Sen. Mike Johanns (R-Neb.) took to the Senate floor Thursday to highlight the urgency of passing the stalled free trade agreements with South Korea, Colombia and Panama. In his pointed comments, Johanns blasted the political games being played to delay the trade deals saying, “the administration seems to be moving the goal posts.”
“The trade agreements were all signed more than three years ago, yet they are still being held up by the Obama administration,” said Johanns. Obama administration officials have said they will not submit the trade deals for approval by Congress until Republicans agree to renew the Trade Adjustment Assistance program, for workers who lost their jobs.
U.S. Trade Representative Ron Kirk said last week that the administration "will not submit the [three free-trade agreements] without an agreement," on renewing the trade adjustment program. The program provides funding for training workers whose jobs are lost due to foreign competition. The yearly cost of the program is estimated at $800 million.
If approved, the trade deals would raise U.S. exports by an estimated $13 billion per year, with $11 billion coming from South Korea alone.
The trade deals are crucial to the U,S, pork industry, according to the National Pork Producers Council. “Colombia, Panama and South Korea are crucial markets for U.S. agricultural products, and the industry stands to gain sales with implementation of the FTAs,” said NPPC President Doug Wolf, a pork producer from Lancaster, Wis. “For the U.S. pork industry, the trade agreements with those countries will add significantly to producers’ bottom line and create thousands of pork industry jobs.”
According to Iowa State University economist Dermot Hayes, by full implementation, the three FTAs combined will generate more than $770 million in additional pork exports annually, causing live hog prices to increase by $11.35 and creating more than 10,200 direct pork industry jobs.
While the trade agreements remain mired in political delay, Johanns is concerned about the U.S. reputation with trading partners around the world. "What does this delay do to our reputation as a reliable negotiating partner?” he asked. “Back where I come from in Nebraska, a lot of business is still done with a handshake. We trust our neighbors, because they are good people with good values. But if you make a deal with someone and shake on the deal, and they keep changing the terms or delaying the follow through, you tend to stop dealing with those people."
According to NPPC, The United States already has lost sales in Colombia because of that country’s FTAs with other nations. Its share of the Colombian agricultural market has fallen to 27 percent in 2009 from 44 percent in 2007. Chile, through its 2004 FTA with South Korea, has increased its market share in the Asian nation because of its tariff advantage over other major pork exporting countries.
Earlier this week, Senate Minority Leader Mitch McConnell (R-Ky.) also criticized the Obama administration for the delay. “Our economy needs jobs and growth, not an ever-expanding list of reasons to delay the creation of those jobs,” said McConnell.