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The Wall Street Journal reports this morning that the European Union and the United States have again chosen different paths regarding free trade, this time with South Korea. However, for once it’s old Europe that wants to boost economic output by lowering barriers. Meanwhile, in the formerly free market U.S., a Congress beholden to Big Labor throws up roadblocks.
It seems that ratification of our own 2007 bilateral agreement with South Korea continues to be delayed by the protectionist wisdom that free trade would harm U.S. auto companies. (Yes, those U.S. auto companies.) But no matter what:
Don't count on progress any time soon. President Obama's trade representative, Ron Kirk, rose from his slumbers last week to give his first big speech but he failed to mention either South Korea or Colombia. Instead, he focused on "trade enforcement," by which he seems to mean picking fights with U.S. trading partners. This will include, Mr. Kirk said, investigating "labor violations" inside other countries. "And if they don't fix their labor problems, we will exercise our legal options," he said. Just what our friends want to see when global trade is contracting: Another U.S. excuse for protectionism.
Incidentally, German officials believe the world’s fourth largest economy may have begun to emerge from recession in the second quarter. That good news is almost certainly unrelated to Chancellor Angela Merkel's proposed tax cuts, or her steadfast refusal to buckle under U.S. pressure for increased stimulus spending.
After all, everyone knows that the surest way to avoid bankruptcy is to tax and spend yourself into oblivion. Oh and by the way, 2+2=5.