In one of Oscar Wilde’s plays, a dimwitted duchess utters a memorable line about Australia: “It must be so pretty with all the dear little kangaroos flying about.”
The poor lady simply doesn’t have a clue. We in the audience have no choice but to chuckle.
Unfortunately, the people lobbying against the new U.S.-Australia Free Trade Agreement are just as misinformed. And that’s no laughing matter.
A herd of union bosses recently called the deal the latest in a series of “flawed trade agreements that fail to create robust, equitable growth and decent employment.” Another group says the FTA “threatens farmers and workers” in the United States.
Hey! Look! A flying kangaroo!
Okay, No more jokes. This really isn’t a laughing matter--and these statements criticizing the FTA are pure balderdash.
I’ll be the first to admit that the pact with Australia isn’t the best FTA I’ve ever seen. The main problem, however, has nothing to do with Big Labor’s gripes. Instead, it’s that the agreement doesn’t go far enough. It’s a good deal rather than a great one. I wish our negotiators had achieved more than they did.
But I’ll gladly take a good deal when the alternative is no deal at all--and that’s a very real possibility, with elections less than five months away and the usual assortment of special-interest groups clamoring for protectionism that helps the few at the expense of the many.
In our political debates over trade liberalization, sometimes facts seem as rare as flying kangaroos--so let’s consider a few facts about Australia. The continental United States and Australia are roughly the same size, though the U.S. population of nearly 290 million people dwarfs the 20 million folks in Australia. There are more Texans in the world than there are Australians.
Despite this, Americans have much to gain from increased trade with the Aussies. The FTA now under consideration will make us richer--to the tune of more than $490 million per year, according to one current estimate.
That may not seem like a princely sum when Washington is approving federal budgets measured in the trillions. Yet it still sounds like an awful lot of jobs to me. And don’t forget that jobs tied to the export market tend to pay pretty well. Our economy is emerging from a recession, but who thinks it couldn’t use an employment boost?
Much of the FTA will benefit the U.S. farm economy. Last year, we exported nearly $700 million in agricultural products to Australia and imported about $2.1 billion from Down Under. On a per capita basis, Australian consumers spent about $4.50 on U.S. products versus every $1.00 Americans spent on Australian products.
That sounds like a healthy arrangement--and the FTA will only make it healthier. Right now, Australia imposes a tariff of 5 percent on most of our farm products--though the tariff on some dairy goods rises to 30 percent. Under the FTA, it has agreed to eliminate all of these. The list of American products poised to benefit is long: potatoes, sweet corn, soups, cherries, grapes, raisins, oilseeds, pork--and that’s just a small sampling.
In return, the United States has agreed to phase out tariffs on meat, dairy, and other farm products from Australia. Some of these tariffs won’t be gone entirely for 18 years.
My preference would have been for a more sweeping agreement that includes additional products and shorter timetables--but we should never let the perfect become the enemy of the good. That’s like getting mad at a baseball player for hitting a double rather than a home run. Just as a new batter will step to the plate and provide another chance to score, we can broaden the scope of this FTA with further talks in the years ahead.
I’m hopeful Congress will approve this FTA. Not only will it be good for our economy, but it will strengthen ties with one of our most important security partners. Australia joined last year’s international coalition to oust Saddam Hussein from Iraq. Even though many of its troops have returned home, several hundred remain behind, working alongside American GIs to bring order and democracy to a country that for decades has known only chaos and tyranny.
It’s obvious that we owe this FTA to the Australians as well as to ourselves--to say nothing of those flying kangaroos.
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In one of Oscar Wilde’s plays, a dimwitted duchess utters a memorable line about Australia: “It must be so pretty with all the dear little kangaroos flying about.”
