Trade: Another Democrat Strikeout

Korea may have lost the finals of the World Baseball Classic at Dodger Stadium on Monday night, but according to the Wall Street Journal, South Korea is about to get a big win for its economy with the forthcoming and possibly imminent conclusion of a European Union-Republic of Korea Free Trade Agreement (FTA). And we’re the losers.

The new European FTA is somewhat patterned after the U.S.-ROK FTA signed in June 2007 (a Congressional Research Service summary is here), and the two are, in fact, designed to be complementary. But Congressional Democrats have been steadfast in their opposition to the U.S-ROK FTA. Even new United States Trade Representative Ron Kirk said that the deal “simply isn’t fair” though he later backed down somewhat in his written responses to questions before confirmation. Still, it would take a lot of pressure from the Obama Administration to get the U.S.-ROK FTA on the Congressional agenda for ratification and even more to actually get it through.

Admittedly, the U.S.-ROK FTA was not signed until June 30, 2007, after the Democrats recaptured control of Congress. So it could hardly have been muscled through. But the Bush Administration could nevertheless have done more – a lot more – to highlight the benefits of the FTA for American exporters and promote free trade more generally.

Meanwhile, the EU, not terribly constrained by protectionist feelings in the Member States even with elections for the European Parliament coming in June, is marching ahead with its own FTA with Korea. The European Commission, which is negotiating the deal, will do what is best for Europe; that’s its job. Whether it’s South Korea or Latin America, one gets the sense that in trade, the EU has its game on, while we’re stuck in politics. And by going first, EU companies will be poised to benefit from the gains from trade that could otherwise have gone to the United States. So it makes it that much harder for us to compete in that market. How that helps American workers and farmers is beyond me.

Add in Mexican trucking, and there’s a pattern emerging: whatever one thinks about trade, this is how the Congressional Democrats treat our friends and allies. Why, then, would other countries want to remain friends with the United States?