|
By Henry M. Seggerman
No one can underestimate the importance of South Korea as a key ally and trading partner to the United States. Nevertheless, the Obama administration appears on the verge of alienating South Korea by walking away from the free trade agreement the two countries signed off on many months ago.
Obama, in his campaign, predictably appealed to baser protectionist voter emotions by calling the Korea deal and other free trade agreements ``unfair'' ― even threatening to renegotiate the North American Free Trade Agreement (NAFTA).
One hoped Obama's more private, and now well-known, ``bitter'' comments (``… they get bitter, they cling to … anti-immigrant or anti-trade sentiment …'') would suggest a more moderate eventual trade policy on the ground after Jan. 20.
But that hope is now fading fast with U.S. Trade Representative nominee Ron Kirk's claim last week that the Korea deal ``simply isn't fair'' and that the administration is ``prepared to step away.''
There is tangible momentum toward ratification right now in South Korea. The deal has strong support from the ruling grand National Party (GNP) and was originally crafted by politicians now in the opposition party.
The deal took many months to negotiate, and any push for renegotiation on the part of the United States would certainly kill the deal in Korea.
Importing U.S. beef into Korea may seem like a small thing to Americans, but after South Korean President Lee Myung-bak allowed it, he resolutely faced down hostile protectionist street mobs, cashing in nearly all the political capital from his December 2007 election, in the process.
U.S. Trade Representative nominee Ron Kirk testifies during his confirmation hearing before the U.S. Senate Finance Committee on Capitol Hill in Washington, D.C., March 9.
/ Reuters-Yonhap |
Kirk's comments on South Korea were in response to Michigan Democrat Debbie Stabenow's complaint about Korean auto imports into the United States. It hardly need be noted that no Democrat has ever been elected President without the support of the United Auto Workers union.
The UAW and Detroit executives have spent decades blaming auto imports from Asia and Europe for their own problems. It is a folie a deux, both fantasizing about 100,000 Ford Mustangs tooling around the highways and byways of South Korea. Well, it isn't going to happen.
Even if South Korea were to cut tariffs on U.S. auto imports to zero, Detroit couldn't sell more than 10,000 per year in the East Asian nation. U.S. autos average 24 miles to the gallon, vs. 29 for the rest of the world. U.S. cars don't last; after all, didn't we invent ``planned obsolescence'' here?
And, now, everyone, including Americans, is terrified that bankrupt Detroit automakers won't be able to service cars they sell to us in the future.
So, President Obama should think very carefully before he snuffs out the Korea-U.S. free trade agreement. It is not merely a forward-looking business opportunity for the United States.
It is also a key building block in our long-standing friendship with this important country. Especially with a new conservative South Korean government finally standing with us shoulder-to-shoulder regarding North Korea's nuclear threat and abysmal human rights record, it is time for Obama to do the right thing.
Henry M. Seggerman is president of International Investment Advisers.
|
.jpg)
