Transcript Slide 1

President Obama’s Trade Policy: Balancing between
protectionist pressures and open-market ideals
Presented by:
Brian Adams
Solaiman Afzal
Junaid Abu
George Mason University
ITRN 603 002
Professor Stuart Malawer
2 December, 2009
The two sides of President
Obama’s trade policy
2
Sanction Categories
3
The President’s legal backing for
sanctions
The U.S. Constitution (Article 2 Section
2)
 The International Emergency Economic
Powers Act (IEEPA)
 The National Emergencies Act
 The United Nations Participation Act of
1945

4
Obama Sanction Outlook
Less sanctions on “sponsors of
terrorism”
 More pressure from labor for
protectionist sanctions
 Expend political capital to support
multilateral trade (the completion of
Doha Round negotiations.

5
Obama supports the completion
of Doha Round Negotiations
Barriers
Enablers
U.S. Agricultural Lobby
Better relationship with India and
China
Labor
The U.S. Export Industry Lobby
Continued weak economy
Economic growth
The Democratic Party
The Republican Party
6
President Obama’s Trade Policy
Rules-based trading system
 Social accountability and political transparency
 National energy and environmental goals
 Trade agreements address unresolved trade
frictions
 Trade agreements and Bilateral investment
treaties
 Strong partner to developing countries

7
Global trade and Economic downturn
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The rule based system and current global
economic downturn
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Antidumping cases
10
Stimulus Package and Trade
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Overview of Obama and China
“As presidential candidate, Barack
Obama wanted to punish China for
manipulating its currency to boost
exports.” (The Economist)
 Tire Tariffs
 Trade Dominates the current
Relationship
 First “Pacific President”

12
Major Problems.

How tough will Obama be in regards to
China currency manipulation which
gives them a trade advantage?
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Legislation
September tire sanctions: He said he wants to "further
expand trade" by showing the world that the US will
credibly enforce its own trade rules. One of those rules
is a specific legal provision that allows a president to
block surges in Chinese imports if they simply disrupt
an American industry.
 Obama's reasoning in furthering trade through tariffs
may sound like doublespeak, but that provision, known
as Section 421 of the Trade Act, was actually agreed to
by China when it joined the WorldTrade Organization
(WTO) in 2001. (Christian Science Monitor)
 This claim is “widely disputed”
 “based on their negotiations with the Clinton
Administration on Section 421, China expected this tool
to be used, if ever, only in the rarest and most
exceptional of cases”. (John Veroneau )

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Tire Sanctions
In the cover of the night
 The US tire manufacturers are against
the tariff
 Tariff means US consumers will pay
more for tires.
 China response

15
Obama abroad in China
Media’s Nothing Narrative
 Potentially easing trade tensions
 Who knows?

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One Issue:
 Is
Obama going to continue to
maintain the US role as the
dominant force on behalf of global
(free) trade?
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Clues:
Obama’s political allocation towards
trade
 Campaigning against NAFTA
 The potential for global protectionist
backsliding
 The lack of progress on negotiations on
three regional trade deals.
 Ron Kirk
 Trade and the US Image

Verdict?
“…it doesn't look like he is planning a big
new drive on Doha or global trade - his
statement on trade made no reference to
the fact that world trade is collapsing."
(Adam Posen of the Peterson Institute)
 So, in President Obama first term it
appears Global Trade is going to need a
new leader.
 Will Obama policies continue to reflect
ambivalences, leadership, or
protectionism?

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Sources
The Economist
 Christian Science Monitor
 Whitehouse.gov
 Financial Times
 Petersen Institute for International
Economics
 WTO
 World Bank
 Imf
