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House passes free trade agreements with South Korea, Colombia and Panama, Senate next
WASHINGTON (AP) ' Free trade agreements with South Korea, Colombia and Panama were approved by the House on Wednesday and immediately headed for votes in the Senate as Congress rushed to complete work on deals that have the potential to spur economic activity and put Americans back to work.
Years in the making, the Obama administration says the three deals, by reducing or eliminating tariffs that disadvantage American producers, could boost U.S. exports by $13 billion a year and foster tens of thousands of new jobs.
The votes come just a day after Senate Republicans were unified in rejecting President Barack Obama's $447 billion jobs creation initiative, and were hailed by lawmakers eager to show disillusioned voters that Congress can work with the president to help get the economy back on track.
The trade agreements, House Speaker John Boehner, R-Ohio, said, are "an area of common ground where we have worked together."
The agreement with South Korea, the world's 13th largest economy, was the biggest such deal since the North American Free Trade Agreement with Mexico and Canada in 1994.
The votes were 278-151 for South Korea, 300-129 for Panama and 262-167 for Colombia. The Senate was scheduled to vote later Wednesday.
Despite the strong majorities, the debate was not without rancor.
Republicans criticized Obama for taking several years to send the agreements, all signed in the President George W. Bush administration, to Congress for final approval. Many among Obama's core supporters, including organized labor and Democrats from areas hit hard by foreign competition, were unhappy that the White House was espousing the benefits of free trade.
Democratic opposition was particularly strong against the agreement with Colombia, where labor leaders long have faced the threat of violence.
"I find it deeply disturbing that the United States Congress is even considering a free trade agreement with a country that holds the world record for assassinations of trade unionists," said Rep. Maxine Waters, D-Calif.
To address such dissatisfaction, the White House demanded linking the trade bills to extension of a Kennedy-era program that helps workers displaced by foreign competition with retraining and financial aid. The Senate went along; the House passed it Wednesday, 307-122.
But with the focus in both the White House and Congress on jobs, the trade agreements enjoyed wide bipartisan support.
The administration says the three deals will boost U.S. exports by $13 billion a year and that just the agreement with South Korea, America's seventh largest trading partner, will support 70,000 American jobs.
Groups that oppose the pacts, including the AFL-CIO, point to past cases where free trade agreements were linked to factories moving overseas and they dispute the job growth figures.
Supporters argue that the three trading partners already enjoy almost duty-free access to U.S. markets and the agreements will lower tariffs on U.S. goods, making them significantly more competitive.
The U.S. Chamber of Commerce notes that U.S. farm products sold to South Korea face 54 percent tariffs, compared with 9 percent for Korean agricultural goods in the United States, and that U.S. automakers are hit with a 35 percent tariff in Colombia, compared with 2 percent for any vehicles coming from Colombia.
The administration says the trade deal with South Korea could increase exports by $10 billion, enough to eliminate the current $10 billion surplus Seoul has with the United States. It would make 95 percent of American consumer and industrial goods duty free within five years.
That agreement, the White House said in a statement, will give American businesses, farmers, workers, ranchers, manufacturers, investors and service providers "unprecedented access to Korea's nearly $1 trillion economy."
Supporters say that the Colombia deal, in addition to opening up markets that have been restricted because of high tariffs, would provide a gesture of political support for President Juan Manual Santos, a strong U.S. ally.
Republicans welcomed the prospect of increased exports but said those benefits could have come sooner if Obama had acted more quickly. They said American businesses have paid $3.8 billion in tariffs to Colombia since the trade agreement was signed, and that Americans are losing markets in South Korea because of a Korea-European Union free trade agreement that went into effect in July.
"There's no reason we should have had to wait nearly three years for this president to send them up to Congress for a vote, but they're a good start nonetheless," Senate Republican leader Mitch McConnell of Kentucky said.
Sen. Orrin Hatch of Utah, top Republican on the Senate Finance Committee, said there had been "nothing but passive indifference" from the Obama administration.
Finalizing the three deals has been difficult: Democratic majorities in the last year of the Bush administration opposed them and Obama demanded renegotiation of certain sections of each deal.
In the past year the administration has succeeded in winning concessions from South Korea to open up its markets further to U.S. vehicles and concluded an agreement to bring transparency to banking practices in Panama, known as a tax haven.
It has prodded Colombia into putting together a plan designed to protect labor rights and crack down on violence against labor leaders.
The congressional votes come a little more than a week after Obama submitted the agreements to Congress. The quick turnaround reflects the importance with which House GOP leaders regard them as economic aids.
The goal was to finish the voting by Wednesday, a day before South Korean President Lee Myung-bak is scheduled to address a joint meeting of Congress.
Lee, in a speech Wednesday to the Chamber of Commerce, said the U.S.-Korea agreement would "send a powerful message to the world that the United States and South Korea stand together in rejecting protectionism and that we are open to free and fair trade."
The United States has free trade relations with 17 nations. The last free trade agreement was completed in 2007 with Peru. It could still take several months to work out the final formalities before the current agreements go into force. The South Korean parliament is expected to sign off on its agreement this month.