Meet the Texan who could have more say over New Zealand's long-term economic future than Bill English; plus the 10 worst predictions of 2008
Over the weekend (NZT) Barack Obama finalised his cabinet, and amongst the last appointments made was a man who could have a significant, lasting, impact on New Zealand's economic future.
Ron Kirk was named as the Obama administration's trade representative, and the selection is good news in our quest for a Free Trade Agreement with the US. The Democrats, with the huge support they receive from union and workers who have a less than positive impression of globalisation, are under pressure to fight the global recession with protectionist policies. Indeed, the bailout of the US car industry is sparking fears of a return to protectionism around the world.
An unhealthy trend is possible. Already Vietnam and India have imposed new steel tariffs, Indonesia has introduced new import licences, while Russia and France are putting up barricades to protect their domestic economies. Argentina and Brazil seem set to follow suit.
But looking beyond the immediate crisis, Kirk's appointment offers New Zealand negotiators some hope, because he's an avowed free trade advocate with a record of supporting NAFTA and extending trade ties with China. Specifically, he endorsed China's entry into the WTO, the very policy that won New Zealand its historic FTA with China this year. The 54 year-old is now a lawyer, but from 1995 to 2001 he was the first black mayor of Dallas. As an early supporter of and fundraiser for Obama, he has been rewarded with a crucial cabinet post.
This from Bloomberg:
Obama said Kirk will balance the opportunities trade brings to U.S. businesses with protections for workers.
“We must engage in strong, robust trade and open doors for American products,” Obama said. “But I also believe that any trade agreement we sign must be written not just with the interests of big corporations in mind, but with the interests of our whole nation and our workers at heart.”
As mayor, Kirk was a proponent for the North American Free Trade Agreement and China’s entry into the World Trade Organization.
Obama has been inconsistent when speaking on trade, but he seems to be in favour of FTAs if their clauses on environmental and labour issues are sufficiently robust. This places New Zealand in a great negotiation position, as a country that can set the standard for what an Obama FTA might look like.
Consider what Kirk told his hometown paper, the Dallas Morning News immediately after his appointment was announced:
"The exciting thing for me is that the president very much sees a robust trade policy as part of his economic agenda. He understands that the United States can't be protectionist, can't step back from our trade relations,"
If Tim Groser hasn't spoken to Kirk before inauguration day, he's not doing his job. We need to get in his ear, and whether it's a Pacific rim deal or a blitateral agreement, New Zealand needs to be making it's case with urgency. Obama has opened the door with his appointment and we need to step forward.
Meanwhile, here's a fun piece from Foreign Policy magazine picking the 10 worst predictions from 2008. The most embarrassing has to be contributor (and McCain adviser) Donald Luskin writing in the Washington Post that “[A]nyone who says we’re in a recession, or heading into one—especially the worst one since the Great Depression—is making up his own private definition of ‘recession.’”
That was published on September 14, one day before Lehman Brothers went under. Doh!
Comments (2)
However Obama's pick for Secretary of Labor, Hilda L. Solis isn't so keen on the whole globalisation thing. Perhaps that's because the whole globalisation thing isn't quite delivering those promised higher relative incomes for working class people. I'd be pissed too if I'd just lost my job.
It seems being "anti-globalisation" nowadays seems to apply to anyone who thinks there should be environmental and labour standards in trade agreements...
What Obama's team suggests is that the new administration is going to pick its way through the middle of the issue. It will be pro-globalisation (which is, after all, inevitable. Being anti-globalisation is a bit like being anti-air travel a few generations ago. It's happening and will keep happening no matter what). But it will also enforce labour and green standards. There's no reason why both can't be achieved, and both the US and NZ have real incentives to want just such a trade deal. Solis won't have anything to do with that.
It's hugely complicated, but there's evidence about that globalisation is creating just about as many jobs as it's migrating, just in different sectors. No, it's no consolation for US manual workers who are too poor or old or whatever to re-train, but it's great for the developing world.
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