Tags: neal | asbury | Obama | Unions | Free | Trade

Obama, Unions Finally Wake Up to Free Trade

By    |   Thursday, 14 April 2011 09:22 AM

Just when the nation’s besieged trade unions start to flex their muscles in an attempt to regain their waning power, they suddenly stop throwing up contrived objections to three pending free-trade agreements stalled before Congress that would create tens of thousands of new U.S. jobs.

Could it be they now know they are losing the battle for unionized government jobs and are turning their attention to the private sector?

There seems to be a realization they wasted precious time and effort blocking agreements that would help their members.

After years of wrangling over the U.S.-South Korea Free Trade Agreement over automobile manufacturing issues and claims of lost American jobs, the UAW is now endorsing the agreement. Under the agreement, the United States and South Korea will scale back tariff cuts for cars, and South Korea said it would allow more imports of U.S.-made vehicles that meet American standards rather than Korean standards.

The U.S. will maintain a 25 percent tariff on truck imports for eight years instead of beginning to phase them out immediately. The expected result is U.S. exports to Korea will grow by as much as $11 billion and support a minimum of 70,000 new U.S. jobs.

Now it looks like the U.S.-Colombia Free Trade Agreement may see the light of day, after being blocked in 2007 when Democrats in Congress teamed up with unions to kill the agreement signed by the Bush administration. Since then, unions in the United States have continued to block approval of the agreement asserting that Colombia has done too little to protect union leaders and activists.

After purportedly 3,000 unionists were killed over the last three decades, Colombian official have significantly reduced violence in recent years for all its citizens and have promised to expand its protection program for labor union leaders, to enforce its labor laws more vigorously and to hire 480 more labor inspectors over four years.

Colombia has made great progress. The murder rate today in Bogota is lower than Washington, D.C., Detroit and Miami. There is no evidence labor leaders experience a higher level of violence or crime than the general population. We should praise this progress not rail against it.

Administration officials voiced confidence that the trade pact with Colombia would increase United States exports to that country, now $12 billion a year, by $1 billion annually. Under the agreement, more than 80 percent of American consumer and industrial goods shipped to Colombia would become duty-free immediately, with the remainder having duties phased out over ten years. On agricultural goods, more than half would become duty-free, with duties ending for the remaining goods over 15 years.

The third free-trade agreement waiting for passage is with Panama, a stable democracy and loyal trading partner. The cornerstone of the U.S.–Panama relationship remains the historic 1970s treaties that granted Panama sovereignty over the U.S.-built Panama Canal. The Panama Canal plays a prominent and growing role in U.S. trade.

Panama is spending $5.25 billion on an expansion project that by 2014 will allow super-container ships, capable of carrying as many as 12,000 containers in a single load (versus the current 4,000-container Panamax capacity). The enlarged canal is expected to generate a substantial increase in the volume of traffic, raising the amount of freight from 280 million tons in 2005 to 510 million tons by 2025.

Panama’s imports from the U.S. exceed its exports to the U.S. by a ratio of 10 to 1. Currently the U.S. exports $4.9 billion in goods and services to Panama; Panama’s exports to the U.S. are $379 million, primarily in seafood and merchandise that has been sent to Panama for repair.

Despite this potential for new export revenue, the International Labour Organization (ILO) is blocking the agreement because it specifies a minimum of 20 members to form a union while Panama’s policy sets the number at 40. The Panamanians believe, as their economy is dependent on small business that must compete regionally, caving into the demands of the American unions will put many of its companies out of business. A compromise seems to be in the works, along with clarification of Panama’s offshore banking secrecy regulations.

Union membership in the U.S. was at its height during the late 1950s when nearly 60 percent of the American work force was unionized. Today it is less than 8 percent. There is a reason.

Union leadership has become stale, self-serving and out of touch. While unionism is failing in the U.S. it is absurd we would be forcing it upon our trading partners.

America’s labor unions appear to be waking up after years of plummeting membership to the stone cold fact that increasing U.S. exports also increase U.S. jobs, including union jobs. Even President Barack Obama, whom has been in the back pocket of the union bosses seems to be rubbing the slumber from his eyes and understanding rubber-stamping union mandates is counterproductive to a revitalized and energized American economy.

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Just when the nation s besieged trade unions start to flex their muscles in an attempt to regain their waning power, they suddenly stop throwing up contrived objections to three pending free-trade agreements stalled before Congress that would create tens of thousands of new...
Thursday, 14 April 2011 09:22 AM
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