THE TTALK QUOTES 

On Global Trade & Investment

 

Published Three Times a Week By

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No. 38  of 2014 

THURSDAY, MAY 22, 2014     

 

   

Filed from Portland, Oregon  

     

Click here for Monday's quote from Keith Woodford of New Zealand
on Global Dairy Trade. 
COAL EXPORTS: A QUALIFIED ENDORSEMENT

"I do think if we can do it -[export coal] - in a safe way, it would be good for our ports and for our economy."  

Monica Wehby
May 16, 2014
CONTEXT
If your are following the various Senate races around the country, you know that Dr. Monica Wehby, a pediatric neurosurgeon in Portland, Oregon, has won the Republican primary and will face off against Oregon's junior Senator, Democrat Jeff Merkley in the fall.  But last Friday the primary race had yet to be decided and her opponent was the other leading Republican contender, Jason Conger, a member of the Oregon House of Representatives.  The City Club of Portland hosted a debate between the Dr. Wehby and Mr. Conger that day, and today's featured quote is from one of Dr. Wehby's responses to questions from the moderator, Jack Roberts. 

Dr. Wehby's slogan is "Keep your doctor, change your senator."  Health care and the problems of the now failed Cover Oregon exchange are the big issues, not international trade.  Still, there were a couple of trade policy questions near the end. The big one dealt with plans for exporting coal from states to the east (we assume Montana and Wyoming) through Oregon ports.  

On this issue there was essentially no difference between the two candidates. (One expects a fair amount of that in a primary.)  Even so, the discussion was illuminating.  Here is the full exchange on that issue from last Friday's debate, the moderator's question and the answers of the two candidates.

DEBATE EXCERPT

MODERATOR JACK ROBERTS:  
Governor [John] Kitzhaber [D] has recently made it clear that he will do everything in his power to prevent coal from being transported by rail across our state en route to China.   Would you assist Oregon's governor in trying to prevent this if you are in the United States Senate? 

And do you believe that the interstate commerce clause of the U.S. Constitution makes regulating such transportation a federal rather than a state issue?

CANDIDATE JASON CONGER:
"Let me answer the last part.  There is an interstate commerce issue, but clearly Oregon should have, and does have, the right to impose safety regulations on products that are being moved through its lands.  And I think we should.

"However, I would not support the governor in trying to prevent the movement of goods through the state.  I would support doing it in a way that is not risky but that creates the jobs that will come with exporting more to a country like China, where we have a huge trade deficit."

CANDIDATE MONICA WEHBY: 
"I agree with Jason on that.  I do believe that the increase in jobs from the activity at the ports will be helpful, but it has to be done in an environmentally safe way.

"I know there is a lot of resistance in this state to doing that, and I think we do have to respect what the citizens of Oregon believe and want.   But I do think if we can do it in a safe way, it would be good for our ports and for our economy."  


COMMENT
Mr. Roberts was not overstating the governor's position.  Speaking to the Oregon League of Conservation Voters on April 19, Governor Kitzhaber said, "It is time to once and for all say NO to coal exports from the Pacific Northwest."

At present a focal point in the coal export debate is Ambre Energy's Morrow Pacific project near Boardman, Oregon, on the Columbia River.  Ambre, based in Salt Lake City, Utah, describes itself as "an emerging leader in [the] U.S. export [of] thermal coal."  In Boardman it plans to transfer coal destined for Asia from trains to barges.

We are not entirely clear just where this project stands, but it remains a political hot button, and on May 5, The Oregonian took the governor to task editorially for moving the goal posts (bending the rules) in an effort to block the project.

Our view is that the moderator, Mr. Roberts, was right to raise the question of the Constitution's Commerce Clause.  Of course, states have a right to be concerned with the safety of the commodities that traverse them.  But should coastal states like Oregon have a right to dictate which products of interior states will be allowed access to their ports?  We think not.

Finally, there is the issue of rare earths, those elements China still virtually controls and which are critical to so many high tech products, including things like the wind turbines that dot the landscape near Boardman, Oregon.  The United States recently won a WTO case against China and its policy of restricting exports of rare earths. 

Even if the "no coal exports" policy were to prevail, there may be little likelihood of a similar case against the United States.  The hypocrisy, however, would not go unnoticed.  
SOURCES & LINKS
A Primary Debate is a link to the video recording of the City Club of Portland's Friday Forum for May 16, 2014, and the primary debate between Monica Wehby and Jason Conger.

Anti-Employment Coal Pandering is the May 6, 2014, editorial from The Oregonian against Governor Kitzhaber's stance coal shipments.

Kitzhaber Says No is a link to the page on Governor Kitzhaber's website with his April 19 keynote address to the Oregon League of Conservation Voters.

A Win at the WTO is a link to a USTR statement on the U.S. success in the WTO rare earths case against China. 

Ambre Energy takes you to the website of this company, including information on the Morrow project.
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