The lack of discussion on important issues in U.S. agriculture in this election cycle is disconcerting to many in agriculture.
Hoping to fuel that discussion, the Farm Foundation hosted a forum last week on ag priorities for the next administration — and included trade as a top issue.
Trade agreements are notoriously complex and there are inevitable burdens that come with globalization, but very few of the problems people are talking about are actually attributable to trade agreements, said Craig Thorn, a partner in DTB Associates.
“I regard trade agreements as being essential to the U.S. economy. They improve our ability to adapt to changes in the economy, to modernize and to cope with globalization,” he said.
Heard often in the trade debate is that trade agreements have led to a big increase in the U.S. trade deficit, but the opposite has always been true. Since 2002, the U.S. has cut its trade deficit almost in half with FTA partner countries and nearly doubled its trade deficit with the rest of the world, he said.
“There’s no ambiguity at all regarding the value of trade agreement for U.S. agriculture,” he said.
NAFTA, the most vilified trade agreement of all, illustrates that point. There’s been a huge increase in U.S. agricultural trade with Mexico and Canada going in both directions, with imports and exports almost parallel, he said.
“I think that’s a good indication of the quality of the trade agreement,” he said.
It’s possible to make similar arguments with every single trade agreement the U.S. has entered into. In every case, they will be positive and represent real economic growth and increases in efficiency in U.S. ag production, he said.
“Take that away or modify it in any significant way, and it would have serious negative consequences,” he said.
Another reason to continue negotiating trade agreements is because the rest of the world is doing it. In addition, countries can throw up illegal barriers to trade that can be dealt with through enforcement of negotiated trade agreements, he said.
“For the health of our economy, and especially our agricultural economy, we need more trade agreements not fewer, and we need stronger rules not weaker rules,” he said.
Trade priorities that should be on the next administration’s agenda include passing the Trans-Pacific Partnership and aggressively pushing new bilateral and regional agreements, he said.
TPP is not a perfect agreement, but it’s safe to say it’s going to be a beneficial agreement for the U.S. economy as a whole and the ag sector in particular, he said.
“It’s undeniable that the defeat of TPP in Congress would be disastrous for U.S. trade policy. It would be decades, I think, before countries would get back into a negotiating room with the United States if TPP goes down,” he said.
The Transatlantic Trade and Investment Partnership, however, is another story, excluding large parts of the ag sector and including serious, WTO-illegal barriers. The U.S. can’t accept that kind of outcome, he said.
He would also add enforcing current trade rules and reviving the World Trade Organization as a negotiating forum as high priorities, he said.