Thursday, December 06, 2007

Free Trade and U.S. Policy

Senate Majority Leader Harry Reid and a number of other senators just came back from Latin America and his statement upon returning hopefully shows some shift toward common sense in the Democratic Party. He argues that free trade agreements can be one element of an overall U.S. policy if done properly, but the obsession with FTAs as the be-all, end-all of policy toward the region is a bad idea (though, after talking about how great the deal was for Peru, he voted no, which is not exactly a way to inspire Latin American leaders).

Another senator, Bob Menéndez, came back saying very reasonably that we need to stop paying too much attention to Hugo Chávez, which relates back to FTAs since they are cited as the way to magically defeat him.

Unfortunately, the “free trade helps out allies against Chávez” is becoming conventional wisdom, primarily as a result of being repeated constantly:

“There is a growing division in Latin America today,” said Senator Charles E. Grassley of Iowa, the ranking Republican on the Finance Committee. “We ought to help countries like Peru that are not going the direction of Venezuela.”

This line of thinking tends to equate a vote against free trade with a vote in favor of Hugo Chávez. We will all be much better off when the two are de-linked.


Anonymous,  10:11 AM  

It's not just the US press and politicians that link the two issues. Local business leaders and politicians in Latin America do the same thing. Colombia is a good example - you can find plenty of people wondering "well, Chavez spits in the face of the US, while Uribe is very loyal. If the US Congress and Hillary Clinton won't support an FTA with Colombia, what more do we need to do to be aligned with the US? We are no closer to the US than Venezuela." Whether it is wrong or right is open to debate, but the perception is that the two issues are very much linked.

Anonymous,  10:37 AM  

If I remember correctly, when Colombia got its deal the the US last year, Bolivia lost a large export market for soybeans. Venezuela and Cuba stepped in buy more of that commodity.

Greg Weeks 3:38 PM  

Mike, I agree, but I wish we could get past the requirement of being "aligned" or "loyal." Loyalty then trumps empirical reality, so we need to ratify an FTA despite reservations we may have.

John, I don't know if that's the case or not, but certainly Venezuela and Cuba pick up on the "us or them" mentality, which just serves to foster more artificial divisions.

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