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Will the proposed Asia trade pact give U.S. companies more customers?

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  • JUDY WOODRUFF:

    Today, the Republican-controlled Senate put President Obama's trade deal with Asia back on track, with a move that can clear the way for a final vote to give the president authority to negotiate the pact.

    This week, we have spoken to leading senators and the head of a major labor union.

    Now Hari Sreenivasan gets a business perspective.

  • HARI SREENIVASAN:

    It comes from the U.S. Chamber of Commerce, which represents three million businesses and employers. It has been pushing hard for the deal.

    John Murphy is a senior vice president who focuses on trade and joins me now.

    So, why, in your opinion, is this a good deal for you and your members?

    JOHN MURPHY, U.S. Chamber of Commerce: Well, trade has risen to the top of the agenda in Washington because it's one of the best ways we have to drive economic growth and job creation here at home.

    It's already provided about a third of our economic growth over the past five years. But we hope it can do a lot more, on top of the 40 million jobs that depend on trade today, on top of the one in three acres on farms that depend on trade. But if you dig into it a little bit, you find that the playing field for American companies and the workers they employ really isn't always level.

    As we're shipping goods, services around the world, we find that they often face trade barriers, tariffs that are in the double digits and other kinds of non-tariff barriers that shut out made-in-USA products.

  • HARI SREENIVASAN:

    OK.

  • JOHN MURPHY:

    So, trade agreements are one way we have to tear down the barriers.

  • HARI SREENIVASAN:

    But one of the criticisms I'm sure you have heard over and over again, especially in the last week, is, why is this being done in such secrecy?

    Today, there was an NPR that said she found the secret hallway where actually members of Congress have to keep their cell phones off. They go in. They can't take notes. If there's nothing wrong with the deal, why not just make it public?

  • JOHN MURPHY:

    Well, actually, the debate about trade promotion authority is in part a way to regularize how these negotiations take place.

    Trade promotion authority is about ensuring that the Congress and the White House actually work together on trade. It's a commonsense notion, but one that we don't get enough of here in this city. So this bill, in addition to laying out the parameters for the White House consulting with the Congress, and the Congress holding the White House accountable, it would lay out new provisions to ensure that members of Congress can review texts.

    At the end of the day, though, it's important to have a degree of confidentiality in negotiating texts. After all, a high school football coach doesn't want to share his game plan with the opposing team. You risk giving away — showing your sensitivities and your red lines. And at the end of the day, that could result in a weaker agreement that is not in the interest of American workers.

  • HARI SREENIVASAN:

    OK.

    The head of a labor union on this program said the other night that 60,000 factories have closed since NAFTA, right, and that there are many parts of this agreement that are modeled on NAFTA or previous trade agreements. What kinds of protections are there for American jobs?

  • JOHN MURPHY:

    Well, actually, in the past 20 years, the output of American manufacturing is up by about 80 percent. American manufacturing has done quite well, and especially since the recession, we're seeing new growth. We're seeing hiring.

    But there's truth in this, that American manufacturers are employing fewer workers. That's because there's been a productivity revolution. There's information technologies, increasingly sophisticated capital goods that allow them to make more products with fewer workers.

    And that's a reality in the global economy today that we all have to wrestle with. What we need most of all, though, is more customers for American manufacturers, so they can make the goods here with American workers and sell them around the world.

  • HARI SREENIVASAN:

    So, there's some concern that Vietnam is not a free-market country. And sometimes the average wage there is 56 cents an hour. If I'm an American company, would I choose to make, let's say, socks for $10 an hour in the U.S. or, through this trade agreement, wouldn't I want to offshore those shows jobs into a much, much cheaper market?

  • JOHN MURPHY:

    Well, wages reflect productivity.

    And the reality is that American wages are a lot higher because American workers are that much more productive. What we need is a level playing field. And that's why these trade agreements, by sweeping away the tariff barriers, are in the American interest. Our market's pretty much wide open. But the other markets that we face, such as Vietnam, they have tariffs in the doubling and triple digits that shut out American farm goods and manufacturing products.

    And by having that level playing field, you help American workers here to ship their goods there, because we already have one-way free trade with goods coming in.

  • HARI SREENIVASAN:

    So, another concern is, is that this would give corporations a right to sue governments, not in our courts, but in these tribunals, and that sometimes the threat or the fines are so significant, that governments water down their own regulations, whether it's environmental regulations, worker protections, and that even foreign companies that work in the United States could do that to us.

  • JOHN MURPHY:

    Yes.

    You know, I think, in this debate, you're hearing concern about this because most of the American people have never heard of these things. There's a reason for that. They have been around for decades. There are thousands of — thousands of agreements around the world that have these provisions, but, in the United States, they're almost never invoked.

    There have only been 17 occasions in the past four decades when anyone has brought one of these cases against the United States, and the United States has never lost a case. That's because we have rule of law here and companies use the domestic courts.

    What these are most useful for, though, is when American companies are doing business abroad in countries where the rule of law isn't so strong.

  • HARI SREENIVASAN:

    Right.

    So, final question for you is, whether it's on food or prescription drugs or, I should say, pharmaceuticals, there's this concern that we won't have the enforcement teeth to make sure that other countries are playing by these shared rules.

  • JOHN MURPHY:

    Well, that's actually an argument for the agreements, because, right now, oftentimes, we have got nothing.

    These new agreements have the opportunity to write new rules that will protect the intellectual property that 40 million American jobs depend on. They will have rules to ensure that labor rights are not watered down in an interest to try and attract investment. And there's also environmental protections that are cutting new ground.

    So I think, from across — across the board, that's why you see growing support.

  • HARI SREENIVASAN:

    Right.

  • JOHN MURPHY:

    That's why you have 65 senators voting for this today to move forward.

  • HARI SREENIVASAN:

    OK.

  • JOHN MURPHY:

    That's why you have the whole business community supporting it.

  • HARI SREENIVASAN:

    John Murphy, thanks so much.

  • JOHN MURPHY:

    Thank you very much.

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