New Doubts About Bush Trade Agenda
    By Paul Blustein
    Washington Post Staff Writer
    Nov. 21, 2003

    MIAMI, Nov. 21 -- Another high-level trade meeting has ended, the topic being the establishment of a Western hemisphere free-trade zone, and this time the participating officials signed a declaration instead of storming out in acrimony.

    But they avoided a breakdown only by agreeing to a pale version of their original goal. That is just the latest sign that President Bush's free-trade agenda is in serious danger of slipping into reverse as next year's national elections loom.

    Bush's trade representative, Robert B. Zoellick, was busily reminding attendees from the 34 countries represented at this week's meeting that the administration is pursuing free trade on three tracks at once. The first, and most significant, is the set of global negotiations aimed at forging a pact to lower trade barriers worldwide. The second track -- the focus of the gathering here -- is regional, with a goal of creating a "Free Trade Area of the Americas" spanning the Western hemisphere from the Arctic to Cape Horn. The third is a series of bilateral free-trade negotiations with individual countries, ranging from Australia and Thailand to Bahrain and Morocco.

    The global talks, originally set to finish in early 2005, were thrown badly off track two months ago when a World Trade Organization meeting in Cancun, Mexico, collapsed amid a rebellion by developing countries, whose representatives complained that the United States and other rich nations were not sufficiently willing to open their markets to agricultural goods or reduce subsidies for their farmers.

    Hard on the heels of that debacle came a sharp escalation in trade tensions between Washington and the European Union, along with several other steel exporters, when a WTO panel decreed earlier this month that the steel tariffs Bush imposed in 2002 violate international trade rules. The specter of a trade war, or at least a damaging fusillade, emerged as the EU threatened to impose retaliatory duties on a host of U.S. exports unless Bush revokes the steel tariffs, a move the president is loath to take for fear of alienating voters in battleground rust-belt states.

    A similar prospect of tit-for-tat retaliation with China arose Tuesday when the administration imposed quotas capping the rapid growth in imports of Chinese bras, dressing gowns and knit fabric; and Beijing promptly suggested that it would join the EU in exercising its rights to levy duties on American goods in the steel case.

    All this is spurring speculation that, amid widespread public discontent over jobs lost to foreign competition, Bush's commitment to opening markets is flagging -- with the most prominent commentary coming from Federal Reserve Board Chairman Alan Greenspan. Without naming any country or action in particular, Greenspan warned Thursday that "some clouds of creeping protectionism have become increasingly visible on today's horizon."

    Administration officials dispute suggestions of any wavering on the trade issue. "This president takes a second seat to nobody in getting free trade," Commerce Secretary Donald L. Evans said in an interview. "If we can't move some agreements as fast or comprehensively as we would like, we're not slowing down. We're still moving forward." He cited recent announcements that the administration is seeking bilateral free-trade deals with the Dominican Republic, Panama, the Andean nations and Australia.

    But there's the rub, according to critics of the administration's approach.

    The countries with which Washington is seeking bilateral accords account for just a little over 6 percent of U.S. exports. So such deals offer little by comparison with the global negotiations, or even with the FTAA, the proposed Western hemisphere pact. Although Zoellick and his Latin American counterparts claimed at their closing press conference Thursday that this week's meeting gave the FTAA new momentum, their vaguely worded declaration glossed over major differences, and it envisioned a much less ambitious accord than the North American Free Trade Agreement, with countries allowed to opt out of portions they do not like.

    "Under Kennedy, the U.S. had the 'Alliance for Progress' in Latin America," said David Rothkopf, a former Commerce Department trade official. "This is the alliance for the illusion of progress." As a result, he said, the administration is left with "continuing to do symbolic but essentially meaningless small agreements."

    It is far from clear, moreover, whether the White House will be able to win congressional approval in coming months for its proposed bilateral free-trade deals, especially controversial ones like an accord currently being negotiated with five Central American countries.

    Partly for that reason, officials of countries that have been resisting Washington's pressure to open markets, notably Brazil, shrug off worries that U.S. deals with their neighbors will deprive them of vital access to the American market.

    "I don't think the United States is signing these agreements to put pressure on Brazil, but if it were to put pressure on Brazil, it would be a waste of time," said Celso Amorim, the country's foreign minister.

    He added, in a barbed reference to the Bush administration's departures from free-market orthodoxy: "Free trade is important. But it's more talked about than practiced."


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