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July 2010 Archive for The Truth about Trade

RSS By: Dean Kleckner, AgWeb.com

Dean is Chairman Emeritus of 'Truth About Trade & Technology, a nonprofit advocacy group led by a volunteer board of American farmers.

We Need a Grand-Slam Trade Agenda

Jul 30, 2010

By Tim Burrack – Arlington, Iowa (www.truthabouttrade.org)

In the world of baseball, everybody’s talking about the trade deadline—teams are trying to get deals done in time for their pennant races.

In the world of Washington, they’re talking about a different kind of trade—the exchange of goods and services across borders. Unfortunately, almost nobody in D.C. shares the deadline-driven urgency of baseball’s general managers, who are busy swapping players and revamping rosters.

Instead, we’re waiting on our political leaders for proof of actual progress. But there hasn’t been much lately.

President Obama recently boasted that exports during the first four months of this year were almost 17 percent higher than they were during the first four months of last year. That’s all well and good, but it has more to do with the ebb and flow of economic cycles than anything public officials have done for America’s export-dependent farmers and manufacturers.

The White House often confuses rhetoric with results. Saying something is not the same as doing something. Earlier this month, for example, Obama introduced the members of his new President's Export Council. The move generated some headlines, but nothing else.

Does the president really need a panel of advisors to tell him that the highest priorities on the U.S. trade agenda are approving the free-trade agreements already negotiated with Colombia, Panama, and South Korea? This has been true for more than three years. Yet Congress has let these deals languish. And the Obama administration has done almost nothing to revive them.

Granted, the president has come a long way. As a senator, he was a devoted protectionist. As a presidential candidate, he talked about renegotiating and / or quitting NAFTA.

Today, Obama appears to have had some second thoughts about economic isolationism. Confronted by an unemployment crisis, Obama has started to appreciate the fact that exports mean jobs for American workers. In his State of the Union address earlier this year, he promised that U.S. exports would double over the next five years. He also called for passing the three long-ignored trade pacts.

Now he has to turn these words into action.

According to some, action will have to wait until after the midterm elections in November, during a congressional lame-duck session. Well, that’s what they’re saying about an awful lot of proposals. Let’s get one thing straight: We needed these trade deals approved yesterday. A lame-duck session is for a lame trade agenda.

Every day that goes by, we lose the opportunity to create jobs.

Three years ago, the United States enjoyed 96 percent of the grain trade with Colombia. That’s true market dominance. Last year, however, this figure slipped to just 31 percent. While Congress ignored Colombia and refused to approve the U.S.-Colombia Free Trade Agreement, South American countries secured their own trade preferences and snatched the country’s consumers.

Our grains face a 15 percent Colombian tariff, costing us $1 Billion a year in lost sales ($314 million of that was just corn sales). We will continue to lose sales as long as Washington does nothing and refuses to approve this trade deal. There are currently 126 FTA's under negotiation around the world involving U.S. trading partners – but we're not involved in any of them!

Canada has approved its own trade agreement with Colombia, dropping the tariff on Canadian wheat to zero. Over time, our dwindling market share will shrink to virtually nothing. We will have forfeited an excellent position.

When we squander our economic future, American workers suffer. The American Meat Institute recently calculated that approving the trade pacts with Colombia, Panama, and South Korea would create almost 30,000 jobs. And that’s in just one sector of agriculture, to say nothing of agriculture’s other sectors or all of the other U.S. industries that would benefit from improved access to these foreign markets.

If the United States wants a jobs program, it needs to look no further than these trade agreements. Passing them today would improve employment tomorrow. This is how economies move from recession to growth.

Ultimately, the United States will want to seek more deals with other countries. The distinguished economic Jagdish Bhagwati recently called on Obama to live up to his reputation as a multilateralist and launch the “Obama Round” of world trade talks.

That’s a grand agenda—or, in baseball terms, a grand-slam agenda. In the meantime, can we just achieve a simple base hit? On trade, America has been striking out for long enough.

Tim Burrack raises corn, soybeans and hogs on a NE Iowa family farm. Tim is a Board Member of Truth About Trade and Technology www.truthabouttrade.org

Regulation That Kills Jobs

Jul 24, 2010
By Bill Horan: Rockwell City, Iowa (www.truthabouttrade.org)

In his latest weekly radio address, President Obama talked about jobs. “Too many Americans whose livelihoods have fallen prey to the worst recession in our lifetimes – a recession that cost our economy 8 million jobs – still wonder how they’ll make ends meet,” he said. Then Obama called for special measures to create more employment.

If the president means what he says, he may want to take a second look at the recent behavior of his own Environmental Protection Agency.

Several months ago, the EPA startled farmers with its decision to conduct an unplanned review of atrazine, the crop-protection tool that we’ve been using for half a century. Not only did the EPA jump the schedule to institute this year's review (in 2006, the EPA finished a 12-year re-approval process and review, reporting that atrazine posed 'no harm') one top agency official recently announced that the EPA would be reaching a decision in September, many months ahead of schedule.

It’s been said that no molecule has received more intensive study than atrazine. Regulators have allowed it on the market because it’s a safe product that does an excellent job of killing harmful weeds that would have reduced yields of field crops.

There has been increased concern that the EPA is taking its marching orders from special-interest groups such as the National Resources Defense Council, which has called for a complete ban of atrazine. This activist organization doesn’t have any scientific data to suggest that atrazine is unsafe. It’s just a radical outfit that despises modern technology.

What would happen if the EPA were to accept the demands of the NRDC and outlaw atrazine? Don Coursey of the University of Chicago studied the question from an economic perspective. Using an economic model, he estimated that farming costs would increase so much that as many as 48,000 workers could lose their jobs in the corn industry alone. Additional losses would rip through the sorghum and sugar cane sectors.

It makes you wonder if anyone at the EPA has taken a look at the unemployment rate. This year, it has hovered around 10 percent. That doesn’t count the number of people who have stopped searching for work. And it’s even higher in many of the rural areas that depend on agriculture for their economic survival.

Obama discusses the jobs crisis at almost every opportunity—not just in his weekly radio address. “To every American who is looking for work, I promise you, we are going to keep on doing everything that we can, I will do everything in my power, to help our economy create jobs and opportunity for all people,” he said recently.

Yet a significant byproduct of an ideological crusade against atrazine would be the destruction of thousands of jobs.

None of this is to say that we should ignore safety or conservation. Quite the opposite. We need a regulatory process based on sound science--one that investigates every possible avenue of inquiry, no matter where it leads. If a product hurts human health or places an undue burden on the environment, then it should not be approved for commercial use.

At the same time, our regulatory system must resist political mischief. If it doesn’t, then American farmers will find themselves in the sorry position of many of our European friends--watching the rest of the world adopt technologies that we reject because special-interest groups have applied pressure.

One of the great ironies of the push to demonize atrazine is that it’s conducted in the name of environmentalism. Yet the loss of this product would hurt the environment. Without atrazine, farmers would have to find new ways to control weeds. Most would begin to till their land more intensely, producing additional soil erosion. It would also require a lot more time behind the wheels of tractors--and that would generate more greenhouse gases.

This isn’t a tough call. Atrazine is a thoroughly vetted product. It has been endorsed by scientific and regulatory agencies in the United States and all over the world. Banning it would toss thousands of Americans out of work and place more stress on the environment--and not produce even a tiny bit of good in return.

If the White House cares about farmers and workers, it will put a quick end to this foolish attack on crop protection.

Bill Horan grows corn, soybeans and grains in Northwest Iowa. This fourth generation family farm has been involved in specialty crop production and identity preservation for over 20 years. Mr. Horan volunteers as a Truth About Trade & Technology Board member. www.truthabouttrade.org

Note: a version of this commentary also appeared in The Washington Times.

Wanted: A Few Good Books

Jul 15, 2010
By Mary Boote - Des Moines, Iowa (www.truthabouttrade.org)

It's summer in Iowa. An ideal day for me would include a body of water, a cool drink and a great book. I read for work and for pleasure. It allows me to learn and some days, to escape. I believe a good book can do much to open our minds to new ideas and sometimes challenge our perceptions.

Getting books in the hands of incoming freshman as they prepare for their first year of college has become a summer regimen for many universities and colleges across the country. Nearly 300 now ask their incoming freshmen to read a particular book before the fall semester begins.

Just don’t assume that this leads to extra servings of Shakespeare, Hawthorne, or Hemingway. A new study by the National Association of Scholars (NAS) says that the books most commonly assigned display “a surprisingly low level of intellectual difficulty.” To make matters worse, a distressing number of schools select books that launch one-sided attacks on the modern food industry.

This is a shame because food production is an important subject that informed citizens should strive to understand and learn more about. Yet these summertime assignments aren’t helping. Some of them are actually hurting the public’s understanding of agriculture.

One of the most suggested authors for summer-reading assignments is the best-selling controversialist Michael Pollan. Students at ten campuses must digest one of his books, according to the NAS survey. They range from little Albion College in Michigan to the prestigious University of California at Berkeley. Another popular writer is Barbara Kingsolver, an advocate of the “local food” movement who is required reading at Virginia Tech and elsewhere.

Professors often talk about the importance of diversity, but I wonder if they really mean it: By assigning books by Pollan and Kingsolver, they’re exposing students to only one part of what is an important global discussion regarding what tools and technology are needed to feed a growing world population in a sustainable manner.

My preference is to recommend a more pragmatic and balanced reading list for the students as they prepare for the next phase of their educational journey. Because the current college and university reading lists imply little interest in alternatives to a narrow-minded and politically correct critique of food production, I thought I’d suggest three books that offer a more rounded understanding of the subject.

  • Denialism: How Irrational Thinking Hinders Scientific Progress, Harms the Planet, and Threatens Our Lives, by Michael Specter – The media bombards us with facts every day. They are intellectually stimulating, mind numbing, and confusing all at once. But the difference between good information and bad information is crucial. Specter’s approach recalls a quote from the late senator Daniel Patrick Moynihan: “You are entitled to your own opinions, but not to your own facts.” Specter encourages us to recognize that science-based facts are often the very best kind of facts. We need more of them, not fewer. They allow us to see through agenda-driven ideologues and special-interest groups. They also help us debunk popular myths about everything from organic food (which is no way to feed the world) to genetically modified crops (which is a part of the solution).

  • Food Politics: What Everyone Needs To Know, by Robert L. Paarlberg – Two years ago, Truth About Trade and Technology named Paarlberg’s Starved for Science as the “book of the year” because of its sensible call for the developing world to accept agricultural biotechnology. Now Paarlberg is back with a new volume that’s jam-packed with the type of science-based facts, figures, and arguments that Specter says we must learn to value. This book informs readers about the basics of agriculture and challenges notions about farming and food production that are regrettably popular in the faculty lounges. Food Politics truly nourishes the mind.

  • The Time It Never Rained, by Elmer Kelton: The author passed away last year, but his novel of a 1950s drought in West Texas is timeless. Its gripping story provides an excellent look at the opportunities and hardships that people in agriculture constantly face. The main character, Charlie Flagg, is a lovable grump who says that “a farmer’s concern is always the land.” The novel goes on to show why this is true, and why farmers and ranchers are some of the best stewards we have. This book is a perfect example of fiction’s ability to provide powerful insights into the way the world really works.

These three books are worthwhile on their own terms as well as for their value as antidotes against the propaganda that a few college and universities are peddling in their summer reading programs.

There's nothing like a good book.

Mary Boote serves as Executive Director of Truth About Trade & Technology
. www.truthabouttrade.org

South African Agriculture on the World's Stage

Jul 09, 2010
By Michael Allen - Middleburg, South Africa (www.truthabouttrade.org)

Sports fans everywhere will turn their attention to South Africa this weekend as my country hosts the biggest athletic event on the planet. They call it the World Cup for a reason: Teams from just about every nation compete and people from all over watch in rapt attention.

There’s no way of knowing for sure how many folks will tune in to Sunday’s championship match in Johannesburg between the Netherlands and Spain, but some estimates put the television audience at more than 1 billion.

So it’s no exaggeration to say that South Africa is truly on the global stage.

I think we’ve proven that South Africa can shine. Since the tournament kicked off a month ago, tourists have poured in. Along with huge numbers of television viewers, they’ve not only cheered goals and saves but they’ve also learned about my country, its history, and its inhabitants.

Most of these guests and onlookers have come away with a positive impression. South Africa is a beautiful country. It’s full of friendly people. Although we have our problems, we also have a lot to offer.

In one area, we are an undisputed leader: agricultural biotechnology.

Farmers in South Africa have embraced GM crops. Last year, we planted more than 5 million acres of genetically enhanced corn, soybeans, and cotton. The International Service for the Acquisition of Agri-Biotech Applications (ISAAA) lists South Africa as one of 15 “biotech mega-countries.” Among other African nations, only Burkina Faso shares this distinction.

My personal experience is typical. I harvest corn and soybeans on about 2,400 acres (1000 ha) in the northeastern part of South Africa, near the town of Middleburg in the province of Mpumalanga--a Zulu name that means “place of the rising sun.” Mpumalanga is the home of Kruger National Park, one of the largest game reserves in the world.

I began to research biotech crops more than two decades ago, planting strip trials for seed companies. At first, these early versions of GM corn didn’t outperform conventional varieties. Yet they were easier to manage, so I started working with them. In recent years, there’s been a remarkable turnaround. The yields of GM crops have beaten non-GM plants by substantial margins.

Over the last decade, my food production has doubled. We owe this to biotechnology ----- today all of my soybeans are GM and most of the corn I plant ----- and other technology innovations. I have access to the latest equipment technology and use precision farming tools such as combine yield monitors and differential fertilizer applicators that allow me to apply the appropriate fertilizer exactly where it is needed.

Many of my immediate neighbors have enjoyed similar levels of success. We’re hoping to make even greater strides in the future, especially if drought-tolerant crops become available.

Unfortunately, a larger group of other neighbors--the farmers in nearby African countries--have not reaped the benefits of biotechnology. Although the experience of South Africa shows how much can be gained from using agriculture’s latest tools, their governments have resisted GM crops.

Part of this reluctance owes to a simple lack of understanding. But they’ve also come under pressure from European governments that provide foreign aid and export markets. The EU has remained irrationally hostile to GM crops--and its hostility has blocked agricultural progress in Africa.

This is tragic. All around the world, farmers are learning how to grow more food for more people with biotechnology and other 21st-century tools. Africa, however, is different: It’s the only continent where food production is in actual decline.

Things don’t have to be this way. The example of South Africa proves that my fellow Africans shouldn’t suffer the curse of food insecurity. By taking advantage of biotechnology and other new approaches to agriculture, farmers in my country are growing a lot more food than we did just a few years ago. Other farmers should have the same opportunity.

This is the way forward for Africa and its people.

There was a time, not so long ago, when South Africa received a lot of unwelcome attention. My country was treated as an international pariah. Yet much has changed, as our hosting of the World Cup demonstrates. Today, in the areas of agriculture and biotechnology, we can be a model for Africa and the rest of the world.

Michael Allen farms with his son in the North Eastern Part of South Africa in the Province of Mpumalanga. They produce corn and soya beans on 1000 hectares (almost 2400 acres). Michael is a member of the Truth About Trade & Technology Global Farmer Network. www.truthabouttrade.org

Seoul Food: Approve the Trade Agreement with Korea Now

Jul 02, 2010
By Dean Kleckner - Chairman, Truth About Trade & Technology

Maybe it’s a good thing that the United States and South Korea lost their World Cup matches last weekend. If both teams had won, they would have faced each other next.

It’s so much better when our two countries can stand united, as they appeared to do at the G-20 summit in Toronto. As President Obama left the meetings, he promised to make an aggressive push to finish the U.S.-Korea Free Trade Agreement, which has languished for three years.

The main reason to support the pact is economic: By boosting exports to South Korea, the deal will create jobs here at home. Yet there’s more at stake as well.

The sinking of a South Korean naval vessel earlier this year has put the Korean peninsula on war footing. An international commission recently determined that a North Korean torpedo killed 46 South Korean sailors aboard the Cheonan.

This is a time for the United States to stand up for its longtime ally. The best way we can do this--and also take a concrete step that will have a real rather than symbolic impact--is for Congress to pass the U.S.-Korea FTA.

The Bush administration concluded the deal with South Korean leaders in 2007. Congress promptly ignored an obligation to hold an up-or-down vote. In doing so, lawmakers ignored their own legislative rules. They also broke a promise to trade diplomats who had negotiated the deal with the expectation that Washington at least would give them a hearing.

This is no way to treat a friend.

When it comes to delays and denials, members of Congress are specialists. Yet even by D.C. standards, this trade deal with an important ally has been neglected for too long.

Trade has the power to promote peace. That’s why I’ve always supported small steps to bring the two Koreas together through exchanges such as the partnership at the Kaesong industrial complex north of the DMZ. The regime in Pyongyang may be one of the world’s most oppressive, but I’ve always believed that economic integration is preferable to economic isolation.

Now the limited trade ties between the two nations are severed. In the face of this crisis, the U.S.-Korea FTA makes more sense than ever before from a national-security perspective.

Fortunately, it also makes sense from an economic perspective. The deal would fuel exports and create thousands of jobs for Americans. One estimate says that new trade activity would boost our GDP by $12 billion.

Farmers and ranchers certainly would see gains. We already sell about $2 billion in food to South Korea. Under the agreement, the tariffs on half of these products would vanish immediately.

Continuing to ignore the trade agreement is a bad idea. As much as the South Koreans would like to buy more American-made goods and services, they have not forgotten the rest of the world while Washington dawdles. Seoul recently completed a set of trade talks with the European Union and it’s making rapid progress on a pact with Australia. There is talk of a Northeast Asia free-trade zone that would provide China and Japan with new advantages in selling to South Korean consumers.

If these competitors start to take market share from U.S. companies and workers, it will be a direct result of Washington’s refusal to take trade seriously. And once we lose it, it's hard to get it back!

"The U.S. runs the risk of losing the Korean market within a decade if we can't get a free-trade agreement ratified," said Jong-hyun Choi, Minister for Economic Affairs for the South Korean Embassy, who met with global pork producers in Iowa last week, according to the Des Moines Register.

Many Democrats have resisted new trade measures, but not all of them. In fact, the U.S.-Korea agreement attracts strong levels of bipartisan support. Democratic senator John Kerry of Massachusetts and Republican senator Dick Lugar of Indiana--the two top members of the Senate Foreign Relations Committee--recently urged Obama to press for the pact. They noted its economic benefits and also said its approval “would be considered a significant show of solidarity with a close and reliable ally.”

Obama has talked up trade, but so far his talk has not amounted to action. He came into office promising that his leadership would improve America’s standing in the world. Right now, that means pushing for an economically responsible trade deal that would help a steadfast ally in a moment of crisis.

Dean Kleckner, an Iowa farmer, chairs Truth About Trade & Technology. www.truthabouttrade.org.

*A version of this commentary was originally posted June 25, 2010, at the Washingtom Times .

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