Brown Seeks Benchmarks in Trade Deals

Business Journal Daily

YOUNGSTOWN, Ohio -- New trade pacts with South Korea, Colombia and Panama were approved by Congress last night with at least two-thirds majorities in both houses, just hours after U.S. Sen. Sherrod Brown called for the United States to get tougher on trade. 

Wednesday evening President Barack Obama described the pacts and trade assistance for American workers that were also approved as "a major win for American workers and businesses."

The United States-Columbia Trade Promotion Agreement Implementation Act passed the Senate on a 66-33 vote, and pacts with Panama and North Korea passed 77-22 and 83-15, respectively. An administration officials said the deals could spur $13 billion annually in new exports and "support tens of thousands of jobs," CNN reported.

"I've fought to make sure that these trade agreements with South Korea, Colombia and Panama deliver the best possible deal for our country, and I've insisted that we do more to help American workers who have been affected by global competition," Obama said in a statement issued by the White House following the Senate votes. "Tonight's vote, with bipartisan support, will significantly boost exports that bear the proud label 'Made in America,' support tens of thousands of good-paying American jobs and protect labor rights, the environment and intellectual property."

Brown, D-Ohio, voted against all three agreements, hours after a conference call with reporters during which he complained that the deals represented "more of the same" in term of "broken promises of job creation and expanded markets." The North American Free Trade Agreement, which was negotiated by George H.W. Bush and which his successor, Bill Clinton, helped get passed by Congress, promised 200,000 jobs to be created immediately but some economists estimate has actually cost the United States some 600,000 jobs that went to Mexico, Brown said.

Brown called for the United States to "change course" on trade, starting with enforcing existing trade law and implementing new tools to standup to China such as the currency manipulation bill approved with bipartisan support in the Senate the day before. "We must reorient our trade policies so that before we rush into new trade agreements we take steps that will ensure that future trade agreements live up to these promises," he said. To that end, he called on the president for ensuring specific benchmarks on net domestic job creation and penetration in the Korean market in that pact.

The Reciprocal Market Access Act, which Brown introduced and discussed during the call, would help the U.S. trade representative ensure that trade agreements result in better market access for U.S. producers and products, he said. If negotiations do not provide new market access, the United State's can't reduce or eliminate tariffs under any trade deals. "It means changing the terms of future trade deals so American manufacturers can compete,' he said.

"If we have a chance to compete fairly, on a level playing field, our company and our workers can compete with anyone, anywhere," said Marlin Perkins, vice president of sales for Globe Metallurgical Inc. in Beverly, who joined Brown on the conference call. Globe's main product is silicon metal, which is used in alloying metal for manufacturing automobile components. 

"We need to be realistic on international trade and focus on getting results. Other countries fight for their businesses and workers and we need to do a better job here to support U.S, manufacturing," Perkins said.

"For far too long our negotiators have focused on tariffs as being the principal barrier to the free flow of goods," added Mike Keel, president of McWane Global, whose subsidiary, Clow Water Systems, is based in Coshocton. In many cases, he continued, countries use "an intricate web of non-tariff barriers" to block access as well.

"This legislation calls for an important change in our trade policy to link the two," Keel continued. "Countries that fail to provide us with effective market access -- the reduction of tariffs and the elimination of non-tariff barriers -- could lose the tariff benefits we provided to them in our negotiations." 

U.S. Sen. Bob Casey, D-Pennsylvania, also voted against the three trade deals. "It is time to focus on the bigger picture: formulating a strategy that helps American manufacturers create jobs and build a stronger middle class," he said. If previous agreements are any indication, he said the pacts will lead to U.S. job losses and fail to create a level playing field by not addressing issues such as violence against unionists and currency manipulation.

He also said proponents have "overstated" the potential benefits of the agreements. "Certain industries and firms are likely to benefit while others will not. What is clear is that in its failure to address non-tariff barriers to trade, the agreement leaves American firms unprotected and on an unlevel playing field," he said.

"Today is a fine example of how the president and Congress can advance policies in a bipartisan manner that will help turn our economy around," remarked U.S. Sen. Pat Toomey, the freshman Republican representing Pennsylvania. A statement issued by his office cited comments by two western Pennsylvania firms: Wendell August Forge in Grove City and Ellwood Group in Elwood City. 

"We need more free trade agreements in place to provide more manufacturing jobs in Pennsylvania. As more jobs are created via these free trade agreements, families have more disposable income to spend on gifts, on food, on clothes," said Will Knecht, the president of Wendell August Forge in Mercer County.

Ellwood, which employs 1,600 workers in western Pennsylvania, manufactures specialty steel forgings for heavy equipment manufacturers such as General Electric and Caterpillar, which then export their products to locations including Columbia, Korea and Panama. "To the best of our knowledge, over half of our company's products end up outside the United States. A vote in Congress to pass the trade agreements with Columbia, Korea and Panama is a strong vote for manufacturing jobs in western Pennsylvania," said David Barensfeld, Ellwood president and CEO.

Said U.S. Rep. Tim Ryan, D-17 Ohio, a consistent critic of trade imbalances, "We hear a lot of statistics, but we don't need statistics. We need jobs. These trade issues are side shows; the No. 1 issue facing this Congress is whether or not we are going to deal with China and their currency manipulation. Fixing this imbalance will create at least 1 million jobs," he said.

Brown Seeks Benchmarks in Trade Deals »