Trade Official Outlines Bush Agenda

In testimony before the House Ways and Means and Senate Finance Committees February 14 and 15, US
Trade Representative Susan C. Schwab outlined the Bush administration’s trade agenda emphasizing
the need for more free trade agreements, a successful Doha Round of liberalization negotiations and
a push for greater exports. There was little emphasis on what US textile manufacturers consider
their most pressing problem — imports.

Painting a generally rosy overall economic picture, Schwab even saw the sunny side of a
record $763.6 billion trade deficit reported earlier in the week — an increase in exports.

Schwab told members of the trade-legislation-writing committees that a strong US economy is
due in part to the Bush administration’s trade policies. She said the economy grew at a rate of 3.4
percent — faster than Japan and the European Union — and that 2 million jobs were created over the
last 12 months. In 2006, the US textile industry lost 25,000 jobs, and apparel employment was down
by 12,700. She noted that real compensation in the United States has risen by 8 percent since 2001,
and consumer spending is up more than 17 percent in the last five years.

Schwab said productivity increases, technological changes and global competition “can lead to
increased opportunities for many workers.” With respect to those who lose their jobs as a result of
import competition, she said the president has asked for reauthorization and improvements to Trade
Adjustment Assistance, a program that provides job retraining and other assistance to workers
displaced by import competition.

Schwab said the continuation of trade-driven economic improvements is dependent upon
extending trade promotion authority (TPA) to the president. She said the president needs TPA in
order to negotiate regional and bilateral agreements to open markets for US exporters “to level the
playing field and to keep pace with US competitors.”

Members of the committee are skeptical of TPA and have indicated that even if it is approved,
it should include requirements for US trading partners to upgrade their working conditions and
environmental protection. Schwab said she is willing to work with Congress on those issues.

Rep. Sander M. Levin, D-Mich., chairman of the House Trade Subcommittee, questioned Schwab’s
emphasis on exports to the exclusion of addressing import problems. He said: “What about imports?
What about people losing factory jobs?” Schwab responded by saying, “Imports do matter,” and she
pointed out that adjustment assistance will be available to “the fewer than 3 percent of the
workers who may have been laid off due to import competition or overseas relocation.”

February 20, 2007