WASHINGTON, Jan. 21, 2015 -- U.S. Trade Representative Michael Froman went before the U.S. Conference of Mayors on Wednesday to start selling the trade agenda President Obama highlighted in his State of the Union address, an agenda that includes trade agreements that Froman said will provide “premier access to two-thirds of the global economy.”
The agreements include the Trans-Pacific Partnership (TPP) with 11 other Pacific Rim nations, which has been under negotiation now for a decade. Froman said the treaty could grow U.S. exports by $123 billion a year while supporting hundreds of thousands of well-paying jobs. Without an agreement, he said the U.S. will be at a disadvantage in a region where the population of middle class consumers is expected to swell from 525 million in 2009 to 3.2 billion by 2030.
“Two thirds of the world’s middle class will call Asia home,” Froman said during a panel discussion at the Conference of Mayors winter meeting in Washington. “The question is, who will serve that market? Will the world’s middle class buy Made-in-America goods and services, or products made elsewhere?”
Froman cited examples of how the TPP, with its emphasis on free trade, could help U.S. exporters immediately:
-- In Vietnam, American poultry producers must pay tariffs as high as 40 percent, twice as high as those faced by Australia and New Zealand producers.
--In Malaysia, American cars and trucks face tariffs of 30 percent, while motor vehicles from Japan, Turkey and elsewhere face no tariffs.
-- In Japan, American aluminum bars face tariffs as high as 7.5 while the same product from Mexico, Chile and elsewhere faces no tariffs.
“These are just three areas where TPP would eliminate or significantly reduce barriers to American exports, leveling the playing field for American workers and businesses of all sizes,” Froman said.
Froman also asked the mayors for support in getting Congress to approve legislation giving the president so called “Trade Promotion Authority,” or TPA. The measure would require congressional oversight throughout the negotiation process. But once a deal is reached, Congress would have to vote yes or no on the agreement, without amendments of filibusters.
“It makes clear to our trading partners that the administration and Congress are on the same page in negotiating high standards in our trade agreements, standards that will protect our workers and the environment.”
Froman said if the TPP is rejected, it would leave the field over to dominance by China, which is moving ahead with its own network of trade agreements in the Asia Pacific region. He pointed out that while the TPP will include the highest enforceable labor and environmental standards of any trade agreement ever, China’s alternative has no such standards.
“The question is, what to do about it?” Froman asked. “Some would have Americans continue the status quo – or worse, compete in a world where the rules of the road are defined by China, not the United States. They would have us sit on the sidelines, rather than take the field, and they would have us do so without the tools we need to win.
“But as the President said (Tuesday) night, we should be the ones who engage and lead. Done right, trade agreements are the keys for unlocking opportunity, for leveling the playing field for American workers and businesses, for making sure we’re the ones who write the rules of the road, for making sure those rules reflect our interests and our values.”
Froman concluded his speech by asking the mayors for their help in getting TPP done.
“We need your voice,” he said. “As America’s mayors, you’re uniquely qualified to put this in context that people can understand, digest, and support. We can’t do this without you.”
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