More On The Looming ‘Fair Trade’ Battles
Having failed to convince fellow Republicans of the merits of comprehensive immigration reform, President Bush now faces the even more difficult task of defending free trade against protectionist Democrats.
A tide of populism, protectionism, nationalism and xenophobia is washing over the country, fueled by right-wing radio talk show hosts, CNN firebrand Lou Dobbs — and legitimate concerns that U.S. workers are falling behind in the global struggle for jobs and good wages.
Anti-globalization is a worldwide phenomenon, in fact, that’s being exploited by populist demagogues such as Venezuela’s Hugo Chavez, whose influence is spreading in Latin America.
Even though his influence is at its all-time lowest ebb, Bush somehow needs to mount a campaign to convince Americans that their continued prosperity depends on an open world trading system.
Election exit polls confirmed that the country generally supports Bush on immigration — 57 percent of voters said illegal workers should have a chance to stay in the country — but other polls indicate Americans are fearful about trade.
A Gallup Poll in April showed that by a margin of 65 percent to 30 percent, Americans believe workers are “mostly hurt by increased trade between the United States and other countries.”
Last July, the House passed the Central American Free Trade Agreement by a mere two votes, with only 15 Democrats in support. That history bodes ill for Bush’s upcoming trade agenda, including renewal of “fast-track” negotiating authority and the already-negotiated agreements with Peru and Colombia.
The House last week even declined to pass an agreement with Vietnam that totally benefited the U.S. by opening Vietnam’s markets to U.S. goods, in the process embarrassing Bush as he was headed to the Asian economic summit in Hanoi.
The rejection stemmed partly from other reasons, such as antipathy toward the high-handedness of outgoing House Ways and Means Chairman Bill Thomas (R-Calif.), and the bill is slated to pass eventually. But it was still a symbolic post-election bash to the idea of free trade.
By one estimate, 27 victorious Democratic House candidates campaigned at least partly against free trade. Ohio’s winning Senate candidate, Rep. Sherrod Brown (D), is one of Congress’ most vociferous opponents of trade agreements, including those promoted by the administration of former President Bill Clinton.
What’s more, with the ascendancy of China critic Rep. Nancy Pelosi (D-Calif.) to Speaker, U.S. relations with that trading giant likely will come under pressure. Congress may well pass an across-the-board 27.5 percent tariff on Chinese imports as punishment for China’s manipulation of its currency.
Bush almost certainly would veto the measure, which is sponsored by Sens. Charles Schumer (D-N.Y.) and Lindsey Graham (R-S.C.), but the exercise will put the administration on defense.
Moreover, a Democratic Congress is likely to increase farm subsidies, making it all the more difficult to win the market-opening concessions from Europe that are needed to revive the stagnant Doha round of world trade negotiations.
Increased farm subsidies? Oh, joy, there’s a market intervention that has really worked…just ask the French!
Sigh…these next two years will be very, very trying…
Am I the only person who finds the embrace, by the we-are-the-world diversity-is-an-unquestionable-good Democrats, of “fair trade” and it’s accompanying protectionist xenophobia an interesting, disturbing, and puzzling development?
Yes, diversity is fine as long as it ends at our borders, apparently…
On the flip side to the Dems protectionist gambit, the California economy is heavily dependent on international trade, which makes sense as its ports are the point of destination for most goods from Japan, China, Taiwan, South Korea, etc., not to mention its trade with Mexico, and many of California’s most profitable businesses (medical, technology, film/entertainment) rely heavily on international sales. In fact,even many of the hardcore lefties in California (at least the ones not in elected office) think free trade is a good deal.
And of course, Democrats are heavily dependant on California’s 55 electoral votes. If they use the protectionist issue to make inroads in the rust belt, they better hope the Republicans don’t nominate one of their more moderate candidates.