By Brian E. Clark
MADISON — The U.S. economy remains in the doldrums, but a trio of foreign diplomats says it would be wrong to erect trade barriers as a solution.
Instead, the diplomats said the United States – and its international business partners – would be better off with the enactment of new free trade agreements. Thursday’s gathering was organized by WisBusiness.com, the Wisconsin Technology Council and the Madison Club.
Robert Dickson, the Chicago-based consul general for Great Britain, said bolstering international trade and investment is essential to restoring economic growth in Europe and in the U.S. He pushed for a free trade agreement between the United States and the European Union.
“It’s not a zero-sum game in any sense; it’s a win-win,” added Dickson, who is married to a Watertown native and considers himself “an honorary cheesehead.”
He argued that enactment of the Smoot-Hawley tariffs in 1930 helped turn what was an economic crisis into the Great Depression.
“That is not the direction to go,” he stated.
The diplomats also decried the killing on Tuesday of the U.S. ambassador to Libya, Christopher Stevens.
“He was one of us,” said Mukta Tomar, the Indian consul general in Chicago. She called Stevens’ murder “despicable.”
Tomar said although India’s economic growth rate has slowed over the past year, it’s still expanding at an annual rate of 7 percent. She said a world free trade agreement would be preferred but said absent that agreements between countries is the way to go.
She said India has $1 trillion worth of infrastructure projects in the works and that Wisconsin companies would do well to bid on some of those efforts. She noted the Badger State is well known for its fresh-water expertise and said India is in great need of that technology.
“India will be a serious growth story for years to come,” she said, while acknowledging hurdles within the country. She noted corruption and the lack of economic development expertise within some of the Indian states.
Brian Herman, a leader on economic affairs for the Canadian consulate in Chicago, said his country and other Great Lakes states like Wisconsin have a long history of working with each other.
“In fact, we don’t sell things to each other, we make things together” because U.S. and Canadian supply chains are so intertwined. By the time a car is completed in Detroit, parts of it may have crossed the border six times, he said.
Herman said Canada and the U.S. are working “bi-nationally” to address both challenges and opportunities. Canada is Wisconsin’s largest trading partner.
In 2011, he noted, the bilateral trade totaled $680 billion, or $1.8 billion in goods and serves crossing the U.S.-Canada border every day. More than 8 million American jobs depend on Canadian investment, he said, and 2.2 million of them are in the Great Lakes states, he said.
He noted that manufacturers like the former Bucyrus and Joy Global sell hundreds of millions of dollars’ worth of mining equipment north of the border.
“There is value in looking to Canada as a continued top destination for Wisconsin exports, and also looking to Canada as a country that contributes very much to your energy needs and North American energy security,” he said.
Herman also noted that President Barack Obama has said he hopes to double the amount of U.S. exports in five years.
“We are highly dependent on trade and exports,” he said, warning against “Buy American” laws.
“The world doesn’t work like that anymore,” he said. “To try to double your exports, you must be open to free and reciprocal trade and imports because increasing the size of the value of the pie benefit all.”
Dickson said Wisconsin currently has a large trade surplus with Great Britain, exporting $624 million worth of goods in 2011. The Badger State, however, only imported $289 million in products from his country, he noted.
In 2012, he said the Birmingham, England airport will be importing seven fire trucks made in Wisconsin, because they were the best value in the market.
“This is an example of how free trade works and trade creates jobs,” he said.
The same is true with investment, he argued. Some 13,200 Wisconsin residents work for British companies in jobs ranging from advanced manufacturing to financial services.
He said a major step toward advancing international commerce would be approval of a free trade agreement between the United States and the European Union.
“Despite Europe’s financial problems and the rise of Asia, the U.S. and Europe are responsible for 50 percent of the world’s economy,” he said.
Whoever wins the U.S. presidential election in November should push forward the treaty because the “net benefit for both sides would be huge,” added Dickson, adding the British government has slashed public spending and tax rates to spur business growth.