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Bush Defends Trade, Economy at N. American Summit

By Michael Abramowitz
Washington Post Staff Writer
Wednesday, April 23, 2008

NEW ORLEANS, April 22 -- President Bush used a summit meeting Tuesday with the leaders of Mexico and Canada to push for congressional approval of a controversial free-trade pact with Colombia and to reiterate his belief that the struggling U.S. economy is not experiencing a recession.

"We're not in a recession," Bush said as he concluded a two-day summit here with Mexican President Felipe Calderón and Canadian Prime Minister Stephen Harper. "We're in a slowdown. We grew in the fourth quarter of last year. We haven't [seen] first quarter growth statistics yet. But there's no question we're in a slowdown. And yeah, people are concerned about it."

Trade and economic issues dominated the fourth annual meeting of the three North American neighbors, whose leaders are bucking protectionist sentiment at home, including new attacks from the Democratic presidential candidates against the 14-year-old North American Free Trade Agreement, which includes Canada, Mexico and the United States.

As he concluded the two-day summit here with the other leaders, Bush also offered perhaps his most pointed defense of NAFTA, which has been under fierce fire from Sens. Hillary Rodham Clinton (D-N.Y.) and Barack Obama (D-Ill.). "Now is not the time to renegotiate NAFTA or walk away from NAFTA," Bush said during a joint news conference with the two foreign leaders.

Bush also criticized House Speaker Nancy Pelosi (D-Calif.) for holding up a vote in Congress on the Colombia deal and secured an endorsement for his efforts from the other two leaders.

"I worry if the United States, in the end, refuses this agreement with Colombia," Harper said during the news conference. "We have important allies in Colombia. Colombia is fighting against political violence, against the [Revolutionary Armed Forces of Colombia]. They fight against drug traffickers. And I think that a rejection of or turning our backs to such an ally as Colombia could create long-term problems for our countries in South America."

Calderón also indicated he would like to see Congress approve the Colombia deal. "It's extremely important, I think, to bear in mind that when you provide more opportunities for trade in the Latin American region, there will be many more opportunities for prosperity," he said.

Bush's comments on the U.S. economy were consistent with his refusal to describe current economic conditions as a "recession," commonly defined as two consecutive quarters in which gross domestic product falls. Although that has not happened, the Federal Reserve has reported that economic conditions have weakened, with manufacturing output down 0.5 percent in the first three months of this year, consistent with a recession. And in congressional testimony this month, Fed Chairman Ben S. Bernanke said that a "recession is possible" -- but that growth could pick up later in the year.

Even so, Democrats slammed Bush as out of touch. "It seems like President Bush is living on another planet if he thinks our economy isn't in a recession," said Sen. Charles E. Schumer (D-N.Y.).

As part of his economic legacy, Bush has been hoping to end his term with approval of free-trade deals with Colombia, Panama and South Korea, but the proposals have met resistance from congressional Democrats. Although the Colombia trade deal would lift tariffs on various U.S. products, organized labor and human rights activists have said Bogota has not done enough to curb the killings of labor union members, an accusation hotly disputed by the administration.

Under U.S. law, the House has 60 days to consider a trade deal. But after Bush sent the Colombia deal to Capitol Hill this month, Pelosi gained approval for a rule change that effectively halted the clock on consideration of the pact. She said the trade deal did not have the votes to pass and wanted to consider what she said was more pressing economic legislation first.

The move elicited outrage at the White House, and Bush has repeatedly criticized Pelosi while in New Orleans, part of an apparent effort to rally business leaders and free-trade Democrats to pressure the speaker. Some Democrats have expressed puzzlement at the White House tactics, but administration officials say they have no choice other than to try to raise consciousness about the repercussions of failing to approve the Colombia deal.

"It's bad for our hemisphere to have the United States of America turn its back on a mutual friend like Colombia," Bush told reporters Tuesday.

Pelosi reacted coolly. "Democrats have repeatedly told the President we are willing to work with him in good faith to create jobs and restore our economic strength," she said in a statement.

"By removing the restrictive timeline on the Colombia Free Trade Agreement, Democrats voted to put the economic needs of the American people first," she said.

Although trade was the big issue at the summit this week in New Orleans -- chosen by Bush as the host city to highlight its recovery from the devastation of Hurricane Katrina -- the three leaders also discussed how to address global warming, reduce congestion at border crossings and streamline regulations.

Calderón and Harper were cordial to the outgoing U.S. president and sought to stay out of U.S. politics, suggesting they would work with whomever is elected -- though making clear they prefer not to reopen NAFTA, as Clinton and Obama have suggested.

"Mexico will have a respectful relationship with the next president of the United States, and we'll always seek the prosperity of our nations knowing that through free trade we have a clear, open and respectful relationship among our countries," Calderón said.

Harper said Canada would be ready to renegotiate NAFTA if the next president insists but suggested that might not be in the U.S. interest. "We'll be prepared for any eventuality," he said. "Canada is the United States' number one supplier of energy. We are a secure and stable supplier. . . . We would be in an even stronger position now than we were 20 years ago, and we'll be in a stronger position in the future."

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