South Korea, Colombia and Panama Trade—Will the U.S. Be a Player?

By: Dr. Lynn Reaser

Congress should swiftly move to ratify the trade pacts with South Korea, Colombia, and Panama because of the positive effects for businesses, consumers, and international relations.  Reducing tariffs faced by U.S. exporters will help producers of a wide variety of products ranging from agriculture to technology.  Last year, San Diego shipped $14.5 million of merchandise to the three nations, double the volume of the prior year. Lower tariffs on our side will also reduce prices paid by consumers and firms using imported materials.  Last year California’s volume of exports and imports with the three countries totaled nearly $35.0 billion.

The European Union two weeks ago implemented its trade pact with South Korea.  Canada’s trade agreement with Colombia will go into effect next month.  The U.S. should not be locked out from a freer flow of capital, goods, and technology.

The major roadblock to the bill’s passage involves controversy over the Trade Adjustment Assistance (TAA) program, which expired at the end of last year.  This program furnishes training, unemployment benefits and health-care subsidies for workers displaced as a result of globalization.  The U.S. Department of Labor was charged with delivering an assessment of the program’s effectiveness four years ago.  Its report will apparently not be completed until the end of this year.  Last year, TAA cost $975 million, amounting to an average of about $4,100 per person for the 235,000 workers covered.  Without information on its efficacy, Congress cannot debate the TAA on any intelligent basis.  However, out trade pacts with these three strategic nations should not be held hostage.


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