By Jon Haveman, research fellow, Public Policy
Institute of California
This opinion article appeared in the Orange County
Register on August 14, 2002
Last Tuesday, President Bush signed a bill restoring Fast Track or Trade
Promotion Authority to the presidency, giving him the ability to submit trade
agreements to Congress for an up-or-down vote without alteration or amendment.
As trade-related legislation often is, this bill was complicated and
controversial, and it did not have much support from the California delegation
in Washington. But, despite the delegation's resistance, if Fast Track revives
the possibility of freer trade, it is vitally important for California.
What this president will do with Fast Track Authority remains to be seen, but
there are many options available to him. In particular, trade agreements with
Chile, Singapore and Taiwan appear to be real possibilities. Of even greater
importance, the president may push liberalization through multi-country
initiatives, such as the Free Trade Area of the Americas, which is currently
scheduled for completion in 2005.
Without Fast Track, none of these initiatives is possible, because in most
cases our trading partners are unwilling to negotiate a document with the
president only to have it altered by Congress. Trade liberalization would
languish in the limbo it has been in since 1994, when a president last had this
Why has it taken nearly a decade for Congress to restore trade promotion
authority to the presidency? For many, resistance is not about what agreements
might be struck under that authority, but about what sorts of protections for
labor and the environment will be written into these agreements. But even with
the valid reasons for uneasiness with trade promotion authority and trade
liberalization, in general, California stand to benefit from increased trade -
more than almost any other state.
California is a major processing center for goods. In fact, one-third of all
goods imported into and exported out of the United States flow through the
More trade leads to an increase in the workforce in and around port
facilities as more labor is needed to handle the growing demand for warehousing,
brokerage services, and cargo handling. This is a reality for imports as well as
exports: 85 out of every 100 people employed in and around California's seaports
owe their jobs to the fact that we import goods from abroad.
This means new and better jobs for many workers in California, above and
beyond the increased employment opportunities that result from trade
It is also important to recognize that Fast Track and any subsequent
liberalization bring important opportunities for California exporters to gain
access to many major foreign markets. In particular, future multi-country
negotiations are likely to address the issue of access to agriculture markets
for imported products. Two of the largest markets in Asia - China and Japan -
remain protected through the widespread use of barriers to agricultural and
Increased trade is admittedly a frightening prospect for many workers. But on
balance, trade liberalization generally creates more and better jobs than it
destroys. And very important sectors of the state's economy depend on free and
open access to foreign markets for their continued growth, including high
technology products, agricultural products and shipping-related services.
Californians should recognize the potential for our state and for the
long-run increase in jobs and economic opportunities.