Speed up and increase trade, or we'll derail our growth and influence
Fast-Track to Freer Trade Promises Bumpy Ride
Gerald Ford had it. Jimmy Carter had it. Ronald Reagan had it. George Bush had it. Now Bill Clinton wants it - and Congress can stimulate long-term economic growth and enhance United States leadership around the globe by giving it to him.
"It" is fast-track authority, a streamlined process for negotiating and approving international trade agreements. Fast-track is a trade-off - not a blank check. The White House submits to strict congressional parameters and enforcement standards in the negotiation of trade agreements. In return, Congress agrees to approve or reject accords without subjecting them to amendments.
President Clinton's formal request for fast-track authority this week promises a spirited House and Senate debate.
The main issue of contention is economics. Opponents of fast-track claim that increased trade also increases the movement of jobs to other countries. For some industries, this claim has merit. Despite our favorable business climate and the fact that American workers are among the most productive in the world, some companies have used expanded trade to relocate to lower-cost areas.
But the beneficial economic effects of trade, over time, overwhelmingly outweigh any short-term consequences. Consider these staggering numbers: Since 1988, nearly 70 percent of US economic growth has come from the export of goods and services. Nearly 1 in 5 jobs in today's work force is supported by trade.
The political argument from some legislators against fast-track is that it places too much economic power in the president's hands, and overly constricts Congress's ability to influence trade accords.
If anything, fast-track strikes an appropriate balance between Congress's need to oversee the executive branch, and the president's authority to make treaties. It gives Congress the final say on American trade policy, yet recognizes that many trading partners wouldn't even come to the table if US negotiators had to consult with 100 senators and 435 representatives on the wording of every clause.
Since World War II, the US has been the undisputed leader in the global effort to liberalize trade, reduce tariffs, and open markets. The prestige gained from that status, combined with our national economic might, has given our leaders considerable leverage in negotiating trade agreements favorable to American interests. But fast-track authority's absence in recent years has sapped that diplomatic strength and undermined our credibility with potential trading partners.
Perhaps the best example of the damaging results of American inaction is Chile. After George Bush suggested in the 1992 presidential debates that he wanted a free-trade pact with Chile, and President Clinton later agreed, the Chilean government eagerly began preparations.
It would've been a good deal for the US. In 1996, US exports to Chile were worth more than $4.1 billion, and our trade surplus with the country was $1.6 billion. An agreement to eliminate all barriers to US goods likely would increase the economic windfall from trade with Chile.
But lack of fast-track trade authority has thrown cold water on those plans. After five years of waiting for free-trade negotiations with the US, a disgusted Chile signed free-trade agreements with Mexico, the South American Mercosur trade alliance, and Canada. More than 20 trade agreements since 1992 - many in Latin America and East Asia - have been enacted without US involvement. The once-mighty leader in global trade liberalization is in danger of being left behind.
Enactment of fast-track trade authority won't be easy. White House failure to introduce legislation until now leaves us with fewer than two months to resolve concerns about foreign labor and environmental standards and to guarantee adequate enforcement of trade agreements.
Time is short, and opposition will be fierce, but the stakes of inaction are clear. President Clinton and the 105th Congress must put the US on the fast track to increased trade or risk a slowdown in our nation's economic growth and a derailment of our global influence.
*Bob Graham (D) of Florida and Mike DeWine (R) of Ohio are US senators.