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No. 28 of 2014 

FRIDAY, APRIL 18, 2014     

 

   

Filed from Portland, Oregon  

     

Click here for Monday's quote from Scott Miller of CSIS.

WYDEN ON TRADE: JOBS AND OTHER ELEMENTS

"It's my view that every trade discussion, every single trade discussion, must now focus on how trade policy can be a springboard to high-skill, high-wage American jobs."

Ron Wyden
April 9, 2014
CONTEXT
Ron Wyden (D), Oregon's senior senator and the chairman of the Senate Finance Committee, is doing town hall meetings in Oregon this week. Today he was in Lakeview (Lake County) and tomorrow he will be in Klamath Falls (Klamath County), both in the south-central part of the state.  At lunch time on April 9, however, Senator Wyden was in Washington, D.C., speaking to the American Apparel and Footwear Association. 

Today's quote is from that April 9 address.  It is a statement early in Senator Wyden's speech, but it isn't the absolute beginning,   Nearer to the start, Senator Wyden declared that "American trade policy has always been a story of adaptation and change."  He illustrated that point with a discussion of President's Kennedy's message to Congress fifty-two years ago, in which he asked Congress to pass the Trade Expansion Act of 1962.

We'll come back  to the Trade Expansion Act later and to the notions of adaptation and change.  First, though, we need to talk about some issues for 2014.  As a new chairman of the Senate Finance Committee, Senator Wyden publicly made a point of holding off official action until he had had a chance to consult with his colleagues.  Indeed, he postponed the trade hearing that had originally been slated for April 3 until the end of this month.  That hearing will be held on the 30th.  

It is understandable that the new chairman wanted to know more about the views of the others senators on his committee.  The rest of the world, on the other hand, wants to know what his views are, and, with respect to a number of issues - starting with jobs and trade - he told them in his speech on April 9.  You will want to read the whole speech, but here are some of the topics he highlighted, together with some short excerpts:

Increase U.S production.  "My basic philosophy with respect to trade is I want to see Americans grow and make things here."

Strong Enforcement of Trade Agreements, the WTO.  Senator  Wyden praised the recent WTO decision against China's restrictions on the export of rare earths.
 
Enforcement at the Border.  He also highlighted the need for Customs and Border Protection to pay more attention to trade violations.  "Fake NIKE shoes and counterfeit computer chips with a fake Intel logo too often make their way past America's border agents."

Digital Trade.  "Trade agreements must promote digital trade. ... They must prevent unnecessary restrictions on data flows or requirements to localize data servers."

TPP and Labor.  "The TPP [Trans-Pacific Partnership agreement] is an opportunity to establish improved labor rights in places like Vietnam and Malaysia."

TPP and the Environment. "The Trans-Pacific Partnership must put an end to subsidized and illegal fishing that threatens our oceans and stop trade in stolen timber and wood products in countries like Malaysia and Vietnam."

Transparency and Trade.  In discussing Trade Promotion Authority, Senator Wyden called for "a smart track" and shone a light on the issue of transparency.  "The public has a right to know what the policy choices are," he said.  He added, "The Congress cannot fulfill its constitutional duty on trade if the public doesn't know what's at stake or how to weigh in."

Footwear and Apparel.  "Trade agreement," Senator Wyden said, "need to reflect those industries as they are in this century -- not as they were in the last one."

COMMENT
Adaptation is the key word in virtually any policy discussion, certainly including trade policy.  We are glad Senator Wyden emphasized it at the beginning of his remarks on April 9.  We are also glad he talked a bit about the Trade Expansion Act of 1962.  That led us to find and read President Kennedy's special message to Congress on Trade Policy.  At almost 6,000 words - about 14 pages in our printout - it is a clear, thoughtful, and persuasive message in support of a bill that would give, did give, President Kennedy new negotiating authority.  As noted, it was about adaptation.  The principal new reality to which the United States was trying to adapt in 1962 was the EU, then the European Economic Community and its common external tariff.  And then as now investment was as much a part of the discussion as was trade per se.  The President wrote, for example, that:

"[I]f we can lower the external tariff wall of the Common Market through negotiation our manufacturers will be under less pressure to locate their plants behind that wall in order to sell in the European market, thus reducing the export of capital funds to Europe."

Yes, that was a long time ago.  And, yes, a lot has changed. 

President Kennedy was seeking to expand America's trade surplus (then $5 billion).  We haven't seen one of those in a long time.

His message was a product of the Cold War, which has been over for a while now (though at times we wonder if that vampire is really dead).

The authority President Kennedy was requesting was really just about tariffs.

And finally, he was able to state that "For many years our trade legislation has enjoyed bi-partisan backing from those members of both parties who recognized how essential trade is to our basic security abroad and our economic health at home."  To say the least, that would be a questionable assertion today.

And yet, a 2014 version of the Kennedy trade message might just be what we need.  With major negotiations in progress with eleven other Pacific countries and, separately, with the European Union and its 28 member states, a clear, calm, and thorough statement by the President of his  objectives in these negotiations, presented in support of a request to Congress for the authority to pursue them, would hardly be out of order.
SOURCES & LINKS
A 21st Century Trade Policy is a link to the text of Senator Wyden's remarks on April 9 to the American Apparel and Footwear Association, as it appears on the website of the Senate Finance Committee.

A 20th Century Request takes you to the page of The American Presidency Project with President Kennedy's trade message to Congress of January 25, 1962.
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