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September 10, 2006 - Trade is a Two-Way Street

At the Farm Progress Show, a week and a half ago, during the hour that Secretary of Agriculture Mike Johanns spent with us on stage in front of a “standing room only” crowd, a farmer from Illinois stood up to ask a question. Well, he actually made a statement, then he asked a question. He said “I am certainly in favor of the United States being number one in exports, manufactured goods and certainly in exports of agricultural products; but I don’t like the idea of agricultural products being imported into the United States. Mr. Secretary, what can we do to fix that?”

That is a challenging and intriguing question. It’s a question I have heard before and the Secretary didn’t hesitate with his response by saying “I understand where you are coming from, but then let me quickly say, it doesn’t work that way, because trade must go both ways. For us to be able to export our agricultural products or any other items that are manufactured in the United States, we must be willing to take products, including agricultural products, from other countries. Remember there are farmers in many countries around the world who see the United States as a very important market to them and they want access to our market.” He went on to say, “We are probably the freest country in the world in allowing products to come into this country without major tariffs and that is one of the reasons we are fighting strongly to level the playing field and open more markets for our products in international trade talks.”

He concluded “It must go both ways”. And while many of our cattle producers don’t like the idea of beef coming into this country, or while producers of other crops and commodities don’t like the idea of foreign products coming in to compete, he said, “if that doesn’t happen, then we see borders around the world closed to our products .”

Also in the crowd that day was former president of the American Farm Bureau Federation, Dean Kleckner. During his term as Farm Bureau president, in many interviews with him, I heard him say several times... “If it doesn’t go both ways, it ain’t trade!”

That may be grammatically incorrect, but the statement is indeed correct. If it doesn’t go both ways, it isn’t trade. Secretary Johanns pointed out that is why it is important to revive the Doha round of WTO talks, to give America’s agricultural producers more access to foreign markets. So he handled the question very well. The questioner probably wasn’t satisfied with the answer, but at least he knows now why the Secretary and many people in agriculture stand the way they do on trade being a two-way street.

My thoughts on Samuelson Sez.