The Peru Deal Advances
Editorial from The Washington Post,
THE U.S.-PERU Trade Promotion Agreement (TPA) took a big step toward becoming reality Wednesday. The House Ways and Means Committee voted 39 to 0 to approve the deal, under which the two countries would slash tariffs on each other’s goods and services. It was not easy to get to this point. In the spring, congressional Democrats appeared ready to join with the Bush administration and pass the Peru deal; then they backed away. Over the summer, Ways and Means Chairman Charles B. Rangel (D-N.Y.) negotiated new Peruvian commitments on labor rights and the environment that made it possible, both substantively and politically, for House Democrats finally to say yes. In fact, the adjustments made it all but impossible for them to say no.
The most prominent Democratic holdout is presidential candidate John Edwards. A few days before the TPA vote, the former North Carolina senator claimed that the pact “does not meet my standard of putting American workers and communities first, ahead of the interests of the big multinational corporations.” In explanation, Mr. Edwards’s Web site said that no new trade agreements should be adopted until Congress passes universal health care, tax reform and several other desirable but elusive pieces of legislation. Somewhat more specifically, he complained that the agreement “limit[s] how we can spend our own tax dollars by banning many Buy America policies.” Apparently, this refers to restrictions on new federal and state rules against contracting with Peruvian firms for services. It’s a pretty abstruse concern, especially since, even under the TPA, existing policies could remain. How extreme is Mr. Edwards’s view? Among those voting in favor of the Peru pact was Rep. Sander M. Levin (D-Mich.), one of the leading trade skeptics in his caucus. He called the agreement, as revised, “a dramatic step in a new trade policy.”
The case for U.S.-Peru free trade remains strong. Affecting $8.8 billion worth of goods and services annually, the deal would benefit a pro-American government in Latin America and open a market to U.S. producers of everything from financial services to grain. Indeed, under current law, Peru has enjoyed access to the U.S. market through periodically renewed temporary trade preferences, while U.S. business has been waiting for the TPA to gain reciprocal treatment from Peru.
Seeking victory in the union-dominated Iowa caucuses, Mr. Edwards has emphasized his skepticism about trade. In rejecting the Peru TPA, he may have overplayed his hand. Of the other two leading Democratic presidential candidates, Sen. Barack Obama (Ill.), to his credit, has declared that he will vote for the TPA, and the front-runner, Sen. Hillary Rodham Clinton (N.Y.), says that she is still studying the agreement and hasn’t made up her mind. Ms. Clinton has shown an unfortunate tendency to waffle on trade in response to Mr. Edwards’s increasingly strident attacks on the North American Free Trade Agreement and other trade-promotion deals. But this is an opportunity for Ms. Clinton to join Mr. Obama in the sensible center.
