Senate Backs Kirk's USTR Nomination

by Mike Godfrey, Tax-News.com, Washington

20 March 2009

The United States Senate has overwhelmingly backed former Dallas Mayor Ron Kirk's nomination to become President Obama's Trade Representative.

Despite doubts over his past tax affairs and his making of a USD10,000 back tax payment, Kirk's nomination sailed through the Senate on March 18 by a vote of 92 to 5.

Kirk's confirmation was lauded by Max Baucus, the Chairman of the Senate Finance Committee, which has sole jurisdiction over international trade.

“He is the right person to steer our trade agenda through these troubled times," Baucus said. "He will work to rebuild America’s faith in the benefits of international trade, and he will help guide America to speedy economic recovery by opening markets to US products. I look forward to working with Ambassador Kirk to accomplish these goals.”

However, while the voting record might show emphatic support for Kirk's nomination, his selection, and aspects of President Obama's trade policy, have been greeted less enthusiastically by many in Congress, including Sen. John MCain, who lost out to Obama in last year's race to the White House.

"While I do not intend to oppose Mr. Kirk’s confirmation, I would like to take this opportunity to discuss some disquieting trends that have emerged recently in our nation’s trade policy," McCain said in a statement ahead of the Senate vote.

"The administration has sent a series of mixed messages on trade policy. Mr. Kirk, for example, has made some statements broadly supportive of international trade, and cognizant that protectionist policies would portend disaster for our economy. But he has also made comments suggesting that protectionism might not be so bad after all," he added.

McCain went on to point out that Kirk had told the Senate Finance Committee in his confirmation hearing how "not all Americans are winning from [trade]" and that America's trading partners "are not always playing by the rules.” Kirk also suggested that the administration may abandon the free trade agreement with South Korea, concluded under the George W. Bush administration – and projected to increase US GDP by USD10 to USD12bn, according to McCain.

True to his future boss's often conflicting attitudes towards free trade, Kirk told the finance panel that while the upside of free trade - i.e. cheaper consumer and other goods - has been beneficial during the economic downturn his main priority will be to ensure that existing and future free trade deals are "fair."

"It is true that cheaper foreign products help squeezed American families stretch their dollars, and the sale of our goods and services abroad support American jobs," Kirk said. "But it is also true that the overarching benefits of trade are difficult to appreciate when a plant closes in a small community because of increased foreign competition."

In addition to the free trade agreement with South Korea, the US has yet to ratify completed trade deals with Colombia and Panama, and it is likely that the new administration will seek to review and possibly renegotiate aspects of these agreements, particularly their labor and environmental provisions, before progressing them. Obama has also signaled his intention to "strengthen" the North American Free Trade Agreement. The world also awaits the US government's input into the crucial closing stages of the Doha Round of World Trade Organization negotiations. And with Mexico having recently decided to increase tariffs on certain US imports in retaliation for Washington's decision to block all Mexican trucks from the United States - in violation of NAFTA - Kirk probably has one of the fullest plates awaiting an income USTR for may years.

Recommended