By Andrew Nuffer
Philadelphians who have witnessed the tug-of-war that's been happening for years on Capitol Hill may have been a bit surprised lately. Congress and President Obama look ready to work together on an issue that would actually benefit Pennsylvania: trade.
Trade supports 1.6 million jobs in the commonwealth. That's one in five, which means that among your neighbor, your gym buddy, the stranger next to you on the train, the woman in front of you at the coffee shop, and the person tailgating you in traffic, at least one has a job supported by trade. That person may even make more than you, considering that trade-related jobs pay on average 13 to 18 percent more in wages.
When most people think of trade, they think of exports. This makes sense because Pennsylvania is a hub for numerous exports. In fact, we exported nearly $60 billion in goods and services in 2013. Even better, 89 percent of the companies that exported were small and medium businesses.
But trade is also about imports, which lower prices and increase choices for Pennsylvania households.
Thompson Mahogany Co. has been in the import business and has been creating good jobs for Philadelphians since 1843. We are one of the nation's largest direct importers of luxury hardwood lumber from Central and South America, Africa, and Asia. Our lumber is used in furniture, musical instruments, and homes, as well as decks and boardwalks for industrial and municipal projects. Thompson's lumber has also been used in the construction of many of the iconic buildings in Philadelphia.
Trade agreements are critical to ensuring not only that we can continue to import the finest hardwood lumber, but also that the cost of doing so isn't prohibitive. It is simple economics really. The higher the cost to move lumber from its origin to Philadelphia, the more expensive that lumber and the goods made from it will be for consumers. On the other hand, the lower the cost of importing, the lower the cost to the consumer.
Trade deals help lower the costs and barriers for imports, which in turn provides lower prices for Philadelphia families.
Currently, the U.S. government is negotiating new trade agreements with countries in the Pacific Rim and Europe. These agreements could open doors for a variety of companies to import from new markets and provide additional options to customers not only in Philadelphia, but across the country.
However, as with most things that Washington works on, there's a complicated catch. There is a small chance these trade agreements will not be finalized because Congress has not reauthorized what's known as trade promotion authority (TPA).
TPA is a tool used by Congress and the president to effectively exercise their respective constitutional responsibilities over trade. Recognizing the importance for the United States of having a strong negotiating position, Congress gives the president marching orders in the form of negotiating objectives, sets the rules for how the president must communicate with Congress during the negotiations, and agrees to hold an up-or-down vote on any resulting deal, without amendments.
It's possible your eyes glazed over during that part, but this will wake you up: Without TPA, the chances of completing any new trade agreements plummet. In fact, just one trade agreement in the past 40 years has been signed without TPA.
The bottom line is that trade is good for Philadelphia. TPA opens the door to more trade. So to get more trade, we need to pass TPA. If lawmakers in Washington can get this done, they may even restore the faith of a few frustrated Americans.