Friday, January 29, 2010

Obama Finally Talks About Trade

. Friday, January 29, 2010

Yes, there was the pie-in-the-sky "double exports in 5 years" talk during the SOTU address, but in a meeting with House Republicans today Obama got a bit more specific:

On the specific issue of trade, you're right, there are conflicts within and fissures within the Democratic Party. I suspect there are probably going to be some fissures within the Republican Party, as well. I mean, you know, if you went to some of your constituencies, they'd be pretty suspicious about it, new trade agreements, because the suspicion is somehow they're all one way.

So part of what we've been trying to do is to make sure that we're getting the enforcement side of this tight, make sure that if we've got a trade agreement with China or other countries, that they are abiding with it -- they're not stealing our intellectual property or making sure that their non-tariff barriers are lowered even as ours are opened up. And my hope is, is that we can move forward with some of these trade agreements having built some confidence -- not just among particular constituency groups, but among the American people -- that trade is going to be reciprocal; that it's not just going to be a one-way street.

You are absolutely right though, Peter, when you say, for example, South Korea is a great ally of ours. I mean, when I visited there, there is no country that is more committed to friendship on a whole range of fronts than South Korea. What is also true is that the European Union is about to sign a trade agreement with South Korea, which means right at the moment when they start opening up their markets, the Europeans might get in there before we do.

So we've got to make sure that we seize these opportunities. I will be talking more about trade this year. It's going to have to be trade that combines opening their markets with an enforcement mechanism, as well as just opening up our markets. I think that's something that all of us would agree on. Let's see if we can execute it over the next several years.


Read one way, this would seem to indicate that Obama would prefer a multilateral approach with built-in enforcement mechanisms to a series of bilateral agreements that leave more wiggle room. But if that's the case, then why hasn't he spent any time trying to jump-start Doha?

There's also some cognitive dissonance going on here. Take this part: "And my hope is that we can move forward with some of these trade agreements having built some confidence that trade is going to be reciprocal; that it's not just going to be a one-way street."

Well, it's pretty difficult for trade to not be reciprocal (it is trade, after all), but his point is that he doesn't want to enter into agreements where other states can manipulate the U.S. As someone in the blogosphere (can't remember who) recently wrote, Obama seems to only like exports. But imports are good too, especially when incomes are falling!

I don't find this encouraging or reassuring. Obama is signaling that he will put domestic interest groups at the forefront of his trade agenda. Which means, I think, that there is little hope for progress on the trade front during his administration. That's too bad.

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Obama Finally Talks About Trade
 
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