregory Meeks (NY) will introduce a sense of Congress resolution today expressing the sense of the House that the US Administration should embark on free trade negotiations with Egypt – as a show of support for the fragile new "Arab Spring" government and the Egyptian people.

Mr. Dreier should know that the Obama Administration has no intention of moving toward freer trade with Egypt – or any other country in the region. WTD has reported that fact many times since the "Arab Spring", even as recently as this week, when US Trade Representative Ron Kirk told the President’s Export Council that an FTA is not in the cards for Egypt anytime soon.

(The Ambassador’s remark came in response to a PEC letter to the President urging closer economic cooperation with the Middle East – that should lead to FTAs. The letter noted that US exports to the region were advancing two and a half times faster than any other region in the world even before the revolutions.)

2. The recent activity at the annual Asia-Pacific Economic Cooperation leaders’ meeting in Honolulu kicked up interest in nearly two-year-old negotiations for a TransPacific Partnership free trade agreement. It even sparked explicit – and public – interest by Japan, Canada and Mexico.

But as far as I know, there have been no hearings in Congress since the start of the talks. Whether Congress will go along in approving the necessary changes in US law will depend on how well the Administration keeps Congress informed.

So far, a "C" grade at best.

3. Another important Congressional matter involves the revocation of the Cold-War-era Jackson-Vanik emigration trade act. Under WTO rules, members have to provide permanent MFN treatment to other nations when they formally join the world trade body. That means Congress will have either to take Russia off the Jackson-Vanik list – of which it is the only country that remains – or repeal Jackson-Vanik altogether.

Not doing so, the United States will have to announce an embarrassing "non-application" of MFN for Russia during next month’s very public WTO ministerial conference. Doing so, Mr. Kirk said earlier this week to the President’s Export Council, would be "horrible."

Congress is ready to do either in a snap, but the White House has to ask. Not done so far.

4. Senior US trade officials, including Deputy US Trade Representative Demetrios Marantis, has told members of Congress in open committee sessions that the lack of Trade Promotion Authority has, so far, been no obstacle to its trade aims. He did say, however, that TPA – whose fast-track provision forbids Congressional amendments to final implementing legislation and sets a specific period for Congressional consideration of trade agreement implementation legislation – would be useful when the time comes to approve a "21st Century" TransPacific Partnership trade agreement.

The Obama Administration has set a rough end-of-2012 deadline for concluding those negotiations.

It would be wise for the Administration to update Congress – beyond a few senior trade members and staff – on the progress of the negotiations. Otherwise it might run into some always unexpected trouble.

So rather than getting up early and worrying about what you and your staff can do off of Capitol Hill, maybe you better stay up later and do your homework Mr. Sperling.

Jim Berger

Sunday, November 6, 2011

Korean Reaction to KorUS

We know now why Korean Embassy officials asked us not to cover Korea's efforts to get the US-Korea FTA approved.