U.S. Trade Representative Robert Lighthizer recently touted an “improved” U.S.-Korea Free Trade Agreement (KORUS) that will “reduce our trade deficit.” Among other things, the revised agreement will allow the United States to maintain its 25 percent tax on Korean pickup trucks until 2041 while erecting new steel quotas that “will result in a significant reduction in Korean steel shipments to the United States.”
“About the only thing they forgot to do was rebrand KORUS as the U.S.-Korea Unfree Trade Agreement,” said Bryan Riley, Director of NTU’s Free Trade Initiative. “The Trump Administration was supposed to be using the threat of tariffs as a negotiating tool to lower trade barriers, not increase them.”
Riley said the goal of U.S. trade policy should be to remove barriers instead of mistakenly trying to eliminate trade deficits. “USTR talking points report that the U.S. trade deficit with Korea has increased since KORUS took effect. Left unstated is the fact that during the same time, the U.S. unemployment rate was cut in half from 8.2 percent to 4.1 percent as the American economy added over 13 million new private-sector jobs. Let’s hope that in the future U.S. officials focus on creating new jobs instead imposing even more restrictions on America’s economy based on a misguided obsession with trade deficits.”