If the effort pays off, it could boost some of America’s most competitive and important companies. Finance and consulting firms would be able to move more deeply into Europe, Japan and some developing countries. Technology leaders would have freedom to source their software and place their computers where it makes the most economic sense. The biotech industry would see longer patent protections, and carmakers could get access to the coveted Japanese auto market.
The risks are the same ones critics have attributed to earlier pacts, such as the North American Free Trade Agreement: that liberalized rules will drain more jobs from the United States than they create and undermine today’s leading-edge sectors the way textiles, automobiles and steel were weakened in the past.
To the Obama administration, it’s the logical response to sluggish job growth, the failure of the Doha round of global trade talks and the fear that trade restrictions incubated in places such as China and India could become the global norm unless countered.
“Going through this crisis and recovery has pushed us all to focus on what it is we can do to create jobs and growth in every area of policy,” said Mike Froman, deputy national security adviser for international economics. “If we are able to execute on this, it will be the most ambitious trade agenda in a very long time.”
It is a wager, in a sense, on robots over running shoes as the administration tries to create trading rules that play to U.S. strengths in innovation, technology and high-end services but could mean more competition for basic manufacturing.
The discussions include the 11-nation Transpacific Partnership, a potentially sweeping agreement that would tie the United States more closely to North American neighbors Canada and Mexico and open new relations with growing Asian economies such as Vietnam. South Korea and Japan, the world’s third-largest economy, may join as well.
The trade-offs could be stark. Vietnam wants to do away with high U.S. tariffs on footwear, a step that could eliminate the few U.S. athletic shoe manufacturing jobs that remain. The benefit for the United States would be a vastly deregulated Vietnamese economy that shows how a Communist country — optimistically China in the future — might limit the role of state-owned businesses and open sensitive sectors to international competition.
Other negotiations include the recently announced Transatlantic Trade and Investment Partnership with the European Union, a pact U.S. and European officials say would create the world’s largest economic zone, eliminate long-standing restrictions on agricultural trade and simplify regulations for an array of goods and services. The United States also has joined 47 other nations in talks on an agreement to liberalize the services sector — a significant issue for U.S. companies that feel they have an advantage in areas such as consulting, energy management and insurance.