Farm Groups Concerned Over Consolidating U.S. Trade Agencies

DC Dialogue

Obama proposes to save money by combining agricultural trade office with other business-oriented offices in the Dept. of Commerce.

Published on: January 20, 2012

President Barack Obama proposed merging six business-oriented agencies, folding together the Department of Commerce's (DOC) core business and trade functions, the Small Business Administration, the Office of the U.S. Trade Representative (USTR), the Export-Import Bank, the Overseas Private Investment Corporation and the U.S. Trade and Development Agency.

Obama said the six major departments and agencies that focus primarily on business and trade in the federal government are “redundant and inefficient.” He said the combination is his first priority action to combine the business-oriented offices to help American businesses succeed and avoid the “maze of agencies when looking for even the most basic answers to the most basic questions.”

Those within agriculture welcomed the administration’s recognition of the need to improve government efficiency and eliminate wasteful spending, but also were cautious of the unintended consequences the move could have on the importance of the U.S. Trade Representative office.

Sen. Chuck Grassley, R-Iowa, said in a statement that the enactment of trade agreements have been a “hard slog” with the President, and he said any reorganization that disrupts trade negotiations and expanded markets for U.S. businesses and agricultural trade for farmers would cause him concern.  

It’s not surprising that the President is focusing on this area for consolidation. Trade is already a lower priority than it should be for this White House,” Grassley said. “Consolidation that doesn’t hurt export opportunities might make sense. Congress will need to look at this proposal carefully.”

This consolidation plan concerns the U.S. Grains Council, said Rebecca Bratter, vice president of international operations, because of the impact it will have on agricultural trade. She said because the USTR has a special office for agriculture, and the ag negotiator has ambassador status, which benefits agriculture in negotiations.

In a short audio clip, Bratter also said agricultural exports have been “recession proof” and one of the few sectors to continual post growth. If the USTR is combined with other agencies, agriculture will no longer have an inside advocate able to handle the special nature of agricultural exports.

The American Soybean Association expressed concern that folding USTR into a massive Department of Commerce or Industry structure “would significantly weaken the coordination role played by USTR on trade interests across sectors, and the work on agricultural trade opportunities and barriers would be diminished. We therefore support continuing the current structure and functions of the Office of the U.S Trade Representative,” a statement from ASA said.

National Cattlemen’s Beef Association President Bill Donald said many of President Obama's proposals to streamline government agencies and cut costs make sense. But said merging the agricultural trade office with other trade agencies is a mistake.

“NCBA maintains that USTR should remain an independent agency within the Executive Office of the President, focusing on trade negotiations, trade agreements and trade enforcement," said Donald. "USTR is vital to ensuring successful trade negotiations concerning U.S. beef and other agricultural commodities with our global trade partners. USTR must be in a position to have direct access to the White House."

He said USTR serves an important role in reducing trade barriers and advocating for free and fair trade for all sectors of the U.S. economy. Donald said USTR has played a crucial role in expanding exports of U.S. beef by ensuring the passage of free trade agreements and working to achieve science-based trade protocols. 

"NCBA is extremely concerned that USTR's ability to continue its effectiveness will be jeopardized if it is wrapped into the massive Department of Commerce," said Donald. "NCBA has a strong history of working closely with USTR on behalf of the beef industry. We strongly support the continuation of the current structure and functions of USTR."