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EuroWire – January 2009
24
T
ransat lant ic Cable
Trade
Will President Obama favour free trade,
protectionism – or neither?
On the day after the election of Barack Obama as the
44
th
president of the United States, a three-person team of
Forbes.com reporters recalled one of the few gaffes made in the
course of Mr Obama’s nearly mistake-free campaign for the office.
It came in March 2008, when another senator, Hillary Clinton, was
still very much in contention for the Democratic nomination. In a
leaked memo, an Obama adviser was disclosed to have assured
Canadian officials that his candidate’s protectionist speeches
were “more reflective of political manoeuvring than policy.”
Predictably, Mr Obama’s political rivals made capital of the
forked-tongue memo, although it obviously did him no
lasting damage. In speeches he had frequently knocked the
North American Free Trade Agreement (NAFTA), and had even
suggested that the US should consider leaving the pact if it
could not be renegotiated. The trilateral trade bloc, in effect
since 1994, binds Canada, the US, and Mexico in ways that
do not wholly satisfy all three signatories, on all points, at all
times. Now, Tina Wang, Lionel Laurent, and Andrew Farrell
were reviving the memo incident on Forbes.com. They wrote,
“[It] highlights the uncertainty around what Obama’s trade policy
will be as president. How much of what he has said is campaign
rhetoric? How much is deeply held belief? Or is it all a bit of
both? Although he frequently took protectionist stances on the
campaign trail, there are indications his trade policies could be
more centrist in practice.” (“Reading Obama’s Trade Tea Leaves,”
5
th
November)
The president-elect’s first appointment suggests as much.
Rahm Emanuel, the Chicago-area congressman who is to be
White House chief of staff, supports expanded trade and would
not want the president to govern as a protectionist. And Marco
Simoni, a research fellow at the London School of Economics’
European Institute, said that he would not expect an overall
rise in protectionism from an Obama administration. But,
Mr Simoni told Forbes.com, there could be “maybe some limit
to international free trade, and also perhaps a more prudent
approach to international movement of capital.”
Eloi Laurent, senior economist at the Sciences-Po economic
research centre in Paris, warned that Mr Obama’s push for
American energy independence could create friction with Europe.
“The desire to launch a new ‘green’ economy brings the risk of
trade confrontations,” he said. “The automobile sector will be the
first battleground.”
Mr Laurent told Forbes.com that, with auto makers on both
sides of the Atlantic appealing to government for green
eco-investment loans, the sector could end up rife with the kind
of rivalry seen between Boeing, of the US, and French-based
Airbus.
The US and Europe have accused each other of illegally
aiding their own plane makers, and the acrimony can be
expected to mount as the stakes rise in the creation of an
ecology-grounded economy.
The Forbes.com writers noted that Asian countries, too, are
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❈
bracing themselves for the presidential election’s impact
on US trade policy, and there are prospects for friction here,
as well. Mr Obama has suggested that he might push for a
revision in the terms of an historic South Korea-US free
trade agreement, signed in 2007 but not yet ratified. The
pact would abolish most tariffs on goods moving between
the two countries and would add tens of billions of dollars
to bilateral trade. In his final campaign debate with Senator
John McCain, Mr Obama declared that, every year, South
Korea exports hundreds of thousands of cars to the US, which
in turn sends only a few thousand cars in the other direction.
“That is not free trade,” he said. “We’ve got to have a president
who is going to be advocating on behalf of American
businesses and American workers.”
Data supplied by Forbes.com support the contention of
unequal trade flow. In 2007, South Korea shipped some
700,000 automobiles to the US and imported 5,000 from
there. The assertion of heavy job losses from trade worked
to Mr Obama’s advantage in the prelude to the election,
as the perception took hold in industrial swing states
such as Michigan, Ohio, and Pennsylvania. Some Democrats
have also called for relaxed South Korean restrictions on
US steel exports.
Telecom
What will the Obama ‘Technology and
Innovation’ plan mean for the American
telecommunications industry?
Introduced on YouTube as “Your Weekly Address from the
President-Elect,” the video featuring Barack Obama went online
on 15
th
November. Mr Obama will be the first US president to
utilise YouTube as well as the traditional radio format favoured
by another president for hard times: Franklin Delano Roosevelt,
who employed his ‘fireside chats’ to reach a wide radio audience
as he steered the nation through the Great Depression and
World War II. On the same day that Mr Obama launched his
YouTube series, policy experts, future Cabinet officials, and
senior members of his transition team commenced holding
video interviews and question-and-answer sessions at the
president-elect’s website Change.gov. The comparison between
all this accessibility and the guardedness of the George W Bush
administration was very striking, and was met with general
delight.
In telecom circles, the response to the communications-minded
incoming president is more measured. Writing in the Washington
Post, Cecilia Kang noted that Mr Obama – who famously made
the Web a pillar of his successful campaign for the presidency –
has championed the idea of an open Internet, or net neutrality.
(“TelecomWarily Waits on ‘Wired’ President,” 14
th
November)
Ms Kang wrote, “It is widely expected that [Mr Obama] will make
net neutrality and access to broadband in rural and poor areas a
key part of his agenda to close economic divides and help spur
job creation.”