Political Hot Topic: U.S. Trade With Colombia
Correction Sept. 9, 2008
In a version of this story heard on air, we mistakenly said that Colombia's economy is the size of Hollywood, Fla. In fact, the economic impact on the U.S. of trade with Colombia is about the size of the economy of Hollywood, Fla.
ARI SHAPIRO, host:
As Senator Obama campaigns in Ohio, Senator McCain starts a two-day trip to Latin American. His travels to Colombia and Mexico City may seem a bit far afield, but in fact, this trip is very much on the campaign trail. Here to talk about this is NPR's Adam Davidson. Hey, Adam.
ADAM DAVIDSON: Hey, Ari.
SHAPIRO: Okay. So, why is McCain going to Latin America?
DAVIDSON: The main reason he's going is to show that he supports the free trade agreement with Colombia.
SHAPIRO: This has been a big deal in the campaign. McCain supports it, Obama opposes it. Why is the free trade agreement with Colombia so important?
DAVIDSON: It is really about symbolism. I mean sure some people here and there might be impacted by a free trade agreement with Colombia, but really most Colombian exports to the U.S. are currently duty free anyway. It really won't change things that much, but it's really symbolic. On the one hand, you've got unions and unions have just singled out Colombia 'cause it's a country that has had a lot of union leaders killed - a lot of people get killed in Colombia, it's a very violent society. But it's - there's been a lot of union leaders killed there and union leaders in the U.S. have basically let Democrats know, hey, this is one we can't see you supporting and still have our support.
On the other hand, of course, McCain is going after different votes. He wants to show no, I am pro-business, I am pro-trade, I am for this deal no matter what. He's actually kind of putting Barack Obama in a tough position because Barack Obama, earlier in his career until this campaign, has been an outspoken free trader, a strong supporter of free trade agreements. He's come out against this agreement. It seems reasonable to guess that that is largely to get the support of union leaders, particularly in some swing states that are not very pro-trade.
SHAPIRO: Well, if this free trade agreement with Colombia were to become a reality, it's on its way, but not quite there yet, would it, in theory, be good or bad for America?
DAVIDSON: Honestly, it would be almost impossible to even measure it. I mean the size of the U.S. economy to the size of Colombia is so miniscule. Really, it would - I mean I think any economist would say frankly, this would be a benefit to the U.S., overall, because we already get most imports from Colombia are… We don't charge them tariffs, but they charge high tariffs on ours. So we'd be able to export a lot more to Colombia under this agreement. But really, I think it would be almost impossible to even measure an impact. That's not to say there won't be individuals. There might be individual sectors where Colombia's strong - flowers; they're big on fruits, things like that - that might be impacted, but really for an economy the size of the U.S., this is a non-issue in the big picture.
SHAPIRO: Well, if this is mostly about symbolism, are these symbols, these conversations about trade, going to be the determining factor in who's the next president?
DAVIDSON: I think that when you get down to the electoral map, some of the really crucial states - Pennsylvania, Ohio, Michigan - these are states where trade is a big, big deal. But they're not…
SHAPIRO: Places that have lost a lot of jobs and…
DAVIDSON: They've lost a lot of jobs. Honestly, very few economists or experts would say they lost jobs due to trade. They lost jobs due to a whole host of factors having to do with a dramatically changing U.S. economy. But in the political sphere, you know, that's not where deep, nuanced economics stands, it's where slogans and emotional cause stand. And clearly, trade has borne the brunt of the blame. And so I think it will be a crucial issue in some of those states. I think other parts of the country, it's just not going to be that big of deal. But this clearly is going to be an election that's going to come down to a handful of states, and possibly a few thousand voters, we don't know, who really see trade as a big issue. So it is going to be a big deal.
SHAPIRO: Adam Davidson is NPR's International Economics Correspondent.
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