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Jewish World Review Nov. 15, 2001 / 29 Mar-Cheshvan, 5762

Aaron Lukas

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More trade means more peace


http://www.NewsAndOpinion.com -- It's polite fiction in Washington to insist that "partisanship ends at the water's edge." And when it comes to waging war that may be true. In the down-and-dirty world of trade policy, however, ideological bickering respects neither oceans nor borders.

The current fight over trade promotion authority is a case in point. TPA is a pledge by lawmakers to stand aside while the administration negotiates trade agreements. Congress then either accepts or rejects the agreements in their entirety.

TPA is needed because trade pacts, like soup, are spoiled by too many cooks. Inevitably, any agreement that passes through Congress gets larded up with special interest gimmees-a tariff here, a subsidy there. For foreign governments, that's like buying a house on Ebay: You have no idea what you' re actually going to get, so you just don't bother.

The Bush Administration wants TPA soon because it would give a big boost to negotiators seeking to launch a new round of global trade talks at the World Trade Organization meeting this month in Doha, Qatar. Congressional leaders promise a vote within two weeks.

But a funny thing's happened on the way to the desert. Hard-core protectionists-mostly labor unions and self-proclaimed environmentalists-have hit up on a creative new strategy: insist on writing the rules before talks begin. Instead of offering the administration broad authority to bring home the best deal it can get, obstructionists in Congress are attempting to call the shots from the sidelines. Specifically, they're insisting that when poor countries fail to meet as-of-yet undefined labor and environmental standards, they should be punished.

At its worst, that approach is embodied in the mammoth 134-page "dirty" TPA legislation introduced by Rep. Charles Rangel (D-NY). His bill calls for a "framework of enforceable multilateral rules that leads to the adoption and enforcement of core, internationally recognized labor standards." That would, Rangel argues, merely inject universally accepted standards into the trade negotiating process.

Of course, if the standards are so universal, then there's no need to saddle trade negotiations with them. Nor will sanctions work as advertised. Punishing countries that permit child labor, for example, sounds great in theory. But since child labor is a regular part of life in most of the developing world, the reality is that sanctions will be applied wherever poor-country exports threaten domestic interests. The few children that work export-producing jobs will, if anything, be pressed into worse conditions.

There isn't a developing country in the world that doesn't want to have good jobs and a clean environment. They're simply too poor to enjoy those things. And for the enemies of trade, that's the point. They know that trade talks will never get off the ground if labor and environmental standards are on the agenda-a convenient way to scuttle free trade and soak consumers without directly seeming to do so.

The calculus is simple: Trade barriers benefit, say, union members-particularly those in old-economy sectors like textiles and steel-at the expense of all other Americans. For all the blather about "fair trade," the protectionists, and their representatives in Congress, are happy to shut out foreign competition forever. They've co-opted the rhetoric of starry-eyed idealists who mistakenly believe that free trade hurts the poor. But in the final analysis, it's all about self-interest.

Unfortunately, their timing couldn't be worse. Scuttling trade talks now isn't just bad for the struggling U.S. economy. It's a blow to global security. "The successful passage of a TPA bill will not only add a much-needed boost to the economy," noted House Speaker Dennis Hastert (R-Ill.) recently, "but it will serve as an instrument in increasing our national security." Administration officials from Colin Powell to Robert Zoellick to the commander-in-chief himself have repeatedly made the same point.

It's a fact that trade ties people together; that nations with substantial commercial bonds rarely come to blows. Indeed, trade agreements were a crucial-and successful-component of U.S. efforts to contain Communism. Quite simply, free trade promotes peace.

Thus, trade must be a weapon in the free world's war against terrorism. It's no accident that the 9/11 hijackers all came from some of the least trade-friendly places on earth.

Given that reality, a "clean" TPA bill should be passed soon. The United States can't afford to be held hostage to self-serving, protectionist, special interests at a time when it should be asserting its leadership as never before. Real trade promotion authority would show the world-and most important, the world's least-wealthy citizens-that America is serious about practicing the economic freedom she preaches.



Aaron Lukas is an analyst at the Cato Institute's Center for Trade Policy Studies (www.cato.org). Comment by clicking here.

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© 2001, Cato Institute