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South Korea- Calling our bluff?By Seymour Klierly Both chambers of Congress were out of session this week and the House will extend their "district work period" through next week as well. While House members continue their second week of town hall meetings and coffee shop chats, the Senate will return to D.C. to debate stem cell research. Late last Saturday the U.S. Trade Representative struck a last minute trade deal with South Korea that has received, at best, a lukewarm reception on the Hill. The trade agreement in question would be the largest based on the size of the economies since the North American Free Trade Agreement in 1994. Several U.S. industries will experience large market gains if this deal were to pass all the legislative hurdles. South Korea agreed to lift tariffs on imported cars and U.S. pork producers will enjoy the opportunity to expand their consumer base as well. It's not what's included in the agreement that is causing so much heartburn on the Hill, but what was left out. Surprisingly absent from the agreement was any mention of rice. South Korea's largest crop is rice, and rice producing states in the U.S. are itching to get a foot in the door. There is no doubt that negotiating a deal on rice was a daunting task, but what message does leaving it out send to future trading partners? Free trade agreements are meant to open all doors between the signing parties, not pick and choose commodities based on protectionism. Also missing from this agreement is a clear and comprehensive position on U.S. beef exports. Did our negotiators think Congress would overlook the little beef issue? Basically, all that is included in this agreement for beef is the 15-year phase out of South Korea's 40 percent tariff. The elementary question here is what good is this agreement if South Korea continues to ban U.S. beef from entering their country? South Korea continues to hold the U.S. to a non-scientific standard and that has upset many members in the past. Senate Finance Committee Chairman Max Baucus of Montana wasted no time and lashed out the trade negotiators for not listening to the warnings given by members of Congress. Sen. Baucus and others have been clear in their opposition to an agreement that did not include the full resumption of beef trade. The Finance Committee holds jurisdiction over trade issues and if Baucus isn't happy, his committee won't consider the package. In an extremely stern press release Baucus called the proposal "entirely unacceptable" and stated he will oppose it based on the beef issue. So where are Sen. Baucus' colleagues? Well this is where the plot thickens. Senator Ben Nelson of Nebraska has also come out strongly opposed to the deal, but he seems to be the only other Senator with such strong opinions. Senator Saxby Chambliss, the lead Republican on the ag committee is withholding his support or opposition at this time. He's waiting to see how South Korea reacts to an expected final designation by the OIE (World Organization for Animal Health) that the United States is a low-risk region for BSE . Sen. Chambliss hopes at that time South Korea will change its position on U.S. beef. Equally confusing is Senator Chuck Grassley's reaction. The top Republican on the Finance Committee has "mixed feelings" about the deal. "Mixed feelings?" The agreement ignores a major crop (rice) and dances around the highest profile ag trade issue on the table (beef). Furthermore, where are statements from other members? Nothing is being said on the House side. Maybe those members are having trouble getting cell phone service out in their districts. Where are the members who have publicly stated in the past that if Korea doesn't open its doors to beef, then the trade deal is dead on arrival? Hopefully these members weren't just talking tough at the time. South Korea is calling our bluff on beef and now is not the time to back peddle. B 4 4/9/07 4 Star NE Date: 4/4/07
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