CPA Statement of Policy 

Position:  CPA supports a comprehensive review and audit of existing trade agreements before approving new trade agreements.  The review and audit should include these objective factors:

1.              Whether goals and objectives for past trade agreements were defined prior to negotiations beginning;

2.              Whether trade negotiators accomplished these defined goals and objectives;

3.              Whether the goals and objectives were consistent with the needs of the American public;

4.              Whether fundamental economic, fiscal and monetary policies of prospective trading partners were considered and resolved prior to and during past negotiations, including policies involving: currency valuation, taxation, subsidies, and regulatory regimes;

5.              Whether the U.S. retained an ability to respond to changes in trading partners’ economic, monetary, and fiscal policies which create trade imbalances;

6.              Whether trade agreements relinquish more political sovereignty of our federal, state, and local governments than necessary for enforcement purposes;

7.              Whether trade agreements give greater legal standing to foreign companies than U.S. companies;

8.              Whether efficient and effective enforcement mechanisms exist in the agreement.

The review process should be clear and transparent.  A moratorium on future agreements should be implemented until this audit is completed and evaluated.

Background:  Existing trade agreements have been debated and passed with a mere simplistic debate – are you for or against trade?  The correlation between a new trade agreement and increased trade has been assumed, but not shown.  The correlation between increased overall trade – including deficits – and improving the nation’s welfare has been assumed but not proven.  Trade agreements cover far more topical ground than mere trade, tariff and subsidy issues.  They constrain domestic policy choices, and impact environmental, safety, investment, and transportation.  Clear goals and objectives have not been set, and thus, trade negotiators were not charged with achieving those goals and objectives.  Congressmen and Senators typically do not read the trade agreements, and the public does not debate the terms of the agreements.  The process has been vague amd opaque.

Rationale:  Trade agreements are business contracts between countries. Business contracts must benefit all parties to succeed.  Businesses have clear goals and objectives when entering into contract negotiations.  If the goals and objectives are not achieved, a contract is not signed.  If a contract is signed, the language of the contract protects the interests of the parties, and there are clear enforcement mechanisms.  Our trade agreements do not have these features, and our trade negotiators are not give clear goals and objectives.

The results are record trade deficits each year, and the loss of the ability to conduct domestic policy in ways many did not intend.  Instituting objective measures of success is necessary for America to succeed.  A comprehensive review and audit of existing trade agreements, prior to approving new ones, is now necessary. 

In the interim, trade will continue because the U.S. needs to buy products and services from overseas sellers, and other countries need goods and services provided by the U.S.