President Sends Trade Deals to Congress

President Barack Obama sent three long-pending trade deals - with South Korea, Colombia and Panama - to Congress on October 3. And it looks very favorable that both the House of Representatives and Senate will pass these agreements. That's a welcome step for the economy, including small businesses.

It is noteworthy that the delay in getting these deals approved reflects, or was a part of a lengthy period of misguided policymaking. The trade deals were originally negotiated by President George W. Bush's administration in 2006. But a Democrat-led Congress blocked the agreements. Subsequently, after running on a protectionist trade platform for president in 2008, President Obama has shown little interest in advancing free trade while in office. He eventually got around to some tweaking of the trade agreements, and after fighting over spending for the Trade Adjustment Assistance program, has finally sent the deals to Congress.

Until now, for the past five years, nothing of substance had been done on trade by the U.S., while at the same time, government spending exploded, taxes rose, even higher taxes have been threatened, and regulation vastly expanded. That's a recipe for a poor economy, and that's exactly what we've gotten.

In contrast, lower trade barriers expand opportunities for U.S. businesses, entrepreneurs and workers, and increase choices and lowers prices for consumers. Indeed, free trade as an economic plus is one of those very few areas where economists are in nearly complete agreement. And for many decades, there was substantial bipartisan political support for lowering trade barriers...

Read the rest of this SBE Council Cybercolumn by chief economist Ray Keating here.