[CTC] Korea free trade agreement and state officials

[Sarah Edelman, Public Citizen's Global Trade Watch]

"Will they do what other administrations have had to do with a Democratic
Congress and that's twist arms to get votes?" Mr. Castellani says. "That's
the real test."Truck Dispute Previews Trade BattleBy ELIZABETH
WILLIAMSON<http://online.wsj.com/search/term.html?KEYWORDS=ELIZABETH+WILLIAMSON&bylinesearch=true>

WASHINGTON—As President Barack Obama renews his focus on trade in a quest
for job growth, a festering dispute with Mexico hints at the political
battles ahead.

Over the past several weeks Mr. Obama has vowed to push for passage of
pending free-trade agreements with Korea, Panama and Colombia, and seek
other trade opportunities. Yet shortly after taking office, Mr. Obama signed
a bill with a provision that effectively bans Mexican trucks from operating
inside the U.S. The ban violates the North American Free Trade Act, and
prompted Mexico to impose punitive tariffs last year on $2.4 billion in
American products—from Christmas trees and potatoes to wine.

Mr. Obama could reverse the ban without the approval of Congress, but that
would infuriate many Democrats and trucking and other unions that are
critical supporters in a tough election year.

On Thursday, the two major business groups in the capital said progress on
the trucking issue would signal that Mr. Obama is moving beyond rhetorical
support for free trade.

"This is an important benchmark of the administration's willingness to put
some action behind its stated goals of doubling U.S. exports," says Patrick
Kilbride, director of the Americas program at the U.S. Chamber of Commerce,
which has advocated for an end to the ban.

John Castellani, president of the Business Roundtable, which includes chief
executives of the biggest U.S. multinationals, said Thursday that while he
takes Mr. Obama's intentions to pursue trade opportunities "at face value,"
the proof of the White House's seriousness will come when the fight to pass
the free trade agreements begins in Congress, a battle expected no earlier
than December.

"Will they do what other administrations have had to do with a Democratic
Congress and that's twist arms to get votes?" Mr. Castellani says. "That's
the real test."

The Mexican government is using Mr. Obama's renewed pledges on trade to
demand action now.

"If we don't see a concrete proposal from the U.S. in the next few weeks,
Mexico will exercise its legal rights, which include expanding the list of
products subject to retaliation," a Mexican government official said
Thursday.

Mexico said it won't be enough to reinstate an expired pilot program, a
compromise that temporarily gave Mexican trucks access to the U.S.

White House spokeswoman Jennifer Psaki said Thursday that the administration
is "committed to working closely with Congress and with the Mexican
government to find a resolution that addresses legitimate safety concerns
and complies with our international obligations." A spokeswoman for
Transportation Secretary Ray LaHood, who said in March the government would
act soon, echoed that statement.

Mr. Obama has vowed for a year to resolve the dispute, but done little.
Free-trade advocates, including agricultural businesses hurt by the tariffs,
say U.S. law would apply to Mexican truckers, and the ban is more a
protectionist measure than a safety issue.

Advocates for the ban, including the Teamsters union, say it is needed
because Mexican trucks and drivers are potentially unsafe.

"If we were to 'settle' this trucking dispute this would only increase the
trade deficit with Mexico, which is up to 59% in January through March,"
said Robert E. Scott, senior international economist at the Economic Policy
Institute, which opposes passage of the free-trade agreements with Korea,
Colombia and Panama.

-- 
Tim Robertson, Director
California Fair Trade Coalition

2017 Mission St., Suite 200
San Francisco, CA  94110
(415)255-7291(o)
(415)987-4870(c)

The California Fair Trade Coalition is a pro-trade, pro-democracy coalition
of labor, immigrant rights, environmental, faith, family farm and women's
interests working towards a balanced approach to international trade. Our
goal is to reform U.S. trade policy and to promote economic justice, human
rights, healthy communities, and a sound environment.
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