Obama’s Export Reshuffle Will Help Boost Jobs and Growth: View

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Jan. 17 (Bloomberg) -- Two years ago, President Barack Obama set an ambitious goal of doubling U.S. exports in five years. In dollar terms, that meant increasing overseas sales to $3 trillion by the end of 2014, from $1.5 trillion in 2009.

He has a ways to go. Export figures for 2011 aren’t yet available, but the U.S. probably just passed the $2 trillion mark (through November, exports amounted to $1.9 trillion).

Getting the rest of the way depends on solid global economic growth. It will also require taking a wrecking ball to an unwieldy bureaucracy, as the president proposed last week. He would reorganize six trade-related agencies into a single trade department. The plan would combine the Commerce Department with the Office of the U.S. Trade Representative, the Export-Import Bank, the Overseas Private Investment Corp., the Trade and Development Agency and the Small Business Administration. Obama hopes to reduce the federal workforce by as many as 2,000 jobs and save taxpayers $3 billion over 10 years.

If Congress goes along, an existing morass of trade-related bureaucracies, which for decades have impeded businesses of all stripes and sizes, would finally become a one-stop export supermarket. It would negotiate trade deals with other countries, formulate and carry out U.S. export policy, promote American goods and services abroad and enforce the rules of fair trade.

Red Tape

It would also cut a lot of red tape for U.S. companies. Imagine you are a maker of accessories for Apple Inc.’s iPad and need help finding new markets overseas. You would have to make the trip to the Commerce Department’s Foreign Commercial Service for help in finding potential customers. If you located them but needed government financing to make the sale, you would need to file an application with the independent Export-Import Bank. If you ran into an unfair trade barrier blocking your sale, then you would need the help of either Commerce’s market-access division or the U.S. trade representative. If your complaint involved unfair competition from low-cost imports, however, that would go to either Commerce or the U.S. International Trade Commission. How frustrating is that?

Some of the more vocal opposition to the agency shuffle will come from alumni (and privately, existing employees) of the U.S. trade representative’s office. Obama would retain the trade rep’s Cabinet status but otherwise end the agency’s independence. Trade-rep officials will argue that this is bad because they play a mostly diplomatic role in negotiating market-opening treaties and multilateral agreements, while Commerce is an unapologetic promoter of U.S. industry. The two are oil-and-water, the argument goes.

Don’t be fooled: This is a complaint about status and turf, not substance. It’s also a canard: The U.S. State Department combines diplomacy and full-throated American advocacy under one roof -- and manages to balance the two quite well.

Obama, who can’t make this change on his own, is seeking so-called fast-track authority to propose federal-agency mergers like this; Congress would vote up or down within 90 days, without any fine-tuning. It’s unclear whether Congress will get in line, given that lawmakers in both parties are also jealous of their turf and often reluctant to give up the power that comes with overseeing federal agencies.

Lawmakers may also balk at denying themselves the prerogative to oversee and shape the executive branch and giving the White House such far-reaching authority. The president may be seeking these powers in an election year because it shows him in a positive, bureaucracy-trimming light.

Assuming Congress wishes to play a role in any reorganization, it should invite the president to send up his plan without the take-it-or-leave-it fast-track authority -- and still act within 90 days to help enhance trade, create jobs and expand the economy. Exports account for 12.5 percent of the U.S. economy and support 9.2 million, or 7 percent, of all American jobs. Good, but not good enough.

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