Some Trade Links, and Today’s “Shamelessly Pandering Congressman” Exhibit

A few items that crossed my desk today. All the emphases in the blockquotes are my own.

Imported Food Regulations

Following up from Doug’s post yesterday advocating for a “deregulatory stimulus,” here’s a story from Inside U.S. Trade [$] that shows how even obscure areas of federal law can serve as examples of, as the article puts it, a “paradigm shift” in the way regulations are written and applied:

The [Food and Drug Administration] proposal represents something of a paradigm shift in the way that imported food is currently regulated. FDA generally allows food to come into the country unless it has information that an exporter has lax safety practices or that a specific shipment is tainted – although it tests only a tiny percentage of imported food.

In essence, the [Foreign Supplier Verification Program, or FSVP] rule is shifting some of the burden to show that food is safe to the private sector. It also creates a basis for FDA to reject food imports besides finding a shipment to be adulterated. Under the proposed rule, food can be turned away if FDA finds that an importer does not have an adequate FSVP in place.

This is all part of a broader change in the way FDA operates that is being brought about under the Food Safety Modernization Act. That law, which was signed by President Obama in January 2011, also requires a frequency of overseas facility inspections by FDA that some observers say are unrealistic given its current funding levels….

In other words, the new Food Safety Modernization Act no longer just requires that imported food be safe. Now imported food can be rejected simply because of the absence of certain documentation. Proving food to be safe is a lot more burdensome than preventing unsafe food from entering the country. It does indeed represent a paradigm shift, and an unwelcome one.

How is the private sector coping with all of this?

Reaction from the private sector to the proposed rule has been fairly positive, according to industry sources. Many were pleased by the fact that FDA narrowed the scope of who is subject to the requirements to the party that actually caused the food to be imported, rather than including the agents who often act as middlemen in trade transactions.

England [a consultant to food importers] also generally praised FDA for limiting the importers’ responsibilities to interacting with the last party involved in exporting the food, and not imposing requirements for importers to go through their suppliers’ entire supply chain, which he said would have been unworkable.

I think that’s code for “not as bad as it could have been.” Kind of sad, don’t you think?

An Editorial Takes An Unexpected Turn

The opening paragraphs of a Bangor Daily News editorial is full of what you would expect from a parochial newspaper defending the economic interests of a factory in its home state (in this case, New Balance in Maine):

While every other producer of athletic footwear has abandoned its stateside manufacturing, New Balance continues to make about a quarter of its sneakers in the United States. The Boston-based company employs 900 workers in Maine at its Norridgewock, Norway and Skowhegan facilities.

And those jobs could be at risk as the U.S. negotiates the Trans-Pacific Partnership free trade agreement with 10 Pacific Rim nations. As part of those negotiations, Vietnam is demanding that the tariffs the U.S. imposes on Vietnamese-made athletic footwear imports be nixed.

Given its economic significance to Maine, it makes sense for the state’s congressional delegation to fight for New Balance and any policy that makes it viable for the company to continue manufacturing here.

So far, so familiar (and so wrong). But a few paragraphs on, the editorial makes a worthy, and unusual, detour into making arguments that are rarely seen in the popular press (or, indeed, outside of die-hard free trader’s policy writing):

But as they devote their energy to sneakers, paper and other Maine legacy industries, that’s energy the state’s congressional representatives aren’t devoting to industries and initiatives that are likely to grow jobs in Maine’s future economy.

While we hope the Maine jobs manufacturing paper and sneakers remain viable in the 21st century, the reality is those industries employ fewer Maine residents today than they did decades, or even five years, ago.

But as their economic importance diminishes, the traditional sectors of Maine’s economy seem to attract more attention from Maine’s congressional delegation — and more headlines — than the up-and-coming sectors and the policies needed to prepare Maine’s workforce for the future economy.

It’s logical to focus on the industries with which voters are most familiar. They employ people we know, and they employ them today. A politician who successfully fights for a policy that protects existing jobs can claim a tangible success. It’s more difficult politically to make the case for an industry that isn’t yet established.

That doesn’t mean, however, that preserving the present is a more important job for our congressional delegation than fighting for the future.

Right on. I agree with little else said in the article, but kudos to the editorial team for including those points in their discussion.

Most Easily-Refuted Quote of the Day

And, lastly, a hyperbolic and shameless quote from a farm-state congressman (Rep. Jeff Fortenberry, R-Neb., as reported by the Fremont Tribune), lamenting the fact that the Farm Bill has still failed to come into law: 

“‘Agriculture is the only bright spot in America’s economy,’ Fortenberry said. ‘It is the main thing we produce anymore and export at high-high [sic] levels.’”

Actually, agriculture is a tiny part of the U.S. economy, accounting for only 1.1 percent of GDP last year. It certainly could not by any stretch of the imagination be considered “the main thing we produce anymore.” And agricultural products comprise less than 10 percent of U.S. exports, at least according to U.S. Census Bureau figures.

Mr Fortenberry told the meeting that the problem was that agriculture was “poorly understood in Washington.” Given his poor grasp of the facts regarding agriculture’s importance to the U.S. economy, I would say he is the one whose understanding needs some work.