It might be an understatement to say that not all members of President Barack Obama’s party are fans of trade. Indeed, as noted here a couple of weeks ago, many lawmakers are pushing the Trade Reform, Accountability, Development and Employment Act as a means of reshaping U.S. trade policy with a protectionist mold.
But the president last week sent a strong signal that he understands the vital role trade plays in the nation’s economy and believes government should do more to help American companies-in particular, small firms-seize market opportunities abroad.
Mr. Obama’s National Export Initiative sets a very ambitious goal: doubling U.S. exports over the next five years. To do so, the NEI calls for the first governmentwide export promotion strategy, one with three key areas of focus:
- ramped-up trade advocacy, especially for small- and midsize firms;
- improved access to credit, again with a focus on smaller firms that want to export; and
- "rigorous" enforcement of international trade laws to clear away barriers that hinder U.S. companies from "free and fair access to foreign markets."
Specifically, the NEI contains a 20 percent increase in the International Trade Administration’s budget to help 23,000 businesses start exporting or grow their international sales next year. The ITA’s five-year goal is a 50 percent jump in the number of small and midsize firms that export to more than one market.
The administration also wants the Export-Import Bank to boost to $6 billion from $4.4 billion the amount of financing it makes available to small and midsize exporters. In addition, the plan calls for the Office of the U.S. Trade Representative to negotiate new trade pacts.
These steps are good as far as they go. However, the administration must remember that exports and trade are not synonymous. Imports also are critically important: U.S. exporters depend on them to turn out products that hold their own globally, and U.S. consumers benefit from access to a broad array of competitively priced items.
In short, the president needs to make NEI part of a broader trade policy built around the idea that the best route to export growth is not a one-way street.
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