Posted by: Jane Sasseen on December 03
Is another key economic post about to be filled by President-Elect Barack Obama? Even as he called a Chicago press conference to announce the expected nomination of New Mexico Governor Bill Richardson to head the Commerce Department this morning, Washington was filled with talk that he has settled on a little-known California Congressman to be US Trade Representative. Congressional Quarterly reported that Obama has asked Xavier Becerra , who has represented Los Angeles in the House of Representatives for 15 years, to fill the key post. The US Trade Representative is the government’s primary negotiator on trade agreements such as the now stalled Doha Round—aimed at expanding trade in services and other sectors and reforming agricultural subsidies—or pacts such as those set with Columbia and South Korea which are stuck in Congress.
The news, which has not been officially confirmed by either Becerra’s office or Obama’s, brought mixed reaction. Though he has served for many years on the powerful House Ways & Means Committee, which has oversight over trade issues, he was not known as a strong voice in that area. Even many who follow trade closely had little inkling of who he is or that he was even in the running. “I certainly would not have cited him as a top pick,” says Joanne Thornton, a research analyst who follows trade for institutional broker the Stanford Group. “It’s not a name one generally associates with trade.”
What little is known about his record has raised concerns among business sources and other free trade advocates. “We’re pretty concerned about some of the past statements he’s made on issues such as Nafta,” says one well-plugged in business lobbyist. In Congress, Becerra has had a mixed record on trade issues; the libertarian Cato Institute says he voted against measures that would have increased trade barriers 65% of the time. While he voted for Nafta, he later said he regrets having done so. More recently, he voted against the Central American Free Trade Agreement, but did vote for a trade pact with Peru. At times he has been highly critical of the global trading system, calling it “broken completely” in 2006 before voting against a trade deal with Oman. “It’s troubling; to oppose Nafta is in many ways to lash out symbolically against trade,” without understanding the benefits of that agreement says Philip Levy, a former Bush administration trade official now with the American Enterprise Institute. “You want the chief person who has to make the case to the American public for trade to recognize what those agreements did.”
Levy also points out that Becerra voted against renewing the President’s “fast-track” authority on trade, which gives the executive branch the ability to negotiate trade deals that Congress is then required to vote on within a set time, and without amendments. He and other trade experts believe that authority is critical to trade negotiations; without it, Levy says, foreign partners have no assurance that any politically difficult concessions they make in bargaining with the US won’t be thrown out by Congress.
Becerra’s record appears to put him firmly within the wing of the Democratic party that has become increasingly skeptical of the benefits of trade in recent years. He and others have argued for much stronger labor and environmental standards in trade agreements in recent years, as well as more aggressive enforcement of current laws to level a playing field that trade critics call increasingly slanted against the US and its workers. Those are all positions that Obama supported on the campaign trail, and which have raised concerns in the business community of a potentially protectionist tilt under the new administration.
Still, not everyone is worried. Robert Vastine, President of the Coalition of Service Industries argues that the pick is very astute politically. He believes Becerra is essentially a free trade advocate who has supported many key trade issues, and that his positions on enforcement, environmental and labor issues fall clearly within the mainstream of the Democratic party now. He’s also a well-respected member of the Democratic leadership. That combination may help him bring more progress on trade issues than a more staunch trade advocate might be able to—and is also far better than having a labor or environmental advocate in the post, which had been a rumored possibility. “Because he’s not a doctrinaire free-trader, he’ll have credibility with the wing of the party that needs to be brought along and convinced about the virtues of trade,” Vastine says. “He brings the abiility to work with members of Congress to make the case for trade politically.”
Washington Bureau Chief Jane Sasseen and other BusinessWeek writers cover the run-up to the Nov. 4 presidential election, paying close attention to how the candidates will handle issues such as housing, the economy, unemployment, and immigration.