Full of exports, full of gear, full of shipments to last the year …

President Obama speaks Tuesday in Seattle to promote the economic value of exports, and it’s a great place to make the argument. As Seattle Times columnist Jon Talton recently blogged, “In ‘export nation,’ Seattle enjoys strong position“:

When I say that Seattle punches above its weight class, consider exports. According to a new report from the Brookings Institution, Seattle ranked No. 10 among the 100 largest metropolitan areas, with more than $24 billion in exports in 2008 and representing 2.3 percent of all metro exports. The competition above us includes New York, LA, Chicago, Boston and San Francisco.

Seattle also had the 10th highest level of export-related jobs, 196,000. Obviously we can thank Boeing for much of this, which underscores the importance of the aerospace cluster here. The report found that transportation equipment exports from Seattle are 4.5 times larger in relation to its total economy than to the U.S. economy.

“Manufacturing industries are the most export oriented, so metropolitan areas that specialize in manufacturing tend to export the largest shares of their” gross metropolitan product, the report found.

Syndicated columnist Neil Peirce also cited Seattle when commenting on the Brookings study, while noting the export opportunities for such cities as Saginaw, Mich. See “Seattle a model of how the U.S. can boost its global trade profile.”

In reporting on the President’s five-state “barnstorming and fundraising trip,” NPR correspondent Scott Horsley sought to put the Seattle speech in context:

Remember, back in the State of the Union address, he set a goal of doubling U.S. exports in five years. The reason for that is it’s a way to grow the domestic economy without having to rely on those overstretched American consumers. Unfortunately, the president got some bad news this past week, when the Commerce Department released new trade figures showing exports actually shrank in June, and the trade deficit widened. So not the direction the president wants those numbers to go in.

The National Association of Manufacturers has released a report, “Blueprint to Double Exports in Five Years,” that outlines the aggressive steps that Congress and the Obama Administration must take to achieve the President’s goals.

The latest trade numbers released today by the Commerce Department reaffirm the importance of doubling U.S. exports over the next five years as outlined in President Obama’s National Export Initiative (NEI). The overall U.S. trade deficit grew unexpectedly to almost $50 billion in June, the highest level since October 2008, and imports increased 3 percent, while exports dropped 1.3 percent.

For goods, the deficit was $62 billion in June, up from $54.3 billion in May. The numbers reflect decreases in exports of capital goods and industrial supplies, while there were increased exports in the automotive sector and engines. Imports increased in June to $200.3 billion from $194.4 billion, led by telecommunications equipment, automobiles, pharmaceuticals and furniture.

If the goal is to strengthen the U.S. economy and job creation, then the best response is to expand U.S. exports as called for by both the National Association of Manufacturers and President Obama in his National Export Initiative. And that means we need to do much more – and quickly – to open foreign markets, assist U.S. companies to export more of their production, and enact policies that support innovation and a competitive manufacturing sector. Of the 15 leading manufacturing economies in the world, the United States is dead last in the percentage of production that is exported. The NAM’s “Blueprint to Double Exports in Five Years” points out that reaching this ambitious goal is possible, but only with a radical shift in policies and programs.

For additional information and to read the NAM’s Blueprint please visit www.nam.org/NEI.

Frank Vargo, vice president for international economic affairs at the National Association of Manufacturers, will appear on C-SPAN’s Washington Journal program on Monday, August 9, at 8:30 a.m.

Among the topics will be the NAM’s Blueprint to Double Exports, the strategy for achieving President Obama’s National Export Initiative goals.

The Department of Commerce organized a blogger/media roundtable today with Under Secretary Francisco Sanchez of the International Trade Administration to discuss Obama Administration’s National Export Initiative and its goal of doubling U.S. exports within five years.

Secretary Sanchez drew distinctions between the Administration’s short- and long-term goals in its trade agenda. The short-term ones, measured on a 12-month basis, could be achieved through advocacy, such things as trade missions, export promotion, international trade fairs and the like. In the first eight months of 2010, that approach could account for $11.6 billion in U.S. content being exported, compared to $7.4 billion for all of 2009.

Also, Sanchez said, “We also recognize that we have to be engaged in some things that can give us some long-term successes, mainly that come from reducing barriers.” That includes, but is not limited to free trade agreements.

The National Association of Manufacturers’ new “Blueprint to Double Exports in Five Years” lays out a multifaceted plan for accomplishing the President’s goals. The report is heavy on figures and targets, which led us to ask how the Administration planned to measure its success. What are its metrics?

Sanchez said Secretary Locke stressed metrics, the Department was working to “tighten them up” further, and 12-month, short-term goals have clear standards of measurement.

What’s a little tougher to measure the trade barriers work. No. 1, it’s not something we’re going to knock out in 12 months. You can say we’re going to do 12 trade missions, you can say we’re going to bring 2,000 international buyers to the United States, we’re going work to on a dozen advocacy cases, whatever that is.

The trade barriers work doesn’t lend itself to that type of a measurement, yet it’s a very important part of accomplishing the president’s goals, so I’d say in some areas, yes, I think we have good metrics. In the trade barrier side, it’s a little more challenging to lock it down.

Sanchez did not mention Secretary Locke’s announcement today of a newly constituted Manufacturers Council, which the ITA will direct.

We’ve put two audio (.mp3) segments of today’s interviews online. The first is Undersecretary Sanchez’s opening comments. The second is Sanchez’s comments on metrics, short-term vs. long-term priorities, and free trade agreements. In this segment, he responds to our initial question and another from Ian Talley of The Wall Street Journal. Talley wrote a good story this week exploring industry’s views of the President’s National Export Initiative, “Industry: Trade Deals Vital to Meet Obama’s Export Goal.”

The American Farm Bureau Federation, the Coalition of Service Industries and the National Association of Manufacturers joined Monday in releasing a blueprint for doubling U.S. exports in five years, a top goal of the Obama Administration. (News release.)

The overriding point: Doubling exports in five years is an ambitious but achievable goal if major changes are enacted.

The plan was released at a media roundtable. Reuters reported, “Business groups recommend ways U.S. govt can double trade,” leading with the FTA angle.

President Barack Obama needs to quickly win approval of free trade agreements with South Korea, Colombia and Panama and start talks on new trade deals with Brazil, India and others if he if serious about doubling exports, U.S. business groups said on Monday.

“We must be extremely aggressive,” Rosemarie Watkins, director for international policy at the American Farm Bureau Federation, told reporters.

NAM’s Blueprint to Double Exports in Five Years is available here. The NAM’s website also has a section devoted to the Administration’s National Export Initiative, here.

Elsewhere, the U.S. Trade Representative’s Office has announced that Ambassador Ron Kirk will be visiting a Pittsburgh-area manufacturer Friday to highlight the Administration’s trade enforcement actions.

His speech is at Allegheny Technologies Incorporated (ATI)’s plant in Washington, Penn.; ATI is a leading diversified producer of specialty metals. With 8,600 employees, ATI operates production facilities, service centers and sales offices in the United States an abroad.

In his remarks, Ambassador Kirk will describe how the Obama Administration’s trade enforcement actions are helping to sustain jobs here in America by making sure that U.S. trading partners adhere to their agreements, respect our trading rights, and play by the rules. Kirk will also discuss how the Obama Administration’s approach to trade, combining tough trade enforcement and smart trade expansion, contributes to President Obama’s National Export Initiative and his overall economic recovery strategy.

ATI is a leading diversified producer of specialty metals. With 8,600 employees, ATI operates production facilities, service centers and sales offices throughout the United States and abroad. ATI uses innovative technologies and systems to supply customers with state-of-the-art metals. ATI’s business covers growing global markets across industries ranging from aerospace and infrastructure to clean energy production and efficient electric distribution.

Today’s international trade numbers released by the U.S. Department of Commerce (here) show our U.S. manufactured goods trade deficit continues to grow, but that  manufactured goods still retain their dominant position, accounting for 80 percent of  U.S. goods exports.   

April exports of manufactured goods were up 24 percent over April 2009, while April imports of manufactured goods were up 22 percent.  Because imports are considerably larger than exports, the import growth rate boosted the dollar value of imports more than the dollar value of exports.  As a result, the April manufactured goods trade deficit grew to $29 billion, up $4 billion from the previous year.

The National Association of Manufacturers had been expecting the trade deficit to increase over the 2009 levels, as the U.S. economic recovery is outpacing that of major markets such as the European Union and Japan — but we did not forecast a return to the $40-50 billion dollar levels of 2005-2006.   The rate of import growth should slow later in the year, and an added export push can stabilize and begin to reduce the trade deficit further.

The April manufactured goods export rate of 24 percent remains significantly above the 15 percent annual rate of growth that will be needed for the next five years in order to reach the President’s goal of doubling exports by 2014.  The rapid rate of growth so far, however, reflects a continuing recovery from the collapse of U.S. exports in 2009 – and achieving the export goal will require additional policy and program changes in order to keep the growth rate at or above 15 percent annually.

One of the policy changes needed is to open up more foreign markets by having more bilateral trade agreements.  Year-to-date data shows the United States continues to run a manufactured goods trade surplus with its Free Trade Agreement (FTA) partners — $8 billion so far. 

The manufactured goods deficit is with countries that have not entered into such agreements with the United States.  Only about 40 percent of U.S. exports go to the FTA partners that have eliminated barriers to U.S. products.  American manufactured goods still face significant trade barriers in the remaining 60 percent of our markets.

Misplaced Congressional fears about trade agreements are delaying implementation and further negotiation of trade agreements, hurting U.S. manufacturing jobs.  Of serious concern is the fact that the United States sits dead in the water, while the European Union is negotiating with key markets, such as Canada, Brazil, and India.  This is no way to ensure that U.S. exports will continue to drive the manufacturing and economic recovery.

See also Secretary Locke’s statement.

Department of Commerce trade data for March released today showed the U.S. trade deficit in goods and services increased $1 billion from February, to $40.4 billion. An increase in the services surplus partially offset a nearly $3 billion jump in the goods deficit. Most of this was in petroleum, but the manufactured goods deficit increased by $1.2 billion as manufactured goods imports expanded more rapidly than exports.

Manufactured goods exports, seasonally adjusted, stood at $83.8 billion in March, up 11 percent from February. Manufactured goods imports were $116.7 billion, up 13 percent. The figures reflected faster growth in consumer goods and automotive imports, not matched by an increase in capital goods exports –- the predominant U.S. manufacturing export.

Comparing March to the same period a year ago, manufactured goods exports were 25 percent larger than March 2009 –- still running well ahead of the 15 percent annual rate that will be needed if the U.S. national goal of doubling exports in five years is to be reached. Manufactured goods imports, though, were up 24 percent, leading to an increase in the deficit.

The U.S. manufactured goods deficit has fallen nearly in half from its peak in 2006 (see graph below), the result both of a more competitive dollar and falling U.S. demand for imports due to the recent recession. The National Association of Manufacturers has expected the deficit to begin rising again with U.S. economic recovery, as consumer goods imports began to increase. Managing the U.S. manufactured goods deficit requires that U.S. exports grow faster than imports –- particularly for capital goods. To achieve this goal will require policy changes to provide more incentives for export and more access to foreign markets through market-opening trade agreements.

So far in 2010 the brightest spot in manufactured goods trade remains the U.S. free trade partners, where collectively, U.S. manufactured goods are in surplus. The manufactured goods deficit is with countries that still maintain barriers to U.S. exports because they have not entered into market-opening agreements with us.

Today is the third anniversary of the Bipartisan Agreement on Trade, “The May 10th Agreement,” a bargain that in return for including enforceable labor and environmental provisions in U.S. trade agreements, those agreements would receive speedy bipartisan support in Congress. But three years later, our trade agreements are still languishing with Colombia, Korea, and Panama.

What a sad anniversary. Nearly 80,000 Americans are unemployed today because of inaction on those agreements (based on International Trade Commission estimates of the additional exports those agreements would bring and Commerce Department estimates of jobs related to trade).

How ironic that the reason for this is organized labor’s refusal to recognize they have been wrong on trade agreements and that our existing trade agreements have actually generated a manufactured goods trade surplus for America. What’s worse, as we have been dead in the water, our chief competitor, the European Union has been busy negotiating its own trade agreements with countries like Brazil, India, Canada, Vietnam, Singapore, etc. –- agreements that will wrap up markets for them and push us out.

President Obama is right in saying we have to double America’s exports in five years, but we can’t do that unless we open foreign markets to our goods and services. This year is the Chinese Year of the Tiger –- but for U.S. trade agreements, every one of the last three years has been The Year of the Snail. It’s time to come out of our shell and open new markets –- starting with those that were supposed to be approved because of the historic bipartisan agreement on trade three years ago.

Commerce Secretary Gary Locke spoke at the PENN Fishing Tackle Manufacturing Company in Philadelphia Friday, promoting President Obama’s National Export Initiative meant to double exports within five years.

Locke’s focus at the event was government programs that offer technical assistance to companies that seek to export. For example, from his prepared remarks.

The NEI is going to provide even more resources and focus on the Commerce Department’s International Trade Administration (ITA)—which has a global network of trade specialists posted in 109 U.S. cities and at 128 U.S. embassies and consulates in 77 countries.

As part of the NEI, the president’s 2011 budget is going to provide new resources so that ITA can hire more trade specialists to help link U.S. businesses with buyers overseas.

ITA plans to bring on as many as 328 trade experts—mostly in foreign countries—to advocate and find customers for U.S. companies.

Good.

A disappointment: In his prepared remarks, Secretary Locke did NOT mention the pending free trade agreements with Colombia, Korea or Panama. It’s next to impossible to double exports while ignoring FTAS. It’s a missed opportunity. Rep. Chaka Fattah (D-PA) was in attendance, and as a consistent opponent of free trade agreements (the exception being U.S.-Peru), he’s the kind of member of Congress whom Administration officials should be working on. The same is true of Sen. Bob Casey (D-PA), also in attendance, who voted AGAINST the U.S.-Peru Free Trade Agreement.

P.S. The Administration has held many, many events in Philadelphia. The media seem to be wearying of them all. Searching via Google News and Bing, we find no coverage of Friday’s trade event other than media advances.

Manufactured goods continued to dominate U.S. trade in February 2010, according to data released today by the U.S. Department of Commerce. Manufactured goods comprised 80 percent of U.S. merchandise exports, compared to 10 percent for agricultural exports. Manufactured goods also accounted for 75 percent of merchandise imports.

Both exports and imports of manufactured goods grew in February compared to January, but the 3.9 percent increase in imports exceeded the 1.6 percent increase in exports. As a result, the manufactured goods trade deficit grew to a seasonally-adjusted $31.1 billion in February compared to $28.1 billion in January. Two-thirds of that increase was accounted for by rapid rises in imports of computers, TV sets, and steel, coupled with an unusual 25 percent drop in the highly volatile category of civilian aircraft exports -– which are subject to large fluctuations depending upon the number of aircraft delivered in a particular month.

Compared to February 2009, the rebound in trade was evident in both exports and imports, with February 2010 exports being 14 percent large than a year ago, while imports were up 17 percent.

To meet the President’s goal of doubling exports in five years, exports must grow at an annual rate of 15 percent, so for the first two months of the five-year growth period, exports are basically on track. This, however, is largely due to the fact that exports are recovering from a huge fall last year. Continued rapid growth of U.S. exports will require policy and programmatic changes that will spur the ability and capacity of U.S. companies to penetrate foreign markets more deeply.

U.S. manufacturers continued to enjoy a surplus in trade with U.S. free trade agreement (FTA) partners. Manufactured goods trade with FTA partners was in surplus by nearly $1 billion in January, while manufactured goods trade with countries not having a trade agreement with the United States was in deficit by $26 billion (February data not yet available).