| In The News #79 >> | ||
>> TITLE Free Trade Pacts Continue Despite Protectionist Talk Lead Story-Dateline: >> SUMMARY President Bush announced the conclusion of a free trade pact with Morocco, the third free trade agreement in recent weeks. The deal concludes more than a year of negotiations on sticky issues related to tariffs on wheat and beef and protections on intellectual property. Morocco agreed to phase out tariffs on U.S. farm exports over the next 15 years in a move expected to expand U.S. wheat exports by five times. Other recent free trade agreements were struck with Australia and five countries in Central America. However, all three agreements still face Congressional approval during an election year increasingly rife with protectionist talk. In fact, Senator Edwards, one of the last Democratic contenders to drop out of the race, made protectionism a central issue in his campaign. The overseas job loss during a time of high unemployment is striking a chord with potential voters. As a result, most analysts expect Congress to delay voting on these issues until after the fall elections. Morocco may be the lone exception with total U.S. trade valued at only $850 million, and minimal or no negative impact on U.S. jobs expected from the passage. >> Talking it Over and Thinking it Through
>> Thinking About the Future Free trade agreements continue to be contentious since the passage of NAFTA and then-presidential candidate Ross Perot’s statement about the “giant sucking sound” (U.S. jobs moving south of the border). During the past several decades there has been a heated debate about how beneficial free trade agreements are to the U.S. In theory, free trade sounds good. As all countries focus on their strengths and engage in trade, all parties will be better off. The problems arise when everyone is not required to play by the same rules. For example U.S. environment and labor laws prevent U.S. firms from being low cost producers in many fields. Look for free trade issues to continue to generate controversy, particularly during an election year.
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