BENEFITS OF FREE TRADE IN THE USA

Benefits of Free Trade in the USA



Benefits of Free Trade in the USA

Introduction

U.S. Trade policy and the impact of globalization on America are regularly the subjects of contentious debate both on Capitol Hill and in the media, and 2007 promises more of the same. The free Trade argument is played out between those that fear the perceived negative effects of freer Trade on their own narrow interests and those that embrace the economic and strategic benefits that open market policies will bring to the economy as a whole. Consequently, in today's policy world, free Trade legislation passes on the margin, where every vote is critical. The loss of even a few proponents of freer Trade policies could result in a costly shift away from the open market policies that have helped to bolster America's economic growth.

With free trade agreements (FTAs) with Peru, Colombia, Panama, and South Korea needing congressional approval; Trade Adjustment Assistance up for renewal; the struggle to advance multilateral Trade talks in the World Trade Organization (WTO); and, critically, the need to extend the President's Trade promotion authority (TPA) this summer, policymakers have ample opportunity to implement a more protectionist policy stance or to stay the course and continue to allow America to reap the benefits of open market policies. Hiding from or ignoring the debate about globalization and its effect on the U.S. will not promote a free Trade agenda. Rather, this approach merely leaves the voice of protectionism as the only voice heard on Trade policy issues. Instead, a firm public commitment to advancing sound open market policies coupled with a presentation of the facts about the effect of freer Trade and investment on America will better help to advance the cause of open market policies. For America to continue to reap the benefits of globalization and to lead the world in demonstrating how globalization progresses and evolves, the President and Congress should make a solid and public commitment to advancing open market policies.

Scope

Without political leadership on Trade issues, the facts behind the benefits of America's international Trade and investment policies will have to suffice in the battle to keep U.S. markets open and global Trade liberalization moving forward. Not only does Trade liberalization make sense from a theoretical perspective, but the data show that freer Trade promotes economic growth and prosperity. Free Trade is about beating poverty and expanding economic opportunity-markedly nonpartisan issues. While working through Trade policy legislation this year, Congress will have the opportunity to advocate free Trade and to help America and the world reap the rewards that accrue from such policies. It is essential that lawmakers separate myth from fact and assess upcoming Trade initiatives objectively. Armed with the facts, they can then help to ensure that prosperity in the U.S. and around the world has a real chance to thrive, both this year and in the longer term.

Explanation

The gains from freer Trade are ...