One of the more positive recent federal developments was the signal that pending free trade agreements may be resurrected. Such deals are in place with South Korea, Colombia and Panama, with approval of the South Korea pact a logical place to start to boost a number of U.S. industries. The National Center for Policy Analysis offers:
The trade pact between the United States and South Korea, which would eliminate about 95 percent of tariffs on industrial and consumer goods within five years, has the usual advantages in promoting job-creating exports. It would help domestic industries involved in telecommunications, technology, pharmaceuticals, farming and financial services gain access to an important market, say USA Today.
Even American manufacturing, a usual source of opposition to these types of deals, should have reasons to like this one.
- South Korea is a highly developed and educated nation with average wages approaching those in the United States and environmental standards that, in some cases, are more stringent.
- What’s more, U.S. manufacturing, after decades of technology-driven productivity gains and related job losses, is highly competitive and showing signs of a rebound.
- In large part this is a result of exports, which are healthy even as domestic consumption lags.
Another argument for the trade deal with South Korea is not economic but geopolitical. A vibrant and prosperous South Korea is a check against the ambitions of the bizarre and belligerent regime to its north, says USA Today.
Who knows, this pact could be a harbinger of things to come, as an overly indebted U.S. economy begins to focus more on investment and savings, and sees trade with fast-growing emerging nations in Asia and Latin America as something to support, not fear. In any case, ratification of the South Korea deal should be high on the Senate’s agenda for 2011.