29 July 2012 - Trade is a Two Way Street

When I say no to COOL, I am not saying no to cool weather; I am saying no to COOL, Country of Origin Labeling. That is the rule the U.S. put into place back in 2009, which required the labeling of the origin of food, particularly meat and meat products. I didn’t like the idea at the time, I still don’t like the idea, and neither does the World Trade Organization.

Of course, our trading partners did not like the idea of Country of Origin Labeling either; as a result, after that rule went into place, our neighbors to the North, Canada, filed a complaint with the World Trade Organization. On June 29th this year, the WTO ruled that the COOL regulations amounted to an illegitimate trade barrier.

I think the Canadians had a pretty good argument because once it was put into place, between 2007 and 2011 U. S. cattle imports from Canada dropped by more than half, hog imports fell more than 40%. It did not make our most important trading partner at all happy.

Carol Kaiser, a cattle feeder and board member of Truth About Trade & Technology wrote an opinion piece for the organization and said, “Canada is our most important trading partner. Last year we exchanged $600-million in goods and services. By some accounts, 8-million U.S. jobs depend on trade with our neighbors to the North, so we should stay on good terms with the Canadians and look for ways to cooperate rather than antagonize.”

I thoroughly agree because agricultural trade is vital to the well-being of America’s farmers and ranchers. I see nothing wrong with labeling your product “Made in America” if indeed, it is. But with today’s global economy, how do you know if a beef animal was born in one country, fed and processed in another country and sold in a third country? What is its country of origin? Under the COOL regulations mis-labeling is a crime, punishable by heavy fines, and rather than take the chance, U. S. companies simply cut back on foreign imports.

There is one thing I have found in common in the 44 countries I have visited, I have yet to meet a farmer who likes the idea of agricultural imports; on the other hand, every farmer would like to see agricultural exports. But trade is a two-way street A quote you have heard me use often, “If it doesn’t go both ways, it isn’t trade.”

My thoughts on Samuelson Sez.