Congress approves Panama, Colombia and South Korea trade deals
Congress has passed free-trade agreements with Panama, South Korea and Colombia, overriding objections from liberal Democrats to advance a key priority for both the White House and congressional leaders.
Backers have billed the deals as job generators that will open up major markets to American businesses and level the playing field for workers. The agreements, originally negotiated by the Bush administration, faced firm opposition from labor groups, progressives and lawmakers from the Rust Belt protective of U.S. manufacturers.
The South Korea pact passed the House on a 278-151 vote, with more than two-thirds of Democrats voting no. The Panama agreement was approved by a 300-129 vote. Colombia, the most controversial of the deals, passed on a 262-167 vote.
Each agreement passed the Senate shortly after with strong majorities. Again, the Colombia agreement encountered the most resistance, passing on a vote of 66 to 33.
The trade pacts will help President Obama in his quest to double U.S. exports in five years, a pledge that he made nearly two years ago as part of an effort to rebuild the economy and boost job growth.
Even so, the agreements aren’t expected to have a significant effect on economic output or employment, as the overall trade volume and markets of these trading partners are relatively small. The White House says the three deals will boost U.S. gross domestic product, the broadest measure of economic activity, by more than $12 billion a year. But that’s less than one-tenth of 1 percent of GDP.
The jobs issue is more contentious. Using one common assumption, that every $1 billion of exports generates 5,500 jobs, administration officials estimate that the Korea pact, by far the most important of the three, will “support” about 70,000 jobs. But that’s not the same as net new jobs for the American economy, because the trade agreements also will boost imports of goods from Korea.
Domestic industries likely to take a hit on employment include electronics and garment and textile manufacturing, but it’s unclear how many jobs may be in danger given that these sectors have been declining for years and that increased shipments from Korea could simply be taking away from imports now coming from other countries. At the same time, jobs at U.S. meat and farm producers in particular may see some small gains as a result of stronger shipments to Korea.
While Democrats exposed intra-party divisions over trade, Republicans were tangled in their own fight. Although many GOP lawmakers and the leading presidential candidate argue it’s time get tough with China, House Speaker John A. Boehner is refusing to bring up Senate-passed legislation clamping down on Chinese currency manipulation.
Republicans joined with Democrats to pass such legislation in the Senate on Tuesday. House Democrats on Wednesday tried to force a vote on the China currency by attaching it to the Colombia trade agreement. The House blocked the move on a party-line vote.