AFF Sentinel Vol.4 #3

Key contrasts in trade policy were evident during R-CALF and NCBA conventions. While neither changed longtime policy, even the tweaks differed significantly.

One R-CALF resolution, ostensibly recognizing trade policy's long-term impact on profitability, nevertheless called for restrictions and tightening of trade agreements. It specified quantity and price "safeguards," "rules of origin (born, raised and slaughtered)" and "upward harmonization" of import health and safety standards. Translation: quotas and limits on imports, COOL to discourage consumers from buying certain beef in U.S. stores and import regulations more restrictive than international standards to discourage or eliminate trade. Existing policy already opposed Fast Track Authority for the president in negotiating free-trade agreements.

By contrast, while expressing concern about opening the U.S. market to over-30-month Canadian cattle, NCBA's resolution calls for permanent identification of older incoming live cattle and an orderly market transition plan to reduce short-term market impact. Satisfied that the USDA's proposed rule is solid science - and advocating science-based trade rules - NCBA's concern is minimizing market disruptions.

"NCBA believes in treating our trading partners as we would like to be treated," said NCBA President John Queen. "But we want free, fair and reliable trade." Goal: U.S. producers are rewarded, not penalized, by free markets.

By contrast, speakers at R-CALF's convention decried President Bush's Golden Rule philosophy governing trade relations. R-CALF's import policy is protectionist, with only lip service to exports. Both R-CALF and the Organization for Competitive Markets (OCM) have been forging political coalitions with labor unions, small manufacturers and faith groups to fight free trade. The United Steelworkers president was scheduled to speak twice at R-CALF's meeting but was ill. An AFL-CIO representative participated in OCM's recent trade conference. Manufacturing representatives at both meetings advocated protection from competition to protect American manufacturing jobs.

While noting decreases in U.S. manufacturing jobs, neither mentioned that manufacturing jobs worldwide are decreasing because manufacturing is continually becoming more efficient, requiring less labor for the same tasks. China's manufacturing job attrition rate has been 15 percent, nearly double the U.S. rate. No mention that U.S. consumers enjoy lower prices and a higher standard of living, having more income left over - potentially to buy beef - because of less expensive imported goods or price competition keeping domestic prices lower.

The anti-trade, cattlemen-labor, union- manufacturer coalitions will be focusing their lobbying - now directed toward a more sympathetic Democratic Congress - to stop free-trade agreements (FTAs) and Fast Track negotiating authority. R-CALF's resolution reveals the import restrictions they advocate, if protectionists fail to scuttle new agreements.

Such opposition ignores U.S. economic gains from exports with trade agreements. It also disregards import restrictions' damage to trade relationships and retaliatory actions on exports.

U.S. goods exports have climbed 26 percent among the ten countries with U.S. trade agreements since 2001 ("Exports and Free Trade," Wall Street Journal, 2/5/07). That is double our export growth with the rest of the world. More recent agreements have yielded 40 percent increases. Agreements usually cut tariffs on U.S. manufactured goods, helping to keep American workers employed, the WSJ noted. Somehow, the revenue and jobs generated by exports seldom get mentioned - only news about job losses. Further emphasizing FTA benefits, those ten countries with FTAs account for only 7.3 percent of world GDP but 42 percent of U.S. goods exports.

Such protectionism from the anti-trade LAG* betrays a deliberate disregard for the economic welfare of cattlemen's beef consumers.

If trade barriers raise the cost of goods to American consumers and decrease export sales that employ American workers and generate income, why do politicians even consider them?

"It's simple: the jobs saved are very visible while the costs are largely hidden," ("Lowering barriers," Colorado Springs Gazette, (11/27/06). There is no tag on an imported item detailing what portions of the price goes to protecting or subsidizing U.S. industries, the editorial noted. (Further, an eliminated imported good is surreptitiously removing consumer options, we would add.) Yet trumpeting the jobs saved, with costs hidden, politicians look like they are protecting us. In reality, they're saving a relatively low number of jobs at a cost of $231,000/job per year.**

The future of cattlemen's revenue from exports - nearly $100 per head at today's prices - rests on which politicians succeed.

*LAG-Liberal Activist Groups-R-CALF, Organization for Competitive Markets (Ralph Nader), Consumer Federation of America (Carol Tucker Foreman), Public Citizen (Ralph Nader), Consumers' Union, Western Organization of Resource Councils and others.

**CATO Institute study, federal statistics; average over 20 protected industries. (Gazette, 11/27/06 as above.)

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