July 7,  2009





It is very disappointing to see that President Barack Obama intends to follow the broken trade agenda of the Clinton and Bush administrations by pushing Congress to approve the Panama Free Trade Agreement.  

We have had 15 years of the “NAFTA-based” trade model on which the Panama Agreement is based, and the results are in:  America now has a $127 billion annual trade deficit with Mexico, Canada, and the other 14 nations with which we have free trade agreements.  Since the passage of NAFTA, the U.S. has lost over 4.5 million manufacturing jobs - over 364,000 in North Carolina alone.
 
We’re in the worst recession since the Great Depression. Unemployment is rising nationwide and is now more than 11 percent in North Carolina.  The last thing this country needs is another poorly negotiated “free trade” agreement that will cause more good-paying American jobs to be outsourced but, sadly, if history is any guide, that’s exactly what the Panama agreement will do.
 
Why is that the case?  One of the primary reasons is that the deal fails to level the playing field for U.S. producers.  Let’s take one important North Carolina product as an example -- seafood.    
 
One of the biggest industries on the Outer Banks is commercial fishing.  The sector has been hammered by a flood of imports from overseas, including Panama.  Panama’s number one export to the United States is fish and seafood.  They export more than $100 million worth of fish and seafood to the U.S. each year. That’s more than 50 times the amount that the U.S. exports to Panama.  Their top exports include products that compete with seafood caught by North Carolina fishermen, including shrimp and yellowfin tuna.  

And it’s important to keep in mind that Panamanian fishermen are not encumbered by the environmental, safety, and labor regulations that U.S. fishermen must abide by.     
 
With the Panamanians already having a huge advantage over U.S. fishermen in terms of balance of trade, one would think that the least U.S. negotiators could insist upon would be a level playing field so our fishermen could have the same ability to access the Panamanian market as their fishermen have to access ours.
 
Unfortunately, that is not the case.  According to the U.S. International Trade Administration, while 100 percent of U.S. fish and seafood imports from Panama would receive duty-free treatment immediately upon implementation of the agreement, only 82 percent of U.S. fish and seafood exports to Panama would receive duty-free treatment immediately upon implementation.  Duties on most of the remaining 18 percent of U.S. exports to Panama would not be eliminated for 10 years!
 
Now how is that a level playing field?  

The simple answer is that it’s not, and our experience with past trade agreements suggests that the unfortunate result of provisions like this will be the loss of even more U.S. jobs.
 
Poorly negotiated trade deals like Panama are one of the main reasons our country finds its production base shriveling, our unemployment rolls rising, and our economy in shambles.
 
Passing this agreement as written would be bad for America, especially at this perilous economic time, and I would encourage the Obama Administration to rethink its position before it asks Congress to approve it.   

 
(U.S. Congressman Walter B. Jones is a Republican who represents the state’s third district in Eastern North Carolina, including Dare and Hyde counties.)

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