For Bush, a Janus-Like View of Trade

The administration faces the prospect of a trade war with Europe if the president fails to lift his temporary steel tariffs, which were ruled illegal on Monday by a World Trade Organization panel. A week from now, talks are to resume to extend the North American Free Trade Agreement throughout the Western Hemisphere, a proposal that has been protested by labor unions, small farmers and environmental advocates.

Even the staunchest allies, like Australia, have complained that the farm bill President Bush signed into law last year is an impediment to new global trade agreements.

All countries will be watching to see if Mr. Bush, the leader of a nation that has profited substantially from global trade, defies the W.T.O. and accepts $2 billion of European sanctions rather than lift the 30 percent tariffs that are meant to protect the American steel industry as it consolidates.

Politics will naturally play an important role in that decision, just as it did when the administration decided to impose the steel tariffs and accept new American farm subsidies as the necessary price to pay for the authority to negotiate free trade agreements with little interference from Congress.

The steel tariffs went a long way to winning votes from lawmakers representing manufacturing states. The farm states, led by Representative Larry Combest, Republican of Texas, made it clear that their votes depended on support for the 2002 farm bill. At one stage, Mr. Combest removed his name from the legislation for trade authority until the president assured him of his support for the increased farm subsidies.

Now the bargain struck for trade promotion authority is threatening to backfire.

Sebastian Mallaby, a senior fellow at the Council on Foreign Relations, said Mr. Bush and his trade representative, Robert B. Zoellick, had committed the classic mistake of free traders who thought they could 'buy the allegiance of protectionists, whether they are big farmers or the steel industry, to make some advance in their long-term trade policy and not become captives of the protectionists.'

"It was na�ve of them to think there wouldn't be a price for all of this," Mr. Mallaby said. "Now, they've disillusioned people in their own free trade camp."

Let's imagime the FTA leaves cultural diversity, investor rights, and the PBS alone. Let's imagine it actually includes farm tariff cuts that take effect in the present century. Then let's imagine what will happen the first time the FTA provisions bump into the political ambitions of George Bush. The EU and WTO have a little more clout than we do. Their clout is not getting translated into free trade very well.