Why Businesses Support Free Trade
Year after year, amidst every trade negotiation, many worry that free trade will render American companies unable to compete with an influx of cheap foreign goods. It's one reason that many Democrats and labor leaders oppose a "fast track" procedure for two major trade deals that are currently being negotiated.
But American businesses -- which, naturally, strongly value their ability to remain competitive -- disagree. And they provide good reasons for doing so.
The National Association of Manufactures (NAM) -- the largest manufacturing association in the United States, representing approximately 11,000 manufacturing companies in every industry and state -- has given free-trade agreements its full-fledged support. According to NAM, "the United States enjoys a $130 billion manufacturing trade surplus with its 20 existing trade agreement partners. In 2012, those countries purchased nearly half of all U.S. manufactured goods exports." Moreover, 95 percent of the world's consumers live outside the United States, offering an enormous market for American goods.
Other businesses agree with the manufacturers. The United States Chamber of Commerce, which represents more than 3 million employers, recently put out its trade agenda for 2014, in which the group stated that trade agreements "have the potential to bring huge benefits to American workers, farmers, and companies. In addition to expanding market access for U.S. exports, these agreements will establish new rules and protections in areas such as intellectual property that are vital to American innovation and competitiveness."
The Business Roundtable, a consortium of chief executive officers of leading U.S. companies, has agreed with the Chamber, concisely stating that "trade is an important engine for U.S. economic growth and jobs."
These business groups have coalesced around securing two major free-trade deals, known as the Transatlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP). The TTIP is a trade negotiation with the 28 members of the European Union, while TPP would incorporate eleven Asia-Pacific countries. Together, the two deals would give American companies access to nearly 1 billion consumers, supplying our companies with new sources of revenue.
Despite the clear benefits and strong support from the business community, these agreements have encountered fierce opposition by organized labor and Senate Democrats, who have refused to give the president Trade Promotion Authority. TPA gives the president the power to "fast track" trade agreements with strict oversight from Congress. Giving the president this authority serves as the best way to quickly, but thoughtfully, pass both agreements.
If we want to continue leading the world, Americans must embrace the global economy and open up our arms to trade. The American business community -- and 80 percent of the public, according to one recent poll -- support free-trade agreements. Congress would be wise to pass TPA to make these agreements a reality.
David Williams is president of the Taxpayers Protection Alliance.