Tag: south korea

Upcoming G20 Summit in Seoul Raises Stakes for U.S.-Korea Trade Deal

The next G20 Summit, to be held November 11-12 in South Korea, is right around the corner. For free traders, the summit has taken on added meaning because of the promise President Obama made during the most recent G20 Summit held last June in Toronto to advance the U.S.-Korea free trade agreement (FTA):

The last time I was in Korea, I said that I would be committed to moving [the FTA] forward. And today I indicated to President Lee that it is time that our United States Trade Representative work very closely with his counterpart from the ROK to make sure that we set a path, a road, so that I can present this FTA to Congress…. I want to make sure that everything is lined up properly by the time that I visit Korea in November. And then in the few months that follow that, I intend to present it to Congress. It is the right thing to do for our country.

We agree, Mr. President. To help policymakers understand the high stakes and potential gains of the agreement, Cato Senior Fellow Doug Bandow has authored the new Cato Trade Briefing Paper, “A Free Trade Agreement with South Korea Would Promote Both Prosperity and Security,” released today.

A preview of Doug’s analysis also was published yesterday in the Daily Caller, under the title “South Korea Free Trade Agreement Key to Prosperity and Security.”

America’s Alliances: Frayed, but not Disappearing

National Journal’s Paul Starobin asks at the National Security Experts blog “Are America’s Alliances Fraying?” Starobin notes that two normally reliable allies, Brazil and NATO member Turkey opposed an additional round of sanctions against Iran. Meanwhile, President Obama has failed to persuade Europeans to provide large numbers of troops to Afghanistan. “Is the ability of Washington to assemble coalitions on behalf of its global objectives starting to ebb?” Starobin asks. “Are our alliances fraying – and if so, why? Does this trend have to do with our flailing economy, with inept diplomacy, or with some other set of factors?”

Excerpts from my response:

It is hardly newsworthy when one of America’s allies bucks Uncle Sam. It has become an almost daily occurrence.

[…]

But just because the United States has had difficulty keeping its allies in line doesn’t mean that it can’t assemble a coalition to deal with common challenges. It all depends on whether the parties agree on the nature and severity of the threat, and on the best means for mitigating it. In this context, the multinational naval task force operating off the Horn of Africa has had great success beating back piracy in the region. The countries that choose to participate agree that piracy poses a threat to their commercial interests, and are willing to band together in a loose coalition – and not as part of a formal, permanent alliance – in order to deal with the challenge. Their contributions are generally consistent with their interests; the benefits seen as in line with the costs.

Alliances are no different, or, at least, they shouldn’t be. Alliances are supposed to be sustained by interests. (British Foreign Secretary Lord Palmerston’s observation that “nations have no permanent friends or allies, they only have permanent interests” has been repeated so many times that it has become cliched). And yet, the United States has maintained its commitment to NATO, South Korea and Japan in recent months, even as it is obvious that the parties do not share common interests. The alliances have become an end in and of themselves, instead of the means to an end.

[…]

When she presented the Obama administration’s national security strategy late last month, Secretary of State Hillary Clinton declared that NATO was one of several global commitments that was “embedded in the DNA of American foreign policy.”

Hardly. While a bipartisan consensus in Washington is enamored of Europe’s dependence upon the United States, most Americans tire of defending our wealthy European allies who are eminently capable of defending themselves. The resentment has only grown as these same allies have shown precious little enthusiasm for supporting the United States in its hour of need in Afghanistan.

[…]

We have created a class of wealthy and secure allies who lack the capability, but most importantly the will, to act on their own behalf, let alone in the service of the world’s policeman.

Read the full response here.

Hotel Afghanistan: We Can Check Out but Never Leave

The U.S. remains stuck in Iraq, as the country moves toward a potentially messy and not so democratic (lots of disqualified parliamentary candidates, etc.) election.  Iran’s refusal to back away from its nuclear program has intensified calls for an American military strike – which, Sarah Palin assures, would even help the president politically.  North Korea unsurprisingly is showing reluctance to rejoin international talks over its nuclear program: renewed proposals for a U.S. military build-up in South Korea and even war against the North are likely to follow.  And then there is Afghanistan.

Even though President Barack Obama talks about deadlines and drawdowns, there is little in present policy to suggest that the U.S. will be able to leave Afghanistan in even the mid-term.  Afghan President Hamid Karzai certainly doesn’t think so.  He figures on U.S. military support for at least another decade, with continuing international financial support for years after that.

Reports the Associated Press:

Afghan President Hamid Karzai warned Thursday that foreign troops must stay in his country for another decade, as world powers agreed on an exit map including a plan to persuade Taliban fighters to disarm in exchange for jobs and homes.Divisions emerged between the U.S. and its partners over Kabul’s willingness to offer peace to Taliban leaders who once harbored al-Qaida, instead of the more limited deal for lower-ranking fighters emphasized by the Americans.

All agree that reconciliation means bringing on board what Mark Sedwill, NATO’s newly appointed civilian chief in Afghanistan, called “some pretty unsavory characters.”

The conference was called to help the U.S. and its allies find a way out of the grinding Afghan war amid rising U.S. and NATO casualties and falling public support. NATO has agreed to accelerate the training of Afghan security forces and gradually transfer more combat responsibility to them.

“With regard to training and equipping the Afghan security forces, five to 10 years will be enough,” Karzai told the BBC. “With regard to sustaining them until Afghanistan is financially able to provide for our forces, the time will be extended to 10 to 15 years.”

It sounds a bit like the Afghan equivalent of the Eagles’ Hotel California.  Defeat or bribe the Taliban and keep Karzai in power, and we will have “won” – but we still won’t be able to leave.  And the Afghan government, assuming it achieves a modicum of honest competence, will still have little incentive to meet even President Karzai’s distant check-out date.  Who in Kabul will want to do without abundent Western cash 10 or 15 years from now?

In 2001 the U.S. had a simple, important, and achievable mission in Afghanistan:  disrupt al-Qaeda and oust the Taliban.  American military forces succeeded.  Alas, we’ve spent the succeeding eight years attempting to build a nation state where none exists.  It’s time to draw down our forces and again focus on combatting terrorists.

Time to Lose the Trade Enforcement Fig Leaf

During his SOTU address last week, the president declared it a national goal to double our exports over the next five years.  As my colleague Dan Griswold argues (a point that is echoed by others in this NYT article), such growth is probably unrealistic. But with incomes rising in China, India and throughout the developing world, and with huge amounts of savings accumulated in Asia, strong U.S. export growth in the years ahead should be a given—unless we screw it up with a provocative enforcement regime.

The president said:

If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores. But realizing those benefits also means enforcing those agreements so our trading partners play by the rules.

Ah, the enforcement canard!

One of the more persistent myths about trade is that we don’t adequately enforce our trade agreements, which has given our trade partners license to cheat.  And that chronic cheating—dumping, subsidization, currency manipulation, opaque market barriers, and other underhanded practices—the argument goes, explains our trade deficit and anemic job growth.

But lack of enforcement is a myth that was concocted by congressional Democrats (Sander Levin chief among them) as a fig leaf behind which they could abide Big Labor’s wish to terminate the trade agenda.  As the Democrats prepared to assume control of Congress in January 2007, better enforcement—along with demands for actionable labor and environmental standards—was used to cast their opposition to trade as conditional, even vaguely appealing to moderate sensibilities.  But as is evident in Congress’s enduring refusal to consider the three completed bilateral agreements with Colombia, Panama, and South Korea (which all exceed Democratic demands with respect to labor and the environment), Democratic opposition to trade is not conditional, but systemic.

The president’s mention of enforcement at the SOTU (and his related comments to Republicans the following day that Americans need to see that trade is a two way street – starts at the 4:30 mark) indicates that Democrats believe the fig leaf still hangs.  It’s time to lose it.

According to what metric are we failing to enforce trade agreements?  The number of WTO complaints lodged? Well, the United States has been complainant in 93 out of the 403 official disputes registered with the WTO over its 15-year history, making it the biggest user of the dispute settlement system. (The European Communities comes in second with 81 cases as complainant.)  On top of that, the United States was a third party to a complaint on 73 occasions, which means that 42 percent of all WTO dispute settlement activity has been directed toward enforcement concerns of the United States, which is just one out of 153 members.

Maybe the enforcement metric should be the number of trade remedies measures imposed?  Well, over the years the United States has been the single largest user of the antidumping and countervailing duty laws.  More than any other country, the United States has restricted imports that were determined (according to a processes that can hardly be described as objective) to be “dumped” by foreign companies or subsidized by foreign governments. As of 2009, there are 325 active antidumping and countervailing duty measures in place in the United States, which trails only India’s 386 active measures.

Throughout 2009, a new antidumping or countervailing duty petition was filed in the United States on average once every 10 days.  That means that throughout 2010, as the authorities issue final determinations in those cases every few weeks, the world will be reminded of America’s fetish for imposing trade barriers, as the president (pursuing his “National Export Initiative”) goes on imploring other countries to open their markets to our goods.

Rather than go into the argument more deeply here, Scott Lincicome and I devoted a few pages to the enforcement myth in this overly-audaciously optimistic paper last year, some of which is cited along with some fresh analysis in this Lincicome post.

Sure, the USTR can bring even more cases to try to force greater compliance through the WTO or through our bilateral agreements.  But rest assured that the slam dunk cases have already been filed or simply resolved informally through diplomatic channels.  Any other potential cases need study from the lawyers at USTR because the presumed violations that our politicians frequently and carelessly imply are not necessarily violations when considered in the context of the actual rules.  Of course, there’s also the embarrassing hypocrisy of continuing to bring cases before the WTO dispute settlement system when the United States refuses to comply with the findings of that body on several different matters now.  And let’s not forget the history of U.S. intransigence toward the NAFTA dispute settlement system with Canada over lumber and Mexico over trucks.  Enforcement, like trade, is a two-way street.

And sure, more antidumping and countervailing duty petitions can be filed and cases initiated, but that is really the prerogative of industry, not the administration or Congress.  Industry brings cases when the evidence can support findings of “unfair trade” and domestic injury.  The process is on statutory auto-pilot and requires nothing further from the Congress or president. Thus, assertions by industry and members of Congress about a lack of enforcement in the trade remedies area are simply attempts to drum up support for making the laws even more restrictive.  It has nothing to do with a lack of enforcement of the current rules.  They simply want to change the rules.

In closing, I’m happy the president thinks export growth is a good idea.  But I would implore him to recognize that import growth is much more closely correlated with export growth than is heightened enforcement.  The nearby chart confirms the extremely tight, positive relationship between export and imports, both of which track similarly closely to economic growth.

U.S. producers (who happen also to be our exporters) account for more than half of all U.S. import value.  Without imports of raw materials, components, and other intermediate goods, the cost of production in the United States would be much higher, and export prices less competitive.  If the president wants to promote exports, he must welcome, and not hinder, imports.

Former South Korean President Kim Dae-jung Dies

At 85, former South Korean president Kim Dae-jung has died of heart failure.  Elected in 1997, he was the architect of South Korea’s “Sunshine Policy” with the so-called Democratic People’s Republic of Korea, highlighted by the first South-North summit with North Korean dictator Kim Jong-il.  Kim Dae-jung’s presidency ended in disappointment – Pyongyang took advantage of South Korean generosity while corruption reached into his family.

But he fought heroically for human rights against the South’s old military regime.  He ran for president in an election stolen by Park Chung-hee and was kidnapped while in exile in Japan. He avoided death at sea when the Reagan administration, alerted to the crime, warned Seoul that he had better arrive alive in South Korea.

I met him in 1989 shortly after his defeat in the first free election after the dissolution of military rule.  Imperious but principled, he seemed destined to spend the rest of his life in opposition.  But he persevered and triumphed.

Kim Dae-jung’s flaws were manifest, but his personal courage and commitment to democracy were without question.  May he rest in peace.

Finally, an Ally That Doesn’t Wait for America

Washington’s willingness to toss security guarantees about the globe like party favors has encouraged other nations to do little for their own defense.  From the European, Japanese, and South Korean standpoint, why spend more when the Americans will take care of you?

But it looks like Australia takes a different view, and is willing to do more to defend itself and its region.  Reports the Daily Telegraph:

The latest defence White Paper recommends buying 100 advanced F-35 jet fighters and 12 powerful submarines equipped with cruise missiles, a capability which no other country in the region is believed to possess.

The “potential instability” caused by the emergence of China and India as major world powers was cited as the most pressing reason for this military build-up. In particular, Australian defence planners are believed to be concerned about China’s growing naval strength and America’s possible retreat as a global power in the decades ahead.

Chinese officials say their country’s growing power threatens no-one. Behind the scenes, Beijing is thought to be unhappy about Australia’s White Paper, with one Chinese academic saying it was “typical of a Western Cold War mentality”.

But the Chinese navy has almost doubled the number of secret, long-distance patrols conducted by its submarines in the past year. The reach of its navy is extending into Australian waters. China is also acquiring new amphibious assault ships that can transport a battalion of troops.

So instead of calling Washington to deal with Beijing, the Australians are building up their own navy.  Novel approach!  Now, how can we implant a bit of the Aussie character in America’s other friends around the globe?

Week in Review: Sotomayor, North Korean Nukes and The Fairness Doctrine

Obama Picks Sotomayor for Supreme Court

sotomayorPresident Obama chose federal Judge Sonia Sotomayor on Tuesday as his nominee for the U.S. Supreme Court, the first Hispanic Latina to serve on the bench.

On Cato’s blog, constitutional law scholar Roger Pilon wrote, “President Obama chose the most radical of all the frequently mentioned candidates before him.”

Cato Supreme Court Review editor and senior fellow Ilya Shapiro weighed in, saying, “In picking Sonia Sotomayor, President Obama has confirmed that identity politics matter to him more than merit. While Judge Sotomayor exemplifies the American Dream, she would not have even been on the short list if she were not Hispanic.”

Shapiro expands his claim that Sotomayor was not chosen based on merit at CNN.com:

In over 10 years on the Second Circuit, she has not issued any important decisions or made a name for herself as a legal scholar or particularly respected jurist. In picking a case to highlight during his introduction of the nominee, President Obama had to go back to her days as a trial judge and a technical ruling that ended the 1994-95 baseball strike.

Pilon led a live-chat on The Politico’s Web site, answering questions from readers about Sotomayor’s record and history.

And at The Wall Street Journal, Cato senior fellow John Hasnas asks whether “compassion and empathy” are really characteristics we want in a judge:

Paraphrasing Bastiat, if the difference between the bad judge and the good judge is that the bad judge focuses on the visible effects of his or her decisions while the good judge takes into account both the effects that can be seen and those that are unseen, then the compassionate, empathetic judge is very likely to be a bad judge. For this reason, let us hope that Judge Sotomayor proves to be a disappointment to her sponsor.

North Korea Tests Nukes

The Washington Post reports, “North Korea reportedly fired two more short-range missiles into waters off its east coast Tuesday, undeterred by the strong international condemnation that followed its detonation of a nuclear device and test-firing of three missiles a day earlier.”

Writing in the National Interest online, Cato scholar Doug Bandow discusses how the United States should react:

Washington has few options. The U.S. military could flatten every building in the Democratic People’s Republic of Korea (DPRK), but even a short war would be a humanitarian catastrophe and likely would wreck Seoul, South Korea’s industrial and political heart. America’s top objective should be to avoid, not trigger, a conflict. Today’s North Korean regime seems bound to disappear eventually. Better to wait it out, if possible.

On Cato’s blog, Bandow expands on his analysis on the best way to handle North Korea:

The U.S. should not reward “Dear Leader” Kim Jong-Il with a plethora of statements beseeching the regime to cooperate and threatening dire consequences for its bad behavior. Rather, the Obama administration should explain, perhaps through China, that the U.S. is interested in forging a more positive relationship with [the] North, but that no improvement will be possible so long as North Korea acts provocatively. Washington should encourage South Korea and Japan to take a similar stance.

Moreover, the U.S. should step back and suggest that China, Seoul, and Tokyo take the lead in dealing with Pyongyang. North Korea’s activities more threaten its neighbors than America. Even Beijing, the North’s long-time ally, long ago lost patience with Kim’s belligerent behavior and might be willing to support tougher sanctions.

Cato Media Quick Hits

Here are a few highlights of Cato media appearances now up on Cato’s YouTube channel: