Bush hits the road to push for free trade

US leader goes all out to counter Congress on trade issues and boost his sagging popularity.

US PRESIDENT George W. Bush has hit the road to garner support for his free trade agenda.

This comes against a backdrop of brewing opposition in the Democrat-controlled Congress, which is trying to clip his powers to negotiate trade deals.

Striking back against the growing populist rhetoric of lawmakers, Mr Bush travelled on Tuesday to East Peoria in Illinois, where multinational

Caterpillar Inc is based. Caterpillar has been a shining example of America’s export prowess, with China now its fifth-largest market.

“The temptation is to say, trade may not be worth it, let’s isolate ourselves, let’s protect ourselves,” he said. “It’s a bad mistake for the country to lose our confidence and not compete.

“Americans wonder, can you compete in a global economy? My answer is, darn right you can.”

For Mr Bush, it was the first of two major speeches this week in a calibrated campaign by the White House to counter Congress on trade issues and boost his sagging popularity at home, with the message that wages and employment are growing.

He was due to deliver a more formal “State of the Economy” address in New York a day later, in which he will make a call to Congress to renew his authority to negotiate free trade agreements which lawmakers cannot amend in a piecemeal fashion.

This authority expires on July 1 and, if it is not extended, immediately puts at risk negotiations for a world trade deal, and talks for 11 free trade pacts under way now, including with South Korea, Thailand and Malaysia.

While Republicans see trade as spurring growth, many Democrats view it as a source of inequality.

This is largely due to the traditional Democratic Party support base of labour unions, which have staunchly opposed free trade deals.

Earlier this month, 37 congressional Democrats sent a letter to Mr Charles Rangel, the chairman of the influential House Ways and Means Committee, urging him to “reverse the troubling results of the administration’s trade agreements and trade policies”.

Mr Rangel on Tuesday signalled his intent to work with the President, saying he was trying to get the two political parties out of “divorce court” on the issue.

“If we don’t give trade promotion authority, we’ve got to have a good reason for not giving it,” he said during a committee meeting.

Pro-trade Democrats like Mr Rangel and Mr Max Baucus of the Senate Finance Committee have sought to appease labour unions by insisting on mandatory labour standards in agreements with developing nations.

Much depends on whether they can sway others. Mr Robert Zoellick, a former point man on trade issues for the Bush administration, told The Straits Times in an interview: “The question that still remains to be answered is whether those like Mr Rangel and Mr Baucus can find compromises that will enable them to bring along more substantial Democrat votes.”

It will not be easy to strike a deal across the aisle because the White House and many Republicans believe that labour and the environment should not be covered in trade agreements.

In his speech on Tuesday, the President maintained that the American economy could grow only if there was more global trade.

The US manufacturing sector, for example, benefited from lower barriers as a result of trade agreements.

He said his administration would pursue more trade-opening opportunities because that leads to a spurt in exports. But it would insist on fair rules for trade.

The greater challenge, however, would be garnering domestic support.

Mr Zoellick, who served as deputy secretary of state and trade representative, noted: “There is a curious irony here. Many countries believe that the US is a major beneficiary of the globalised economy. But many Americans continue to remain wary of the changes and the uncertainties that globalisation brings.”

AMERICA MUST COMPETE

“The temptation is to say, trade may not be worth it, let’s isolate ourselves, let’s protect ourselves. It’s a bad mistake for the country to lose our confidence and not compete.“
PRESIDENT BUSH, seeking public support for his free trade policy