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  • Guest Blogger: Wally Herger (R-CA) on Maintaining U.S. Competitiveness

    Three years ago the U.S. finished negotiating a free trade agreement (FTA) with Colombia that would have given American businesses reciprocal access to the Colombian market that Colombian companies have been receiving for years. Two years later, in an unprecedented move, Speaker Pelosi denied the FTA an up or down vote in the House, stripping the agreement’s “fast track” procedural protections under the law. Despite calls for action, the Obama Administration has followed suit by failing to push the agreement forward. Now Canada has swooped in to lock in an agreement with Colombia that will give their farmers, in particular, the benefits that should have gone to American farmers. And the result: the loss of millions of dollars in U.S. agricultural exports to Colombia.

    I wish this was the only example of how our inaction on trade is causing the U.S. to fall behind, but it gets worse. While the U.S. has been sitting on yet another free trade agreement with South Korea (which was anticipated to be the gateway agreement to the East Asia region), the EU has finalized negotiations on their own FTA with Korea. Again, the U.S. will not only lose opportunities to grow our economy and create jobs through increased exports of American made goods and services, but also will actually see a reduction in exports.

    This time, however, the cost to the U.S. economy will be more substantial. South Korea is our seventh largest trading partner, the fifth largest market for U.S. agricultural goods, and the third largest services market in Asia. The U.S. International Trade Commission estimated that the reduction of Korean tariffs on goods included in the FTA would add $10 to $12 billion to our economy each year and approximately $10 billion to annual merchandise exports to Korea. Rather than see that gain, our nation would suffer a $1.1 billion decline in U.S. exports if the EU acts first, according to analysis by the Ways and Means Committee Republican staff. In other words, South Koreans will start doing more business with EU companies and less with American companies – our businesses will see our market share erode as EU goods and services become more competitive in the Korean market.

    Meanwhile, China is angling for a regional East Asia free trade agreement that will exclude the United States. Asian nations are increasingly reliant on China for trade, and China has been using commercial diplomacy more and more to gain influence and leadership in the region. The United States should be working to counterbalance China’s influence through economic engagement of our own. If we don’t, our workers and companies will be left out. Unfortunately, by postponing the South Korea FTA indefinitely, the Administration is sending the wrong message to the region.

    The reality is that while the U.S. sits on the sidelines, waiting for the Obama Administration to lay out a trade agenda, other nations are forging ahead to open-markets for their own goods and services that will put American businesses and workers at a disadvantage. Soon our challenge will not be expanding market access, but rather maintaining it.

    We still have the opportunity to correct our course on trade and solidify U.S. competitiveness and leadership by rigorously pursuing market-opening agreements, starting with passing the three pending FTAs with Colombia, South Korea, and Panama. I hope President Obama uses his upcoming speech at the Asian-Pacific Economic Cooperation leaders’ summit to commit to this proactive trade agenda and announce a strategy for greater engagement in the Asia-Pacific region to protect future U.S. interests. American businesses and their workers should not be left behind as the rest of the world moves forward.

    The views expressed by guest bloggers on the Foundry do not necessarily reflect the views of the Heritage Foundation.

    Posted in Economics [slideshow_deploy]

    6 Responses to Guest Blogger: Wally Herger (R-CA) on Maintaining U.S. Competitiveness

    1. Bob says:

      As of today it has been 1074 days since the US Colombia FTA was signed by our two nations. As we continue to await congressional approval of this agreement an estimated $2.3 Billion of taxes, tariffs and duties have been imposed on US exports to Colombia. All the while our competitors from around the world can send their products, goods and services to Colombia as duty, tax and tariff free. I urge everyone to write to their member of Congress and demand an up and down vote on this FTA. This agreement, when approved by Congress, will in fact help give a "stimulus package" to the American economy! I commend Congressman Herger for his support of the trade agreement!

    2. Tim Az says:

      This is all nice but its just a dream as long as America's free market system is under attack by liberals who now hold Washington DC. Do you actually believe they are going to just give up on their war against America's wealth as long as they have control of our government? Until the people are willing to accept the situation they are now in. There will be no hope for prosperity creating a society of equally distributed misery. Is this the hope and change you've been waiting for?

    3. Nicolai Alatzas says:

      What types of gains do we get by setting up free trade with more countries? Seems to me we lost hundreds of thousands of jobs to Mexico in the NAFTA. The automotive workers taking the brunt of losses.

      Please explain to me how encouraging American Companies to set up shop in other countries benefits the people.

      Most Sincerely,

    4. Louis L Cesar F Levy says:

      In this multidimensional war against us, the Economical dimension is of tremendous importance for us as well as in the eyes of the Enemy. China was somehow hurled against us economically, by means not easy to understand but still real, 9-11 real endeavor, and not only symbolically, was to crack the Economy. The BIGGGS: governments, Taxes, Bills all point to the same aim. So these other also in some way.

      Again the Sleepy Giant Must Wake Up and do the Right things.

    5. Jerry from Chicago says:

      We should all fear the depredations of the U.S. Congress and our current 'leadership' far more than anything cooked up by jihadists, Al Quaeda or the Taliban.

    6. Ronald J Riley - Was says:

      Free trade reminds me of free sex in the sixties. Neither was free.

      There is no reason that free trade cannot work except for the fact that what we have been sold as free trade was drafted by and for transnational corporations. Their vision for free trade is much like their vision for patent reform and has lined their pockets at the expense of people and small business at both ends of the deal.

      What we have is irresponsible trade. We need to replace irresponsible trade which has been sold as free trade with responsible and equitable trade.

      Companies promoting free trade are the same ones laying waster to America’s and other developed countries economies. These companies are impoverishing all of us.

      Even worse is that those companies are also destroying job creation by stealing American ingenuity and shipping the value of inventors creations out of the country.

      Normally an inventor will license their first inventions to generate capital and then they use that capital launch small companies. Unfortunately when those free and irresponsible traders get away with stealing independent, academic and small business inventions we lose jobs which would have been created and oftentimes we lose the subsequent inventions which would have been produced.

      Large companies have two trade associations of serial patent thieves which represent the worst players. I believe the most disreputable group is the Coalition for Patent Fairness, better known as the Piracy Coalition. This group is made up of truly despicable bad players whose business model is built on serial infringement. Another slightly less dishonest group calls themselves the Coalition for 21st Century Patent Reform. They push HARMonization of America's patent system, an agenda of turning our patent system into a king's sport which will serve their interests at the expense of start up companies.

      Two other organizations which deserve special attention are NAM and the US Chamber of Commerce. Both are in my opinion purely big business stooges.

      It is small business which creates the vast majority of jobs and invention driven small business based on patent property rights is the only way to create wealth at the rate necessary to sustain America's standard of living.

      Ronald J. Riley,

      I am speaking only on my own behalf.

      Affiliations:

      President – http://www.PIAUSA.org – RJR at PIAUSA.org

      Executive Director – http://www.InventorEd.org – RJR at InvEd.org

      Senior Fellow – http://www.PatentPolicy.org
      President – Alliance for American Innovation

      Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel

      Washington, DC

      Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

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