Bumps in the road for Bush's trade agenda

Leaders from 34 countries meeting in Quebec will consider a trade deal for the Western Hemisphere.

At first glance, it seems like this could be a big year for George W. Bush to advance his free-trade ideals.

But as he stares down a blockbuster lineup of international trade meetings - including one in Quebec City next weekend - reality may hit the president faster than a Texas hot sauce.

Congress remains deeply divided over the wisdom of further opening up trade. The social-justice activists and labor leaders who helped to torpedo trade talks in Seattle in November 1999 have not gone away. And even President Bush's own administration is contemplating protectionist measures for the steel industry - a move that would prompt criticism from Tokyo to Brussels.

"It will be very difficult - harder than the tax cut," says Bill Frenzel of the Brookings Institution in Washington. "It's going to take the president going to the bully pulpit."

During the campaign, Bush gave general outlines of his views, which included eliminating trade barriers from Alaska to Cape Horn. Now, he'll get his chance to elaborate. At the meeting in Quebec, Bush and 33 other hemispheric leaders will be deciding how to move forward on a Free Trade Area of the Americas (FTAA). This concept would open up borders in the Western Hemisphere to free trade by January 2005.

"It has the potential to be as acrimonious as NAFTA," says Fritz Mayer, associate professor of public policy at Duke University's Terry Sanford Institute of Public Policy in Durham, N.C.

Later in the year, world trade leaders will meet in Qatar to try to resurrect the trade talks that failed in Seattle in 1999. This time, however, there will be fewer demonstrators since getting to the Middle East nation is not going to be easy.

Fast-track authority

But if any of these efforts are to advance without great delay, Bush has to win "trade promotion authority" (TPA), an agreement by Congress to expedite consideration of any trade agreement. This would make it more difficult for a dissenting senator, for example, to mount a filibuster.

"Having that authority shows commitment by the White House and the Congress," says Jeffrey Schott of the Institute for International Economics in Washington and the author of a soon-to-be published book on FTAA.

To get TPA passed, Mr. Frenzel, a former congressman, says that the Bush administration may have to give Congress more time to look at any new trade agreement as well as offer more formal ways to be part of the process. "Congress has always felt left out of the negotiation process," says Frenzel.

In addition, Frenzel says Bush may have to find ways to win over moderate Democrats since not all Republicans will back the president. This may mean including national security, environmental, and labor issues in the negotiations.

At the Quebec meeting, unions will be arguing that the FTAA is a NAFTA clone. "We think NAFTA is a failed model of trade and development," says Thea Lee, assistant director of public policy at the AFL-CIO.

Despite the high stakes, it's not clear how high a priority the trade legislation is compared with education, a tax cut, and deregulation. "Publicly, the business community is saying it wants this to happen, but privately it's saying this is not a high priority," says Bruce Stokes, a trade expert in Washington at the Council on Foreign Relations. "Are the political advisers going to spend limited political capital on something that is not a high priority?"

Still, some trade analysts see pressure building to get the process moving. "While we are sitting on our hands, Mexico, Canada, and the European Union are doing regional free-trade agreements, and we are not involved. We are losing out as countries get special access to one another," says Robert Hormats, vice chairman of Goldman Sachs, International in New York.

FTAA basics

The FTAA concept would encompass a region with 800 million people. It would involve large, rich countries such as Canada and the US, poor countries like Haiti, and small ones such as St. Kitts & Nevis (pop. 39,000).

The idea of an FTAA is not new. It started in 1994 in Miami, and since then the hemisphere's trade ministers have met five times to try to develop a framework. Twelve working groups have been set up.

But Latin American diplomats say the US is mistaken if it thinks the FTAA means only more exports for US companies. "There has to be a willingness to discuss agricultural subsidies and antidumping," says Juan Gabriel Valdes, Chile's ambassador to the United Nations. "We need to see commitment and political will."

But Jeanne Archibald, a former general counsel of the US Treasury, is one who's optimistic a deal will eventually get done. "I think everyone realizes they can do better by working together," says Ms. Archibald, now at Hogan & Hartson, one of the leading Washington law firms involved in trade issues.

But Ms. Lee of the AFL-CIO maintains there will be plenty of opposition from labor. And, she observes, it's still several years until negotiations will be concluded. "Our goal right now is to convey as strongly as possible our concerns."

Key meetings

April 20-22: Summit of the Americas in Quebec City

July: Group of Seven/Eight summit in Genoa, Italy

Mid-October: Asia-Pacific Economic Cooperation summit in Shanghai, China

Nov. 9-13: World Trade Organization ministerial in Qatar

(c) Copyright 2001. The Christian Science Monitor

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