April 09, 2008

IN IDAHO'S BEST INTEREST

By Senator Mike Crapo

Trade issues typically get less media than hot button issues like immigration, mortgage industry challenges and energy prices. However, regulating trade between the United States and other nations is a Constitutional obligation of Congress.  In 2007, the U.S. recorded $1.6 trillion in exports, representing scores of American jobs. Exports account for a larger percentage of U.S. GDP than ever before, and jobs supported by goods exports pay wages 13 to 18 percent higher than the national average. Idaho is one of the biggest winners: The International Trade Commission cites Idaho's export growth from 2006 to 2007 as the sixth highest in the nation. 

 

As the world's largest exporter and economy, the U.S. levies considerable international influence through trade. In the face of slow World Trade Organization talks in recent years, the U.S. has been pursuing bilateral free trade agreements (FTAs). These bilateral agreements open up fertile markets for our goods abroad, breaking down prohibitive trade barriers-U.S. exports typically face duty rates of five to 60 percent. FTAs generally reduce restrictions on the entry of U.S. goods into foreign markets. FTAs also have a number of practical implications for the environment, human rights, democracy and rule of law in other nations. When we engage in FTAs with emerging economies, environmental degradation and workers' rights can be addressed. Additionally, as markets expand and competition stimulates economic growth, stricter adherence to rule of law helps keep growth-oriented market conditions in place. FTAs increase transparency, reducing the likelihood of corruption, and trading partners often become strong allies.

 

As emerging economies become stronger through trade with the U.S., our economy grows and our interests abroad are enhanced. The U.S.-Colombia Trade Promotion Agreement (CTPA), under consideration in Congress, demonstrates this. Benefits to Idaho include: immediate duty-free access for peas and lentils, dry beans, apples, cherries, fresh potatoes, and almost all processed potatoes; the elimination of tariffs on wheat and wheat products, barley and barley products; the removal of Colombia's 80 percent duty on prime and choice cut beef imports; the elimination of all dairy product duties; and increased access to the Colombian market for computer and communications equipment that currently face tariffs averaging eight to15 percent.   

 

In addition to economic considerations, Colombia is a vanguard of democracy in South America. Dictators such as Venezuela's Hugo Chavez and, to a lesser degree, Ecuador's president Rafael Correa, are actively seeking to move the region toward socialism, converting private businesses into state-owned operations, thus discouraging capitalism and independent enterprise. Signaling our support for Colombia's popular democratic president, Alvaro Uribe, through the CTPA, is a national security move in our best interest. This brings up another highly-compelling argument for trade agreements with emerging economies-FTAs discourage trade and production of illegal drugs by increasing the profitability of legal goods' production and distribution.  If the U.S. fails to enact the CTPA, it could have long term effects on our mutual relationship, tarnishing the Colombian people's and future governments' views toward the U.S.    

 

While the CTPA and other FTAs demonstrate substantial progress in market access for U.S. products-an essential tenet to ensure U.S. industries' global competitiveness-as with any public policy issue, prudence and caution must be exercised in FTA development. In particular, we should not make further concessions on domestic support. Lopsided deals that don't provide new market access for U.S. farmers and ranchers are not trade arrangements in our best interest. 

 

Healthy, fair international trade drives our economy, secures our homeland and reduces political barriers that impede economic freedom and basic human dignity at home and abroad. Trade agreements like CTPA are a step in the right direction. 

 

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