Freeing up food trade
The agricultural talks that begin in Washington today between the United States and Common Market nations represent an opportunity to avert a new round of protectionism that could do serious harm to the Atlantic community. At issue in the discussions are US complaints that Europe is deliberately undercutting US farm sales abroad through export subsidies. All parties to the negotiations - including Deputy US Trade Representative David Macdonald, who heads up the American delegation - must make every effort to produce a working agreement that serves the best interest of both the United States and Europe.
Indeed there is a new urgency for such an agreement given the fact that a number of equally important and, in some respects, more difficult trade problems are looming ahead.
The most immediate is what happens when Japan's voluntary agreement limiting auto exports to the US expires March 3l. Japan's minister of international trade and industry has said that he might not extend the quota, which limits the number of auto exports to the US to 1.7 million units annually. Yet not extending the quota for a third year could have an unfavorable impact on Detroit , which is starting to emerge from recession. Meantime, the US and Japan continue to be at odds over the matter of increasing American citrus and beef products entering Japan. A Japanese agreement imposing quotas on those commodities expires next year.
Then there is the trade dispute between the US and the People's Republic of China. The Chinese would like to export more textiles to the US than allowed in recent years, a move that has been opposed by American textile manufacturers.
World trade is essential to economic growth. What is to be avoided at all costs is unwise political action - such as domestic content legislation now before the US Congress - that could only lead to retaliatory steps abroad. In this context, the proposal by the US Department of Agriculture that the US dump surplus farm products (such as butter) onto the world market to help spur European negotiators into reaching an agreement is a dubious proposal that would only anger the Europeans, not to mention harm US allies such as New Zealand that do not subsidize their farm products at the expense of the US.
In the agricultural talks US negotiators must be firm in pointing out the financial disadvantages of the present subsidy system, under which nations attempt to prop up their farm communities by way of costly subsidy programs. And , looking ahead, the US must be no less firm with Japan in working out another car agreement, perhaps quickly sending a special delegation to Tokyo as was done before Japan imposed its voluntary quota system several years ago.
With cooperation by the parties concerned there is no reason why mutually beneficial agreements cannot be reached in each of these areas.