It's past time for Congress and the Administration to act on three long-pending trade agreements that have the potential to help increase U.S. farm exports.
It hasn’t been that long ago when growers would attend a farm bill listening session or similar type of meeting and receive a stern, almost finger-waving lecture on how they needed to learn to survive in a global economy, on a “level playing field” with other countries.
In the ensuing years, farmers, for the most part, have heeded such words and responded with higher-quality products produced with fewer inputs and with less impact on the environment.
The demand currently enjoyed by most commodities didn’t happen by accident — it was created by growers and the U.S. agricultural research community.
So now that you’ve done your jobs, what’s next?
For starters, Congress and the Administration could quit playing politics with issues that in the past have enjoyed bipartisan support, a case in point being the three long-pending free trade agreements with Colombia, Panama and South Korea.
The negotiations for some of these pacts were completed as long as four years ago, but they’re still stuck in that purgatory known as the U.S. political process.
This democratic process — once the envy of the world — apparently can no longer accomplish the simplest of things.
The reason given for this latest logjam and that the Obama Administration, along with Congressional Democrats, have insisted on the simultaneous passage of the free trade agreements and trade adjustment assistance, which helps U.S. workers who are hurt by trade agreements.
Republicans, on the other hand, feel the trade agreements should be passed independent of TAA.
It seems like such a small point, but as we’ve come to learn, no one dares to compromise in this dangerous game of brinksmanship that defines our current politics.
Both parties seem to agree that passage of the agreements will help to stimulate economic activity and create jobs, but here we are, with no such agreements in place. What makes this foot dragging even worse is that other countries are making progress on these issues while we do nothing.
This past month, for example, Canada’s free trade agreement with Colombia went into effect, and U.S. Wheat Associates are estimating it will cost U.S. wheat producers approximately $100 million in lost sales each year.
This comes at a time when producers already are facing a variety of weather-related disasters. And business interests say a new trade deal between Europe and South Korea is hurting American sales there.
Alabama Agriculture Commissioner John McMillan recently added his voice to those pushing the President and Congress to get off their duffs and pass these agreements.
“We need the opportunity to open up more trade,” says McMillan, who believes the agreements will allow Alabama farmers to sell more poultry, beef and peanuts to the three countries. This past year, approximately $15.5 billion in products were exported from the state, with agricultural products making up $908 million of that total.
Some members of Congress have expressed concern over the costs of trade adjustment assistance, but money from such programs traditionally has flowed to Alabama, sending workers back to school after they’ve lost their jobs in hard-hit industries like apparel and textiles.
A large trade with South Korea already flows through Mobile, Ala., though at the moment it is non-agricultural. “I think everyone knows the relationship that Alabama has with South Korea because of the investments in our state,” McMillan says, referring to the Hyundai auto assembly plant in Montgomery and associated Korean suppliers.
Alabama had $1.47 billion in imports from South Korea in 2010, the most from any country. That was dominated by shipments bound for Hyundai. Alabama, in turn, sent $574 million in goods back to the Asian nation. Both of those numbers hit new records in 2010.
Trade with Colombia and Panama, on the other hand, has not fared as well.
Alabama exports peaked at $15.9 billion in 2008, fell sharply to $12.4 billion in 2009 as recession led to a contraction of trade around the world, and rebounded to $15.5 billion last year.
Port authorities in Alabama say that Mobile has established service to all three countries, meaning it would be relatively simple to funnel more traffic to the state if the trade deals are approved.
The potential is there, if only the politicians will quit blocking the way.