Prospects for more open trade closing up
Lots of articles on trade issues today — and most of them are bleak in terms of trade liberalization. Instead, reporters are focusing on the strong protectionist sentiment in the U.S. and what that portends for the World Trade Organization’s faltering Doha Round of trade negotiations and for the renewal of “fast-track” trade promotion authority, which expires at the end of this month.
Bloomberg News focuses on the Doha Round negotiations and the last-gasp attempt in Germany this week to resuscitate the talks. The article discusses this new era of protectionism, the waning appetite for multinational deals, and the increased focus on bilateral pacts.
The Wall Street Journal (June 18, p. A2, subscription required) meanwhile gives attention to the soon-expiring Trade Promotion Authority, through which Congress gives the President the ability to negotiate trade agreements and have them voted up or down by Congress without amendments. Prospects for TPA renewal don’t look good.
According to the WSJ,
More broadly, the expiration of fast-track is likely to move the U.S. into a new era of trade uncertainty. It isn’t clear that whoever follows Mr. Bush will have much luck winning renewal of fast-track, given the deep reservations about trade that have taken hold in both parties on Capitol Hill. The prospects will be especially bleak if Democrats retain their majority. Rank-and-file Democrats are particularly anxious about trade, citing the impact on workers and families. Antitrade sentiments helped elevate the party to power in 2006 and are already roiling the 2008 contest.
With protectionist sentiment high on the Hill, the Democratic leadership is pushing for trade agreements to include stringent labor and environmental provisions — mandates that will hobble the ability of developing countries to benefit from more open trade.