Q&A with Chris Padilla

Chris Padilla is a veteran of Washington’s trade battles who has worked as both a lobbyist and a government official. Among other issues, he worked to win congressional approval of a key China trade bill, fast-track authority for President Bush, and a free trade agreement with Central American countries.

Padilla currently serves as the Department of Commerce’s undersecretary for international trade. His chief task these days is to convince Congress to support a free trade agreement (FTA) with Colombia, a country that many members have visited in recent months on trips organized by the Bush administration.

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Labor unions and most Democrats oppose the deal, highlighting ongoing violence against union organizers. Many believe the administration may try to force Congress’s hand by introducing legislation implementing the deal to Congress, which under fast-track rules would subject the agreement to a vote under a strict timetable and without amendments.

Q: Do you think you’re making any progress in convincing Congress to take up the Colombia FTA?

Yes, I think we’re making good progress. I think on the merits, more members are seeing a compelling case for the Colombia FTA from both sides of the aisle. If this agreement is given a straight up-or-down vote on the merits, I think it would pass with good bipartisan support.

Q: How do you accomplish that?

We’re trying to work in a very open, bipartisan way with the congressional leadership in both the House and the Senate to address their concerns and any questions they have, and to make clear that this is a country that has made remarkable progress in reducing violence against union members, and it’s a country that is prepared to do even more than that.

If the goal is to foster greater prosperity and stability in one of our closest allies in the hemisphere, the right thing to do is to give the agreement an up-or-down vote. We’re trying to engage every member of the leadership who’s willing to talk to us.

Q: Have any members of the leadership gone on these trips?

No.

Q: Is that something that you’d like to see?

They have an open invitation from President [Alvaro] Uribe to go. We encourage every member of Congress who wants to go to go and see for themselves. And not just take the guided tour, but meet with the opponents of the FTA in Colombia, as well as the proponents. And hear both sides and make their own judgment about what the right course for America is. I’m confident that if the judgment is made on the merits, the agreement will pass.

Q: Have you seen any evidence that anyone has changed their mind as a result of these trips?

What I have seen from my participation on these trips is a lot of opening of minds, including my own, quite frankly. I went down with a preconceived notion that Colombia was the Colombia of the Pablo Escobar era. When I landed in Medellin, what I saw was a vibrant city that used to be the most violent in the world but is now thriving because of its participation in the global economy. People who used to be involved in the drug trade are now growing flowers, sewing T-shirts and baking cookies that are sold in the U.S., and we just want more members to see that for themselves.

Q: The administration to an extent can force the issue by introducing legislation that could require Congress to vote. Is that something that’s an option?

I hope it doesn’t come to that, and I don’t think it should come to that, because what we’re doing is engaging with the leadership of the Congress in a very open and transparent way to try to understand what their concerns are, and to make every effort to address those concerns.

Q: Are you disappointed that you haven’t been able to convince key House Democrats like Charles Rangel [N.Y.], Sandy Levin [Mich.], Nancy Pelosi [Calif.], Steny Hoyer [Md.] or James Clyburn [S.C.] to go on one of these trips?

Well, they have an open invitation to go. I’d be pleased if they would avail themselves of the opportunity. There is still an opportunity to do so if they want to.

Q: How do you see the presidential campaign affecting this? Once the Democratic race is settled, do you think that could make it easier for this issue to get picked up by Congress?

Honestly, I’ve been around trade for a long time, and people always say it’s impossible to consider trade issues in an election year, and yet history shows the opposite. A deal on permanent normal trade relations with China was done in 2000 in an election year, with an opposing party controlling Congress. President [George H.W.] Bush … signed NAFTA [with Canada] in an election year in 1992. So I think a lot can be done in an election year.

Q: Do you think the administration is winning or losing the debate with Congress over whether punitive legislation should be imposed to get China to lower the value of its currency?

I try not to look at it in terms of the horse race. I think we’ve made a very compelling set of arguments that the right strategy for dealing with China is dialogue backed up with tough enforcement, and I think we’re doing that. Certainly what I’ve tried to do is to point out that there are some real risks to using the blunt instrument of using punitive legislation.

Q: Congress is considering legislation that would allow the government to find that currency manipulation is a subsidy, which could lead to higher tariffs on Chinese goods. What do you think the risk is if this bill becomes law?

There are several, and I’m not sure what one is the biggest. One of the biggest is it’s unworkable. And it would invite retaliation against our exports in a way that would be extremely negative for our exports at a time when exports are the shining star in our economy. If we open up that Pandora’s Box, we don’t know what’s going to come out, and I worry very much about other countries using this as a subjective weapon to block our exports, so that’s one thing. Second thing is, I don’t think it will work.

Q: You don’t think it would work meaning —

I don’t think it would have an effect on the bilateral trade deficit. Any economist will tell you that the movement of the currency alone is not going to solve the bilateral trade deficit with China. Even if the appreciation makes exports from China more expensive, it also makes inputs sold or purchased by China cheaper.