Consolidating agencies could hurt trade

Jan 20, 2012

President Barack Obama plans to ask Congress for the authority to consolidate several federal agencies dealing with trade and business development, including the Office of the U.S. Trade Representative (USTR), which negotiates agreements covering exports of beef, pork and poultry.

His plan would elevate the Small Business Administration to the Cabinet, and combine it with the Commerce Department, USTR, the Export-Import Bank, the Overseas Private Investment Corporation, and the Trade and Development Agency.

Under the proposal, the Commerce Department would cease to exist, handing the National Oceanic and Atmospheric Association over to the Interior Department and the rest of its operations to the new organization. The U.S. Census would become part of a statistics branch under the Labor Department. Approximately 1,000 to 2,000 jobs would be lost, according to White House estimates, most through attrition.

According to some reports, the plan would save $3 billion over 10 years by getting rid of duplicative costs and programs.

Agricultural organizations were quick to voice concern that the consolidation could delay or hamper efforts to promote U.S. trade.

“National Cattlemen’s Beef Association (NCBA) has strong concerns about President Obama’s proposal to merge the Office of the U.S. Trade Representative with other trade agencies. NCBA maintains that US- TR should remain an independent agency within the Executive Office of the President, focusing on trade negotiations, trade agreements and trade enforcement. US- TR is vital to ensuring successful trade negotiations concerning U.S. beef and other agricultural commodities with our global trade partners. USTR must be in a position to have direct access to the White House.

“By being an independent office within the White House, USTR serves an important role reducing trade barriers and advocating for free and fair trade for all sectors of the U.S. economy. USTR has played a crucial role in expanding exports of U.S. beef by ensuring the passage of free trade agreements and working to achieve science-based trade protocols,” said NCBA’s released statement.

Under Obama’s request for what is called “fast-track” powers, Congress would give him authority to consolidate the agencies subject to an up-or-down vote by Congress, which could approve or disapprove the specific proposal but could not change the details.

The president’s proposal also received skepticism from trade experts.

“The administration has to carefully consider the importance of collapsing nimble and adept agencies such as USTR into a broader organization when you’re dealing with markets that are as complicated as Russia is,” Randi Levinas, executive vice president of the U.S.-Russia Business Council, told Bloomberg.

The American Soybean Association (ASA) said, “US- TR’s efforts have been vital to the growth of American agricultural exports. We are concerned that folding US- TR into a massive Department of Commerce or Industry structure would significantly weaken the coordination role played by USTR on trade interests across sectors, and the work on agricultural trade opportunities and barriers would be diminished.”

“Agricultural exports are just too important to our nation’s economy, rural America, soybean farmers, and the livestock industries we supply,” an ASA release said.

“Agricultural exports are just too important to our nation´s economy, rural America, soybean farmers, and the livestock industries we supply.”

Some are calling this a pre-election political ploy to appeal to Republican followers seeking less government.

Obama challenged Republican lawmakers to support his idea, but hinted that he would turn to the American public if they didn’t.

“After presiding over one of the largest expansions of government in history, and a year after raising the issue in his last State of the Union, it’s interesting to see the president finally acknowledge that Washington is out of control,” said Don Stewart, a spokesman for Senate Minority Leader Mitch Mc- Connell, R-KY.

“With or without Congress, I’m going to keep at it, but it would be a lot easier if Congress helped,” Obama said. “This is an area that should receive bipartisan support, because making our government more responsive and strategic and leaner, it shouldn’t be a partisan issue.”

White House officials said the administration talked with business leaders and government employees to draft the plan, which Obama said would require that any changes reduce the number of agencies or save taxpayer dollars.

If the authority were granted on the fast-track, Congress would be required to hold an up-or-down vote on the president’s plan, without changes, within 90 days of its submission.

Jeffrey Zients, Obama’s point man on the initiative, said the fast-track authority is needed to avoid having it “bogged down” by amendments and opposition from “special interests.”

Skepticism was also circulating through the Democrat arena after the announcement.

“Making it just another corner of a new bureaucratic behemoth would hurt American exports and hinder American job creation,” said Sen. Max Baucus, D- MT.

In an article in the Chicago Tribune titled “Obama Steals GOP Thunder, Sets Up SOTU,” the first sentence reads: By proposing on Friday to merge multiple U.S. trade agencies, President Barack Obama sought to outmaneuver Republicans on one of their key talking points in the presidential race: making government smaller.

As Obama continues his incumbent race, and the political battles heat up, actions may very well speak louder than words.

“Fighting for the middle class is going to be a thematic that runs through all of this year, through State of the Union, through the budget, through everything we do,” White House Communications Director Dan Pfeiffer said in an interview.

Traci Eatherton, WLJ Editor