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Remarks by Ambassador Michael Froman at the Woodrow Wilson International Center for Scholars

Remarks by Ambassador Michael Froman at the Woodrow Wilson International Center for Scholars

Washington, D.C.
January 13, 2016

*As Prepared for Delivery*

“Thank you, Jane, for the kind introduction. And thank you for your service, both during your distinguished career in Congress and now here at the helm of the Wilson Center. 

“Last night, we heard quite a speech from President Obama. It’s hard to be the follow-up act. You could feel the President’s optimism about the United States and its future. His speech was infused with a sense of possibility. He focused on the importance of not turning inward from the world, of not being scared about the future, but of asking ‘Why not?’ when it comes to taking on big issues.

“I’m here to talk about just one of those issues: the Trans-Pacific Partnership.

“The full text of the agreement has been out for over two months now, and day after day, as more Americans delve into its details, the momentum is building for its approval.

“Day after day, fresh facts are displacing stale fears. Like the fact that more than 95 percent of the world’s customers live outside our borders, and that by 2030, the majority of the world’s middle class consumers will call the Asia-Pacific region their home. The fact that TPP cuts over 18,000 foreign taxes on Made-in-America exports, making it easier for American workers, farmers, ranchers and businesses of all sizes to compete and win in the global economy. And the fact that TPP will support more high-paying jobs here at home, putting more money in the pockets of middle class families.

“Day after day, the American people are stepping up and speaking out in favor of leading on trade.

“Just in the last week or two, we’ve heard from American manufacturers and service providers and businesses of all sizes: the Business Roundtable, the Chamber of Commerce, the National Association of Manufacturers, and the National Small Business Association.

“We’re hearing from American innovators: ITI, TechNet, the Business Software Alliance and the Semiconductor Industry Association.

“We’re hearing from American farmers and ranchers and the American Farm Bureau.

“Already, organizations representing thousands of businesses employing tens of millions of Americans have endorsed TPP. And we’re hearing from a wide range of stakeholders outside business who see TPP’s high standards as an opportunity to drive global growth consistent with our interests and our values. Growth that does not sacrifice standards, but raises them. Growth that does not abandon labor or environmental protections, but gives them teeth. Growth that is not only stronger, but also sustainable and inclusive. 

“As we work with members of Congress, businesses, and key stakeholders to ensure they know what’s in the deal, how it addresses the challenges they care most about, and how it will be implemented and enforced, we expect this diverse coalition to grow and strengthen.

“But given the work this institution does, I’d like to focus on what yet another group has said about TPP. This is a group that you might not normally associate with trade policy,  but it’s a group whose advice we often turn to when the stakes couldn’t be higher. Our national security and foreign policy experts -- U.S. Secretaries of Defense and State, National Security Advisors, Generals, Admirals, and others -- are all saying that TPP is a strategic imperative.

“They recognize that trade agreements, first and foremost, must stand on their economic merits.  They appreciate that the foundation of U.S. national security is a strong economy and that by driving growth and keeping America competitive, TPP will strengthen that foundation. But they also appreciate that TPP is strategic in the broader sense of the word. TPP is the economic centerpiece of our rebalancing to Asia and a concrete manifestation of America’s ability to show global leadership.

“Right now, this critical region is in flux. There are tensions over territory, volatility in markets, and uncertainty about tomorrow’s rules of the road. In the past decade, hundreds of trade agreements have been negotiated in the Asia Pacific alone. As the economic and strategic landscape of the region continues to evolve, our partners and allies have been blunt about the need for the stability and certainty that only U.S. leadership, engagement, and commitment can provide.

“Historically, China has been a dominant power in Asia, and it will clearly play a pivotal role going forward.  All of the countries in the Asia-Pacific region, including the United States, need to have a positive and constructive relationship with China.  Its peaceful rise, consistent with international norms, is in all of our interests.  I was thinking the other day about our friend, Sandy Berger, who said it best last year: The future of the Asia-Pacific region is still being written. They are two possibilities: Will it be China-centric or Trans-Pacific in nature?  That is what at stake, economically and strategically.

“That’s why, for many of our TPP partners, the economic benefits of the agreement are matched by the strategic benefits of having the U.S. embedded in this region.  Prime Minister Lee of Singapore has noted that, ‘For the U.S. to engage in the region, and to expand its influence and relevance to Asian countries, trade policy has to be a key instrument.’ Prime Minister Abe of Japan has said that TPP ‘is also about our security. Long-term, its strategic value is awesome.’ 

“They get it, and the broader region gets it.  American leadership through TPP is already having a magnetic effect. There is a growing list of countries expressing interest in potentially joining this platform over time.

“Stepping back, it’s clear that the strategic stakes extend even beyond the Asia Pacific. Trade policy one of our primary tools for revitalizing the open, rules-based order we’ve led for over seven decades. Consider what that order has delivered. It has established a lasting peace among states that had twice gone to war and brought the world with them. It has spurred growth that lifted more than a billion people from poverty in the last generation.

“That order, however, is bending under the strain of seismic shifts and competing alternatives. In recent years, a series of forces -- globalization, technological change, and the rise of emerging economies -- have reshaped, and continue to reshape, the global landscape. At the same time, some nations are offering alternative visions for trade and investment, including many of those who have benefited most from the open, rules-based system. 

“In these alternative visions, the state is often absent where it should be present, and present where it should be absent. Instead of recognizing that labor and environmental protections are key to achieving balanced and sustainable growth, these alternatives sacrifice long-term interests for short-term gains. Rather than promote fair competition, they encourage a gaming of the system with excessive and unfair subsidies. Instead of building bridges to unlock humanity’s collective potential, they raise national walls to block the flows of data and ideas.

“How these alternatives play out will have a major impact on tomorrow’s global economy, but it will have profound consequences for geopolitics as well.  Other countries appreciate this. Witness China’s ‘One Belt, One Road’ initiative or the Russian-led Eurasian Economic Union.

“This will also have a major impact on the U.S. economy.  Consider the alternative path to leading on trade: TPP fails and the rest of the world moves on. Markets that would have been open to us remain closed, while our competitors eat away at our current position. Rather than launching a race to the top, we find ourselves in a race to the bottom, without strong labor and environmental protections, without disciplines on state-owned enterprises, without rules to keep the Internet open and free, and without protections for our innovators. 

“How could that alternative be more in the interest of American workers, farmers, ranchers and businesses than the path represented by TPP?

“So there’s an urgency here that’s undeniable. The world is not simply watching to see whether the United States will lead on trade. It’s moving forward without us. The question is whether the United States will move forward as well or be left on the sidelines. 

“Delay is costly, both in economic terms and in terms of U.S. leadership. Why wait and allow thousands of foreign taxes on American exports to persist?  Why wait on supporting additional high-paying middle class jobs here in the United States?  Why wait and allow other countries like China to write the rules of the road?

“As President Obama asked Congress last night, ‘You want to show our strength in this century? Approve this agreement. Give us the tools to enforce it.’

“I couldn’t say it any better.

“The namesake of this institution once said, ‘The world has a habit of leaving those behind who won’t go with it.’ Through TPP, we can do more than go along with the world. We can lead it.

“Let’s get it done.

“Thank you.”