It's Now or Never on Free Trade

Posted: Oct 11, 2011 10:37 AM

When it comes to free trade agreements (FTAs) pending in Congress, Americans have learned not to get their hopes up. No matter what President Obama might say in favor of passing the three FTAs with Panama, Colombia and South Korea; no matter how close congressional leaders are in getting a deal done; and no matter how many times proponents preach the unsurpassed benefits to free trade, something always blocks final passage.

So we should take the news that Congress is - once again - close to finishing work on the three FTAs with a heavy dose of skepticism. Nevertheless, Congress has the best chance at passage than at any other point since the beginning of the Obama Administration and we cannot afford to squander this opportunity. When the final obstacles are cleared, it's up to Congress to forgo the partisan bickering and get to the business of finally passing these necessary vehicles of economic prosperity and job creation.

A new report from the Council on Foreign Relations spells out in troubling language the damage America's inertia on free trade has caused our economy. Headed by former Bush chief of staff Andy Card and former Senate Majority Leader Tom Daschle, the bipartisan report explains how other nations, especially in the EU, Asia and Central America, have spent the past decade pursuing free trade agreements, all the while the U.S. continues to dither.

The report summarizes: "By allowing the EU, in particular, to gain a first-move advantage, U.S. companies may find themselves forced to conform to European regulatory standards if they are to sell into the world's fastest growing markets." In other words, U.S. businesses are in danger of losing the autonomy that has given them their historical advantage over foreign competition. Now, we're playing catch-up instead of leading.

The CFR report covers more than the three pending FTAs with Panama, Colombia and South Korea. It sets forth a national trade strategy that "brings to more Americans more of the benefits of global engagement, within the framework of a strengthened, rules-based trading system." The Obama administration should work with Congress to consider the report's findings. If instead the president decides to punt, the Republican presidential candidates should give the report the attention it deserves - and the Obama administration all the criticism it has invited.

The truth is that despite the president's rhetorical support for the pending FTAs, he has put little White House muscle behind their passage. Indeed, the president has never mentioned the FTAs in any of his recent speeches on job creation or the economy. This absence of leadership has allowed pro-union congressional lawmakers to put up obstacle after obstacle to block their approval.

But the free-trade opponents are fighting a losing battle. When unemployment remains above 9 percent, cutting U.S. companies off from emerging markets won't build jobs. Protectionism is a short-sighted position that will, inevitably, come back to haunt us - just as the CFR report makes clear.

Besides, it's been so long since Congress has compromised on behalf of the American people. At least on the matter of free trade, the case is closed and shut.

That's because the benefits of free trade couldn't be clearer. Over the last 15 years, free trade has created more than 25 million jobs and increased real wages for U.S. workers. In fact, according to the Peterson Institute for International Economics, the cost of not passing the Colombian and South Korean agreements has been on the order of 300,000 jobs. The longer we delay passage, the longer hundreds of thousands of Americans remain out of work.

As president and CEO of an association representing more than 2,000 consumer technology companies, I know firsthand just how important free trade is for the continued prosperity of our industry. But the consumer electronics industry isn't alone. Across the economic spectrum, free trade creates wealth and jobs - and both have never been more needed than right now.