A lot of news coverage of the U.S.-Mexican truck issue a year after Mexico imposed retaliatory tariffs against U.S. farm and manufactured goods:

• Houston Chronicle, “US working to resolve border trucking dispute“
• CNN International, “Mexico to US: Allow cross-border trucking“
• Reuters, ”Obama criticized for Mexico, Brazil sanctions“
• Consumer Electronics Association, “CEA Urges Reauthorization of US-Mexico Trucking Program“
• The Hill, “War over fries“
• American Frozen Food Institute, “American Frozen Food Institute Urges White House and Congress to Resolve …“
• Wall Street Journal, “Mexico Tops List of Trade Issues Facing White House“

The Journal piece is based on the Q&A from U.S. Trade Representative Ron Kirk after his speech at the National Press Club Tuesday:

WASHINGTON—The Obama Administration’s top trade negotiator said the U.S. was working quickly to resolve a damaging trade spat with Mexico, one of several obstacles to the president’s goal of doubling U.S. exports within five years. 

“We understand the sense of urgency,” said U.S. Trade Representative Ron Kirk after a speech at the National Press Club.

It has been one year since Mexico imposed the retaliatory tariffs, so somewhere along the line that sense of urgency has been lost.

Ambassador Kirk’s prepared remarks did not add anything to his testimony last week on the Administration’s trade agenda, but that’s understandable. President Obama speaks at the Export-Import Bank’s annual conference on Thursday, and you wouldn’t want to overforeshadow your boss.

U.S Trade Representative Ron Kirk appeared before the Senate Finance Committee Wednesday to formally present the President’s 2010 Trade Policy Agenda, and as expected, express support for passage of the three long-pending free trade agreements (FTAs) with Colombia, Korea and Panama were high on the agenda for Senators.

“The FTA’s are a priority,” Kirk told the lawmakers. “We have not given up on any of those.” (Kirk’s statement.)

The ambassador was challenged by both Chairman Baucus and Ranking Member Grassley, who warned him that the United States will lose out to our competitors in Europe and other nations if we don’t advance the pending FTAs with Colombia, Korea and Panama. The goal of doubling exports in five years will be strongly aided by passing these pending FTAs, Kirk heard more than once.

As far as that competition from Europe and other countries, the European Union is certainly not letting any grass grow under its feet. On Tuesday, the EU announced the start of FTA negotiations with Vietnam. On Wednesday, the EU announced the start of FTA negotiations with Singapore. And, of course, the EU is looking to enact its FTA with Korea in the next few months.

The U.S. has an FTA with Singapore, and Vietnam would be included in the Obama Administration’s proposed Trans-Pacific Partnership (TPP) FTA –- the first round of negotiations for the TPP begins in mid-March.

This news all comes on the heels of the announcement by the EU Tuesday that it has concluded its FTA negotiations with Colombia and Peru, and is looking to a May 2010 signing with entry into force by 2012.

Colombia is also nearly finished negotiating an FTA with Canada.

Canada, by the way, is negotiating an FTA with the European Union. And, of course, Canada and Korea are negotiating an FTA too.

There seems to be a trend here: Strong manufacturing countries, whose industries compete with manufacturing in America for exports to these markets, are all fiercely pursuing trade deals with the same group of nations. If past trends continue, once they conclude negotiations, Europe and Canada will move quickly to enact these agreements. So will Peru, Colombia, and Korea.

The results are in, the judges have made their decision, and the results are final.  U.S. Free Trade Agreements (FTAs) for the second year in a row have turned in a trade surplus for U.S. manufactured goods.  U.S. manufactured goods exports to NAFTA, CAFTA, and the other FTAs exceeded imports by $21 billion in 2008 and extended their surplus to $26 billion in 2009 –- starkly visible in the graph below.

This two-year surplus of nearly $50 billion is pure gold when viewed against the distressing $1.4 trillion dollar deficit for U.S. overall trade in goods and services during that period.  What a great record for U.S. Free Trade Agreements – the brightest spot in the U.S. trade picture!

This reality stands in sharp contrast to what the trade naysayers have been telling Congress, blaming trade agreements as the reason for the trade deficit.  Well, the score is in, the facts are now known, and the deficit is with the countries that DON’T have trade agreements with the United States.

Hopefully winning the “Trade Olympics” gold medal will catch Congress’ attention so they will focus on reality rather than the mythology that has been handed to them for years – and will take up and pass the three pending trade agreements with Colombia, Korea, and Panama.

Thousands of Americans are out of work today rather than being employed by America’s manufacturers who would have expanded sales, production, and employment opportunities if Congress stopped insisting that we should continue to have to pay high tariffs to sell in those countries.

Frank Vargo is NAM’s vice president, international economic affairs.

The U.S. merchandise trade balance improved in October 2009, with the bulk of the gain coming from manufactured goods trade. On the basis of the Commerce Department trade figures released today, the NAM has calculated that seasonally adjusted October trade deficit for manufactured goods was $24.8 billion, compared to $27.6 billion in September.

The $2.7 billion improvement in the manufactured goods balance accounted for 85 percent of the overall gain in the merchandise trade balance. October manufactured goods exports were 2.8 percent higher than in September, while imports fell marginally by 0.8 percent.

Exports were paced by the vital capital goods sector, which accounts for nearly half of U.S. manufactured goods exports. Capital goods exports rose 3.7 percent over September. The fact that 21 of the 32 capital goods categories showed growth indicates that the export recovery is broadening..

Trade fluctuates monthly, so not too much can be inferred from one-month changes. However, the October figures reinforce the recovering trend evident in that exports have risen in four of the last five months. October manufactured goods exports were 14 percent higher than their trough in May 2009. Though it is clear manufactured goods exports are recovering, there is still a long way to go, as October exports were still 20 percent below the July 2008 peak immediately before the collapse in world trade.

The recovering export growth, coupled with slower imports stemming from reduced U.S. consumer demand, have combined to slash the U.S. deficit in manufactured goods nearly in half. The deficit peaked at $46 billion in February 2007, compared to the October 2009 deficit of 24.8 billion.

Manufactured goods trade with free trade partners (NAFTA, CAFTA, and the other free trade agreements) continued to be in surplus in 2009, which through September was at an annual rate of $26 billion - up from the $21 billion surplus in 2008. As we often point out, contrary to the claims of trade critics, the United States has a [manufactured goods*] trade surplus with the countries with which the United States has concluded free trade agreements.

* Editor’s mistake, corrected 8:55 a.m. Friday. In editing copy, I omitted the important qualifier, “manufactured goods.” Thanks to commenter Karl for the catch.

ABC News’ “This Week” featured a pundit panel discussion this morning on the President’s jobs forum and his upcoming speech on the economy. Notable passage from Richard N. Haass, President of the Council on Foreign Relations.

HAASS: But there’s also an area where working Americans — in some cases, represented by organized labor — are not on the side of working Americans, because what’s missing from this entire jobs debate is trade. The single biggest engine of American job creation is trade policy, is export promotion, and where are we? We don’t have a positive trade policy. This is the best way to have non-inflationary stimulus that doesn’t break the budget, it doesn’t cost us a dollar. Let’s start negotiating in earnest a global free trade agreement…

Or at least by enacting the pending U.S. free trade ageements with Colombia, Panama and Korea.

From The Washington Post, “Jobs summit underscores dilemma“:

Obama says he does not have the money for the plan many of his liberal supporters say packs the biggest employment punch — direct federal investment in job creation. Instead, he came close to embracing a to-do list for the private sector that sounded rather familiar: weatherization, small-business incentives, regulatory and other help for exporters, and tax credits for employers who hire new workers.

Obama said the proposals could create jobs immediately, while providing long-term benefit at a relatively small expense to the federal government. “Overall, we generated a lot of important ideas,” he said. “Some of them, I think, can translate immediately into administration plans and, potentially, legislation.”

Regulatory and other help for exporters? U.S. Export-Import Bank Chairman Fred Hochberg co-chaired one of the break-out sessions, “Expanding Job Opportunities for America’s Workers Through Exports,” and the NAM believes the Eximbank is an important, effective supporter of private-sector exporters. Indeed, the head of one company that works effectively with the Eximbank is quoted in the Post story. Air Tractor of Olney, Texas, a manufacturer of ag planes (for purposes like spraying and seeding), has been featured as an Eximbank success story as it reaches into South American markets. (PPT slide from Eximbank’s 2009 conference.)

David Ickert, a senior executive of Air Tractor, a Texas firm that manufactures planes used in agriculture and fire suppression, said he would like to see the administration do more to free up financing for export-oriented firms.

“Exporting is one of the areas that has a lot more potential,” he said. “It can create jobs and does not cost a lot of money to fund. There just has not been enough attention paid to it from a policy standpoint.

Right!

The lack of attention — or rather, effort — has also been a problem with the three free trade agreements still pending which, if enacted, would quickly lower trade barriers to U.S. exporters. The White House should lead its export-related jobs creation by demanding Congressional approval of the FTAs with Colombia, Panama and South Korea.

Another plug for tonight’s CNBC program, “Meeting of the Minds: Rebuilding America,” scheduled for 8 p.m. Eastern. Here’s CNBC’s summary of the issues addressed in the discussions, moderated by Maria Bartiromo. NAM President John Engler is a panelist.

Manufacturing led the United States to become the richest nation in the world and has been the foundation of the middle class. But times have changed and today’s economy values innovation and design over manual labor — emphasizing mind over matter. This sea of change has spurred many questions: Are the manufacturing jobs in the US gone forever? Does an economy that doesn’t produce anything have any real value and has ‘Made in the USA’ died, taking with it the soul of our country? CNBC’s gathers some of the most influential leaders in manufacturing for a Meeting of the Minds at Carnegie Mellon University to answer those questions and plan for the industry’s future.

Leo W. Gerard, president of the United Steelworkers International, gives his report on the discussions taped Monday evening in Pittsburgh at the Huffington Post, a post, “CEOs, Union Leader Agree: Manufacturing Strategy Crucial.” Sure. But once you get past process — the manufacturing strategy — agreement’s harder to find. In opposing free trade agreements, organized labor turns its back on jobs in dynamic, export-intensive industries.

Others panelists: Bill Ford, Executive Chairman, Ford Motor Company; Daniel R. DiMicco, Chairman, President & CEO, Nucor Corporation; Jeff Immelt, Chairman & CEO, General Electric; and Hilda Solis, U.S. Secretary of Labor.

UPDATE: Courtesy CNBC, John Engler (left) and Secretary of Labor Hilda Solis

Investor’s Business Daily editorializes on the United States falling behind as a nation and economy benefitting from trade, arguing in “Losing Out Big Time” that the decline must be reversed quickly or become a permanent disadvantage.

Tuesday, Cato Institute economist Daniel Griswold took issue with U.S. Trade Representative Ron Kirk’s congratulatory claim that the U.S. is “the most open market in the world.”

Actually, it slipped from No. 2 in 2000 to No. 26 in 2007, the last year for which data are available, in Cato’s 2009 Economic Freedom of the World annual report.

“If an Olympics were held for the most open economy, the United States would be out of medal contention,” Griswold wrote, citing tariffs, regulatory barriers and other factors.

It’s reportedly down to No. 28 in 2008 data, and getting worse. Given that size of government, freedom to trade internationally and regulation are the criteria used in Cato’s index, you can bet that the U.S. ranking will drop even lower in 2009.

It puts the U.S. behind Hong Kong, Singapore, the United Arab Emirates, Chile, the Netherlands, Ireland, Switzerland, Slovakia and Estonia, all nations that have seen their living standards rise based on an aggressive strategy of free trade.

Here’s Griswold’s column at Cato@Liberty, “U.S. ‘the Most Open Market’? Not Even Close.”

Investor’s Business Daily also cites the NAM’s Frank Vargo, who has analyzed export data and finds that the United States ranks last among 15 industrialized countries in the percentage of its manufactured goods exported. (See this Shopfloor.org post.) The editorial concludes:

Competitiveness isn’t lost through a single event; rather, it’s lost over time as the effects of many bad policies are felt. Right now, on trade, the U.S. is going in the wrong direction. It could turn things around quickly by getting back on the free-trade bandwagon.

President Obama gave a speech in Tokyo Saturday announcing the Administration’s plans to engage with the Trans Pacific Partnership countries to shape a regional agreement, an engagement that could produce real benefits for U.S. exporters and manufacturers. The Asia-Pacific region is the world’s fastest growing both in terms of trade and in the number of trade agreements being negotiated.  The NAM has long called for a trans-pacific trade agreement that would open up the region to U.S. exports.  America’s manufacturers cannot afford to be on the outside of an Asian trade wall looking in.

Reacting to the President in a statement, U.S. Trade Representative Ron Kirk made the case that a high-standard regional trade agreement under the Trans Pacific Partnership could help generate American jobs and economic prosperity.  (USTR fact sheet.) Exports will be the driver of U.S. economic recovery, but only if they have open access to world markets.

Strong U.S. leadership will be necessary to achieve a regional Pacific agreement that includes the highest standards already incorporated in U.S. bilateral agreements.  The United States currently has bilateral agreements with four of the seven Trans Pacific partners – Australia, Chile, Peru, and Singapore. (The others are New Zealand, Brunei, and Vietnam.) None of the gains for American manufacturers that were negotiated in those agreements should be abridged in any way, including intellectual property and investment protections and market access commitments. 

We were also pleased to see President Obama’s urging other nations to join the United States in demanding an ambitious and balanced Doha agreement, “not any agreement, but an agreement that will open up markets and increase exports around the world.”  This is the only road to success for the Doha Round.

The President’s focus on trade and trade agreements highlighted in his Asian trip should not, however, push other trade priorities off the table. On the contrary, they should produce a concerted effort to resolve any last issues with the three pending trade agreements – Colombia, Korea, and Panama – so these can be sent to Congress for approval.

News coverage…

• Associated Press, “APEC urges new growth model, climate pact progress“
• Reuters, “Obama pledges greater US engagement in Asia“
• Radio New Zealand, “Free trade deal may be in place in two years, says PM“

Frank Vargo is Vice President, International Economic Affairs, National Association of Manufacturers

The testimony has been posted from yesterday’s Senate Commerce subcommittee hearing, “A World of Opportunity: Promoting Export Success for Small and Medium-Sized Businesses,” and the committee also has a nice selection of quotes here.

From Sen. Amy Klobuchar (D-MN), who chaired the hearing by the Subcommittee on Competitiveness, Innovation, and Export Promotion: “Exporting is literally a world of opportunity. Over 95 percent of the world’s customers are located outside the United States. Increasing our exports will mean more business, more jobs and more growth for the American economy.”

And from the manufacturer who testified, Tom J. Wollin, Director of International and Government Sales, Mattracks, Inc.,* of Karlstad, Minn.:

There are roadblocks for U.S. companies, big and small, when they export products internationally. Tariffs, duties, and value-added taxes can make the costs of U.S. products extremely prohibitive. For example, an American product that has a dealer cost of $35,000 when it leaves our shores can have a final cost reaching $60,000 to $70,000 when it reached its destination! U.S. innovation and product quality can overcome many obstacles, but a doubling in price can be crippling. The removal of these types of trade barriers are also needed to ensure new and continued sales growth internationally.

That’s a critical point. For all the many good and helpful government programs to promote manufacturing exports, sales must be cost-competitive. That’s why Congress’ resistance to enacting the pending free trade agreements with Colombia, Panama and South Korea is so discouraging. By ratifying the Colombia Free Trade Agreement, for example, Congress could quickly lower costs of U.S. exports to that country by an average of 14 percent.

* A plug for Mattracks — What a great product! A “rubber-track conversion system [that ] transforms most 4×4 vehicles into a true all-terrain vehicle equipped with rubber tracks that will go almost anywhere and bring you back!”