The Truth about Trade
Dean is Chairman Emeritus of 'Truth About Trade & Technology, a nonprofit advocacy group led by a volunteer board of American farmers.
Editor's Note: We are saddened to hear of Dean Kleckner’s passing and extend our sympathies to his family and friends. The AgWeb staff is grateful to have had the chance to work with him.
Drive a ‘Steak’ Through the Heart of Protectionism
Sep 05, 2008
Americans weren’t the only ones who attended the political conventions over the last two weeks--a handful of South Korean lawmakers also traveled to Denver and the Twin Cities to watch the Democrats and Republicans nominate their presidential candidates.
The flight from Seoul is long, but a South Korean official called the conventions “a good networking opportunity,” according to the Yonhap News Service.
I hope the Koreans had a chance to network over a few tender steaks. It will have given them a taste of what they’ve been missing.
Until recently, Americans couldn’t sell beef in South Korea. That was the fault of the Koreans, who imposed a short-sighted and ill-conceived ban on our products. Now that the ban is lifted, however, we still can’t sell the Koreans as much as we’re capable of producing or they’re capable of buying. And that’s the fault of our representatives in Washington.
It’s time to drive a ‘steak’ through the heart of protectionism.
About five years ago, South Korea was the world’s third-largest buyer of US beef. Then sales were cut off, following a scare over mad-cow disease. Only in recent months have our producers regained access to South Korean consumers.
The good news is that we quickly captured about one-fifth of the South Korean market. The bad news is that while we were away, the Australians and New Zealanders swooped in to provide South Koreans with the meat they no longer could buy from Americans. Now we’re going to have to fight to win back the market share we never should have lost in the first place.
It would be a lot easier if Congress were simply to approve the US-Korea Free Trade Agreement, which our government finished negotiating last year. It can’t go into effect without the approval of Congress, and so far protectionists in Congress haven’t even bothered to schedule a vote.
The benefits for US beef are obvious. Over a 15-year period, the deal would wipe out tariffs that currently range up to 40 percent. Other meat producers would profit as well, with duties on pork and poultry put on a timetable for elimination.
Farmers would see their sales to South Korea surge, too. Everything from wheat and corn to wine and grape juice would have immediate, tariff-free access to South Korea. The American Farm Bureau Federation estimates that once the pact is fully implemented, sales of agricultural products will go up by $1.6 billion annually.
Exports create good jobs for US workers. They also reduce our country’s trade deficit. You would think that American lawmakers would do everything in their power to pursue these important goals.
The Central American Free Trade Agreement provides a good example of what can happen. Since it went into effect, the value of beef exports to the Dominican Republic has jumped by 40 percent. This year alone, pork exports have tripled.
The South Korean market is especially attractive. Its roughly 50 million people have a serious purchasing power that will only grow as their economy continues to mature. They’re also drawn to particular kinds of beef cuts that don’t sell very well in the United States.
Whereas many Americans like nothing more than a nutritious choice steak, South Koreans prefer to shred their beef and serve it with rice dishes. So our biggest export items include bone-in short ribs and chuck rolls. This unique demand increases the overall value of what we produce because these cuts are tougher to sell here at home.
A trade deal with South Korean would help us pry open a beef market that never should have been closed and do it faster. After all, the mad-cow scare of five years ago wasn’t confined to Korea. Other countries had concerns as well. But Canada and Mexico--two extremely important export markets for us--didn’t behave as rashly as South Korea, in large part because they’re our NAFTA partners.
We were able to address their concerns quickly and efficiently. A similar relationship with South Korea might have saved millions of dollars in sales and the American jobs attached to them.
Candidates running for federal office this year should pledge themselves to passing the free-trade agreement with South Korea.
Carol Keiser owns and manages cattle feeding operations in Kansas, Nebraska and Western Illinois. Mrs. Keiser is a Truth About Trade & Technology board member. (www.truthabouttrade.org)