International Trade, a Bush Legacy
ONE part of the economy has been robust on George Bush's watch. Fittingly, it is the part where the economy meets Mr. Bush's keen interest in foreign affairs - international trade.Skip to next paragraph
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At least 80 percent of what growth the economy has produced in the past couple of years, is from growth in exports.
Only a very small share of that growth is credited to the efforts of the Bush administration.
Yet trade policy in the Bush White House offers a glimpse of some of the president's critical strengths and weaknesses in a world where money is fast surpassing missiles as the currency of power.
Bush is clearly a genuine believer in benefits of full and unencumbered commerce between nations. His pursuit of a free-trade zone that encompasses the Western Hemisphere even amounts, by most accounts, to vision.
His conviction, however, is not always strong enough for him to hew to his own principles. When domestic politics pushes him off his course, as it did in his Japan trip in January, he stumbles.
Further, his heart, like those of his closest advisers, beats not to the meter of trade but to the cold-war pulse of national security, according to former associates and close outside observers.
Still, President Bush's most enduring legacy could be the international trading system he helps build and not the dramatic lessons of the Gulf war. This legacy rides on such eye-glazing negotiations as the General Agreement on Tariffs and Trade (GATT), the North American Free Trade Agreement (NAFTA), and the Enterprise for the Americas Initiative (EAI).
If Bush has pursued any idea far-away enough to be called a vision, it is probably his vision of a free-trade zone encompassing the Western Hemisphere from "Hudson Bay to the Strait of Magellan."
"His hemispheric vision of trade in the Americas is really brilliant, the best that any president has come up with to date," says Bill Frenzel, until last year a Republican congressman from Minnesota and now a trade expert at the Brookings Institution.
Bush is a man with a deep sense of how dangerous the world can be, rooted as he is in his World War II experiences. But his view toward Latin America is now sharply defined by economics and trade, not the threat of creeping communism in Chile or Central America. "On Latin America, the lens of the Cold Warrior is definitely shattered," says Inter-American Dialogue associate Dan Weiss of the Bush outlook.
"It is one of the most important, if not the most important, policy initiatives by this government" toward Latin America in history, says Otto Reich, a trade consultant and former US ambassador to Venezuela.
Bush argues that trade is why his abiding interest in global diplomacy matters to American pocketbooks. "Make no mistake," Bush said in February, "the future growth of the United States economy depends on expanding mutual investment and trade with our neighbors in the Americas." It will "create new jobs and raise the quality of life for people in Syracuse and St. Louis as well as Sao Paulo and Santiago."
US exports worldwide have in fact risen throughout the current recession, 7.2 percent last year, cushioning Americans against the fall in domestic demand.
The Bush administration can claim a little credit for the export boom, driven mostly by low dollar value. Trade negotiators may have cut several hundred million dollars from the $43 billion-and-still-growing US trade deficit with Japan, says William Cline of the Institute for International Economics.