NOT SO FAST

Congress begins its August recess fresh off of settling an argument it has been having with itself since 1994 – whether a president should have the authority to negotiate trade agreements. President Bush begins his month-long break with this renewed authority. Fast track is good to go.

Or not. Amid all the assurances that fast track, or trade promotion authority, will give the United States the ability to respond quickly to global economic opportunities – Congress can accept or reject presidential trade agreements, but cannot tinker with them – a point overlooked in Washington but not anywhere else on the globe is that these speedy deals won’t go far if the president continues to talk free trade while embracing protectionism.

The raising of steel tariffs, which do a lot to make steel more expensive but nothing to make America’s steel industry more competitive, opened a lot of eyes worldwide. The new Farm Bill is a bloated mess of subsidies for the agriculture industry at a time when other developed nations are realizing that few things hurt undeveloped nations more than such subsidies. Of particular interest to Maine is the now-embarrassing boost of duties on Canadian lumber.

The spat between the United States and Canada on softwood lumber is based upon real and important issues. Canadian producers get subsidies, largely through access to public lands. American producers, especially in Western states, get subsidies as well – public lands, federal road-building programs and so on. The question was who got how much and how much it tilted the playing field. Unable to negotiate a settlement, the Bush administration last spring imposed a tariff that has lurched from 19.3 percent to 32 to now 27. The immediate result was damage to the Canadian lumber industry, little improvement in the American industry and higher prices for consumers.

More recently, economic experts have observed that the one bright spot in the economy, especially for the Northeast, is housing but that a full-fledged housing boom that could get a lot of other economic sectors moving is being stifled by high lumber prices. On top of that comes the somewhat humbling ruling July 27 by the World Trade Organization that the White House erred: Canada’s system of providing producers is a financial contribution subject to countervailing duties, but the United States picked a number for those duties based more on a hunch than fact.

With the issue now back to square one, Canadian leaders, gathered in Halifax for a premier’s conference, are calling for Ottawa to get back to the negotiating table. Washington should get back there, too. Fast.