NTU Supports an Up-or-Down Vote on Pending Free Trade Agreements

The Honorable Barack Obama
President of the United States
1600 Pennsylvania Ave., NW
Washington, DC 20500

Dear Mr. President:

Recently, members of youradministration have said that the passage of three pending free tradeagreements (FTAs) must be linked with the renewal of the Trade AdjustmentAssistance (TAA) program. With the economic recovery showing signs ofweakening, passage of the free trade agreements with Panama, Colombia, andSouth Korea would provide a much-needed remedy and should not be madeconditional on the passage of a wasteful and expensive jobs program.

Trade is a vital part of the U.S.economy and will necessarily assume a key role in its resurgence. Despite therecent recession, the free trade agreements to which the U.S. is a party havehelped us remain the world’s largest exporter. Although the 17 partner nationscovered under these FTAs represent only 7.5 percent of the world’s non-U.S.gross domestic product (GDP), they purchase on average more than 40 percent ofU.S. exports. Through similar demonstrations of their market expanding power,the pending FTAs can grow the trade-related jobs base that already employs 38million Americans – or more than one in five in the United States.

The trade pacts would also providea significant boost to America’s exporters, by way of reduced tariffs, and fortaxpayers, in the form of lower prices and more jobs. The latest illustrationof the vital link between economic growth and liberalized trade appears in a reportby the U.S. International Trade Commission which found that approval of theKorea-U.S. Free Trade Agreement would increase GDP by $11 billion annually andadd 70,000 American jobs.

Time and again, the evidence hasshown that taxpayers and consumers are the winners from more open trade, butthese benefits are undermined by the misguided policy of Trade AdjustmentAssistance. By creating a nonsensical distinction between jobs supposedlydisplaced by foreign imports and those lost from other forms of competition,such as technology or changing consumer tastes, the TAA program perpetuates themyth that international trade negatively impacts the economy. Furthermore, witha price-tag of roughly $2.4 billion, the program imposes a heavy burden ontaxpayers without delivering positive results for the economy. In fact,assessments from both the Office of Management and Budget and Government AccountabilityOffice have raised serious doubts about the program’s effectiveness with scarcetaxpayer dollars.

With the economy languishing andunemployment stubbornly high, a prudent and practical response is to jump-starttrade through passage of the Panama, Colombia and South Korea free tradeagreements, not add to our deficit by continuing counterproductive Trade AdjustmentAssistance. Please support the American taxpayer - support the up-or-down vote thefree trade agreements deserve.

Brandon Greife
FederalGovernment Affairs Manager

108 North AlfredStreet Ø  Alexandria, Virginia 22314  Ø Phone: (703) 683-5700  Ø  Fax: (703) 683-5722  Ø Web: www.ntu.org