President Obama faces a big selling job: pushing massive trade deals, now nearing conclusion with Asia and Europe, through a recalcitrant Congress.
The facts are on his side. The U.S. is the world’s largest trading nation. Exports support more than 11 million good jobs, which pay about 18 percent above the national average.
Public opinion is also behind him. In the latest Gallup poll, 58 percent saw increased trade “as an opportunity for economic growth.” Only 1 in 3 see trade as “a threat to the economy” – the lowest rate in two decades.
“The American people,” concludes The Washington Post, “understand that they have more to gain than to fear from a more open global economy.”
But organized labor, a key Democratic constituency, won’t listen to those facts. Union chiefs harbor a theological opposition to trade that defies reason or reality. And their allies on Capitol Hill cravenly cave in to that prejudice.
As the president put it at a recent press conference, some Democratic lawmakers “traditionally have just, on principle, opposed trade because the unions, on principle, regardless of what the provisions are, are opposed to trade.”
Obama’s challenge is to make sure that this worldview, which blindly rejects the virtues of “a more open global economy,” does not dictate national policy.
The first battle will be over a bill called Trade Promotion Authority, crafted by Republican Orrin Hatch and Democrat Ron Wyden, the ranking members on the Senate Finance Committee. This authority – which presidents from both parties enjoyed for many years before it lapsed in 2007 – enables a president to submit a trade pact to Congress for an up-or-down vote, with no amendments allowed.
The idea is that no trade partner will make concessions to U.S. negotiators if they know that Congress can pick the deal apart. Few Democrats have been willing to defy the unions and support this totally sensible idea. And while the White House is willing to win with mainly Republican votes, more Democrats are needed to put trade authority over the top.
Of course, there are losers as well as winners in a dynamic global marketplace. The losers tend to be companies making low-end goods like textiles and toys that can be produced in other countries at much lower cost. And it’s easy for trade opponents – and journalists – to take pictures of shuttered plants and jobless workers and rail against the evils of outsourcing.
But those trends are inevitable and unstoppable and no trade deal – or lack of one – will deter them. As Obama noted, “Companies that are looking for just low-cost labor, they’ve already left.”
Since those jobs are not coming back, we’re left with only two realistic options.
Option 1: Compensate communities and workers damaged by economic forces we cannot contain. And the trade promotion bill does extend a program called Trade Adjustment Assistance that has provided that compensation since 1975.
Option 2: Embrace opportunity and take advantage of a worldwide economy that is growing more integrated every day. Prime Minister Shinzo Abe of Japan is due in Washington next week, and at the top of his agenda is concluding a trade deal that would tie together 12 Pacific nations comprising 40 percent of the world’s economy.
“I will be able to show,” Obama said, “when the final agreement is presented, that this is absolutely good for not just American businesses, but for American workers. And it’s good for the economy and it’s the right thing to do.”
Yes it is. Start with the basic issue: opening foreign markets to American goods from beef and rice to cars and computers. As the president likes to say, “95 percent of the world’s markets are outside our borders” and the fastest-growing opportunities for American exporters “are going to be (in) Asia.”
But the “fastest-growing” sector of the export market is not goods at all; it’s services: insurance and finance, law and consulting. In assessing the potential impact of the Asian deal, the Wall Street Journal concluded that “internationally traded services such as software engineering and financial advice would get the big boost.”
The whole conversation about trade is stuck in a time warp. Unions want to talk about the past, not the future; about jobs lost, not ground gained.
But that’s an old story. Looking forward, expanded trade will create far more jobs than it will destroy. And easier commerce will stretch the budgets of American families by supplying low-cost goods from abroad.
That’s the new story Obama has to tell – and sell.
Steve and Cokie Roberts can be contacted by email at firstname.lastname@example.org.