Trading Places on Trade
TO someone who has served as a United States diplomat, opposition in Congress to government help for US exports is puzzling. When business-oriented conservative Republicans might be expected to support such assistance, they are, instead, calling for the abolition of the Department of Commerce. In the past, these voices have also criticized legislation to authorize the Export-Import Bank (Exim), the agency that provides credit for exports. Successful selling of US products overseas requires the identification of markets and the promotion of sales, augmented by credit terms that are competitive against other suppliers. The Department of Commerce, through its field offices in the US and its representatives in embassies abroad, provides the information and the promotion. Exim provides the credit. Opposition to these agencies stems from a conservative belief that the private sector needs no official assistance: Let the free market reign. Today the Department of Commerce is also seen as a tempting target by those who would reduce the scope of government and the budget. Opposition to Exim has come from both sides of the legislative aisle. Conservatives have attacked it as an unnecessary competitor with commercial banks. Liberals have attacked it as a form of ''corporate welfare'' because of credits extended to large corporations such as Boeing. Those who insist that market forces should prevail might be right if international business were a level playing field. It is not. Every one of America's major competitors abroad relies heavily on help from government institutions. Japan has its Ministry of Industry and Trade. Britain has its Board of Trade. In France and Germany, intimate links exist between government and business. Government subsidies are provided for trade fairs, feasibility surveys, and technical advice that may lead to contracts. Other governments are particularly active in providing credit assistance to their companies abroad. US commercial banks find it difficult to offer terms that are competitive with what official export agencies of other countries provide. Although, the US has made futile efforts from time to time to implement an international agreement that would limit official export credits, other major trading countries are not interested. The proposal to abolish the Department of Commerce comes, ironically, at a time when the US government is becoming more supportive of overseas business and more popular with much of the business community. The trend was apparent in the Reagan administration when Secretary of State George Shultz intervened personally on behalf of an overseas contract for a major company. Secretary of Commerce Ronald Brown has increased the effort substantially in the Clinton administration. In July, the Department of Commerce arranged a conference, Big Emerging Markets, presenting for US business executives some of the possibilities in countries such as India and Indonesia that have not been major trading partners. More than 500 business executives attended. One congressional proposal would meld the export-related functions of the Department of Commerce with those of the US Special Trade Representative (USSTR). Few who know the field, however, believe that the USSTR, which undertakes the often difficult and occasionally bitter negotiations of trade agreements, can, at the same time, effectively promote US exports and investments. US exports have accounted for one-third of the nation's economic growth over the last 10 years. At least a part of that growth can be laid to the energetic support of official agencies such as Commerce and the Exim Bank. To eliminate or cut back on major US instruments in today's trade competition for largely ideological reasons makes no sense.