Looks like President Bush is not going to let Congress pretend there aren’t Free Trade Agreements that need action.

From the White House:

President Bush to Welcome President Alvaro Uribe of Colombia

President Bush will welcome President Alvaro Uribe of Colombia to the White House on September 20, 2008. Colombia is a strategic ally of the United States, and this visit underscores the deep friendship and extensive cooperation between the United States and Colombia. The two leaders will discuss a range of issues, including their shared commitment to the United States-Colombia Trade Promotion Agreement, continuing to reduce violence and increase peace and security in Colombia, and strengthening democracy throughout the region.

Following this:

President Bush to Welcome President Martin Torrijos of the Republic of Panama

President Bush will welcome President Martin Torrijos of the Republic of Panama to the White House on September 17, 2008. Panama is an important friend and ally of the United States. The President looks forward to discussing a range of issues with President Torrijos, including our common commitment to the United States-Panama Trade Promotion Agreement, expanding free trade and strengthening democracy throughout the region, enhancing security cooperation, and strengthening cooperation in international fora. This visit, following President Torrijos’ visit last May, underscores the on-going deep friendship and cooperation between the United States and Panama.

Missed this from earlier in the week, a new survey released during a Consumer Electronics Association event at the Republican National Convention in Minnesota. From CEA:

Fifty-eight percent of those polled said they consider trade a good thing because it has reduced the costs of goods such as electronics and clothing while at the same time helping Americans to become more competitive with workers overseas. The survey released by the Consumer Electronics Association (CEA)^® was conducted by Zogby International.

A vast majority, 69 percent, report that they personally benefit from trade. Support for trade has particularly been drawn from the technology and consumer electronics fields. Sixty-nine percent of Americans called said they support overseas trade in those sectors. In addition, 74 percent said that it was a “good thing” that overseas trade and global manufacturing had reduced the costs of consumer electronics goods in the United States. Fifty-seven percent said that America would not be the economic leader it is today without overseas trade. Only 25 percent disagreed with this statement.

“The verdict is in and the people have spoken. Now it’s time for Congress to grasp what the American people firmly understand – that trade benefits our country,” said CEA President and CEO Gary Shapiro. “It’s time for Congress to listen to the American people and not the protectionists in the media and do what’s right for our economy, which is passage of trade agreements with Colombia, Panama and South Korea.”

The event in Minnesota, which featured Commerce Secretary Gutierrez, was part of the CEA’s month-long “America Wins with Trade” bus tour. Washington Times story here.

From AFP, “Singapore says free trade talks with China concluded“:

SINGAPORE (AFP) — Singapore and China have successfully concluded negotiations on a bilateral free trade agreement, the city-state said in a statement Thursday.

It said the bilateral deal builds on a free trade agreement already reached between China and the 10-member Association of Southeast Asian Nations (ASEAN), to which Singapore belongs.

Granted, regional trade agreements complicate the global trading systems, introducing protections and complications even as they lower other trade barriers. The Economist comments in “A second best choice“:

On August 28th India agreed a free-trade agreement with the ten fast-growing countries in the Association of South-East Asian Nations. ASEAN also announced a second big regional deal, with Australia and New Zealand. Coming so soon after Doha’s collapse, the two agreements sent a powerful message. The global trade talks may have stumbled, but regional pacts are pushing ahead, particularly in the fastest-growing part of the world economy. According to the World Trade Organisation (WTO), over 200 regional and bilateral agreements are in place with many more under negotiation. More than 100 came into force during Doha’s seven exasperating years.

That is disturbing. Every trade deal should be measured on its own merits. But, for all their political appeal, bilateral and regional deals are never a substitute for progress at the WTO. Multilateral trade rounds are the foundation of the trading system because they are based on the “most favoured nation” principle—that any tariff cuts offered to one country must be offered to them all. Regional and bilateral deals are based on discrimination.

And here’s the third best choice, which equals the BAD choice: Do nothing, as so many in Congress — especially the House leadership — have decided is the best course of action on FTAs with Colombia, Panama and Korea.

UPDATE (4:15 p.m.): From today’s Asian WSJ, “Bilateral Trade-Off,” a column by trade thinker Bernard K. Gordon that takes the criticisms pretty darn far:

The latest sign that the postwar era of “multilateral” trade liberalization has ended came last week in Singapore. The event was an Association of Southeast Asian Nations ministerial meeting, where the 10-member grouping and India formally agreed to a “free trade” deal to take effect in January. At the same meeting, Asean leaders also agreed to establish yet another so-called “free trade agreement,” this one with Australia and New Zealand.

That brings to roughly 400 the number of regional and bilateral trade agreements that have been notified to the World Trade Organization. Meanwhile, another try to keep the Doha Round of world trade talks alive will be made in Geneva later this month. But the prospects are not bright, and all of this has been very predictable. Scores of observers — not only academics — have regularly warned that bilateral and regional trade pacts, which are in fact preferential rather than free trade agreements, are both a cause and a consequence of a breakdown of the WTO system.

 

The NAM has released its 11th annual Labor Day Report.  Facing Up To The Challenge: Trade Energy and the Economy focuses on the current state of the American worker.  Sluggish domestic demand, chiefly due to high energy prices and an ongoing housing recession, have caused employment to decline continuously throughout the first seven months of the year.  The construction sector and a number of manufacturing industries have been hit hard. 

Amid these significant challenges, the one bright spot continues to be exports, which have accounted for more than half of total  economic growth during the first half of this year.  The report calls for a comprehensive national energy strategy that both boosts domestic production and exploration of energy resources as well as increases energy efficiency.  The result will be reduced dependence on foreign sources of energy, lower energy prices and higher disposable incomes for American workers. 

The report also calls for policy makers to aid U.S. exports (which are manufacturing jobs) by passing the three Free Trade Agreements (with Colombia, Panama and South Korea) that are awaiting Congressional Approval on Capital Hill.  

According to the Commerce Department’s revised estimate released today, the economy grew at a solid 3.3 percent pace in the second quarter.  This is 74 percent faster than the advanced estimate of 1.9 percent growth released last month.  While consumer spending edged up a little faster, rising at a 1.7 percent annual rate, than initially reported, the bulk of the improvement in the health of the economy came from trade.  Export growth was revised up to 13 percent (compared to 9 percent growth in the advanced report) while imports fell by 7.6 percent (compared to -6.6 percent in the advanced report). 

As a result, net exports (exports-imports) contributed 3.1 percentage points (or 94%) of the total 3.3 percent growth in the second quarter.   This is the single largest quarterly contribution to growth from trade in 28 years (2nd quarter 1980).  Exports alone were responsible for half of GDP growth last quarter.

Thanks to a more-competitive value of the dollar and solid growth overseas, trade winds are propelling the economy forward just at the right time.  Since the housing recession started in the first quarter of 2006, trade has added more to GDP growth than housing (residential investment) has taken away. 

Today’s news should be a wake up call to members of Congress, especially those who are dubious about the benefits of trade and claim that Free Trade Agreements, which work to level the playing field and make U.S. manufacturers more competitive, hurt American workers. 

The trade deficit, which was 5 percent of GDP in the second quarter, is mainly a reflection of our country’s reliance on foreign sources of energy.  By themselves, imports of petroleum made up 69 percent of the entire trade deficit in goods and services last quarter.  A comprehensive national energy strategy focused both on increasing efficiency as well as increasing domestic production will help reduce our reliance on energy imported from abroad.

The trade deficit in manufactured goods with our FTA partners, however, has narrowed over the past few years and through the first six months of this year, has turned into a suplus!  Congress can help manufacturers further by passing the three FTAs (with Colombia, Panama, and South Korea) that are awaiting congressional approval.  Economically, its a no-brainer.  Lets hope that the politicians on Capital Hill can show the political courage, ignore the foes of free trade, support U.S. manufacturers, and pass these agreements.   

 These issues are discussed more fully in this year’s, NAM Labor Day Report, which was just released.  I’ll write more about this tomorrow.

From the White House:

President Bush will welcome President Martin Torrijos of the Republic of Panama to the White House on September 17, 2008. Panama is an important friend and ally of the United States. The President looks forward to discussing a range of issues with President Torrijos, including our common commitment to the United States-Panama Trade Promotion Agreement, expanding free trade and strengthening democracy throughout the region, enhancing security cooperation, and strengthening cooperation in international fora. This visit, following President Torrijos’ visit last May, underscores the on-going deep friendship and cooperation between the United States and Panama.

(Note: NAM’s Executive Vice President Jay Timmons is blogging from the National Democratic Convention in Denver this week.)

Colorado Governor Bill Ritter and First Lady Jeannie Ritter were the gracious hosts to a diverse group of international guests at an event sponsored by NAM member company 3M at the Governor’s residence Wednesday.

Jeff Rageth, 3M’s Vice President for Government Affairs, opened by noting that 3M manufacturers in 70 countries around the world and sells products in over 200 countries.  American innovation and commerce is key to building strong economies around the world, and 3M is a vivid example of why free trade is good for the United States and the world.

The event was co-hosted by the National Democratic Institute, an organization working to strengthen and expand democracy worldwide. As part of its International Leaders Forum, NDI brought observers – party and elected leaders in emerging democracies – to the Democratic National Convention from across the globe to witness democracy in action.  The Prime Minister of the Republic of Mauritius, Navinchandra Ramgoolam, made note of the unique and powerful role that NDI has in promoting democracy and democratic principles.  (Side note: Mauritius made news earlier this month as bantomweight boxer Bruno Julie became the first Olympic athlete from that country to ever secure a medal – a bronze).

Last year, I had the opportunity to work with NDI’s sister organization, the International Republican Institute (IRI) when the organization sent me to Cambodia to work with four political parties in developing policy proposals and platforms for their upcoming national elections – something many nascent democracies are not familiar with.  NDI and IRI are vital partners in advancing the cause of freedom and democracy around the world.  When Americans get frustrated with our political system, we need only look at the struggles of billions who live in the shadow of tyranny and oppression to understand how blessed we are to live in our country.

From Logistics Management, “Coalition pushes for more awareness, removal of tariffs on environmental goods“:

The Coalition for Environmental Trade Agreement hopes to continue the momentum generated earlier in the month behind the Environmental Goods and Services Agreement (EGSA) and ensure that trade and tariff regulations don’t get in the way of climate change possibilities.

The National Association of Manufacturers (NAM) created the coalition in August after agreement talks in the World Trade Organization fell apart. Not wanting the EGSA to fall by the wayside, the coalition was formed to raise awareness of the agreement and expand the list of products it would affect and ultimately get it passed.

The formation of this group (news release here) may have slipped some people’s attention during the summer slumber, so the story from Logistics Management is a useful reminder.  More…

For logistics and supply chain professionals, fewer tariffs and barriers will mean more trade and business activity. The breaking down of barriers for services could also open up new doors for material handlers.

 

“Increased trade of any kind would benefit that sector,” NAM trade policy director Doug Goudie said, “specifically on the services side.” 

Ken Alfred of the Ohio Fuel Cell Coalition said basic economics dictates that lower prices on goods like fuel-cell powered and hybrid lift trucks will increase demand.

“Free trade is almost always a good thing,” he said.

The best column we’ve seen in some time on China’s ability to challenge manufacturing in the United States appeared in today’s Washington Post, and it’s a sports column about the Olympics. Thomas Boswell writes, “They Made the Buses Run on Times.”

At 3 a.m. on most Olympic nights, a bus with a few reporters would return to the Beijing Tibet Hotel. A dozen security officials met us to make sure we had credentials. During the day, knee-high tape outside the hotel created lanes for entering and exiting — a reasonable way to keep things organized.

But in the middle of the night in a sleeping city, the tape was irrelevant. So, exhausted, we’d step over the tape and take the direct route to the front door. And every night the security people objected, insisting forcefully that we obey the stupid tape maze.

Finally, a Chinese solution was devised. Instead of stopping by the front door, our bus continued to the side of the hotel so, even though our walk was longer, the direct route now obeyed the tape.

Though we were the guests and they the hosts, we didn’t matter. Common sense was irrelevant. The tape — symbolic of a decision made by somebody somewhere in an unknowably complex and security-conscious control structure — was all that mattered. They had uniforms. We didn’t. That’s big everywhere. It’s huge here.

Rigidity, authoritarianism, unimaginative but must-be-obeyed rules — none of these serve the creative, innovative demands of an advanced industrial society.

But on other hand, you want to halt economic activity to clean up the air, you can just order it. The smog went away, as James Fallows reports. Granted, the weather cooperated, with good winds and timely rain.

Isolationist writer Alan Tonelson has made a career of distorting economic data to convey a false image of U.S. manufacturers abandoning our country for foreign shores. The reality that the United States remains the world’s leading manufacturing country, that we enjoy an immense technological advantage, or that we actually have a trade surplus with free trade agreement nations, has no place in Tonelson’s mythical land of demons and dragons trying to subvert our way of life.

Anyone who doubts Tonelson’s estrangement from reality can allay their doubts by visiting his web site and the post, “Who’s on First?” at the National Association of Manufacturers. Tonelson  tries to get his audience to believe that NAM President John Engler has contradicted himself about implications of China’s manufacturing expansion.

In reality, as Tonelson should know if he did any due diligence at all, Engler was misquoted in The Financial Times and the editors afforded him an opportunity to state his real position. If you missed the FT retraction on September 18, you will find it on the NAM home page (www.nam.org) along with the Engler commentary.

Tonelson is entitled to his own opinions, but not to misrepresent the opinions of others.