Congress faces an important choice in the months ahead as it considers legislation to renew Trade Promotion Authority. TPA is vital because economic growth and job creation at home depend on our ability to sell American goods and services to the 95 percent of the world’s customers living outside the U.S.
Many Americans are already seizing these opportunities. More than 38 million U.S. jobs depend on trade. About 1 in 3 manufacturing jobs depends on exports, and 1 in 3 acres on American farms is planted for hungry consumers overseas.
However, the international playing field is often unfairly tilted against American workers and companies. While our market is generally open, U.S. exports face foreign tariffs that often soar into double digits as well as a thicket of non-tariff barriers.
Free-trade agreements are crafted to tear down these barriers. By creating a level playing field, they help U.S. companies and the workers they employ compete in overseas markets. But without a proactive and determined trade agenda, we’ll be stuck on the outside, looking in.
The record of America’s FTAs is outstanding. While our 20 FTA partners represent just 10 percent of the global economy, they buy nearly half of U.S. exports. Our FTAs have generated an expansion in trade that supports more than 5 million American jobs, according to a U.S. Chamber of Commerce study.
Further, if you’re worried about the trade deficit, FTAs aren’t the problem — they’re the solution. The U.S. has a trade surplus in manufactured goods with its 20 FTA partners on top of global surpluses in services and farm products.
How can the U.S. seize more of these benefits? The good news is that the U.S. is taking part in two major trade negotiations. The first, the Trans-Pacific Partnership, involves 11 other Asia-Pacific countries from Japan to Australia.
The appeal of the TPP is simple. Two billion Asians joined the middle class in the past 20 years, and another 1.2 billion will do so by 2020. That’s a lot of potential customers.
Further, the International Monetary Fund estimates the world economy will grow by $22 trillion over the next five years, and nearly half of that growth will be in Asia. The TPP will help U.S. companies tap these booming markets
In the second big negotiation, the U.S. and the European Union are pursuing a Transatlantic Trade and Investment Partnership, the largest market for U.S. business.
U.S.-EU trade reaches $1 trillion annually and employs 15 million Americans and Europeans. Even so, eliminating today’s relatively modest trade barriers would bring big benefits.
According to one study, the TTIP would boost U.S. exports to the EU by $300 billion annually and increase the purchasing power of the typical American family by nearly $900. Europeans would secure similar benefits.
However, to make these or any other growth-driving trade agreements a reality, Congress must first approve Trade Promotion Authority. The Constitution gives Congress authority to regulate international trade, but it gives the president authority to negotiate with foreign governments.
TPA builds on this constitutional partnership by directing Congress to set negotiating objectives and requiring the executive branch to consult extensively with Congress during negotiations. In other words, TPA strengthens the role of Congress in trade policy.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.