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Policymakers Disagree on Global Trade Policy

posted on October 20, 2006


Hello, I'm Mark Pearson. Government reports this week eased concerns about inflation and boosted prospects for continued economic growth. The Labor Department reports its Consumer Price Index, the most widely accepted barometer of inflation, dipped 0.5 percent last month due primarily to declines in gasoline and other fuel prices. Excluding the volatile energy and food sectors, core inflation edged slightly higher, marking the third consecutive month of modest gains. The numbers are likely to influence the Federal Reserve not to raise interest rates when it meets next week. Wall Street investors cheered the news and pushed the Dow Jones industrial average above 12,000 on the announcement. With the midterm elections now just three weeks away, republicans are optimistic declining energy prices and a rising stock market will convince Americans to vote with their wallets. But democrats claim the recent drop in energy prices doesn't explain why middle-class wages are lagging behind in the current recovery. And with the nation expected to set a record trade deficit of $840 billion in 2006, democrats this week blasted the Bush administration's trade policy.
Policymakers Disagree on Global Trade Policy While policymakers generally agree that promoting trade expansion serves U.S. national interests, many disagree on the specifics. Senator Byron Dorgan this week said trade negotiators have rushed to participate in the global economy. The North Dakota Democrat claims the U.S. now imports $2 billion a day more than it exports.

Senator Byron Dorgan, D-North Dakota: "I believe in trade and plenty of it, but I want us to have trade agreements that are fair to our producers, workers and farmers. The minute you breathe a new trade plan, others will say "isolationist stooge" wants to build walls around our country. That is total rubbish! It's the thoughtless language of a debate that has become thoughtless rather than thoughtful."

Meanwhile, Fred Bergsten, the director of the Institute for International Economics, claims current U.S. trade policy is good for the country.

Fred Bergsten, Institute for International Economics: "The share of U.S. economy that is wrapped up in international trade has more than tripled in the last 25 years. The U.S. has in fact, globalized at a rate more than the EU as a group. We're twice as integrated in world economy as Japan. So, we're not only at a high level of integration, but we've increased rapidly."

Senator Dorgan also is promoting his new book, Take This Job and Ship It: How Corporate Greed and Brain Dead Politics Are Selling Out America. In the book, he makes a case for "fair trade" verses "free trade". He supports expanded foreign trade, but only if it is fair and mutually beneficial.

Senator Byron Dorgan, D-North Dakota: "We live in a global economy. I couldn't change that if I wanted to. I do not, however, believe in trade that is one sided or unfair to our country's economic interests..."This undermines this country. It pulls the rug out from American workers, pulls the rug out from American farmers and is unsustainable."


Tags: news policy trade