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Impact: EconomyKORUS is necessary to help economic recovery, preserve United States’ interest in the region and allow American business to prosper in barrier-free markets Klingner and Roberts 5/13, The Heritage Foundation (Bruce K. James R. 5/13 "FTAs with South Korea, Colombia, and Panama Would Create U.S. Jobs and Exports" http://www.heritage.org/research/reports/2011/05/ftas-with-south-korea-colombia-and-panama-would-create-us-jobs-and-exports )PHS The Korea-U.S. Free Trade Agreement (KORUS) would be America’s largest free trade agreement in Asia. It would increase U.S. exports by an estimated $10 billion annually, increase U.S. gross domestic product (GDP) by $11 billion, and add 70,000 U.S. jobs—all without a dime in federal government spending.[1] The accord would also serve as a powerful statement of the U.S. commitment to East Asia at a time when many perceive declining American interest, presence, and influence in the region. The FTA would strengthen U.S. commercial ties and expand the bilateral relationship with South Korea beyond traditional military ties or the North Korean threat. KORUS would also reduce the vulnerability of a key U.S. ally to Chinese pressure by diversifying Korea’s trading base and decreasing its economic reliance on Beijing. Seoul has become increasingly concerned about China’s belligerent and arrogant behavior and willingness to use its growing military and economic power to pressure smaller Asian nations. Rejecting KORUS would disadvantage U.S. companies by locking in discriminatory trade barriers. During the four years the agreement was held hostage by special interest groups and congressional protectionists, the U.S. lost $40 billion in potential exports. American companies continued to lose market share to foreign competitors. The U.S. used to be South Korea’s largest trade partner, but in less than a decade it has been displaced by China, the European Union, and Japan. As Korea’s market opens further, it will be foreign competitors and not U.S. companies that will benefit. SKFTA = Good for Economy
“Since visiting South Korea in April, it has become clear that we need to find a way forward on passing these important trade agreements,” Hoeven said “With unemployment hovering above 9 percent, and our economy languishing, these agreements could mean hundreds of thousands of jobs for Americans and a much-needed boost to the American economy.” The three trade agreements combined represent more than $13 billion in increased economic activity for U.S. manufacturers and farmers. The South Korean Free Trade Agreement alone will increase the nation’s exports to that country by more than $10 billion and create 280,000 American jobs, according to the Congressional Research Service. South Korea has a $1 trillion economy and 49 million consumers. It’s the 15th largest economy in the world and the United States’ 7th largest trading partner. The U.S.-South Korea Free Trade Agreement will eliminate or reduce more than 85 percent of the tariffs between the United States and Korea, including the eventual elimination of a 40 percent Korean tariff on American beef. “Just one project in North Dakota would generate a $100 million investment in our state’s economy and create 500 new jobs if the Korean agreement is approved,” Hoeven said. “Clearly these agreements can benefit North Dakota, but they can also benefit our country at a time when unemployment is high and our economy is struggling.” Nuclear war.
None of which means that we can just sit back and enjoy the recession. History may suggest that financial crises actually help capitalist great powers maintain their leads--but it has other, less reassuring messages as well. If financial crises have been a normal part of life during the 300-year rise of the liberal capitalist system under the Anglophone powers, so has war. The wars of the League of Augsburg and the Spanish Succession; the Seven Years War; the American Revolution; the Napoleonic Wars; the two World Wars; the cold war: The list of wars is almost as long as the list of financial crises. Bad economic times can breed wars. Europe was a pretty peaceful place in 1928, but the Depression poisoned German public opinion and helped bring Adolf Hitler to power. If the current crisis turns into a depression, what rough beasts might start slouching toward Moscow, Karachi, Beijing, or New Delhi to be born? The United States may not, yet, decline, but, if we can't get the world economy back on track, we may still have to fight. Ext: EconomySKFTA will drastically change US-soko economic relationships and boost jobs Gerwin and McConaghy 4/2011, The Economic Program (Ed G. Ryan M. 4/2011 "The Korea Trade Agreement: A Good Deal for America" http://content.thirdway.org/publications/385/Third_Way_Policy_Memo_-_The_Korea_Free_Trade_Agreement-A_Good_Deal_for_America.pdf )PHS To compete and win in the global economy, America must become an export powerhouse. For this to happen, it’s essential that we break down unfair foreign barriers that keep American companies and workers from selling their goods and services to the world. The U.S.-South Korea Free Trade Agreement (KORUS) would do just that, allowing America to go toe-to-toe with China and Europe in the competition for global business. By winning fairer treatment for American exports, KORUS would lead to greater economic growth, support good American jobs, and benefit American companies, communities, and families. And it would do all of this in a manner that’s in keeping with America’s values. On March 28th, FedEx launched new, direct Boeing 777 freighter service to South Korea from its world hub in Memphis.1 This new route positions FedEx and its U.S customers to seize the many new opportunities that KORUS would create for American exports to South Korea.2 Under KORUS, the cargo holds of FedEx aircraft—as well as South Korea-bound shipping containers, passenger aircraft and international data networks—would carry a wide array of U.S. products to waiting South Korean customers—from Florida orange juice, Michigan auto parts, Campbell’s soup and Hershey’s Kisses, to Hollywood movies and life insurance for Korean families. This story, and many more like it, illustrates how KORUS would help industries, communities, companies and workers throughout the United States. Below, we outline some of the compelling stories and convincing data that demonstrate why KORUS is a good deal for America. Over the next 5 years, 87% of global growth will take place outside of the United States. By 2030, the global economy will add some 2 billion new middle class consumers.3 South Korea’s 49 million consumers are a dynamic part of the rising global middle class. But, to reach these eager customers, America needs to clear away the many barriers that deny us fair access to the South Korean market.4 Tearing Down Tariffs- America boasts one of the world’s most open economies, and this openness is a key source of U.S. economic strength. South Korea, on the other hand, currently maintains significant barriers to exports from the United States. For example, Korea’s duties on imported farm products average 54%—compared with U.S. tariffs on the same imports that average 9%. On non-farm goods Korean duties average 6.6%—compared with 3.2% for the United States.5 By eliminating these high tariffs KORUS would significantly expand the pipeline for American companies and workers selling to South Korea.6 The agreement would immediately make almost-two thirds of U.S. farm good exports (by value) duty free and eliminate Korean duties on almost 95% of U.S. exports of industrial and consumer products within 5 years.7 Breaking down Barriers- However, high tariffs aren’t the only barriers that KORUS would help to break down. U.S. exporters have long complained that Korea employs an array of tactics—from discriminatory standards and closed rulemaking, to a lack of due process—to exclude American manufactured and farm goods, services and investments from the Korean market.8 KORUS would tackle many of these unfair barriers head-on. The agreement’s provisions on rules and standards would, for instance, strengthen Korea’s obligations to provide transparency in rulemaking, provide American firms with greater opportunities for meaningful participation in Korea’s development of standards and establish effective procedures for resolving disputes.9 For example, the KORUS revisions negotiated by the Obama Administration would address Korea-specific auto standards that have acted as severe barriers to U.S. auto exports. Under the agreement, Korean safety officials would allow each American automaker to import 25,000 U.S. originating cars per year that comply with U.S. safety standards. American cars would also meet Korea’s soon to be issued fuel economy and emissions standards if they achieve targets within 19% of those benchmarks. 10 Both the United Auto Workers and Ford, along with the other American automakers, now support KORUS because these changes would significantly open up Korea to American auto exports Opening Opportunities for Growth Studies- by the U.S. International Trade Commission (ITC)also estimate that just the tariff cuts on goods under KORUS would increase American exports by $10-11 billion per year, and it’s estimated that these exports would support tens of thousands of good American jobs.12 And these estimates don’t include the additional exports and jobs that KORUS would support by opening up South Korea’s half-trillion dollar services sector to highly competitive U.S. firms. Nor do they account for the job-creating impact of breaking down many of South Korea’s non-tariff and regulatory barriers to U.S. exports, which the USITC estimates could “substantially increase” U.S.-Korean trade.13 As detailed in Appendix I, the strong track record of recent U.S. free trade agreements further shows how trade deals like KORUS have the potential to boost American exports, in many cases well beyond the U.S. International Trade Commission’s original, more conservative estimates. South Korea’s vibrant economy—which has been growing at twice the rate of America’s—could be an important source of new economic growth.14 By making it easier to sell American products and services to South Korea, KORUS would allow America to tap into the market’s potential to drive growth and create jobs at home. SKFTA = Good for Economy Office of the United States trade representative, July 21, 2011 (Pending trade agreements will increase opportunities for American services provides, supports US jobs, http://www.ustr.gov/about-us/press-office/blog/2011/july/pending-trade-agreements-will-increase-opportunities-american-s, July 26, 2011) “Three out of every four U.S. workers are currently employed in a service-related industry, so it makes sense that service is part of our trade policy,” said Ambassador Kirk. “And connections between people – through electronic devices, over networks, and across borders – are becoming more critical to U.S. job creation every day. In many cases, when U.S. service companies expand into new markets through global supply chains, they can support additional service industry jobs here at home.” Global customers increasingly demand the world-class services that American companies and workers provide. Last year, foreign consumers bought over $500 billion worth of U.S. services, which yielded a services trade surplus of $132 billion for America. And, as Ambassador Kirk pointed out, the Obama Administration is working to secure additional opportunities for U.S. service providers in international markets. For example, upon implementation of the pending trade agreements with South Korea, Colombia, and Panama, U.S. service providers will gain access to a combined services market of over $750 billion. SKFTA will greatly benefit the US Economy. Failing to pass SKFTA will cost the US 20.3 billion in lost export sales and 345,017 jobs and will endanger the US’s role in Asian Markets Korea-US Partnership Organization 3/1/11 (No Author 3/1 "Expanding U.S. Trade with Korea - An Easy Economic Stimulus" http://www.koreauspartnership.org/files/Overall%20Benefits%20Final.pdf )PHS Enhancing the longstanding partnership between the United States and the Republic of Korea by enacting the KORUS FTA will bring important economic benefits and opportunities to U.S. businesses, farmers, and workers by immediately opening access for U.S. goods and services in Korea-one of the world's largest and most dynamic economies. By securing a more open and competitive Korean market, the FTA will boost U.S. exports to and investment in Korea-generating new jobs and economic growth for both countries- The Importance of Trade to the U.S. Economy- More than 57 million American jobs are directly supported by international trade. Exports represent 13% of U.S. GDP, and exports have been the single largest contributor to economic growth, generating 48% of GDP growth from April 2007 to March 2008. 95% of the world's consumers live outside the United States. Trade Between U.S. and Korea Korea = 7th largest U.S. trading partner Korea = 5th largest market for U.S. agricultural goods Korea = 2nd largest market for U.S. services in Asia Korea = 10th largest market for U.S. information technology Overall Benefits of the KORUS FTA (USITC, 2007) U.S. GDP growth: $10.1~11.9 billion U.S. Merchandise Exports increase: $9.7~10.9 billion -Cost of Inaction -A recent US Chamber of Commerce study found that America could suffer a net loss of more than 345,017 jobs, $20.3 billion in lost export sales and U.S. national output failing to grow $40.4 billion, if it fails to implement the KORUS FTA while the EU and Canada move forward to implement FTAs with Korea. Tariff Elimination by the KORUS FTA U.S. exports to Korea face an average applied tariff of 11.2 percent, while the equivalent U.S. tariff on Korean exports is 3.7 percent. Chart showing tarrifs on U.S. and Korean exports Source: CRS Report for Congress, "The Proposed South Korea-U.S. Free Trade Agreement (KORUS FTA)," July 28, 2007 With approval of the KORUS FTA, nearly 95 percent of bilateral trade in consumer and industrial products will become duty-free within three years-and almost all other tariffs will be eliminated within 10 years. The FTA creates significant new access in Korea for U.S. agricultural products, which now face an average applied tariff of 52 percent. Under the FTA, tariffs will be removed immediately on more than half of current U.S. farm exports to Korea-a value of $1.9 billion. KORUS FTA will give U.S. businesses, workers and farmers an advantage over other global competitors in Korea's growing market. Korea has concluded an FTA with the European Union - a major agreement that could give significant advantages in the Korean market to many European service and manufacturing companies at the expense of American companies waiting to benefit from the KORUS FTA. Trilateral talks between Korea, Japan and China are moving ahead with the goal of establishing a massive regional market. KORUS FTA will ensure that the United States not only remains competitive in the Korean market, but remains a strong competitor throughout Asia. SKFTA is good- it is key to allow businesses to expand their market and generate jobs. Obermeyer, president of Obermeyer Hydro Inc., 11 (Henry Obermeyer, president of Obermeyer Hydro Inc., July 4, 2011, The Coloradoan, “US needs to reach trade deal”, http://www.coloradoan.com/article/20110705/OPINION04/107050317) Since 1990, Wellington-based Obermeyer Hydro Inc., has called Colorado home. As a manufacturer and exporter of water control gates, Obermeyer Hydro is proud that all of its products are manufactured in America. However, we have learned that with a specialized product line, we must look for opportunities to market wherever there is a demand - which often is outside the state of Colorado and beyond America's borders. In fact, we have customers across the world. I recount the history of Obermeyer Hydro to highlight the importance of U.S. international trade policy that is unclear. President Barack Obama has called for the doubling of U.S. exports within the next five years to create and support 2 million U.S. jobs. This is a laudable goal and likely would provide additional opportunities for my company and our 50 employees. The best way to jump-start this effort is for Congress to approve the U.S.-Korea Free Trade Agreement as soon as possible. For Obermeyer Hydro, and other American businesses and farmers, South Korea already is a lucrative market - but it could be even bigger. If Obermeyer Hydro is selling its products to South Korea, you might ask why we need a free trade agreement? The answers are simple. First, South Korea has ratified a free trade agreement with the European Union and is aggressively negotiating pacts with other foreign competitors. Once the EU-Korea FTA took effect on July 1 - absent movement on the US.-Korea agreement - our products will be placed at a significant disadvantage. A European manufacturer will be able to undercut our prices consistently, which could lead to a long-term decline for our sales in the region. Second, an enacted free trade agreement with South Korea will create American jobs, grow the American economy and make America more secure. The U.S. Department of Commerce estimates that for every $1 billion in exports, 6,250 manufacturing jobs are created and supported in the United States. The Korean free-trade agreement will increase U.S. merchandise exports to South Korea by as much as $11 billion, which will translate directly into new American jobs and growth. It is alarming that South Korea is not the only market we are in danger of losing. Throughout the world, countries are forging trade agreements that exclude the United States. The World Trade Organization estimates about 400 such free trade agreements involving countries in all corners of the globe are scheduled to take effect by the end of 2011. Of this number, U.S. is party to only 11 (with 17 countries). Clearly we are being left behind. The longer the United States puts its trade policies on hold, the more we put American companies in danger of losing market share in vital growing markets worldwide. With 95 percent of the world's consumers living outside U.S. borders, it should be clear to U.S. policymakers - including Congress - a key component of any policy designed to boost America's economy and stimulate job creation is to forge trade agreements that will maximize our potential to sell our products, crops and services abroad. Skfta gives us huge economic gains Donohue 1/6/11(Thomas J., President of the US Chamber of Commerce, Korean Trade Pact is a Welcome Shot in the Arm for US Economy, http://www.uschamber.com/press/opeds/korean-trade-pact-welcome-shot-arm-us-economy, Accessed 7/26/11) A funny thing happened in the wake of the midterm elections: Washington entered into an era of bipartisanship, and trade is the unlikely topic of agreement. From the U.S. Chamber of Commerce to the United Auto Workers, President Obama's announcement that he'll send the Korea-U.S. Free Trade Agreement (KORUS) to Congress early this year has been applauded. Trade leaders from both parties have pledged support, and the new Congress should act swiftly to ratify this pact. We must seize this opportunity. Now is the time to advance an aggressive trade and global engagement agenda that will create jobs, revitalize the economy, and reassert America's leadership. Such an agenda offers an excellent opportunity to advance the goal of doubling U.S. exports in five years and putting Americans back to work. It starts with ensuring congressional passage of KORUS by next summer. Working together, the Chamber of Commerce and the administration have vowed to build public support for this vital agreement that will help American companies sell their goods and services to the world's 12th-largest economy. KORUS will boost GDP by at least $12 billion through expanded exports and create more than 70,000 American jobs. Successful implementation of KORUS will not only create jobs but will save jobs. A Chamber of Commerce study found that failure to enact KORUS would cost more than 340,000 American jobs and cut $35 billion in exports. Those jobs would be lost because the European Union and others would gain a competitive advantage over America in Korea as their free trade agreements (FTAs) go into effect soon. KORUS will help the United States gain an important strategic foothold in Asia, one of the fastest-growing regions worldwide. Currently, the United States is at risk of being shut out of this market as the number of FTAs in Asia has exploded. There are more than 175 agreements in force, 20 awaiting implementation, and 50 under negotiation. By contrast, the United States has entered into exactly two FTAs with Pacific countries - Singapore and Australia. While we're trying to create jobs by exporting more American goods and services, our share of Asia's international trade is actually declining. Many U.S. manufacturers and farmers are being displaced by local competitors based in the European Union or Australia, which are forging deals across the region. SKFTA affects regions with many small businesses Luden ’11 (Mark, The Columbus Dispatch, http://www.dispatch.com/live/content/editorials/stories/2011/07/02/free-trade-deals-help-small-businesses.html?sid=101) On July 1 a trade agreement between the European Union and Korea will go into effect. That means that any U.S. company selling to Korea will immediately be placed at a disadvantage because European companies will no longer have the added cost of tariffs on their products in the Korean marketplace. (A deal between Canada and Colombia also is set to go into effect soon. Clearly this will not help us sell in Korea if a Korean customer does not have to pay high tariffs on a foreign competitor's products but does on ours. Why not a level playing field for U.S. companies that export? How would that harm any U.S. group or organization? Hype and hyperbole about free trade may make for interesting news shows, but the truth of the matter is that we are in a worldwide economy. Free trade creates and keeps U.S. and Ohio jobs. Just ask my employees. Or ask my friend who owns a family business that manufactures heavy equipment in central Ohio. He tells me they are finding it hard, if not impossible, to enter the Brazilian market because of their 75 percent tariffs on imports. Congress can either pass the trade agreements now or let our small businesses be left behind. I urge our lawmakers from both parties to vote in support of the free-trade agreements with Colombia, Panama and South Korea. SKFTA is good- failure to pass it leads to loss of almost 350,000 jobs. Cresta 11 (Jane Cresta, July 26, 2011, seacostomline.com, “Korea-US trade pact aims to create jobs”, http://www.seacoastonline.com/articles/20110726-BIZ-107260365) The Republic of Korea and the United States signed the FTA on June 30, 2007. Officials say it is the most commercially significant U.S. trade deal in more than a decade and will bring important economic benefits and opportunities to businesses, farmers and workers by boosting exports to and investment in Korea. The Commerce Department estimates the FTA will create 70,000 new jobs in the U.S., while failure to implement it would lead to a loss of market share to competitors and the loss of more than 345,000 jobs. SKFTA is good- it creates jobs. Post-Standard Editorial Board 11 (Post-Standard Editorial Board, July 12, 2011, syracuse.com, “US-Korea Trade: Why ratify free trade agreement? Jobs, jobs, jobs, http://blog.syracuse.com/opinion/2011/07/us-korea_trade_why_ratify_free.html) With more than 14 million Americans still out of work — as many as 500,000 of them in New York state — and the recovery from the Great Recession less than anemic, the argument for ratifying the proposed free trade pact between the United States and South Korea grows stronger by the day. Proponents of the agreement say it will create jobs in America. And we desperately need jobs. Han Duk-soo, the Republic of South Korea’s ambassador to the United States, said during a recent visit to Syracuse that the deal would create 70,000 U.S. jobs in manufacturing, 29,000 jobs in agriculture and an unknown number spinning out from Korean investment in U.S. businesses. A report by the Senate Finance Subcommittee on Trade found the agreement has the potential to create about 280,000 American jobs when fully implemented, though that job growth would be uneven among states and across industries. And Central New York businesses that already do a brisk trade with South Korea — among them Welch Allyn Inc. (medical equipment), Nixon Gear (gears) and Inficon Inc. (high-tech gas sensors) — are itching to do more. U.S. goods are at a disadvantage in Korea because of tariffs imposed on U.S. imports — an average 6.6 percent on non-agricultural goods, and as high as 54 percent on agricultural goods, compared with U.S. tariffs on Korean imports of 3.2 percent and 9 percent, respectively. Ending or gradually reducing tariffs will allow U.S. manufacturers and farmers to compete better on price. The agreement also swings wide the door to 49 million South Korean consumers with a growing appetite for U.S. beef, wine, produce and financial services, among other things. While the U.S. economy has been growing at 1 or 2 percent a year — depressing consumer demand here — they’ve got money to burn in Korea, whose economy grew at a torrid 6 percent last year, and is projected to grow another 4 percent this year. The Obama administration has worked hard to amend the original 2007 agreement to allay concerns that it would favor Korean automakers. The United Auto Workers union and the three major U.S. automakers now support it. Obama also wants to link passage of the trade agreement to a renewal of special unemployment benefits for workers who lose their jobs due to foreign trade. Many in Congress — including Rep. Ann Marie Buerkle, R-Onondaga Hill — object to that linkage. While the Trade Adjustment Assistance program is far from perfect, Congress and the administration must find some way to help workers displaced by trade. The U.S. economy was fundamentally changed by the Great Recession, and a rebound must rely on economic growth outside our borders. Ratification of the Korea-U.S. free trade agreement is a step in that direction. Rather than fear competition engendered by this and other free trade agreements, U.S. businesses must seize the opportunity to raise their game. In this global economy, we can’t afford not to. Skfta key to econ – boosts exports. DAILY NEWS 12-20. [“Trade deal would be a boon for Washington” -- http://tdn.com/news/opinion/article_2bb8bfbc-0c25-11e0-8128-001cc4c002e0.html] Let's hope Hufbauer is right about this agreement's prospects. The trade pact is a very good deal for the United States. Sen. Maria Cantwell, D-Wash., has cited estimates that say U.S. exports to South Korea could increase by $10 billion to $12 billion a year under the agreement. Washington exporters would benefit significantly from its ratification. Cantwell noted earlier this year that, "South Korea is Washington's fifth largest export market, making the U.S.-South Korean Free Trade Agreement crucial to future job and economic growth. Passage of the FTA would have enormous benefits for Washington, by making many U.S. food products duty-free, including wheat, cherries, wine and potatoes." Trade fuels the economy, both state and national, in both good times and bad. Trade, in fact, has been one of a very few bright spots in this recession-battered economy. Writing for The Wall Street Journal, Edward F. Gerwin Jr., senior fellow for trade and global economic policy at Third Way, reported that, in 2009, U.S. free trade agreements with 17 countries "accounted for 40 percent of U.S. goods exports and 31 percent of our goods imports." According to Gerwin, "One reason for the success of FTAs in promoting U.S. exports is that we often have more to gain because other countries must usually eliminate higher trade barriers than the United States. This certainly is true of Korea." Skfta key to the economy.
Mr. Speaker, I stand here today to encourage and request the United States Congress to immediately pass the free trade agreement with South Korea. This is an important measure that has languished too long for this Congress. First and foremost, we need to pass this because it is important for our economy – expanding free trade and opportunities for commerce for our nation is critical in this time of an economic recession. For my district in Hawaii expanding free trade will directly help the tourism industry, the number one sector of my district. Key to jobs.
"South Korea has the 14th largest economy in the world, and our ability to compete in that market is critical to preserving and supporting new jobs for Americans," a US trade official said. "This initiative aims to reverse the declining US market share of Korean imports (and) will contribute to President Obama's goal to double US exports by 2014." Lawmakers from Obama's Democratic party who had campaigned against the deal appear ready to approve it. "The president's announcement of a concrete plan to move the Korea agreement forward is great news for America's economy," said Democratic Senator Max Baucus, head of the powerful Senate Finance Committee. He called it "the most commercially significant trade agreement in more than a decade." More ev it creates jobs.
That is all the more reason for the two sides to take a fresh look at another issue that has at times divided them: trade. In 2007, the Bush administration inked a free-trade agreement with Mr. Lee's predecessor. The United States and South Korea currently do about $101 billion worth of business with each other. Under the trade pact, nearly 95 percent of consumer and industrial products would be duty-free within three years, and most remaining tariffs would disappear within 10. The U.S. International Trade Commission estimates that the deal would add $10 billion to $12 billion to U.S. gross domestic product, and $10 billion to merchandise exports to Korea. Given the current plight of the economy, it's little wonder that the vast majority of U.S. businesses support the pact: It would be a powerful job creator. Impact scenario- Economic collapse laundry list
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