This comes at an important time. President Obama is in Asia to participate in discussions about the Trans-Pacific Partnership, which would support economic growth and jobs by removing trade barriers for goods and services, improving intellectual property protection and creating new 21st century trade rules.
The United States and 11 other countries (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam) are included in this partnership, which will help increase the United States’ trade and investment ties with these countries. They have a combined population of 482 million people and account for about 15 percent of global trade. It also will create millions of good-paying American jobs.
The U.S. has been involved in this initiative for some time, but many nations were skeptical that the U.S. could commit to this agreement because Obama didn’t have trade promotion authority — the ability to fast track trade agreements, pending Congressional approval.
In the past, granting the president trade promotion authority was fairly routine, but after it expired in 2007, Obama requested renewal of the authority in 2012 to complete negotiations for the Trans-Pacific Partnership. But his authority was road blocked by his own party.
Although the perception of some was that Republicans were the problem, that was not the case. According to reports, the Republicans on the House Ways and Means Committee (which oversees trade) wrote a letter to U.S. Trade Representative Michael Froman that declared their strong support for the Trans-Pacific Partnership negotiations.
The real stumbling block is that Republicans would prefer that Obama be granted trade promotion authority before agreeing on the Trans-Pacific Partnership. But Democrats in the House and Senate were reluctant to do so, lest they displease their traditional anti-trade union supporters. But the tide has turned now that union influence has been diminished.
Trans-Pacific Partnership is just one pending agreement that has been stalled by Democrats. The other important pending free trade agreement is the Transatlantic Trade and Investment Partnership between the European Union and the United States.
Like the Trans-Pacific Partnership, it aims at removing trade barriers in a wide range of economic sectors to make it easier to buy and sell goods and services between the EU and the U.S.
To put this important free trade agreement in perspective, the U.S. ships more than $730 million in goods to the EU every day, which translated to more than $253 billion worth of industrial products in 2012. With the elimination of EU tariffs on American industrial products, including innovative and high-technology products such as industrial and electrical machinery, precision and scientific instruments and chemicals and plastics, U.S. products would be put on equal footing with goods from the EU’s other free trade agreement partners — Chile, Mexico, South Korea and South Africa — which receive duty-free treatment, as well as with exports from one EU member state to another.
Think of how frustrating this must be for our manufacturers, small businesses and entrepreneurs that these two big trade agreements have been bogged down in political infighting and labor union intrusion.
The midterm election sent a strong signal that Americans don’t like the direction this country is headed in. One way to get this nation moving economically and to create jobs is to give Obama trade promotion authority so he can bring home the Trans-Pacific Partnership and the Transatlantic Trade Investment Partnership agreements for Congress to approve.
It’s the beginning of a new direction in prosperity and optimism.
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